Economics of Medical Fraud

Posted on February 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

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Healthcare Leads the Pack

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All Medical Executive-Post readers and subscribers are aware of the Federal False Claims Act. Since 1986, False Claims Act [FCA] judgments and settlements totaled over $20 billion dollars. 

Of Miscreants and Feasors

According to outside unverified resources, below are the top 20 alleged FCA recoveries to date. Notice that all twenty, of the top 20, are healthcare and big Pharma related.

The Top 20

  1. Tenet Heath Care – $900,000,000
  2. HCA – $731,400,000
  3. Merck – $650,000
  4. HCA – $631,000,000
  5. Serono – $567,000,000
  6. Taketa Abbott Pharmaceutical Products Inc – $559,483,560
  7. Schering Plough – $255,000,000
  8. Abbott Labs – $400,000,000
  9. Fresenius Medical Care (National Medical Care) – $385,000,000
  10. Cephalon – $375,000,000
  11. Bristol Myers Squib – $328,000,000
  12. SmithKline Beecham [DBA] GlaxoSmith Kline – $325,000,000
  13. HealthSouth – $325,000,000
  14. National Medical Enterprises – $324,200,000
  15. Gambro Healthcare – $310,000,000
  16. Schering-Plough – $292,969,482
  17. AstraZeneca Pharmaceuticals – $266,127,844
  18. St. Barnabas Hospitals – $265,000,000
  19. Bayer Corporation – $257,200,000
  20. Schering Plough – $255,000,000

More: You can read all the details regarding these fraud judgments & settlements here 

Assessment

The above are the very companies that doctors, patients and many stakeholders rely upon. They bombard us every hour with TV advertisements and information on the latest drugs and newest procedures. They often promote cures for the exaggerated illnesses and nebulous ailments they seek to treat. Is this expense model just business-as-usual; or the cost-of-doing business?

Link: http://www.taf.org 

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Conclusion

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WellCare Medicare-Advantage Scandal

Posted on February 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Company “Misled and Confused Medicare Beneficiaries”?

By Dr. David Edward Marcinko; FACFAS, MBA, CMP™dr-david-marcinko20

According to Jacob Goldstein, of the WSJ, on February 20, 2009, WellCare the publicly traded company that some folks “love-to-hate”, and manages health coverage for Medicare and Medicaid beneficiaries, is in trouble again. In a recent letter, the Feds ordered the company to stop enrolling new Medicare beneficiaries, effective March 7, 2009. The sanction will be in effect until the Centers for Medicare and Medicaid Services [CMS] is satisfied that the company has corrected the alleged deficiencies.

Letter from the Feds

Adjusted for enrollment, the rate of complaints about WellCare’s marketing of Medicare Advantage plans are three times the national average, the letter says. The letter goes on to allege that the company “misled and confused Medicare beneficiaries” and “engaged in unauthorized door-to-door solicitation.” CMS also accuses WellCare’s agents of “misleading beneficiaries and misrepresenting WellCare plans at sales events in December 2008″ and failing to “discover forged applications through its own monitoring systems.” Of course, the company said it would continue to work with independent third-parties to ensure that it is compliant with CMS.

Click here to read the letter.

Oh Regina – Say it Ain’t So!

Finally, and perhaps the most personally distasteful for me in this whole sordid affair is not the fact that WellCare allegedly tried to rip off old folks. It’s just that Dr. Regina Herzlinger, the Harvard Business School professor – mother of a physician herself and proponent of healthcare competition and Consumer Directed Health Care Plans [CDHCPs] and a WellCare BOD member – apparently sold $2.3 million worth of stock in Wellcare three months before the FBI arrived.

Assessmentbiz-book5

 I first became aware of Regina Herzlinger’s work while in business school [not HBS] in the early 1990s. I recall calling her office for advice and referencing her several times in both editions of my best-selling book, the Business of Medical Practice [Profit Maximizing Techniques for Savvy Doctors]. She even came to Piedmont Hospital, here in Atlanta, last year on a healthcare speaking tour promoted in the local newspapers. What a shame. All co-incidence; ask Regina? Link: www.MedicalBusinessAdvisors.com

Industry Indignation Index: 35

Full disclosure: I am the founder of www.CertifiedMedicalPlanner.com and a reformed insurance agent, registered investment advisor and Certified Financial Planner™

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated. Do you think WellCare “Misled and Confused Medicare Beneficiaries?” You may opine and decide.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com  or Bio: www.stpub.com/pubs/authors/MARCINKO.htm

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Filed under: Ethics, Industry Indignation Index, Managed Care, Op-Editorials, Practice Management, Professional Liability, Research & Development | Tagged: , , , , , , , | 13 Comments »

About In-Situ Medical Practitioners

Posted on February 25, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Searching for Definitional Clarity

Staff Reporters

solo-consultant2Apparently, there is a growing trend toward so called “in-situ medical practitioners”. In this model, specialists like internists or diabetologists, add a certain medical expertise to address a large number of patients with specific needs in a general or primary care practice. 

Link: www.HealthDictionarySeries.com

Business Savvy

This clearly indicates that physicians are becoming more business savvy, are becoming more sophisticated in driving the growth of their practice, and better understand the structure and needs of their local health care market. 

Assessment

Regardless, the basic principles of relationship building and relationship management apply – treating each party with mutual respect and engaging in open and honest dialogue. Of course, we seek input form readers and subscribers to further define this emerging trend; if not merely a group of isolated incidents made known to us.

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com  or Bio: www.stpub.com/pubs/authors/MARCINKO.htm

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