6 hospitals on healthcare's naughty list

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Much like Santa, we're making a list and checking it twice. And although 2012 saw hospitals making great efforts to improve care and cut costs, some healthcare organizations deserve a stocking full of coal.

Here are six hospitals and health systems that made headlines for all the wrong reasons.

1. Hospital Corporation of America

Kicking off the list is Tennessee-based HCA, which saw a spate of lawsuits and federal investigations this year.

In September, the biggest U.S. hospital operator agreed to pay $16.5 million to settle claims that it violated the False Claims Act and the Stark statute in 2007. Its subsidiaries allegedly gave financial benefits to Diagnostic Associates of Chattanooga to sway the physician group to refer patients to HCA facilities.

Meanwhile, HCA is under federal scrutiny for aggressively performing cardiac services at 10 of its Florida hospitals for higher reimbursements. In the wake of the investigation, media reports also claimed the 163-hospital system changed its billing to make emergency patients appear much sicker.

2. Health Management Associates

The Florida-based hospital operator earned itself a spot on the list thanks to allegations of excess admissions.

A recent 60 Minutes exposé accused HMA of overly admitted patients from the emergency department, as well as setting admission quotas for its emergency physicians to boost Medicare reimbursements. According to former HMA physicians, they were pressured to admit patients when it was not medically necessary or they would lose their jobs.

HMA held an investor call before the 60 Minutes piece aired on Dec. 2, maintaining its admissions rates were near- or below industry norms.

Back in January, the hospital operator also got hit with a wrongful termination lawsuit from a former employee who had accused HMA of defrauding Medicare by allegedly billing for inpatients who were treated as outpatients.

3. Prime Healthcare Services

Violation of patient confidentiality, coupled with alleged upcoding put Prime Healthcare Services on the list for 2012.

Last month, state officials gave the California-based health system a $95,000 fine for repeated instances of patient privacy breaches when two executives at Prime-owned Shasta Regional Medical emailed a patient's records to nearly 800 employees and shared the patient information with two newspapers.

The hospital execs shared the medical info, without the patient's permission, to prevent a news outlet from publishing a California Watch story alleging that Prime overbilled Medicare for rare and serious conditions at high rates.

While the hospital admits no wronging, the California public health department in May issued citations against Shasta for disclosing the confidential details of a diabetes patient, therefore breaking federal and state law.

4. Parkland Memorial Hospital

Next on the list is Parkland Memorial Hospital in Texas, which has been suffering from oversight issues following multiple reported patient safety breaches this summer.

Despite progress, public safety monitors still found hundreds adverse patient safety issues at Parkland in June alone. Moreover, the surgical-site infection rate more than doubled and hand-washing noncompliance jumped by nearly 1,000 violations in July.

In September, Parkland agreed to pay a $1 million settlement to the Texas Department of State Health Services that would resolve and dismiss all potential litigation and enforcement actions for compliance issues that occurred before May 31. But the hospital failed to pay the $750,000 portion due with 30 days and now may owe even more money to the state health department.

5. Carolinas Medical Center-Mercy

Carolinas Medical Center-Mercy may have a charitable mission as a nonprofit entity, but this hospital takes the next spot on the naughty list for suing thousands of patients who can't afford to pay their medical bills. The hospital, which receives tax-exemptions to provide charity care and financial assistance, sued more than 12,000 patients over the past five years.

However, media interviews with sued patients suggest many were unable to pay--they cited a lack of insurance, no knowledge of available financial assistance programs, or charity care eligibility.

6. University of Minnesota Medical Center, Fairview.

With questionable billing and collections, last but not least on the naughty list is University of Minnesota Medical Center, Fairview.

The controversy surrounds an April complaint from Attorney General Lori Swanson that condemned Fairview and Chicago-based Accretive Health for aggressive patient debt collections. As a result, the Centers for Medicare & Medicaid Services is investigating whetherFairview violated federal law with its harsh practices that involved employees collecting payments from patients in the emergency room--even encouraging patients to return to their cars to get their checkbooks.

What other hospitals won't be getting a visit from Santa on Dec. 25?

There's still time left to make this year's nice list. And with the reform law's survival, hospitals have the opportunity to spread some healthcare cheer by moving toward accountable care, better coordinating care across the continuum and promoting value over volume. - Alicia (@FierceHealth)