House Seeks HHS Probe of HCA ER Admissions Practices

The House Subcommittee on Oversight raises concerns about the for-profit health system's billing practices and reports of chronic understaffing.

A House subcommittee wants federal watchdogs to investigate questionable emergency department admissions by HCA Healthcare hospitals that may have cost Medicare $1.8 billion.

"I write regarding alleged fraud and staffing issues at HCA Healthcare (HCA) facilities," U.S. Rep. Bill Pascrell, Jr., D-NJ, chairman of the House Subcommittee on Oversight, says in a letter this week to Health and Human Services Secretary Xavier Becerra.

"In light of reports that there may be misconduct and potentially the improper shifting of taxpayer dollars, I ask that HHS launch an investigation into the allegations leveled against HCA regarding its emergency department admissions practice, including its joint venture with EmCare," Pascrell says in his letter to Becerra. "As HCA is the largest health system in America, transparency and oversight are essential to ensuring that hospitals, like those in HCA's system, are honest stewards of taxpayer dollars."  

HCA pressed for admissions policies

In a separate, four-page, footnoted letter this week to HCA CEO Samuel Hazen, Pascrell raised concerns about "alleged fraud and staffing issues at HCA facilities."

"As HCA is the largest health system in America, transparency and oversight are essential to ensuring that hospitals like those in your system are appropriate stewards of taxpayer dollars," Pascrell says in his letter to Hazen. "Recent reports of systematic unnecessary inpatient admissions intended to draw higher and more profitable reimbursement rates, in addition to severe understaffing issues, raise questions about HCA's corporate policies and practices."

Pascrell notes that HCA – the largest health system in the nation – "sets the pace for both for-profit and not-for-profit hospitals in the United States."

"HCA's profits in 2021 were almost $7 billion, up nearly 100% in one year. This is welcome news for your shareholders, since HCA repurchased $8.2 billion worth of its shares in 2021 and recently authorized an additional $8 billion of share repurchases, all during the COVID-19 pandemic. Yet this single-minded focus on profits might be bad news for patients, families, workers, Americans taxpayers, and the Medicare program."

Pascrell cites recent media reports that patients in HCA emergency departments are being admitted for inpatient stays "regardless of medical necessity."

"One recent report estimates that these unnecessary admissions by HCA may have charged $1.8 billion in excess amounts to the Medicare program from 2008-to-2019," Pascrell says.

"I am especially alarmed by these findings given HCA's history of healthcare fraud settlements with both federal and state authorities," Pascrell says, pointing to a $1.7 billion settlement in the early 2000s to resolved criminal counts and civil fraud allegations that occurred when now U.S. Sen. Rick Scott was CEO. It was at the time the largest health care fraud in U.S. history.

There have also been allegations that HCA sets corporate admission targets and threatens retaliation against staff if those targets are not met, Pascrell says.

The congressman also raised concerns that HCA was in cahoots with its contracted physician staffing firm EmCare, a subsidiary of the private-equity-owned Envision Healthcare, in setting and meeting admissions targets.

He asked Hazen to provide by Sept. 27 explanations of several HCA practices including:

• Incentives for physicians practicing in HCA hospitals relating to the admission or referrals of inpatients, including value-based measures, job termination policies or loss of admitting privileges for all employed and contracted physicians.
   
• Performance data for all employed and contracted physicians, including the volume or value of referrals or admissions and value-based measures.
   
• Details of HCA internal reviews to ensure that care is medically necessary, and that Medicare is not being billed for unnecessary services, including the scope and frequency of reviews, the identity the HCA official overseeing the reviews, and any memorandum describing specific compliance failures.

To address reports of chronic understaffing at HCA hospitals, Pascrell asked Hazen to describe: how the number of physicians, nurses, and other staff needed to provide medically necessary care to patients is determined; any role that financial metrics or financial targets play in the setting of staffing levels; the extent to which the cost of employees' salaries, wages, and benefits factor into the determination of bonus compensation for corporate, regional, and hospital executives, and how that compares with the role of other cost centers considered in that determination; whether decisions about how many and which employees are assigned for shifts are made at the hospital department level, hospital level, regional level, or corporate level; and which measures of staffing are monitored by HCA corporate staff.  

HCA Responds

HCA issued a statement saying it was "reviewing Congressman Pascrell's letter and will respond to his requests for information."

"The issues raised in the letter appear to be similar to ones we addressed previously and publicly," HCA says. "HCA Healthcare operates more than 180 hospitals in a variety of communities throughout the country. Our hospitals are staffed by physicians, clinicians and nurses who work tirelessly to ensure our patients receive medically necessary care in the appropriate clinical setting. We believe that our operational processes and procedures are working well and that we are meeting the healthcare needs of our patients and communities."

"We are proud of our response to the pandemic, during which we cared for more COVID-19 patients than any other health system," HCA says. "We were one of the only, if not the only, health system to return all of our portion of the federal CARES Act funding to the government, which was approximately $6 billion. We are grateful to our colleagues who show up in every way to serve the healthcare needs of our communities."

The health systems says it spent $250 million on programs to ensure that none of our employees would be furloughed or laid off due to the pandemic, that it was again named one of Ethisphere's Most Ethical Companies for the 11th time and was recognized on the 2021 LinkedIn Top Companies rankings