HMA disputes admissions 'quotas' in 60 Minutes investigation

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Responding to 60 Minutes' exposé into Health Management Associates' admission practices that aired Sunday, the hospital chain maintained allegations that HMA set admission quotas for its emergency physicians are "absolutely wrong."

During its year-long investigation and interviews with more than 100 current and former employees, according to 60 Minutes reporter Steve Kroft, employees accused the for-profit hospital operator of setting admission quotas at 20 percent from the emergency department, well above local averages.

Former physicians at the hospital system said they felt pressured to admit patients when it was not medically appropriate or they risked losing their jobs.

"My department chief said, 'We will admit 20 percent of our patients or somebody's going to get fired,'" Cliff Cloonan, former physician at HMA's Carlisle Regional Medical Center in Pennsylvania, said in the report.

When 60 Minutes asked about standard business practices to set quotas, former Carlisle physician Scott Rankin responded, "We're not building widgets. We're taking care of patients who are ill and come in to the emergency department."

Jeff Hamby, an emergency room doctor at HMA's Summit Medical Center in Arkansas, called it "coercion to commit fraud." Hamby is suing HMA for wrongful termination.

HMA said, "60 Minutes relied entirely on disgruntled former employees of the company and former contracted physicians, several of whom are seeking financial gain through active litigation with Health Management."

Alan Levine, HMA senior vice president, said in the 60 Minutes piece that there are no quotas or certain percentages for hospital admissions.

When Kroft showed Levine an alleged benchmark report for individual physicians from one of its hospitals, indicating a goal of 20 percent of admissions from the emergency department, Levine said he had never seen that report.

"We tell [physicians] collaboratively to make sure the patient gets in the right setting. We don't want a patient going home that should be admitted. We don't want a patient admitted that shouldn't be admitted," Levine said.

The healthcare operator on Friday held an investor call, shortly after 60 Minutes notified the health system the news outlet was moving forward with the broadcast. HMA preemptively released its data, saying its admissions rates were near- or below industry norms.

"60 Minutes failed to identify a single patient who had been inappropriately admitted from any of the company's emergency rooms, including by the physicians interviewed. Neither 60 Minutes, nor the physicians interviewed, identified any admission decision in which a physician's medical judgment was overridden by an HMA executive, much less to defraud Medicare," HMA said in a statement.

Kroft also said in the report that employees weren't disputing the quality of care, but rather the quantity of care in the interest of revenue.

As the fourth largest for-profit hospital chain, HMA makes $5.8 billion in annual revenue, according to 60 Minutes.

Former hospital employee and retired FBI investigator Paul Meyer said HMA has racked up hundreds of thousands of Medicare and Medicaid payments in hospital stays. Meyer is also suing HMA for wrongful termination.

The disputes between HMA and 60 Minutes is more than just a health system pitted against the media, but rather it calls attention to the growing pressure on for-profit institutions and heightened cost-consciousness among patients and the federal health programs.

As Levine noted on the conference call, the report failed to mention pressures from Medicare regarding admissions versus observation status--the heart of the lawsuit between the American Hospital Association and the Centers for Medicare & Medicaid Services--in which hospitals face increasingly complex regulations.

Levine also pointed to "interference for-profit RAC auditors," suggesting that contract auditors are incentivized to find fraud among hospitals.

HMA is currently under investigation by the Justice Department.

For more information:
- here's the 60 Minutes video and transcript
- see the HMA statement and data slides (.pdf)

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