Billions in Medicare Advantage overcharges likely gone for good

By Fred Schulte, Center for Public Integrity doctorsmoney

Four years ago, Medicare auditors came to an alarming conclusion: the federal government shouldn’t have paid a half-dozen insurance plans hundreds of millions of dollars to treat seniors in especially poor health.

The findings signaled that billing errors could be deeply rooted within private Medicare Advantage plans — which contract with the federal government to care for nearly 16 million elderly Americans — and that these abuses could be wasting taxpayer dollars at a ferocious clip. (more…)

Medicaid contracts, a close friend, big money and Gov. Scott’s re-election campaign

By Dan Christensen, 

Gov. Rick Scott

Gov. Rick Scott

Before the Legislature convenes in Tallahassee next Tuesday, Coral Gables healthcare tycoon Miguel B. “Mike” Fernandez will host a Sunday afternoon BBQ with Gov. Rick Scott, his wife Ann, and key members of the governor’s campaign finance team.

Fernandez, dubbed “Florida’s newest billionaire” last year by Florida Trend, was named finance co-chair for Scott’s campaign in January. In the announcement, the governor called Fernandez a “close friend.”

But Fernandez, chairman of MBF Healthcare Partners, is more than Scott’s friend. He’s also a huge contributor to his re-election campaign and the owner or co-owner of fast-growing healthcare companies that under Scott’s administration have been awarded multiple, multi-year state contracts potentially worth hundreds of millions of dollars.

Most of those lucrative contracts involve Florida Medicaid, which is implementing managed care changes, including the Managed Medical Assistance program. The program is expected to begin in May.

fernandezinvite.jpgBetter Health Plan, which does business as Simply Better Health and is an affiliate of Fernandez’s $450 million Simply Healthcare Plans, won contracts from Florida’s Agency for Health Care Administration (AHCA) last year to provide general services in three of Florida’s 11 Medicaid managed care regions, including Broward County.

Clear Health Alliance, a Medicaid plan offered by Simply Healthcare Plans, was awarded AHCA contracts to provide “specialty” services to Medicaid patients who are HIV positive or have been diagnosed with AIDS.

The Florida Times-Union first reported Fernandez’s ties to Better Health and Clear Alliance in January after Scott appointed Fernandez to his campaign team.

AHCA disclaimed any partiality in contract awards in a statement released by agency spokeswoman Shelisha Coleman.

“Every company that won an award in SMMC (Statewide Medicaid Managed Care program) rightfully earned its award. No companies received an award as a result of favoritism. The agency followed Florida’s strict procurement laws…in letter and in spirit at all times.’

Fernandez, reached Tuesday via email, said, “Companies in which I have invested in have Medicaid contracts, totaling in the billions since 1990. This includes contracts with the State of Florida under the leadership of multiple governors, including a contract under Governor Crist. All contracts save the state much needed funds and improved care to our patients.”

In October 2012, reported that Fernandez was a silent partner in a $44.8 million contract awarded by Florida’s Department of Children and Families (DCF) to manage mental health services in Broward.

The multi-year department contract went to the Broward Behavioral Health Coalition, a nonprofit led by former DCF boss and state attorney general Bob Butterworth, and its for-profit partner, Concordia Behavioral Health of Miami.

Fernandez was a major Concordia shareholder. His name was disclosed to top department officials, but was omitted from DCF records about the procurement.

Fernandez’s invisibility regarding the Broward procurement meant that no one took note of his $125,000 contribution to Let’s Get to Work, a fundraising organization set up with the governor’s support, on Jan. 25, 2012 while the procurement was pending.

Previously, during Scott’s 2010 campaign, Fernandez and his MBF Family Investments gave Let’s Get to Work $500,000.

Asked about those large contributions in 2012, Katy Sorenson, head of the Good Government Initiative at the University of Miami, said, “It sounds like maybe Gov. Scott is running Florida like a business – doing business with his friends.”

Fernandez’s money continues to gush the governor’s way.

On November 2, 2013, as the governor’s re-election campaign was stirring, Fernandez personally gave $1 million to Let’s Get to Work. No one else has written a check that large in support of Scott’s re-election.

Little River Plantation home

Little River Plantation home

Sunday’s get-together at Fernandez’s opulent Little River Plantation, not far from Tallahassee, is a by invitation only event. The public is not invited.

Miami Herald political reporter Marc Caputo recently obtained a copy of the invitation and accompanying email:

“As an important member of Governor Rick Scott’s finance team, Mike Fernandez is opening his home to you. He is not a public person and believes we need to meet each other in person and in a social setting…Nothing formal (casual jeans and casual setting.) We will chat, have BBQ and see beautiful horses…We need to come together so we can deliver victory together,” the email said.

Little River Plantation features a 7,000 square foot home with six bedrooms, seven baths, a full gourmet kitchen and a great room, according to its web site. There’s a smaller lake house nearby.

“Your every whim will be coddled within the walls of our fabulous homes away from home,” prospective guests are told.

A psychiatric hospital for North Ridge site? Oakland Park commission set to decide


UPDATE: FEB. 21 —  With anxious residents watching at city hall and at home on computers and cable television, Oakland Park has put off for two weeks a decision on whether to approve a controversial psychiatric and drug rehabilitation hospital. The reason: Wednesday night’s hearing ran too late to finish the hearing.

About 40 persons spoke for and against the project.

Resident and former Mayor Steven Arnst was critical of a letter sent to the city by a West Palm Beach lawyer for the developer instructing commissioners on their “duty” to grant Palm Partners’ application and warned that they faced a possible discrimination lawsuit if they did not. Arnst called it a “threat.”

Fort Lauderdale lawyer Wilson Atkinson, who represents another rehab facility, Fort Lauderdale Hospital, informed commissioners that Palm Partners does not have a Florida Agency for Health Care Administration license needed to operate a 300-bed psychiatric/behavioral health hospital.

Atkinson said that should the city approve the project, and Palm Partners is unable to obtain such a license, the city would be stuck with a facility that would operate under less stringent Department of Children and Families regulations for residential treatment facilities. Those facilities allow patients to freely come and go outside specific treatment hours — a nightmare scenario for residents and one that Palm Partners has said it would not allow.

The five-member city commission will pick up the quasi-judicial hearing regarding the proposal to open the North Ridge Behavioral Health Center on March 5.

By Dan Christensen, 


Revised plans for a controversial psychiatric/behavioral health hospital on the site of the old North Ridge Medical Center in Oakland Park are to be presented to the city commission Wednesday before a final up or down vote.

The changes, including additional fencing and assurances that it would not admit convicted sexual offenders to its residential treatment programs, were made to satisfy the concerns of nearby residents.

If approved, the proposal by Palm Partners LLC promises to reinvigorate a working hospital facility vacant since its purchase and closure by nonprofit Holy Cross Hospital in 2008. It would also create 300 new jobs and return the property to the tax rolls, promising “a significant increase in revenues to the city,” according to the proposal.

Today, Palm Partners operates a small, upscale drug and alcohol rehabilitation facility in Delray Beach. Its plan for a much larger, 300-bed facility to be known as the North Ridge Behavioral Health Center has provoked a strong negative reaction from wary residents in Oakland Park’s North Andrews Gardens neighborhood.

City Hall, located at 3650 NE 12th Avenue, is bracing for a crowd at Wednesday’s 6:30 p.m. public hearing.

“We are expecting a lot of people,” said Kristen Nowicki, an Oakland Park senior planner.

Two elementary schools and a high school are in the neighborhood. Several parents said in interviews that they fear their children will not be safe.

Opposition to the psychiatric facility has also come from the Broward School Board, which recently notified the city of its concern about “spillover effects” from the proposed psychiatric facility on nearby Northeast High School.

“The district’s position is that the proposed project is incompatible with the school,” said a letter from the School Board’s growth monitoring unit.

Last month, the city’s five-member planning and zoning board unanimously recommended the commission deny Palm Partner’s application to the city for its approval. If the city commission votes no, Palm Partners, owned by company chief executive Peter A. Harrigan, would have to go to court in an attempt to make the project happen.

Palm Partners signed a contract last year to purchase the 11-acre site on North Dixie Highway, between Northeast 56th and 58th streets, from Holy Cross Hospital for an undisclosed sum.

The company has said it hopes to operate an inpatient detoxification and rehab facility that will cater to a well-heeled class of psychiatric patient. The hospital would also treat other maladies such as eating disorders and sleep apnea.

“Our facilities and services fill a significant gap in our society, providing much-needed help to those suffering with addiction and behavioral health. These illnesses are life threatening and tear families apart. Our facilities provide a foundation for recovery,” Harrigan said in a statement on Monday.

“We often hear that people know someone who needed help, including family, but were unsure what to do. Education is key and we will work with the neighboring high school and other community organizations to provide educational and outreach programs. We are here to help, and I will work hard every day to ensure this hospital is a community partner that the City of Oakland Park can be proud of,” Harrigan said.

Palm Partners has told city officials it will not accept Medicaid patients, Baker Act patients, other indigent care patients or walk-ins. All patients will pay through private insurance, third-party reimbursement or cash.

In an interview, Harrigan said most patients would stay 30-90 days. The cost of a 30-day stay would be $24,500, he said.

Harrigan has sought to assure neighbors that the hospital intends to make sure that its patients pose no threat to local residents.

“I appreciate the neighbors’ concerns and share in the need to keep our communities safe. Safety is paramount to our mission,” Harrigan said in Monday’s statement. “We have operated in Florida for 20 years and have never had a security incident involving the surrounding neighborhood.

“Our plans to invest $20 million to restore this facility, which has been vacant since 2008, will serve as a catalyst for economic growth, drawing businesses back to the area and creating thousands of jobs for the City of Oakland Park. Our investment will restore the hospital into a leading, cutting-edge facility, which will provide substantial tax revenue to the City.”


Payments to CEO raise new conflicts at top health quality group

By Marshall Allen, ProPublica 

Dr. Cristine Cassel, President and CEO of the National Quality Forum, speaking before the Senate Committee on Health, Education, Labor, & Pensions. Dr. Cassel was paid hundreds of thousands of dollars in additional outside compensation after she was hired in December 2012. (

Dr. Cristine Cassel, President and CEO of the National Quality Forum, speaking before the Senate Committee on Health, Education, Labor, & Pensions. Dr. Cassel was paid hundreds of thousands of dollars in additional outside compensation after she was hired in December 2012. (

The top executive at the country’s pre-eminent health care quality organization is being paid hundreds of thousands of dollars by two large medical companies that have a stake in the group’s work.

The payments to Dr. Christine Cassel raise new conflict-of-interest concerns at the National Quality Forum, which endorses benchmarks that Medicare uses to compensate hospitals based on performance. (more…)

Post traumatic stress crisis ignored: Americans wounded in their own neighborhoods

By Lois Beckett, ProPublica 

A shooting victim is rushed to the hospital in Miami. Photo: CBS4

A shooting victim is rushed to the hospital in Miami. Photo: CBS4

Chicago’s Cook County Hospital has one of the busiest trauma centers in the nation, treating about 2,000 patients a year for gunshots, stabbings and other violent injuries.

So when researchers started screening patients there for post-traumatic stress disorder in 2011, they assumed they would find cases.

They just didn’t know how many: Fully 43 percent of the patients they examined – and more than half of gunshot-wound victims – had signs of PTSD. (more…)

Oakland Park commissioners likely to decide soon on controversial psychiatric hospital

The former North Ridge Medical Center Photo:

The former North Ridge Medical Center Photo:


UPDATE: Jan. 16 — Shot down unanimously by Oakland Park’s planning and zoning board on Monday, a Delray Beach drug rehab operator’s controversial plan to develop a 300-bed psychiatric hospital on the site of the old North Ridge Medical Center is expected to go before the city commission soon for a final decision.

A hearing could be held at City Hall in as soon as three weeks.

“The applicant wants Feb. 5,” said senior planner Kristin Nowicki. “I don’t see why we wouldn’t be able to do that, but we have to make sure all the requirements are fulfilled. If not, then it would be the 19th.”

The applicant is Palm Partners LLC, which operates a small, upscale drug and alcohol rehabilitation facility. The company’s owner, Peter A. Harrigan, has said he expects to create 300 jobs at the North Ridge site.

“We had a packed house at our hearing,” said Caryl Stevens, a former mayor who now chairs the zoning board. “The area around this site is a working class neighborhood and it is by design: easy accessibility to schools. People are concerned.”

UPDATE: Jan. 13 — Declaring that a proposed psychiatric hospital is not compatible with nearby Northeast High School, the Broward School Board notified Oakland Park today that it “must compel the applicant to ensure” the facility “will not negatively impact” the school.

“The subject sites are in close proximity to Northeast High School. The district’s position is that the proposed project is incompatible with the school due to potential spillover effects from the proposed establishment,” said the letter sent to the city clerk boy Mohammed Rasheduzzaman, a planner in the growth School Board’s monitoring unit.

The high school is about a block away from the site, which once housed North Ridge Medical Center. Many children heading to and from school must walk by the property.

The School Board’s decision to wade in on the matter only hours before tonight’s public hearing before the city’s planning and zoning board could jeopardize chances for approval that had earlier seemed likely.

By Dan Christensen, 

A proposed 300-bed “psychiatric/behavioral health facility” on the site of the shuttered North Ridge Medical Center in Oakland Park is stoking fear among jittery neighborhood residents, and assurances of strong oversight and security from the prospective new owner.

Palm Partners LLC, which operates an upscale drug and alcohol rehabilitation center in Delray Beach, hopes to operate a similar facility on the 11-acre campus that would take advantage of the hospital setting to provide not only inpatient detoxification and rehab, but treatment for other maladies such as eating disorders and sleep apnea.

“We run a very tight ship,” said Peter A. Harrigan, owner and chief executive of for profit Palm Partners. “I think we’ll be a great asset for the community.”

Harrigan said he expects to create 300 new jobs.

City planning staff is recommending approval, with several minor conditions like improved landscaping and the addition of bus shelters. A public hearing before the planning and zoning board is set for Monday at 6:30 p.m. The city commission is to take up the issue in February.

Palm Partners owner Peter Harrigan

Palm Partners owner Peter Harrigan

Monday’s agenda item about the new North Ridge psychiatric hospital does not use inflammatory words like “drug” or “alcohol,” nor is there any discussion of Palm Partners’ existing drug rehab center and treatment program.

Rather, the document indicates Palm Partners will cater only to a well-heeled class of psychiatric patient.

“Palm Partners will not accept Medicaid patients, Baker Act patients, other indigent care patients or walk-ins. All patients will pay through private insurance, third party reimbursement or cash,” the agenda says.

Most patients will stay “30-90 days.” The cost of a 30-day stay at Northridge would be $24,500, Harrigan said.

Holy Cross Hospital bought the site at 5757 N. Dixie Highway from healthcare giant Tenet Healthcare in 2008 for a reported $20 million, including an adjacent medical office building. It has agreed to sell to Palm Partners for an undisclosed sum, but the sale is conditional on the city’s approval of Palm Partners’ plans. While there has been some confusion about the status of the office building, which is occupied, it is not part of the proposed sale, according to city officials.

Once the purchase by the for profit Palm Partners closes, the property now owned by the non-profit Catholic hospital would return to the city’s tax roll.

northridgenoticeThe facility, originally an acute care general hospital built in 1974, is near three public schools: Rickards Middle, Northeast High and North Andrews Gardens Elementary. Children walk by every day on their way to and from school.

Signs have been up at the site for more than a month disclosing the upcoming hearing, but several people interviewed for this article were critical of what they said were the city’s inadequate notification efforts.

Kristeena Chace’s daughter attends Northeast and her son is a third-grader at North Andrews Elementary. She and her mother, Tina, believe Palm Center’s plans to draw psychiatric patients for treatment puts local children at risk.

“I have major concerns,” said Kristeena Chace. “I am an alumni of all these schools and I stayed in the neighborhood. I wanted to bring my children up in a safe environment. However, if a hospital like that is put in there my children will not be safe.”

Shannon Thompson, who has a first-grader at North Andrews Elementary and a seventh-grader at Rickards Middle, agrees.

“I’m not happy at all about this. It will expose our children to things that are probably not very safe,” said Thompson. “They’re claiming they’ll have good security, but I don’t foresee that as being 100 percent.”

Oakland Park Mayor John Adornato did not return a phone call seeking comment.

Harrigan says neighbors’ concerns are groundless. With 24-hour security and “a tremendous amount of psychiatric staff, doctors and nurses, we will provide the highest level of care.

“The biggest thing people need to recognize is that this is a voluntary program. They want to be there. They’re not court-ordered,” said Harrigan. “We are investing a tremendous amount of money in the neighborhood. We want the quality of the neighborhood to stay intact and we want to help it get better.”

A Palm Partners advertisement

A Palm Partners advertisement

Palm Partners’ program summary offers further safety assurances.

“No patients will be permitted to leave the facility without staff ascertaining the patient’s present status and ability. In the event a patient wishes to leave prior to the end of their treatment, arrangement will be made for them to be taken to their intended location off premises, in a safe and responsible manner,” the summary says.

The program summary says the new hospital will feature an array of health care practitioners including medical doctors, psychiatrists, chiropractors, acupuncturists, pharmacists and massage therapists.

Should the city commission approve the psychiatric hospital, the only remaining requirement will be a site license from the state.

Harrigan, who has other smaller facilities in Lantana and Miami, hired lawyer/lobbyist Pam Kane, a partner in Fort Lauderdale’s Panza Maurer & Maynard, to represent Palm Partners before the city.

In November, Palm representatives met with residents of the surrounding North Andrews Gardens and Embarcadero Condominium neighborhoods. Harrigan said “we’ve gotten a very favorable response.”

The stakes are high for Harrigan, who said he will relocate his corporate office to North Ridge.

“There is a lot of competition in this business,” he said. “Fort Lauderdale will be the cornerstone. This will double the size of our company.”

Harrigan said getting fully up and running would take “a couple of years.”

“After we close (the sale), it will be another 60 days before we take our first patient,” he said. “There will be 60 people on staff on opening day. It will be a slow ramp up.”

Florida prison officials didn’t ask, companies didn’t tell about hundreds of malpractice cases

By Dan Christensen, prison

The Florida Department of Corrections awarded a five-year, $1.2 billion contract to provide medical care for thousands of state prisoners in north and central Florida to Corizon, a Tennessee company that was sued 660 times for malpractice in the last five years.

Nearly half of those cases remain open. Of those that are closed, 91 – one in four – ended with confidential settlements that Corizon declined to discuss. Corizon began work in August providing care at 41 correctional facilities.

A second contractor, Pittsburgh-based Wexford Health Sources, signed a five-year, $240 million contract in December to provide medical services to state inmates in nine institutions in South Florida.

Wexford, however, was hit with 1,092 malpractice claims – suits, notices of intent to sue and letters from aggrieved inmates from January 1, 2008 through 2012. Records say Wexford settled 34 of 610 closed matters for a total of $5.4 million, as well as another case that ended in a $270,000 jury verdict against the company.

The Department of Corrections, headed by Secretary Michael D. Crews, hired Corizon and Wexford to lead Florida toward millions of dollars in savings promised by the massive privatization of inmate healthcare enacted by Gov. Rick Scott and the Republican-controlled Legislature.

Along the way, however, the corrections department never asked the corporations bidding for those lucrative jobs to disclose their litigation histories — how often they’d been accused of malpractice, where those cases were filed and the outcomes.

Neither Crews nor Dr. Olugbenga Ogunsanwo, the assistant secretary for medical and health services, agreed to be interviewed for this story. Corrections spokeswoman Misty Cash, however, called the state’s contracting process “comprehensive.”

Florida Corrections Secretary Michael D. Crews

Florida Corrections Secretary Michael D. Crews

“The selection of Wexford and Corizon was transparent,” she said. “Both companies provided the required and requested documentation as outlined in the procurement and bidding process.”

Government agencies elsewhere in Florida typically require corporate bidders to provide litigation histories in order to assess the quality and reliability of their services, as well as their ability to limit potential liability.

Prisons are obligated under the Eighth Amendment to provide prisoners with adequate medical care.

The problematic litigation histories of Corizon and Wexford raise questions about the quality of inmate care promised by those companies and paid for by Florida’s taxpayers.

“What really troubles me about this is the fact that the department didn’t ask these very basic, elemental questions any system would ask,” said Eric Balaban, a staff attorney for the National Prison Project of the American Civil Liberties Union. “These two vendors were taking over Florida’s massive health care system and you’d think they would have asked hard questions to determine if these companies can provide these services within constitutional requirements.” obtained the litigation records from the Broward Sheriff’s Office using Florida’s public records laws.

BSO obtained them from Corizon and Wexford during their unsuccessful bids this summer to provide healthcare services for inmates at the Broward County Jail. Each company complied, to varying degrees.

Prison companies don’t like to discuss lawsuits filed against them, and neither Corizon, created by the 2011 merger of competitors Prison Health Services and Correctional Medical Services, nor Wexford would comment for this article.


Corizon, in fact, initially tried to block the release of its litigation history by claiming it was exempt from disclosure as a “trade secret.” The company rescinded that claim in late August, after its work for the state had begun and after being told litigation was being contemplated by this news organization to force disclosure.

While Corizon told BSO it had been sued 660 times, it did not provide the requested list of cases.

One example, however, can be found in the court file of 24-year-old Brett Fields.

Fields was sent to the Lee County Jail on July 6, 2007 after being convicted of two misdemeanors. He was healthy, except for a bump “about half the size of a tennis ball” on his left arm – the result of a spider bite, the court records say.

On Aug. 6, after a month of sporadic, ineffective and “lax” treatment by Corizon staff, Fields “felt his back go sore and numb.” The next day, his legs began to twitch uncontrollably, with the pain becoming unbearable after midnight on Aug. 8, records say.

Fields could no longer walk by the time he saw a physician’s assistant about 9 a.m. who checked Fields’ his leg and foot reflexes and found none. Fields was given Tylenol and returned to his cell.

Early on Aug. 9, Fields “felt his intestines escaping from his rectum.” Fellow inmates begged Corizon’s staff to take him to the hospital. Instead, nurse Bettie Joyce Allen “obtained some K-Y Jelly, and pushed the intestines back in,” the records say. Hours later, at a local hospital, doctors found an abscess compressing his spine.

A jury awarded Fields $1.2 million in 2011 after finding Corizon solely responsible for what happened. The award included $500,000 in punitive damages. Fort Lauderdale attorneys Gregg Lauer and Dion Cassata represented Fields.

The verdict was  upheld last year by an appeals court that observed prompt treatment “could have averted permanent damage to his legs, but he did not receive that treatment because Prison Health (Corizon) delayed his treatment.”


In addition to the lawsuits and claims filed against them, Corizon and Wexford both have faced withering official criticism about the delivery of care to inmates.

  • Idaho – In 2011, the Associated Press reported that Corizon was fined $382,000 by the state “for failing to meet some of the most basic health care requirements outlined by the state.” Last year, an expert appointed by a federal judge to review Corizon’s medical care at one prison near Boise found “inhumane” conditions.
  • Pennsylvania – Corizon paid a $1.85 million fine to Philadelphia after investigators determined the company had used a front company as a subcontractor to meet city requirements for minority-owned vendors.
  • Maine – In 2011, a state agency review of Corizon’s operations there found that the company maintained medical records poorly and had failed to fulfill contract obligations. The head of Maine’s American Civil Liberties Union later told the state’s Public Broadcasting Network that those problems rose to “a systemic constitutional dimension.”
  • Mississippi – In December 2007, the joint legislative committee criticized Wexford and the state’s Department of Corrections for failing to ensure that all inmates received timely access to quality medical care. Wexford was also assessed more than $930,000 in fines for maintaining staffing levels that were not in compliance with contract minimum – fines the committee said had not been collected.
  • Arizona – Wexford and the state’s corrections department agreed in January to terminate Wexford’s medical services contract in the wake of accusations the company improperly dispensed medicine to inmates and wasted state resources, according to the Arizona Republic. Wexford was awarded a three-year contract seven months earlier. Arizona hired Corizon to replace Wexford.

Florida has had its own problems with the two companies.

In 2006, Corizon, then known as Prison Health Services, backed out of a 10-year state prison healthcare contract saying it wasn’t making enough money. The company had won the contract only months before with a bid that was millions lower than its competitors.

In 2004, Florida legislative auditors called Wexford’s medical care “problematic,” according to the Miami Herald. In 2002, the newspaper reported that the Florida Correctional Medical Authority had reprimanded Wexford the year before for poor medical care following the deaths of two inmates.

Florida let bygones be bygones when it hired Corizon and Wexford to help achieve the 7 percent in cost savings mandated for privatization by the legislature. Corrections spokeswoman Misty Cash said taxpayers would save $3 million a month because of those contracts.

Some contend Florida’s emphasis on savings has eclipsed questions about the quality of the medical care for inmates that taxpayers are purchasing.

Michael Hallett is a professor of criminology at the University of North Florida in Jacksonville who has written about prison privatization. He said quality of care simply isn’t much of a concern when it comes to prisoners.

“Most people feel, as long as they achieve their 7 percent savings who cares how they treat inmates?” he said.

New data shows drugmakers’ payments to hundreds of thousands of doctors

By Tracy Weber and Charles Ornstein, ProPublica drugsmoney

Dr. Jon W. Draud, the medical director of psychiatric and addiction medicine at two Tennessee hospitals, pursues some eclectic passions. He’s bred sleek Basenji hunting dogs for show. And last summer, the Tennessee State Museum featured “African Art: The Collection of Jon Draud.”

But the Nashville psychiatrist is also notable for a professional pursuit: During the last four years, the 47-year-old Draud has earned more than $1 million for delivering promotional talks and consulting for seven drug companies. (more…)

Broward Health believes whistleblower is behind anti-kickback probe; Justice Department involved

By Karla Bowsher, 

A whistleblower apparently sparked the ongoing federal anti-kickback inquiry into allegations of false Medicare and Medicaid claims at Broward Health.

U.S. Department of Health and Human Services (HHS) agents surfaced the probe in May 2011 with a subpoena demanding records related to the public health care system’s business dealings with more than two-dozen doctors.

“We have reason to believe there’s a whistleblower,” said Broward Health General Counsel Sam Goren. He explained that belief is “based on the nature of the subpoena and its substance,” as well as the experience of Broward Health’s Washington, D.C. lawyers.

Under the False Claims Act, private individuals with knowledge of fraud against the government can blow the whistle – and seek rewards – by filing a lawsuit on its behalf. By law, such lawsuits are brought under seal to allow the Department of Justice time to investigate and decide whether to help prosecute the lawsuit.

An HHS official declined to say whether a whistleblower is involved in the Broward Health case., however, has learned that HHS agents are conducting the current civil inquiry jointly with the Department of Justice in Washington, D.C. and the U.S. Attorney’s Office in Miami.

Does that mean there is a parallel criminal probe? “Not to our knowledge,” said Goren.

Millions of pages of district documents have beenhanded over to federal authorities, Goren said. He explained it took so long because the district’s lawyers sought to limit how much information had to be turned over.

Broward Health, whose legal name is the North Broward Hospital District, did not finish producing all of the subpoenaed records until last month.


The 15-page subpoena from HHS’ Office of Inspector General (OIG) demanded Broward Health’s records concerning its contracts, negotiations and agreements with 27 doctors and one doctor-run business, North Broward Orthopedic Associates.

The kinds of documents sought included tax returns, financial data and other information regarding compensation, patient referrals and hospital admissions by the 27 doctors since January 2000.

The subpoena also required Broward Health to produce proof that it had taken steps, like employee training, to ensure that federal anti-kickback laws were not violated.

Click the chart for the complete list of names

State corporate records state that North Broward Orthopedic Associates was run by physicians Michael Abrahams and Sein Lwin, and was involuntarily dissolved in 2008 when no annual report was filed.

“I just happened to be the representative for the group,” said Lwin, one of the 27 doctors named in the subpoena. “It has nothing to do with my practice.”

Broward Orthopedic Associates’ contract with Broward Health ended more than five year ago, Lwin said, and he had not been served a subpoena himself.

Lwin is one of six orthopedic surgeons named in the subpoena. Seven other physicians are cardiologists or chest surgeons – the most common specialty among the 27 identified.

Cardiologists generally treat more Medicare patients than other types of specialists because cardiac problems are common among the elderly.

Most of the doctors named in the subpoena – 18 – belong to the Broward Health Physician Group, meaning they are district employees rather than independent doctors in private practice.


The tax-subsidized Broward Health has hired the Arent Fox law firm to represent it in the matter. Attorneys Linda A. Baumann and Jacques Smith specialize in false claims issues. Both declined comment because the investigation is ongoing.

Alicia Valle, spokeswoman for Miami U.S. Attorney Wilfredo Ferrer, declined to comment.

Agent Omar Perez with the HHS Office of Inspector General’s Miami Lakes regional office declined to discuss specifics of the inquiry.

“We’re still … inquiring whether there’s some substance to the allegations that were raised,” he said.

By law, whistleblower lawsuits filed under the False Claims Act must remain under seal for 60 days. If the government wants to keep it sealed after that, it must demonstrate “good cause” to a judge every 60 days


If Broward Health submitted false or otherwise improper insurance claims to Medicare or Medicaid, the district could be in violation of the federal Anti-Kickback Statute or the Stark Law.

The Anti-Kickback Statute prohibits offering or receiving incentives for patient referrals that involve any federal health care program, such as Medicare and Medicaid.

Criminal offenders can be sentenced to up to five years in prison and fined up to $25,000 per violation. Civil penalties can include fines of up to $50,000 per violation.

The Stark Law, also known as the Self-Referral Law, prohibits doctors from referring Medicare patients to entities, such as hospitals, to which they have financial ties. It also prohibits those entities from billing Medicare for such referrals.

Violators can be required to refund illegal payments and pay civil fines up to $15,000 per violation.

Broward Health commission Chair Joel Gustafson did not respond to interview requests.

Broward Health Chief Executive Frank Nask, through attorney Goren, declined to comment because the investigation is ongoing.

Karla Bowsher can be reached at

Broward Health’s assets at “distressed” levels, “below book value” without tax levy, study says

By Karla Bowsher, 

Broward General Medical Center

A new state-ordered study compares the value of Broward Health’s operating assets to those of a “distressed hospital” worth “significantly below book value.”

The study by the audit firm Deloitte determined Broward Health’s fair market value to be $271-$320 million, without counting the tens of millions of dollars in annual property tax revenues it receives. If those taxes are included, Broward Health’s value rises to $503-$532 million – or “slightly above book value,” Deloitte’s 69-page report says.

The firm will present its findings to Broward Health’s governing board at a public hearing at 5 p.m. today at the Westin Cypress Creek in Fort Lauderdale.

The hearing is a requirement of Florida’s “Sale or Lease” law, passed last March at the urging of Gov. Rick Scott, that required all public hospitals to determine how much they are worth and evaluate the possible benefits of selling or leasing their facilities to a private corporation.

Before the law was enacted, Broward Health’s board spent many months looking at whether to privatize. That effort, however, stalled for reasons that remain unclear.


The North Broward Hospital District, whose business name is Broward Health, operates four hospitals and 22 other medical facilities. Its flagship is Broward General Medical Center in Fort Lauderdale.

As a special taxing district, it receives property tax dollars from Fort Lauderdale to Parkland to help care for indigent patients. Last year, the district took in $154 million in tax revenues, according to an annual report.

Broward Health’s board of seven governor-appointed commissioners voted on July 25 to hire Deloitte for $275,000 to put a price on the district.

Deloitte’s final report, submitted to Broward Health last week, analyzed the district’s fair market value in two scenarios: with and without tax revenue.

“Deloitte made no conclusion or recommendation in the report,” Broward Health CEO and President Frank Nask said in an emailed statement. “The next step is for the board to review Deloitte’s report and vote on accepting it as a matter of public record.”

Frank Nask, president and CEO of Broward Health

Commissioners Debbie Kohl and David Di Pietro, board members appointed by Gov. Rick Scott, did not return phone messages seeking comment.


The board began to discuss the idea of leasing its facilities to a community nonprofit corporation prior to the passage of the federal Patient Protection and Affordable Care Act of 2010. Also known as “Obamacare,” the legislation requires uninsured individuals to obtain private health insurance or pay a penalty starting in 2014.

Nask broached the subject at a board meeting on July 22, 2009.

“If everyone gets insured, then we would not receive tax dollars,” he said, according to the meeting minutes.

At a special meeting on Sept. 10, 2010, the board passed a resolution authorizing Nask “to initiate and facilitate” the lease process.

Commissioner Clarence McKee, an appointee of former Gov. Charlie Crist, was the lone vote against the resolution. He said it seemed rushed and that he needed more information and time to make an informed decision.

“This looks like a done deal,” he said, according to the minutes.

The board acted without seeking public comment, fueling a backlash.

At a public tax hearing a few days after the meeting, critics berated board members for not allowing them to voice their opinions before the vote.

Four town-hall style meetings were later held about the matter. The resolution was ultimately repealed and replaced with a slightly different version.

The new resolution authorized Nask “to explore and to evaluate all potential options for the district to respond to the impacts of federal healthcare legislation … including, but not limited to, the potential lease of the district’s facilities.”

But according to Nask, the possibility of transitioning the public hospital system into a community-based nonprofit that could lease or sell its assets is now moot.

“As far as a transition process from 2010, the board simply made a motion to study a possible transition,” Nask said. “There’s nothing to proceed with because the law changed.”


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