The public will have until May 22 to submit comments, which will be posted to Regulations.gov.
The Federal Trade Commission is asking stakeholders to chime in on competition and security among cloud computing providers in several sectors, including healthcare.
Specifically, the Request for Information query asks about “the competitive dynamics of cloud computing, the extent to which certain segments of the economy are reliant on cloud service providers, and the security risks associated with the industry’s business practices,” the FTC says in a media release.
"Large parts of the economy now rely on cloud computing services for a range of services," says Stephanie T. Nguyen, the FTC's Chief Technology Officer. "The RFI is aimed at better understanding the impact of this reliance, the broader competitive dynamics in cloud computing, and potential security risks in the use of cloud."
The extent to which segments of the economy are reliant on a small handful of cloud service providers;
Whether cloud customers can negotiate their contracts or are stuck with a take-it-or-leave it standard;
Incentives offered cloud customers to get more services from one provider;
The extent to which cloud providers compete on their ability to provide secure storage for customer data;
The types of products or services cloud providers offer based on, dependent on, or related to artificial intelligence; and the extent to which those products or services are proprietary or provider agnostic;
The extent to which cloud providers identify and notify customers of security risks.
The public will have until May 22 to submit comments, which will be posted to Regulations.gov.
CalRx will offer biosimilars for Glargine, Aspart, and Lispro, which are expected to be interchangeable with Lantus, Humalog, and Novolog respectively.
California will contract with non-profit, generic drugmaker Civica Rx to supply the CalRx Biosimilar Insulin Initiative with $30 vials of the life-sustaining drug, Gov. Gavin Newsom says.
"California's partnership with Civica is a game changer," Newsom says. "Reducing the high cost of insulin is a critical step toward addressing health inequities and ensuring affordable and accessible healthcare for all."
CalRx will offer biosimilars for Glargine, Aspart, and Lispro, which are expected to be interchangeable with Lantus, Humalog, and Novolog respectively. The CalRx insulins will be made at Civica's 140,000 square-foot plant, under construction in Petersburg, VA.
"Diabetes has become an overwhelmingly expensive chronic condition," Civica President / CEO Ned McCoy says, "and it is heartbreaking that millions of people in California and across the U.S. are faced with the possibility of having to ration their care and put their lives at risk because they can no longer afford insulin."
Newsom says the new supply chain will lower the cost of insulin by about 90%, saving insulin users between $2,000 and $4,000 a year. Specifically, a 10mL vial will sell for no more than $30 (normally $300); and a box of 5 pre-filled 3mL pens will cost no more than $55 (normally more than $500).
No new prescriptions will be required, consumers can mail-order it, or pick it up at their local pharmacies, which will be required to order and stock the products, the state says.
"With CalRx, and unlike private companies, we're getting at the underlying cost – the price is the price, and CalRx will prevent the egregious cost-shifting that happens in traditional pharmaceutical price games," Newsom says. "It'll cost us $30 to manufacture and distribute, and that's how much the consumer can buy it for. You don't need a voucher or coupon to access this price, and it's available to everybody regardless of insurance plan."
Drug makers say Newsom is barking up the wrong tree.
"If the governor wants to impact what patients pay for insulins and other medicines meaningfully, he should expand his focus to others in the system that often make patients pay more than they do for medicines," Reid Porter, senior director of state public affairs for PhRMA, told HealthLeaders.
"For example, he could require these entities, including insurance companies and middlemen like pharmacy benefit managers, to share the average 84% in rebates they receive on insulin directly with patients at the pharmacy counter," Reid says. "Instead, he wants to score political points and villainize the industry responsible for making California a global leader in developing lifesaving treatments and cures and infusing more than $200 billion into the economy and supporting nearly 700,000 jobs."
In his first day in office in January 2019, Newsom signed an executive order mandating that California leverage its enormous buying power to negotiate lower prescription drug costs.
Civica is a nonprofit, 501(c)(4) organization founded in 2018 by health systems and philanthropies to increase the reliability of the drug supply chain, reduce drug shortages and related high prices in the United States. To date, more than 55 health systems have joined Civica, representing more than 1,550 hospitals and one-third of all U.S. hospital beds.
The Civica deal comes just days after two of the nation's largest drug makers said they would slash the price of insulin.
On March 1, Indianapolis-based Eli Lilly and Co., the nation's largest insulin manufacturer, said it would immediately slash the cost of the drug by 70% and cap patient out-of-pocket costs at $35 or less per month.
"While the current healthcare system provides access to insulin for most people with diabetes, it still does not provide affordable insulin for everyone and that needs to change," Lilly Chair and CEO David A. Ricks said.
On March 14, New Jersey-based Novo Nordisk Inc. followed suit, saying it would cut U.S. list prices of several insulin products by up to 75% for type 1 and type 2 diabetes, including both pre-filled pens and vials of basal (long-acting), bolus (short-acting) and pre-mix insulins, effective January 1, 2024.
In addition to the lowered insulin costs, Newsom says his administration's Master Plan to Tackle the Fentanyl Crisis is looking to bring to market low-cost versions of the opioid antagonist Naloxone.
America's Essential Hospitals says MedPAC's MSNI ignores the costs of uncompensated care, and care to Medicaid beneficiaries.
Safety net hospitals say the wording of the Medicare Payment Advisory Commission's otherwise well-intended recommendation to provide $2 billion in additional funding for them "could have the perverse effect of shifting resources away from hospitals that need support the most."
Beth Feldpush, chief lobbyist for America's Essential Hospitals, says MedPAC's Medicare safety net index (MSNI) put forward in the newly released March 2023 Report to Congress "fails to account for all the nation's safety net hospitals by overlooking uncompensated care and care provided to non-Medicare, low-income patients—especially Medicaid beneficiaries."
"Any practical definition of a safety net provider must consider the care of Medicaid and uninsured patients, yet the MSNI misses on both counts," Feldpush says.
As a result, Feldpush says the shortcomings "would shift resources away from large, teaching, and urban hospitals and those serving many uninsured patients and contradict Congress' intent to better account for uncompensated care in Medicare disproportionate share hospital (DSH) payments."
"The MSNI also would hinder work to improve care equity by undermining providers that care for people at greatest risk of structural inequities and health disparities, including many low-income Medicare beneficiaries," Feldpush says.
America's Essential Hospitals is calling for the government to develop a federal designation of safety net hospitals and to reject the MSNI as a part of that process, "as it would jeopardize access to care for marginalized patients and harm hospitals that operate on low margins and rely on public payers," Feldpush says.
"Further, policymaking for these hospitals should supplement, rather than redistribute, existing Medicare DSH funding, which reflects a congressionally sanctioned, well-established methodology."
For clinicians, MedPAC recommends targeted add-on payments of 15% to primary care clinicians and 5% to all other clinicians for physician fee schedule services provided to low-income Medicare beneficiaries.
As of January 1, vaccines are now free under Medicare Part D, and include vaccines for Tdap and shingles.
Seniors and people with disabilities could save more than $230 million in out-of-pocket costs for vaccines now covered for free under Medicare Part D, thanks to the newly enacted Inflation Reduction Act, the Department of Health and Human Services says in a new report.
HHS's Office of the Assistant Secretary for Planning and Evaluation reports that the 3.4 million of 51 million Medicare Part D enrollees who received covered vaccines in 2021 paid $70 on average for these vaccines for a total of $234 million.
As of January 1, those vaccines are now free, and include vaccines for tetanus, diphtheria, and pertussis (Tdap) and shingles, which can otherwise cost seniors almost $200.
The ASPE report was based on 2021 figures, but HHS believes the future savings will be even greater because more seniors are likely to get vaccinated when it's free. In addition, the expanded vaccinated senior population could also result in lower downstream healthcare costs that arise from otherwise vaccine-preventable diseases. The free vaccines are also expected to improve racial and ethnic access.
The report examines vaccine use, total vaccine spending, and out-of-pocket spending for vaccines that are covered under Medicare Part D: shingles; tetanus/diphtheria (Td); tetanus, diphtheria, and pertussis – also known as whopping cough (Tdap); hepatitis A; and hepatitis B. Medicare Part B already covers flu, pneumococcal, COVID-19, and certain other vaccines without cost-sharing for people with Medicare.
Most vaccinations covered by Medicare Part D are for shingles prevention, which account for about 82% of total vaccine costs for enrollees. On average, enrollees pay $77 out of pocket for the shingles vaccine – but for some seniors the vaccine can cost almost $200, $51 for the hepatitis B vaccine, and $28 for the Tdap vaccine, HHS says.
Out-of-pocket costs were even higher for people who did not receive the Part D Low-Income Subsidy: $95 for shingles, $81 for hepatitis B, and $73 for other vaccines.
A state-by-state breakdown of shows that California ($20 million), Florida ($18 million), and Texas ($14 million) had the highest total beneficiary out-of-pocket costs for all Part D vaccines, with average enrollee savings of $51 per person in California, $79 per person in Florida, and $69 per person in Texas.
South Dakota seniors ($142.39) had the nation's highest out-of-pocket costs, while the District of Columbia (32.74) had the lowest.
The IRA also capped seniors' out-of-pocket costs for insulin at $35 a month, and a recent ASPE report estimates that 1.5 million Medicare beneficiaries will save $500 per year on insulin because of the new law.
Overall, more than one-third (35%) of Americans are worried about the AI swiping their jobs.
Nearly half (44%) of healthcare workers fear that artificial intelligence could take their jobs, according to a survey fromFreelanceWritingJobs.com.
The survey of 3,000 workers across several economic sectors shows that those concerns are widely felt in many professions, including technology (64%), hospitality (59%), legal (52%), journalism (52%), finance (42%) education (44%), tourism (43%), retail (43%), and energy (41%).
"The results of this survey provide a valuable insight into American workers' attitudes towards AI and its impact on their job security," says Shaun Connell, founder of FreelanceWritingJobs.com.
"It's clear that workers across the country are concerned about the impact of AI on their jobs, and industries must take proactive steps to support and reskill their employees to ensure they remain competitive in the AI-driven job market."
The least-concerned workers were in the public service sector, where only 19% expressed concern.
“One reason for the low level of concern among public sector workers may be the perception that the government is less likely to adopt new technologies, including AI, as quickly as the private sector,” the survey surmised. “Public sector organizations often have more bureaucratic processes and regulations in place, which can slow down the implementation of new technologies. This means that public sector workers may feel that their jobs are less vulnerable to automation and other forms of technological change.”
Overall, the survey found that 35% of Americans are worried about the AI swiping their jobs. State-by-state, that feeling was most prevalent in New Hampshire (71%) and least prevalent in Nebraska (17%).
“This disparity may be due to the fact that Nebraska is a traditional farming state, and agriculture has yet to be significantly impacted by AI,” the survey speculates.
The survey also found that 36% of workers said they use AI in their day-to-day jobs to make work easier.
An MIT-Sloan study finds policies in the category related to data protection affect health information sharing the most.
Policies developed by state legislatures can play a critical role in the adoption of health data sharing, which, in turn, will improve care quality, according to a new study from MIT Sloan School of Management.
The MIT Sloan researchers wanted to determine why, despite the high levels of adoption of electronic health records since the 2009 Health Information Technology for Economic and Clinical (HITECH) Act, the actual use of shared data to improve care has sputtered.
"If states want to increase the use of health information sharing in an effort to improve quality of care, we need to understand how state laws most encourage and discourage the use of HIEs, and then weigh the benefits of information sharing with other goals like the strength of privacy protections," says coauthor MIT Sloan Prof. Joseph Doyle.
Fewer than 10% of hospitals (and fewer than 20% of doctors) were using EHR before the HITECH Act, which doled out $30 billion to increase the adoption. By 2014, 97% of reporting hospitals had electronic health record technology.
Despite the big investment and adoption, the study notes that the actual use of the data and resulting improvements to healthcare quality and productivity have been tepid.
In particular, the research finds policies in the category related to data protection affect health information sharing the most.
The researchers built a database of laws from 50 states between 2000 and 2019 and tracked 12 policies area that may increase HIE use. In turn, those 12 policy areas were further divided into four main categories: clarifying HIE governance, strengthening financial stability, specifying the uses and users of an HIE, and protecting the underlying data.
MIT-Sloan looked at shifting state policies over the 20-year span and then tested whether health information sharing responds to changes in state laws. The findings identify policies can have the potential to bolster the use of digital tools to improve health and lower costs.
For example, the research shows that data protection policies affect health information sharing the most. In states that make the protection of data less costly, HIE usage increases by 18%. Enacting legislation that has patients participate by default leads to a 16% increase in usage.
"When comparing outcomes of policies that had patients 'opting in' or 'opting out' of using health information exchanges, we found that 'opt in' policies resulted in less participation and data sharing," Doyle says.
The study also found that HIE use can improve care quality. An examination of hospital discharges for heart attack patients in Florida from 2011 to 2014 found that hospitals using HIEs had lower readmission rates.
In addition, physician offices with strong HIE programs have maintained quality with 5% lower Medicare spending.
Even with those measured successes, however, surveys of HIE stakeholders show ongoing and stubborn challenges to HIEs, including financial viability, state regulations and concerns about privacy.
In a first-of-its-kind proposed action, the commission also issued an order banning the online counseling service from sharing consumers mental health data.
Online mental health provider BetterHelp Inc. will refund $7.8 million to its customers for "deceiving" them and sharing their medical data for targeting ads used by Facebook, Snapchat and other social media, the Federal Trade Commission announced Thursday.
The FTC says the proposed action – which cleared the commission on a 4-0 vote -- is its first to return money to consumers whose health data was compromised and includes a proposed order banning BetterHelp from sharing consumers health data, "including sensitive information about mental health challenges."
The agreement will be published in the Federal Registry for 30 days for public comment, after which the commission will decide whether to make the order final.
"When a person struggling with mental health issues reaches out for help, they do so in a moment of vulnerability and with an expectation that professional counseling services will protect their privacy," Samuel Levine, director of FTC's Bureau of Consumer Protection, says in a media release.
"Instead, BetterHelp betrayed consumers most personal health information for profit. Let this proposed order be a stout reminder that the FTC will prioritize defending Americans sensitive data from illegal exploitation," Levine says.
Mountain View, California-based BetterHelp did not respond Thursday to HealthLeaders' request for comment.
The company markets mental health services geared toward specific groups, such as Faithful Counseling for Christians, Teen Counseling, and Pride Counseling for LGBTQ people.
Prospective customers are required to fill out a questionnaire asking for sensitive mental health information—such as whether they have experienced depression or suicidal thoughts and are on any medications. The applicants also provide their name, email address, birth date and other personal information, after which they are matched with a counselor and pay between $60 and $90 per week for counseling, the FTC says.
Consumer Protection inspectors at FTC note that, at several points in the signup process, BetterHelp promises consumers that it will not use or disclose their personal health data except for limited purposes, such as to provide counseling services.
"Despite these promises, BetterHelp used and revealed consumers email addresses, IP addresses, and health questionnaire information to Facebook, Snapchat, Criteo, and Pinterest for advertising purposes," according to the FTCs complaint.
For example, the FTC complaint says BetterHelp "used consumers email addresses and the fact that they had previously been in therapy to instruct Facebook to identify similar consumers and target them with advertisements for BetterHelps counseling service, which helped the company bring in tens of thousands of new paying users and millions of dollars in revenue."
In addition to the refund, the FTCs proposed order will ban BetterHelp from sharing consumers personal information with certain third parties for re-targeting consumers who previously had visited BetterHelps website or used its app, including those who had not signed up for the companys counseling service.
According to the complaint, BetterHelp pressed customers for sensitive health data by repeatedly showing them privacy misrepresentations and nudging them with unavoidable prompts to sign up for its services.
"Despite collecting such sensitive information, BetterHelp failed to maintain sufficient policies or procedures to protect it and did not obtain consumers affirmative express consent before disclosing their health data," the complaint states, adding that "BetterHelp also failed to place any limits on how third parties could use consumers health information—allowing Facebook and other third parties to use that information for their own internal purposes, including for research and development or to improve advertising."
The counseling service further lied to users and the public in 2020 when it denied media reports that it shared consumers' health information with third parties, the complaint says.
Lilly's announcement puts pressure to follow suit on competitors Novo Nordisk and Sanofi.
Indianapolis-based Eli Lilly and Co., the nation's largest insulin manufacturer, says it will slash the cost of the drug by 70% and cap patient out-of-pocket costs at $35 or less per month.
“While the current healthcare system provides access to insulin for most people with diabetes, it still does not provide affordable insulin for everyone and that needs to change," Lilly Chair and CEO David A. Ricks says in a media release Wednesday.
"The aggressive price cuts we're announcing today should make a real difference for Americans with diabetes,” Ricks says. “Because these price cuts will take time for the insurance and pharmacy system to implement, we are taking the additional step to immediately cap out-of-pocket costs for patients who use Lilly insulin and are not covered by the recent Medicare Part D cap."
Specifically, Lilly says it will:
Cut the list price of its non-branded insulin, Insulin Lispro Injection 100 units/mL, to $25 a vial. Effective May 1, 2023, it will be the lowest list-priced mealtime insulin available, and less than the price of a Humalog vial in 1999.
Cut the list price of Humalog (insulin lispro injection) 100 units/mL1, Lilly's most commonly prescribed insulin, and Humulin (insulin human) injection 100 units/mL2 by 70%, effective in Q4 2023.
Launch Rezvoglar, a basal insulin biosimilar of injected Lantus for $92 per five pack of KwikPens, a 78% discount to Lantus, effective April 1, 2023.
Automatically cap out-of-pocket costs at $35 at participating retail pharmacies for people with commercial insurance using Lilly insulin, effective immediately.
Provide access to $35 insulin for uninsured diabetics using its online website InsulinAffordability.com, effective immediately.
A Department of Health and Human Services report issued last month found that 1.5 million Medicare enrollees will benefit from a $35 cap on a month’s supply of insulin, which was mandated under the Inflation Reduction Act.
The report also found that nationally, the average out-of-pocket cost was $58 per insulin fill in 2019, typically for a 30-day supply. On the commercial side, the report found that patients with private insurance or Medicare paid about $63 per fill on average, and 1 in 5 Americans taking insulin paid more than $70 per prescription.
Pressure on Rivals
Lilly's announcement puts pressure to follow suit on competitors Novo Nordisk and Sanofi, who with Lilly manufacture more than 90% of the global insulin supply. Neither company would commit to copying Lilly's price cuts, but both also say they already have extensive policies in place for purchasing insulin at rates similar to what Lilly is charging.
In a Tweet Wednesday, President Joe Biden calls Lilly's announcement "a big deal" and added "it's time for other manufacturers to follow."
"For far too long, American families have been crushed by drug costs many times higher than what people in other countries are charged for the same prescriptions. Insulin costs less than $10 to make, but Americans are sometimes forced to pay over $300 for it. It's flat wrong," Biden says. "Last year, I signed a law to cap insulin at $35 for seniors and I called on pharma companies to bring prices down for everyone on their own. Today, Eli Lilly did that."
"Now it’s time for other drug manufacturers to join in. And it's time for Congress to build on, not repeal, our new prescription drug law, the Inflation Reduction Act," Becerra says.
While not mentioning his competitors, Ricks implied that Novo Norisk and Sanofi should follow Lilly's lead, noting that “7 out of 10 Americans don't use Lilly insulin."
"We are calling on policymakers, employers and others to join us in making insulin more affordable," Ricks says.
Denmark-based Novo Nordisk issued a statement affirming its "ongoing commitment to patient affordability and access over the past several years."
"For more than 10 years, we have had an offering through Walmart which includes a human insulin program for about $25 per vial," the drugmaker says. "In addition, through NovoCare, our My$99Insulin program provides eligible people living with diabetes a 30-day supply of a combination of our insulin products (up to three vials or two packs of pens) for $99, equating to $33/vial or $49.50/pack of pens. Our Immediate Supply program provides those who may be at risk of rationing their insulin a one-time free 30-day supply of our insulin."
Sanofi issued a statement saying it "believes that no one should struggle to pay for their insulin, regardless of their insurance status or income level, which is why we have a suite of innovative and patient-centric savings programs to help people reduce their prescription medicine costs."
The Paris-based company says that 100% of commercially insured people are eligible for Sanofi's copay assistance programs, regardless of income or insurance plan design, which caps out-of-pocket expenses for most patients to $15 or less for one month.
In addition, Sanofi says all uninsured people are eligible for a $35-a-month price through its Insulins Valyou Savings Program, and also allows uninsured people to pay as little as $99 for a 30-day supply of pens.
"We also provide free medications to qualified low- and middle-income patients through the patient assistance component of the Sanofi Patient Connection, and last year, Sanofi also launched Insulin Glargine U-100 at a price that is 60% less than the current Lantus list price, while continuing to offer Lantus to payers who choose to cover the existing product," the drugmaker says.
Hot Button Issue
The high cost of healthcare, and specifically the skyrocketing costs of prescription drugs, have been a hot topic in state and federal government circles, and in Congress, where Republicans and Democrats have says it's time to address the issue.
On Jan. 12, California Attorney General Rob Bonta filed suit against Lilly, Sanofi and Novo Nordisk, and pharmacy benefits mangers CVS Caremark, Express Scripts, and OptumRx “for driving up the cost of the lifesaving drug through unlawful, unfair, and deceptive business practices in violation of California's Unfair Competition Law.”
"Insulin is a necessary drug that millions of Americans rely upon for their health, not a luxury good," Bonta says. "With (this) lawsuit, we're fighting back against drug companies and PBMs that unacceptably and artificially inflate the cost of life-saving medication at the expense of vulnerable patients."
Biden used his State of the Union address last month to scold "Big Pharma" for reaping "record profits" from insulin sales, and urged Congress to support a universal $35-a-month cap on the price of the life-sustaining diabetes drug.
Biden told Congress that the $35-a-month insulin price cap for Medicare enrollees under the IRA should be available to everyone regardless of their coverage status.
"Insulin has been around for 100 years,” Biden told a joint session of Congress. "The guy who invented it didn't even patent it because he wanted everyone to have it. It costs drug companies just $10 a vial to make. But, Big Pharma has been unfairly charging people hundreds of dollars – and making record profits."
Sen. Bernie Sanders (I-VT), chair of the Senate Health, Education, Labor and Pensions (HELP) Committee and an outspoken and ardent critic of pharma, credited the cost cuts to public pressure more than corporate benevolence on Lilly's part.
"This is what fighting back accomplishes: At a time when Eli Lilly made over $7 billion in profits last year, public pressure forced them to reduce the price of insulin by 70%," Sanders Tweeted. "Sanofi and Novo Nordisk must do the same."
CMS agrees that enhanced oversight is needed, but says OIG audit 'does not constitute credible information of overpayments.'
Federal watchdogs are recommending that the Centers for Medicare & Medicaid Services claw back as much as $216 million for noncompliant definitive drug testing paid to at-risk Medicare providers.
The Department of Health and Human Services’ Office of the Inspector General audited $3 billion in Medicare Part B payments between 2016 and 2020 and found that CMS had paid $704 million over that period for definitive drug testing services made to more than 5,200 providers.
The audit found that 1,026 at-risk providers in the five-year period routinely billed for a definitive drug testing service with the highest reimbursement amount (procedure code G0483) more than 75% of the time, compared with 4,227 "other providers" who "did not routinely bill this service."
"We determined that presumptive drug testing preceded most definitive drug testing services billed by both the at-risk and other providers," OIG says. "However, the at-risk providers may not have always used presumptive testing to determine the number of drug classes that needed to be tested using definitive drug testing, because they routinely billed for testing 22 or more drug classes using G0483 and the other providers did not."
The up-coded billings from at-risk providers occurred even though their patient mix and testing frequency were not significantly different from that of other providers, OIG says.
"This suggests that the at-risk providers may have been able to bill for definitive drug testing services using primarily procedure codes with lower reimbursement amounts, as the other providers did," OIG says. "If CMS's program safeguards had focused on at-risk payments to at-risk providers for procedure code G0483, Medicare could have saved up to $215.8 million for our audit period."
CMS Responds
While CMS has agreed with OIG’s recommendations for enhanced oversight, the agency disagreed with suggestions that it seek refunds from providers.
"This audit does not constitute credible information of overpayments because no overpayments were identified," CMS Administrator Chiquita Brooks-LaSure writes in a response to the audit. "Therefore, this audit is not sufficient basis upon which CMS can support a 60-day rule notice to identified providers."
Brooks-LaSure notes that OIG "classified providers as ‘at risk’ for improper payment only due to the frequency at which they billed this code and the amount of Medicare reimbursement they received during the audit period. This analysis alone does not provide findings of improper payment, which would have required medical review."
Instead of using agency resources to track down overpayments from providers with no assurances of collections, Brooks-LaSure says CMS will instead "send a comparative billing report to those providers that IOG identified, alerting them to the fact that their billing is an outlier compared to their peers."
The settlement is the latest development in an ongoing, bitter feud between former colleagues who've traded accusations of drug abuse and improper romantic relationships.
UPMC will pay the federal government $8.5 million to settle whistleblower false claims allegations, ending one chapter in a bitter, years-long feud between former physician-colleagues at the prestigious health system that reads like a script taken from "General Hospital."
UPMC, University of Pittsburgh Physicians, and James L Luketich, MD, the renowned chair of the Department of Cardiothoracic surgeon at the sprawling, Pittsburgh-based health system, agreed to the fine to settle allegations that Luketich "regularly performed as many as three, complex surgical procedures at the same time, failed to participate in all of the ‘key and critical' portions of his surgeries, and forced his patients to endure hours of medically unnecessary anesthesia time, as he moved between operating rooms and attended to other patients or matters," the U.S. Justice Department says in a media release.
The DOJ complaint stated that "those practices amounted to violations of the statutes and regulations which prohibit ‘teaching physicians' (like Dr. Luketich) from billing the United States for ‘concurrent surgeries,' were well known to UPMC leadership, and increased the risk of surgical complications to patients."
"The Settlement Agreement provides that it is neither an admission of liability by the Defendants nor a concession by the United States that its claims are not well founded," DOJ says. "Instead, in order to avoid delay and the expense of protracted litigation, and in consideration of the promises and obligations of the Settlement Agreement, the parties agreed to resolve the case."
Luketich's attorney, Efrem M. Grail, says his client is "pleased this settlement puts an end to the Government's case."
"Medical schools and their hospitals have sought clarity about the billing regulation for teaching physicians at issue here for years, and the United States has never provided it," Grail says. "This settlement provides a mechanism we hope will lead to authoritative guidance so that universally respected surgeons like Dr. Luketich can return their focus to training young doctors to save lives without having to put up with baseless claims of fraud."
UPMC issued a statement acknowledging the "false claims action challenging UPMC's billing for some of Dr. Luketich's most complicated, team-based surgical procedures."
"At issue was compliance with the CMS's ‘Teaching Physician Regulation' and related billing guidance as well as with UPMC's internal surgical policies," the statement read. "Among other terms, the parties agreed that UPMC could seek clarity from CMS regarding how it should bill for such surgeries. While UPMC continues to believe Dr. Luketich's surgical practice complies with CMS's requirements, it has agreed to pay $8.5 million to the government to avoid the distraction and expense of further litigation. UPMC has also reserved the right to challenge the relator's share of the settlement."
'Sordid Vendetta'
This is where things turn nasty.
While the case with the government has been settled, Luketich is the plaintiff in a separate but related and ongoing defamation suit alleging that the whistleblowers -- two former colleagues – illegally recorded a February 2018 private medical consultation that Luketich had with his personal physician in a UPMC Presybterian Shadyside surgical observation room, during which they discussed Luketich's Suboxone prescription.
The whistleblowers – identified as Jonathan D'Cunha, MD, now chair of cardiothoracic surgery at Mayo Clinic, Arizona, and Lara Schaheen, MD, a UPMC resident at the time – allegedly recorded the conversation and circulated a transcript of it to peers, rival health systems, government officials and hospital administrators, the suit claims.
Documents filed by Luketich in an Allegheny County court allege that his two former colleagues "were acting on a deep-seated and visceral animus" against Luketich that began in 2017 after he confronted them about their alleged romantic relationship and the alleged favorably treatment that D'Cunda showed to Schaheen.
"Their personal interactions, as described by many with whom they worked, were far outside the norms of what would be expected of professional colleagues," Luketich's filing states. "For example, Dr. Schaheen drew circles on Dr. D’Cunha's wrist in the operating room, and Dr. Schaheen received text messages from Dr. D'Cunha while she was in the operating room asking her to 'come to the office and cuddle with [him].'"
The defamation suit alleges that D'Cunha and Schaheen, as part of a "sordid vendetta, sought to use the illegal recordings to portray Luketich "as a drug abuser and as an impaired physician."
Luketich wants an Allegheny County Court judge to throw out recordings, which he says were illegally obtained and which are being used as evidence in a separate suit filed against him by a former patient.
'Dr. D'Cunha's Brave Decision'
D'Cunha's attorneys offer a different picture.
They claim D'Cunha blew the whistle because Luketich's longstanding practice of conducting and overseeing multiple surgeries at once was a violation of Medicare rules, and endangered patients. D'Cunha alleged that UPMC knew about it since 2015 but took no action against the renowned surgeon.
"The Department of Justice's complaint strongly refuted any suggestion that this lawsuit was merely a billing dispute involving confusing government regulations," D'Cunha's attorneys at Phillips & Cohen LLP say in a media release. "It alleged that the conduct did not involve merely technical violations of billing requirements or internal policies. Instead, the government alleged that Luketich's surgical practices defied the standard of care, abused patients' trust, inflated anesthesia time, increased the risk of complications to patients, and – on at least several occasions – resulted in serious harm to patients."
Claire Sylvia, D'Cunha's attorney and Phillips & Cohen says "Dr. D'Cunha's brave decision to step forward despite the personal costs he has endured in order to ensure that this conduct was addressed is exactly the kind of conduct the False Claims Act was intended to encourage and reward."
Her colleague, Jeffrey Dickstein, says the settlement "finally brings meaningful oversight of Dr. Luketich and UPMC."
"Patients deserve more of their surgeon's attention; the government demands it. Now they'll get it," Dickstein says.
The defamation suit and related countersuits are being heard in the Court of Common Please of Allegheny County Pennsylvania.
