Whistleblowing

James R. Teeter
President
Arkansas Hospital Association

Try to imagine the Civil War years of 1861-1865 during which the ugliest chapter in American history was written. They were dreadful years of families ripped apart and of homes, farms, and businesses lost. "Do all you can for my folks and when I get back I will make it right with you and if I never get back I hope God will reward you," wrote John Bowen in a letter mailed from Fort Smith. More than 110,000 Union and 94,000 Confederate soldiers would eventually die in battle, and another 413,000 would perish from disease and infection.

By 1863, President Lincoln and the Congress had become emotionally and physically exhausted. And, frustrated with the widespread fraud that plagued the Union's military requisitions. Union troops, which included 9,000 Arkansas men, were opening gun powder kegs in the heat of battle, only to find them full of sawdust. To help curb this deadly outrage and numerous other forms of fraud, Lincoln signed into law the federal False Claims Act (FCA) which included what would be known as "whistleblower" provisions. The FCA was a good law. It addressed genuine intent to steal from the government. It was not abusively applied to simple errors of finance.

After the Civil War, the FCA and the whistleblower law were rarely invoked. But, in 1986, Congress amended the statute to make whistleblower actions easier to win. In so doing, it encouraged people with supposedly first-hand knowledge of fraud (usually company employees) to sue on behalf of the government, and keep for themselves 15% to 30% of the recovered amount.

Not surprisingly, whistleblower cases have mushroomed from six or fewer a year to hundreds in 1997. They have captured the attention of big name novelists like John Grisham, whose recent best selling legal thriller, The Partner, tracks an unscrupulous lawyer who has stolen the $90 million a whistleblower harvested for assisting in a multi-billion dollar recovery for the government. With such glorification and increasing public awareness of whistleblowing, we should expect more of these cases in the future. This, when almost 50% of whistleblower cases already allege healthcare reimbursement fraud.

Over the past many months, the hospital field has complained about the unfairness of government officials automatically applying the grossly punitive FCA to hospital billing mistakes. A federal judge in Ohio recently called such actions "heavy-handed" and "extremely onerous." Another U.S. judge in Houston has since ruled that the FCA's whistleblower provisions are unconstitutional in some instances. In the Houston case, for example, a nurse who worked at St. Luke's Episcopal Hospital claimed that patients were unnecessarily admitted to St. Luke's and/or their organ transplant status was artificially upgraded to defraud Medicare.

Interestingly and surprisingly, the judge ruled that because the nurse was not directly affected, financially, she had no cause to sue. Plaintiff attorneys are still in a state of shock. They fear that the Houston ruling will have a chilling effect on whistleblowing. Certainly, hospitals and other enterprises innocent of fraud can hope so. This case is likely to be appealed to the Fifth Circuit Court of Appeals, and possibly to the U.S. Supreme Court. We' ll stay tuned, of course.

Arkansas Newsmakers and Newcomers
Randy King, CEO, Baptist Memorial Hospital-Blytheville, has been named vice president/market leader for the Baptist Memorial Health Care Corporation eastern Arkansas market. His responsibilities include overseeing the operations of Baptist Memorial Hospital-Blytheville, Baptist Memorial Hospital-Osceola, ambulatory services, home health care, behavioral healthcare services, a long-term care facility, and wellness/rehabilitation.

Al Sypniewsk, former administrator at Baptist Memorial Hospital-Osceola and assistant administrator at Baptist Memorial Hospital-Blytheville, has been named administrator of the Blytheville facility. Joel North , former assistant administrator at Baptist Memorial Hospital-Forrest City, has been named administrator of Baptist Memorial Hospital-Osceola.

Kenneth S. Breaux has been named CEO at Randolph County Medical Center in Pocahontas. Breaux, who has 23 years of hospital administration experience, was chief operating officer at Columbia North Houston Medical Center, Houston, Texas, prior to his move to northeast Arkansas.

Doug Weeks, senior vice president and administrator of Baptist Rehabilitation Institute (BRI) in Little Rock, has been named senior vice president and administrator of Baptist Medical Center (BMC), succeeding Steve Lampkin. Weeks will also continue serving as BRI administrator. Lampkin, who represents the Metropolitan Hospital District on the AHA board of directors, will serve as Baptist Health's senior vice president for strategic development.

Lt. Col. Mike Miller has been named administrator of the 314th Medical Group (Little Rock Air Force Base) in Jacksonville. He is a former chief of financial management, Command Surgeon's Office, Air Force Materiel Command at Wright-Patterson Air Force Base in Ohio, and also served as assistant administrator of Wright-Patterson Medical Center.

James Summersett III, president of Conway Regional Medical Center, was appointed to the Arkansas Hospital Association Workers' Compensation Self-Insured Trust board of directors by AHA chairman, Patrick Flynn. Summersett succeeded Bob Bash, administrator, Booneville Community Hospital. Jim Mugan, vice president of patient services at Margaret Mary Community Hospital in Batesville, Indiana, has accepted the position of chief nursing officer at Conway Regional Medical Center, effective January 12, 1998.

Michael L. Morgan, president and CEO of St. Edward Mercy Health Network in Fort Smith, has been recognized for his efforts while serving as president and CEO of Mercy Hospitals of Texas. Mercy Regional Medical Center in Laredo, Texas, has been identified as one of the Top 100 performing acute care hospitals in the U.S. through June 30, 1997 by HCIA Inc. and William M. Mercer Inc.

Barry Brady, former vice president of Conway Regional Medical Center, has accepted the position of administrator of Ozark Health (Van Buren County Memorial Hospital & Nursing Home) in Clinton. He will succeed Alan Finley who has accepted the position of vice president of general and diversified services at CRMC. Jim Lambert, former vice president of Covenant Health Systems in Nashville, Tenn., has been named chief operating officer of the Conway facility.

Brian Clemens, president of North Arkansas Regional Medical Center in Harrison, has resigned to accept a position as manager of a physicians group in Oklahoma. Carl Brown, NARMC vice president, will serve as interim president until a successor is named.

Gary Bebow, administrator/CEO of White River Medical Center in Batesville and AHA chairman-elect, recently received the Award of Merit from the Batesville Area Chamber of Commerce. The Award is presented annually to an individual who has exhibited outstanding ability and dedication in his field.

AHA Educational Calendar

April 3 -- Little Rock
Arkansas Society for Healthcare Consumer Advocacy

April 9-10 -- Hot Springs
Healthcare Financial Management Association

April 14-15 -- Little Rock
Case Management Seminar

April 16-17 -- Hot Springs
Arkansas Association for Hospital Engineering

April 17 -- Jacksonville
Arkansas Society for Healthcare Administrative Support

April 21 -- Little Rock
Arkansas Hospital Managed Care Society

May 6-7 -- Fairfield Bay
Society of Arkansas Hospital Purchasing and Materials Management

May 12 -- Little Rock
Healthcare Benchmarking: From Data to Decisions

May 21 -- Little Rock
Ambulatory Payment Groups Seminar

June 10 -- Little Rock
Arkansas Council of Nurse Managers

June 10-12 -- Branson, Missouri
Arkansas Hospital Administrators Forum Summer Management Conference

June 12 -- Little Rock
Arkansas Healthcare Human Resources Association

Arkansas Congressional Visits Made
Members of the Arkansas Hospital Association's executive team dedicated much of December to meeting with the state's congressional delegation about the Medicare fraud and abuse issue. They were joined by one or two hospital CEOs in most of the meetings who helped deliver this message:

-- hospitals recommend zero tolerance for fraud, and strongly support efforts to prosecute those who willfully and knowingly commit fraudulent acts;
-- Medicare billing mistakes are the result of a cumbersome, complex process which maximizes the potential for errors, but these errors are not intentional fraud;
-- the federal Department of Justice is out of line in its characterization of billing errors as fraud, and is not justified in seeking prosecution of hospitals submitting erroneous claims under the False Claims Act;
-- and, Congress' support is needed to pass legislation to restore an administrative process for addressing Medicare billing error issues and to resolve the misapplication of the False Claims Act.

The list of CEOs who participated in the meetings includes Bob Atkinson (Jefferson Regional Medical Center); Russ Harrington (Baptist Health); Diana Hueter (St. Vincent Infirmary Medical Center); Luther Lewis (Medical Center of South Arkansas); and Hank Walkley (Methodist Hospital of Jonesboro). By the month's end, visits had been made with Representatives Marion Berry, Jay Dickey, Asa Hutchinson, and Vic Snyder; as well as Senator Tim Hutchinson.

Arkansas Hospitals Receive Quality Awards
Eleven Arkansas hospitals and health systems were among 72 state business organizations to receive Arkansas Quality awards recently. The AHA members named as award winners were the Central Arkansas Radiation Therapy Institute (CARTI), which won one of three Governor's Quality Awards presented by Governor Mike Huckabee; Arkansas Children's Hospital, Baptist Health, National Park Medical Center, Northeast Arkansas Rehabilitation Hospital, and St. Vincent Infirmary Medical Center, all recipients of Quality Achievement Awards; and Delta Memorial Hospital, Drew Memorial Hospital, Northwest Health System, Northwest Arkansas Rehabilitation Hospital, and St. Vincent North Rehabilitation Hospital, which were each recognized with Quality Commitment Awards. The awards, which recognize organizations' achievements in implementing quality principles and practices, were presented October 20 during the Arkansas Quality Awards Banquet.

Arkansas Hospital Administrators Forum, June 10-12
The Arkansas Hospital Administrators Forum summer management conference will be held June 10-12 at the Chateau on the Lake in Branson, Missouri. For the first time, the Arkansas Health Executives Forum will cosponsor the event.

Peg Neuhauser, a management and organizational consultant, will present "Mergers, Partnering, Restructuring: Coping with Culture Clashes in your Healthcare Organization?" Diane Mackey, Arkansas Hospital Association legal counsel, will discuss "hot" legal issues, including fraud, abuse and false claims; EMTALA; JCAHO sentinel events; employment of and contracting with physicians; the Freedom of Information Act; and an update on discovery issues currently in litigation. In addition, Ellen Pryga, director of policy development with the American Hospital Association, is scheduled to appear.

And, with the exciting atmosphere and many, many entertainment opportunities in Branson, there will be plenty of activities for the whole family. Call 501-224-7878 for registration information.

Trustee Regional Meetings: Focus on Fraud and Abuse
The Arkansas Association of Hospital Trustees (AAHT) has planned a third series of regional dinner meetings this spring. The excellent attendance at the first two rounds of meetings was indicative of the various educational needs of hospital trustees. A full day out of the office or away from family interests and responsibilities is impossible for some, and the short, closer-to-home evening meetings fulfilled their needs.

Due to the effect the Department of Justice's assault on hospitals by inappropriate use of the False Claims Act in investigating disputes of Medicare billing will have on Arkansas hospitals, this year's regional series will focus on healthcare fraud and abuse. Representatives of Compliance Concepts, Inc. will lead the discussion at each of the five sessions. Scheduled dates and locations are:

May -- Batesville
May -- Hot Springs
May -- El Dorado
May -- Fort Smith
May -- Springdale

Call 501-224-7878 for registration and program information.

Arkansas Supreme Court Allows Tax
The Arkansas Supreme Court ruled December 18 that a not-for-profit hospital must pay taxes on county property it leases. By a 5-2 margin, the court said the property Crittenden Hospital Association (CHA) -- Crittenden Memorial Hospital, West Memphis -- leases is not exempt from taxes since it isn't used exclusively for public purposes. Crittenden Hospital Association leases the property -- a building and lo -- from the county. It then leases space in the building to private practicing physicians who also staff the hospital.

CHA filed suit after the Crittenden county assessor assessed the property for taxation. The Arkansas Hospital Association later joined the suit, filing an amicus brief. The case was originally lost in Crittenden County Circuit Court when the circuit judge ruled the CHA failed to meet its burden of proof for the exemption. The Supreme Court ruling upheld that decision, declining to "depart from our long line of cases embracing this standard of proof." Justices Donald Corbin and Ray Thornton both issued dissenting opinions on the case.

Arkansans Celebrate AHA Centennial
From its inception as the Association of Hospital Superintendents of the United States and Canada, the American Hospital Association celebrates its centennial this year. Over the years, certain key philosophies have prevailed and now are integral to its mission to create healthy communities. The association's earliest transactions record that "The object of this association shall be promotion of economy and efficiency in hospitals," and they also reflect a primary concern for patients and communities.

The sentiment that hospitals should do more than treat the sick and poor and reach out to a broader community was recorded in association minutes as early as 1899. "The hospital is an institution in which the patient comes first. His interests and welfare are paramount to the interest of all others," declared Cincinnati Hospital Superintendent John Fehrenbatch, one of the association's earliest elected officials.

At the January 31-February 3 meeting, Arkansas hospital chief executive officers, administrators, trustees and medical staff members joined with others to hear presentations by U.S. Attorney General Janet Reno, HCFA administrator Nancy-Ann Min DeParle, U.S. Rep. Bill Thomas, and U.S. Senator Bob Kerrey, among others. The Arkansas group visited with the six-member Arkansas congressional delegation during an annual luncheon, and honored the congressional aides with an appreciation dinner.

Little Rock Physicians Surveyed
A survey by the Center for Studying Health System Change, Washington, DC, shows that 44% of physicians in the Little Rock area report receiving capitation payments for at least some of their patients. That is the lowest percentage of all but two of twelve metropolitan areas in which physicians were surveyed. Among those areas, Seattle, Wash. (73%) and Orange County, Calif. (72%) had the highest rate of physicians reporting capitation income. Little Rock (44%), Greenville, S.C. (43%), and Syracuse, N.Y. (41%) registered the lowest three percentages. Nationwide, 56% of physicians said some of their patients are covered under capitated rates. The survey also showed physicians in Little Rock are less likely than those in other metropolitan areas to have factors such as patient satisfaction, quality measures, and practice profiles influence their compensation from managed care.

Arkansas Center for Health Improvement
The University of Arkansas for Medical Sciences (UAMS) and the Arkansas Department of Health (ADH) have established the Arkansas Center for Health Improvement (ACHI). ACHI was created with a mission of improving the health of Arkansans through policy research, professional education, program development and public advocacy.

The focus of these key functions include:

Policy research: Research will focus on the needs of state government and private non-profit institutions for objective information and analysis on policy alternatives and their consequences. Examples of goals will be to learn how other states have handled the transition to managed care, and to study ways to re-direct federal health dollars toward more cost-effective preventive and population-based health strategies.

Professional education: Arkansas does not have a school of public health. ACHI will work with UAMS and other educational institutions to increase the number of trained public health professionals; improve the training of health professionals in public health and related fields, including development of new degree-granting programs in fields related to health improvement; and train professionals in the provision of education and counseling on health-related behaviors.

Program development: ACHI will help evaluate and design research-based, cost-effective programs to increase access to healthcare and improve health-related behaviors.

Public education and advocacy: ACHI will encourage the public, the legislature, the executive branch, local governments, schools, businesses and private organizations to understand and support strategies that increase access to high-quality affordable medical care, incorporate preventive medicine into clinical practice, reduce environmental and occupational hazards, and help people adopt healthy behaviors.

This unique partnership joins the academic capabilities of the university with the policy and health promotion responsibilities of the health department in a cooperative effort to advance health in Arkansas. The partnership approach also makes the best use of the limited resources available from public and private sources for new health initiatives. Once established, the success of this joint venture will provide a valuable new model for similar initiatives in other states.