The settlements involve Gold Coast Health Plan, and Medi-Cal providers Dignity Health, Clinicas del Camino Real, Inc.
Ventura County and three healthcare organizations will pay California and the federal government $70.7 million to resolve whistleblower allegations of an "organized scheme" to bilk Medi-Care, state and federal prosecutors have announced.
Along with Ventura County -- the owners of Ventura County Medical Center – the three settlements include Gold Coast Health Plan, and Medi-Cal providers Dignity Health, Clinicas del Camino Real, Inc.
Prosecutors allege the providers "submitted false claims in an organized scheme to illegally keep federal funds intended for Medicaid Adult Expansion under the Affordable Care Act. California will get $2.45 million of the settlement, plus accrued interest."
"Medi-Cal props up our communities by providing access to free or affordable healthcare services for millions of Californians and their families,” California Attorney General Rob Bonta says in a media release. "Those who attempt to cheat the system are cheating our communities of essential care."
Starting in 2014, Medi-Cal expanded to cover uninsured adults without dependent children with annual incomes up to 133% of the federal poverty level. The feds, who fully funded the expansion for its first three years, intentionally overfunded to provide a cushion to cover additional medical needs for the newly insured population.
Gold Coast's contract with the state stipulated that if it did not spend at least 85% of what it received for the AE population on eligible services, the surplus money would be returned to Medi-Cal, which would return that money the federal government.
Ventura County will pay the federal government $29 million, Gold Coast will pay $17.2 million, Dignity will pay $10.8 million to the federal government and $1.2 million California, and Clinicas will pay $11.25 million to the feds and $1.25 million to the state.
The settlements are the results of a whistleblower lawsuit filed by Atul Maithel, Gold Coast's former controller, and Andre Galvan, Gold Coast's former director of member services.
Dignity Health Denies Allegations
Dignity Health issued a statement saying it "denies all of the allegations and resolves the matter expressly without conceding any liability."
"During the period January 1, 2014 through May 31, 2015, Dignity Health d/b/a St. John’s Regional Medical Center and St. John's Pleasant Valley Hospital provided critically necessary population health management and related services to this newly-eligible adult Medi-Cal population in Ventura County. The hospitals provided these services in addition to the underlying services agreement between the hospitals and Gold Coast Health Plan, the county organized health system responsible for administering the Medi-Cal program in Ventura County, and received fair market value compensation for the services actually provided to this vulnerable population.
"Dignity Health denies all of the allegations and resolves the matter expressly without conceding any liability. Dignity Health continues to maintain that all the reimbursement received was properly utilized in serving Ventura County's Medi-Cal beneficiaries. Consistent with their mission, these hospitals continue to both serve the Medi-Cal population in Ventura County and innovate in the areas of prevention, education, and case management services."
Crozer will revert to a nonprofit, the status it held before 2016 when it was acquired by Los Angeles-based, for-profit Prospect Medical Holdings.
ChristianaCare Health System, Inc., and Pennsylvania-based for-profit Crozer Health have called off merger talks, blaming the changing “economic landscape,” over the past six months, the two health systems announced jointly on Thursday.
Had the deal been completed, it would have given ChristianaCare a toehold in the competitive Southeastern Pennsylvania market that includes Penn Medicine, Jefferson Health, and Main Line Health.
No specific reason was given for stopping the negotiations, which began in February with the signing of a letter of intent, but the press release issued by both health systems noted that "since the signing of the LOI in February, the economic landscape has significantly changed, impacting the ability of the sale to move forward."
"Both organizations worked very hard to reach a final agreement and have significant respect for each other and remain committed to caring for the health of those in Delaware County," the statement read.
In a letter to Crozer Health employees, cited by The Inquirer, leadership at the Springfield, PA-based health system and parent Prospect said the reversion to nonprofit status will "allow us to engage with the community through local governance, support from community-based volunteers, and the creation of partnerships with community-based organizations."
The letter said that Crozer will reopen its Springfield Hospital "as a comprehensive outpatient complex with an Emergency Department, medical offices, ancillary services, and ambulatory surgery center," and that 60% of Crozer’s revenue already comes from outpatient services, according to The Inquirer.
Wilmington-based ChristianaCare, Delaware's largest health system, includes three hospitals with a combined 1,300 licensed beds, a freestanding emergency department, and a network of physician offices and outpatient clinics.
Prospect owns 17 hospitals and more than 165 clinics and outpatient centers in California, Connecticut, Pennsylvania, Rhode Island, and Texas.
Crozer Health, formed in 1990 by the merger of Crozer-Chester Medical Center in Upland, Pa. and Delaware County Memorial Hospital in Drexel Hill, Pa, includes Taylor Hospital in Ridley Park, and Springfield Hospital in Springfield.
Plans that spend more for primary care are more likely to get better ratings from NCQA.
A first-of-its-kind study involving 5.4 million Medi-Cal managed care enrollees -- nearly half of the state’s Medicaid plan members – links higher spending for primary care with better care quality, patient experience, and plan ratings.
"Increasing emphasis on primary care in Medi-Cal is essential to improving health and well-being and reducing health disparities," says Kathryn E. Phillips, senior program officer at the California Health Care Foundation, which commissioned the study. "This study provides an important baseline for understanding how greater investment in primary care can improve performance."
The study by Edrington Health Consulting found that plans that spent more for primary care were more likely to get a better rating from the National Committee for Quality Assurance. The study examined 13 Medi-Cal managed care plans and found wide variation in primary care spending, from $8.85 to $61.24 per member per month, or roughly 11% of healthcare dollars spent on primary care, with a range from 5% to 19%.
When specific quality metrics were studied, plans with a higher percentage of spending on primary care performed better on nine of 11 measures. Three of these measures met criteria for statistical significance and align with state priorities: receipt of recommended cancer screenings and two measures of management of medications for depression.
The findings come just weeks after California established a new Office of Health Care Affordability to measure and promote a greater role for primary care in the state's healthcare delivery system.
Beginning in 2024, the California Department of Health Care Services will require all Medi-Cal managed care plans to report on primary care expenditures for the plan's more than 10.8 million enrollees.
"DHCS is committed to reducing the stark racial and ethnic disparities in access to primary care. These include maternity outcomes and children's preventive services, as well as improving maternal and adolescent depression screenings," says Palav Babaria, MD, CQO CDHCS. "This study will serve as a benchmark among Medi-Cal managed care plans as we seek to achieve these and other bold goals."
Federal watchdogs have raised concerns after the recent deaths of nine patients who were discharged or transferred to other facilities.
The City of San Francisco and patients' advocates have filed a pair of lawsuits aimed at reversing the federal government’s decision to cut funding and order discharges or transfers by Sept. 13 for all patients at the troubled Laguna Honda Hospital & Rehabilitation Center.
"The federal government has put Laguna Honda and our City in an impossible situation," City Attorney David Chiu says in a media release. "As the final safety net for many of our most vulnerable San Franciscans, Laguna Honda serves too critical a need to be closed due to an arbitrary, bureaucratic decision."
The 156-year-old skilled nursing facility cares for nearly 700 patients and relies on more than $200 million in funding each year from the federal government. However, federal watchdogs have raised concerns after the recent deaths of nine patients who were discharged or transferred to other facilities.
The city’s lawsuit against the U.S. Department of Health and Human Services and Secretary Xavier Becerra alleges that the Centers for Medicare & Medicaid Services forced the city to implement an unworkable closure and transfer plan that denies the city due process and puts Laguna Honda patients at risk.
The complaint claims CMS imposed an arbitrary Sept. 13 deadline to transfer Laguna Honda's patients and has denied the city due process as the facility is required to close well before the city's administrative appeals can be decided—appeals that would render the transfers unnecessary.
The lawsuit asks a federal judge to eliminate the Sept. 13 deadline and extend federal funding to Laguna Honda at least until the appeals can be decided and all patients can be safely transferred or discharged.
A separate class-action lawsuit filed on behalf of Laguna Honda patients and families, alleges that the closure of Laguna Honda and rushed transfer process violate the Americans with Disabilities Act and deny patients and their families substantive and procedural due process.
"For over 150 years, San Franciscans have relied on Laguna Honda to provide critical care to our most vulnerable," says plaintiffs counsel Louise Renne, a former city attorney and now a partner at Renne Public Law Group.
"We simply cannot allow Laguna Honda to close. The actions of CMS and the California Department of Health are illegal, unnecessary, and cruel."
Chiu says CMS's mandate forces San Francisco "into an unworkable closure and transfer plan that has done far more harm than good. Hundreds of patients' lives are stake. We are taking legal action today in the hope that a court will compel the federal government to exercise compassion and common sense."
San Francisco Mayor London N. Breed says the city is "working hard to address issues that have been raised at Laguna Honda, and that important work will continue."
"But closing this facility and forcing residents and families to go through the trauma of transfers should not be part of that process," Breed says.
"This facility provides care and support for some of the most vulnerable people in our city, and that support must continue to keep them healthy and safe."
Both suits are filed with the U.S. District Court for the Northern District of California.
Unionized clinicians in Northern California plan to start picket lines and rallies outside Kaiser facilities throughout the Bay Area and from Sacramento to Fresno.
More than 2,000 Kaiser Permanente mental health clinicians – claiming burnout and frustration from alleged chronic understaffing – are poised to begin an open-ended strike starting on August 15.
"We're serving a strike notice because our patients aren't receiving needed services." Shay Loftus, a psychologist in Kaiser's Napa/Solano region, says in a news release issued by the National Union of Healthcare Workers. "We're not willing to be part of a system that disrespects the work we do and prevents us from providing ethical care. Kaiser has no excuse to continue treating mental healthcare as a separate and unequal service, and we're going to keep striking until that changes," Loftus says.
Unionized psychologists, therapists, chemical dependency counselors and social workers in Northern California plan to start picket lines and rallies outside Kaiser facilities throughout the Bay Area and from Sacramento to Fresno.
Money is not the issue, the union says, noting that KP reported an $8.1 billion net profit last year, and they system’s HMO has $54 billion in reserves. The disgruntled clinicians say that in Northern California, Kaiser staffs one fulltime equivalent mental health clinician for every 2,600 members, forcing patients to wait months to begin therapy regimens. As a result of delayed care and a relentless caseload, the union says therapists are leaving Kaiser at a record rate.
Kaiser has been fined by state regulators for its lack of mental healthcare, sued by local prosecutors and is now facing a new state investigation following a sharp rise in patient complaints last year. Kaiser also has failed to comply with a new state law requiring follow-up mental health therapy appointments be provided within 10 business days, the union claims.
NUHW President Sal Rosselli says most of the nation's mental health clinicians are not unionized, which he says is one reason why mental healthcare has not attained parity in services.
"Patients are getting ripped off while Kaiser's coffers are bulging," Rosselli says. "We don't take striking lightly but it's time to take a stand and make Kaiser spend some of its billions on mental healthcare."
After more than one year of negotiations, Rosselli says KP has rejected staffing increases and improved access to care, prompting clinicians in June to authorize their first ever open-ended strike.
'Unethical and Counterproductive'
With the walk out looming, Deb Catsavas, senior vice president of human resources at KP, says the health system is "still in active bargaining and are committed to resolving the issues and reaching an agreement."
"It is perplexing that NUHW leaders have chosen to strike when we were close to an agreement," Catsavas says. "In our last bargaining session we were about 1% apart in our respective wage proposals, and we came to bargaining last Friday with hopes to bargain vigorously and bring negotiations to a conclusion. Unfortunately, union leadership delivered a fully new economic proposal from NUHW that avoids reaching agreement and pushes us further apart."
"Despite the unethical and counterproductive tactics by NUHW's leadership, we are committed to bargaining in good faith to reach a fair and equitable agreement that is good for our therapists and our patients," Catsavas says.
Drugmakers say 'patients lose when the government sets prices.'
Payers, providers, and patient advocates are mostly praising the healthcare provisions included in Sunday's passage of the $750 billion Inflation Reduction Act.
On a hyper-partisan 51-50 vote -- with no Republicans voting for the 750-page bill -- the Senate needed the vote of Vice President Kamala Harris to send the bill to the Democrat-controlled House, which is expected to take it up this month.
The IRA has three key healthcare provisions.
First, it earmarks about $64 billion to extend through 2025 the health insurance subsidies created under the American Rescue Plan, which Democrats say will ensure affordable health insurance for 13 million people, with some premiums continuing to be as low as $10 a month.
Second, the bill gives the Department of Health and Human Services the long-sought authority to negotiate lower drug prices for Medicare, starting in 2026. However, that negotiating power will be limited to only 10 drugs in 2026, 15 drugs in 2027, and 20 drugs in 2029 and beyond.
The Congressional Budget Office estimates that these provisions would cut the deficit by $287 billion through 2031, with $321 billion in gross savings and $34 billion in new spending.
Third, the bill caps monthly insulin costs at $35 for Medicare patients, and limits overall drug costs to $2,000 a year. Democrats had attempted unsuccessfully to include that monthly cap for commercial plans, but that provision was stripped by Republicans in the reconciliation process.
PhRMA Hates It
Pharmaceutical Research and Manufacturers of America President and CEO Stephen J. Ubl says passage of the IRA "may feel like a political win for Democrats, but it’s really a tragic loss for patients."
"This drug pricing plan is based on a litany of false promises," Ubl says. "They say they're fighting inflation, but the Biden administration's own data show that prescription medicines are not fueling inflation. They say this is "negotiation," but the bill gives the government unchecked authority to set the price of medicines. And they say the bill won't harm innovation, but various experts, biotech investors and patient advocates agree that this bill will lead to fewer new cures and treatments for patients battling cancer, Alzheimer's and other diseases."
“They’re also misleading the American people when they say this bill fixes the affordability challenges patients face. This bill provides almost no relief to millions of individuals trapped in an insurance system that discriminates against sick patients. Under this bill, patients will still be forced to pay more for medicine than their insurance company pays. Democratic leaders seized every opportunity to make this bill worse for patients, including giving insurers the green light to raise premiums by six percent and delaying a rebate rule that would provide immediate relief to millions of seniors. When given the choice to stand with patients or insurers and middlemen, Senate Democrats stood by insurers and middlemen.
"Once the government can set prices for life saving medicines, it will demand even more control over the healthcare of American patients and the collateral damage from this bill will only grow," Ubl says. "There is still time to reject this partisan bill and work on bipartisan reforms that lower costs at the pharmacy and protect the hope patients have for new treatments. We urge the House to do what's needed to stop this dangerous bill and deliver the kind of meaningful patient-centered reforms the American people are counting on."
Hospitals
Providers generally noted that the bill is lacking in some areas, but they embraced it as a significant step forward.
Bruce Siegel, MD, president and CEO of America's Essential Hospitals, says extending the health insurance subsidies "would safeguard access to care for millions of individuals and families—a critically important outcome, given the ongoing threat of COVID-19 and emerging public health challenges, such as monkeypox."
Still, Siegel says hospitals didn't get all they wanted.
"We are disappointed it lacks funding for hospital workforce and infrastructure needs. Essential hospitals face persistent staffing shortages, high labor costs, and infrastructure constraints," he says. "They need more funding from Congress to meet these challenges as the impacts of the pandemic continue."
Payers
Blue Cross Blue Shield Association President and CEO Kim Keck says extending the tax credits "will protect nearly 13 million Americans from cost increases at a time when the price of everything—from gas to groceries—is rising. This move keeps real money in the pocketbooks of Americans and gives them real peace of mind."
Matt Eyles, president and CEO of America's Health Insurance Plans, says "every American deserves access to affordable coverage and high-quality care, and the Senate's action will continue vital support that millions of hardworking American families need to purchase their own health coverage in the years to come."
Margaret A. Murray, CEO of the Association for Community Affiliated Plans, says her organization "led the call for the extension of enhanced APTCs for the past year to keep premiums affordable and to promote the uptake of comprehensive health coverage through Marketplaces."
"There is more work for Congress and the Administration to do, particularly to strengthen Medicaid and CHIP for children and postpartum individuals, but this is an excellent start," Murray says. "Because this bill helps keep millions of people covered, we urge the House to send this bill to President Biden's desk for his signature with all due haste."
Employers
The Purchaser Business Group on Health has raised concerns about stripping the insulin price cap from commercial plans.
"Since the measures will now apply to Medicare only, the legislation would actually increase prices for those with commercial coverage, above the unsustainably high prices they’re already paying, as costs are shifted from Medicare to employer plans," PBGH said in a media release. "If prices are reduced in Medicare with no corresponding protections for commercial markets, working families may well foot the bill as costs will rise to recoup losses from Medicare drug sales."
Patient Advocates
Louise Norris, an analyst with HealthInsurance.org, says the subsidies will bolster marketplace enrollment.
"Without action from Congress, millions of people will likely see their subsidies decrease or disappear in 2023, and 3 million current enrollees might lose their coverage altogether," Norris says. "The Senate's vote to pass this legislation is a step toward ensuring these hard working Americans will still be able to afford their health coverage next year, and we hope to see it pass quickly in the House."
Calling access to affordable insulin "a matter of life or death for people with type 1 diabetes," the Juvenile Diabetes Research Foundation blasted as "unconscionable" the vote of 43 Republican Senators who stripped away the provision to cap insulin costs at $35 for commercial plans.
"While the Senate removed the $35 per month cap for commercial plans, the Inflation Reduction Act still contains other critically important insulin affordability measures, including a Medicare provision to cap the monthly cost of insulin and limit overall drug costs to $2,000 per year," JDRTF says.
Robert Weissman, president of Public Citizen, noted but did not identify "serious flaws and gaps in this legislation," but nonetheless called the bill "a huge step forward for the American people."
Beyond the musical chairs shuffle, the top hospital rankings, now in its 33rd year, are essentially unchanged from 2021.
Four California health systems have maintained their place atop U.S. News & World Report's widely read and influential "Honor Roll" of the nation’s Top 20 hospitals in 2022, although the rankings for some hospitals shifted slightly.
Cedars-Sinai Medical Center was ranked 2nd in the nation (up from 6th last year), behind Mayo Clinic (No. 1 for seven straight years).
Beyond the musical chairs shuffle, the top hospital rankings, now in its 33rd year, are essentially unchanged from 2021.
"Thanks to the dedication of our physicians, nurses, academic leaders and thousands of others on our staff, Cedars-Sinai continues to provide innovative healthcare, enhanced by our commitment to pioneering research, teaching and education," CEO Thomas M. Priselac says in a media release. "We are proud of Cedars-Sinai's contributions to our diverse Los Angeles community as well as nationally and globally."
Johnese Spisso, president of UCLA Health and CEO of UCLA Hospital System, says his health system's long-standing place among the nation's top hospitals "reflects the unwavering dedication and immense skill of our physicians, nurses, healthcare professionals and support staff."
"Being among the best in the country requires continually striving for improvement to enhance all aspects of patient care," Spisso says. "I'm proud of the dedication and commitment of our team in pursuit of excellence in providing world-class care with compassion to patients who come to UCLA Health from near and far."
The methodologies used to rank the hospitals are based on measures collected by the federal government and hospital stakeholders, such as risk-adjusted survival and discharge-to-home rates, volume, and quality of nursing, among other care-related indicators for more than 30 specialties, procedures and conditions, such as cardiology, oncology, diabetes, orthopedics, geriatrics, and psychiatry.
This year, the magazine has added ovarian, uterine, and prostate cancer surgeries to its list of specialties and has expanded health equity metrics that highlight care for low-income patients and racial disparities in surgical outcomes.
(Editor's note: The version of this story that ran in the August 1, 2022 issue of California Health Facts included incorrect numbers and ratings. The article has now been corrected with the 2022 numbers.)
Health plans pledged to standardize finance, support and metrics for the delivery of advanced primary care.
Six of California's largest health insurance companies have signed a memorandum of understanding to expand investment and improve access to advanced primary care.
The first-of-its-kind California Advanced Primary Care Initiative -- led by California Quality Collaborative, a program of the nonprofit Purchaser Business Group on Health, and the Integrated Healthcare Association -- aims to enable primary care providers to transform to a high-performing, value-based care model that reduces costs and improves quality and equity.
The six payers that signed the MOU -- Aetna, Aledade, Blue Shield of California, Health Net, Oscar, and UnitedHealthcare – have pledged to standardize finance, support and metrics for the delivery of advanced primary care.
"This initiative reflects our understanding that the impact of any one payer alone is limited," says Peter Long, executive vice president of Strategy and Health Solutions at Blue Shield of California. "That’s why Blue Shield is committed to partnering with our peer payers and providers to scale delivery of high-quality primary care across the state. Ultimately, we know this is what is best for our members, and we all must work together to make this vision a reality."
Under the MOU, the payers identified four areas of focus, including:
* Transparency: Report primary care investment and adoption of value-based payment models that support the delivery of advanced primary care and performance on the advanced primary care measure set jointly developed by CQC and IHA.
* Payment: Adopt an agreed upon value-based payment model for primary care providers that offers flexibility, supports team-based care delivery and incentivizes the right care at the right time.
* Investment: Collaboratively set increased primary care investment quantitative goals without increasing the total cost of care.
* Practice Transformation: Provide technical assistance to primary care practices to implement clinical and business models for success in value-based payment models, integration of behavioral health and reduction of disparities.
"Primary care is the heart of all healthcare," says Jeff Hermosillo, California Market President, Aetna. "This innovative initiative will help ensure accessible, affordable and high-quality primary care to improve the well-being of all Californians. Working together with our peers, providers, plan sponsors and members, we are committed to primary care that makes a difference in people's lives."
CQC and IHA have been collaborating since 2019 to develop shared standards of advanced primary care, including common definitions of practice attributes, a performance measure set, methods to identify quality at the practice level and a value-based primary care payment model.
AHA says they're "pleased" with the increase, but complain it "still falls short".
Acute care hospitals could see a 4.3% bump in reimbursements in fiscal year 2023 under a revised Inpatient Prospective Payment System final rule released Monday, about $1 billion more than the federal government had proposed in April, the Centers for Medicare & Medicaid Services announced.
"This reflects a FY 2023 hospital market basket update of 4.1% reduced by a 0.3 percentage point productivity adjustment and increased by a 0.5 percentage point adjustment required by statute," CMS says in a media release. "This update reflects the most recent data available, including a revised outlook regarding the U.S. economy and, as a result, is 1.1 percentage point higher than the proposed update for FY 2023."
The higher reimbursement will go to hospitals that successfully participate in the Hospital Inpatient Quality Reporting Program and that are meaning users of electronic medical records, CMS says.
The cost of the IPPS payment increase will be about $2.6 billion. CMS projects that increase will be partially offset with decreases in disproportionate share payments and uncompensated care costs totaling about $300 million, and reductions of about $750 million for inpatient payments for cases involving new technologies.
In April, CMS had initially proposed an IPPS increase of 3.2% for FY 2023, an additional $1.6 billion. However, that proposal drew flack from the hospital lobby. The Federation of American Hospitals called the proposed increase "woefully inadequate."
"It does not reckon for the hyper-inflation, staffing crisis, and the continuing pandemic, which will impact resources necessary for patient care well into the future," FAH said in April.
The announcement Monday that the reimbursement would be bumped up to 4.3% brought a tepid response from a "pleased" American Hospital Association.
"This update still falls short of what hospitals and health systems need to continue to overcome the many challenges that threaten their ability to care for patients and provide essential services for their communities," AHA Executive Vice President Stacey Hughes says in a media release.
"This includes the extraordinary inflationary expenses in the cost of caring hospitals are being forced to absorb, particularly related to supporting their workforce while experiencing severe staff shortages," Hughes says. "We will continue to urge Congress to take action to support the hospital field, including by extending the low-volume adjustment and Medicare-dependent hospital programs."
HCA denies the allegations and calls the new complaint 'a rehash of claims this group purported in 2020.'
A union-backed investment group has filed a complaint with federal regulators against HCA Healthcare, claiming that the nation's largest for-profit hospital chain failed to disclose "elevated risk" to shareholders stemming from allegations of Medicare fraud.
The complaint was filed Thursday with the Securities and Exchange Commission by the Strategic Organizing Center Investment Group (formerly known as the Change to Win Federation), formed in 2006 by a coalition of labor unions that includes the Service Employees International Union, which represents workers at a number HCA facilities.
SOC said it filed the complaint six months after a report written by the SEIU revealed that HCA may be unnecessarily admitting patients from hospital ERs, putting shareholders at grave risk.
"Since at least 2014, HCA has consistently explained its corporate strategy to investors by noting that higher hospital admissions reliably translate into high company earnings, and that emergency departments are one of the key mechanisms through which hospitals can increase their admission rates," the complaint reads. "For over a decade, Medicare regulators at HHS have identified high levels of emergency department admissions as a potential indicator of improper practices."
In its February report, the SEIU said that "HCA has potentially been engaging in widespread Medicare fraud through the systematic over-admittance of patients from Emergency Departments at HCA hospitals—a practice that may have continued throughout the pandemic."
"Data from the report reveals that HCA may have collected nearly $2 billion in excess Medicare payments since 2008 through these potential ED over-admissions—information that HCA failed to disclose to shareholders," the SOC says.
The complaint asks the SEC to investigate HCA's "failure to disclose to shareholders potential liability of these alleged practices and for the agency to hold the nation's largest for-profit healthcare corporation accountable for alleged wrongdoing."
SOC says there is precedent for the federal action, noting that in 2007 the SEC leveled civil fraud charges against Tenet Healthcare for "failing to disclose to investors that the company's earnings between 1999 and 2002 were 'driven by exploiting a loophole in the Medicare reimbursement system,' a scheme that cost investors billions in lost share value when brought to light."
HCA responds
HCA issued this statement when contacted by HealthLeaders.
"SOC Investment Group is a union-backed organization that formerly called themselves CtW Investment Group, and this appears to be a rehash of claims this group purported in 2020."
"We took their concerns seriously and we analyzed the data and our procedures, and our publicly filed-response can be found here. We remain confident in our processes and robust audit systems. In addition to our internal reviews, independent third-party audits provide additional confidence in our compliance with regulatory requirements. 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."
"This year, HCA Healthcare was named one of Ethisphere's World’s Most Ethical Companies for the 12th time and we are confident that our operational processes and procedures are working well and that we are meeting the healthcare needs of our patients and communities."
