Florida hospital CEO charged with fraud after allegedly embezzling funds

http://www.healthcarefinancenews.com/news/florida-hospital-ceo-charged-fraud-after-allegedly-embezzling-funds?mkt_tok=eyJpIjoiTmpFeE5tVmxNVEF3T0RVMSIsInQiOiJOZzVFMTN2NUpJTllJRVk0Q0RjN0lHQWN5bEhaOHVsWWRFWXpuQ3VDbGx2VkJYRFFmanBPaFJ0bXpvaWs2R3lmVUdGNWpjeVNKek13RWNHeVV1OHpRYUk1UngwelZ1WUhOdDU3SjZJa20rRGltZ2tCUDFFZzJWdGtKbEd3d1NtQyJ9

 

Former chief executive of Calhoun-Liberty Hospital is charged with using money to pay various personal expenses.

A former Florida hospital CEO has been indicted by a federal grand jury on charges he embezzled money from the hospital where he worked through false billing practices and a shell company, according to the U.S. Department of Justice.

Phillip Hill Jr. of Blountstown, Florida has been indicted on 24 counts of wire fraud and 4 counts of filing false tax returns. The indictment alleges that between 2010 and 2015, when Hill served in dual roles as Chief Executive Officer and department head of Emergency Management Services, to embezzle money from Calhoun-Liberty Hospital.  According to the indictment, he billed the hospital for goods it never received using invoices in the name of “Southeastern Medical Supply,” a fake business connected to a bank account he himself controlled. The indictment also stated that Hill ordered medical supplies from eBay and other vendors then billed the hospital for them supplies at price points far exceeding what Hill actually paid, the DOJ said.

According to the indictment, Hill used the funds in the Southeastern bank account to pay personal credit card bills, fund a business he owned and operated, to obtain cash, and to pay personal expenses including groceries and travel.

The DOJ also said the indicated that an employee at the hospital once inquired after contact information for Southeastern Medical Supply, and Hill responded that he had lost his phone and didn’t have the number, and also that the last time he had “talked with” the company they were discussing going out of business.

The maximum penalty for each wire fraud count is 20 years in prison. The maximum penalty for each count of filing false tax returns is 3 years in prison.  A trial date of this July 2nd has been set. The case was investigated by the Internal Revenue Service — Criminal Investigation, the Florida Department of Law Enforcement, and the Blountstown Police Department.

CEO, CFO of Missouri hospital resign over inappropriate reimbursements

https://www.beckershospitalreview.com/hospital-executive-moves/ceo-cfo-of-missouri-hospital-resign-over-inappropriate-reimbursements.html

Image result for Paid Time Off

 

The CEO and CFO of Ranken Jordan Pediatric Bridge Hospital in Maryland Heights, Mo., have resigned after the hospital board discovered the executives violated the hospital’s paid time off policy, according to the St. Louis Post-Dispatch.

The hospital board requested and accepted the resignations of president and CEO Lauri Tanner and vice president and CFO Jean Bardwell, effective May 2, according to the report.

In a statement to the St. Louis Post-Dispatch, the hospital said the two executives were allegedly paid for time off “to which they were not entitled.” The hospital said the board is demanding Ms. Tanner and Ms. Bardwell repay the hospital, but it did not disclose the amount of inappropriate reimbursement the executives allegedly received.

The board’s executive committee initially identified the potential irregularities, and the board subsequently launched an investigation, which allegedly revealed the two executives violated hospital policy, according to the report.

To help prevent a similar issue from occurring in the future, the hospital has put corrective measures in place.

Ranken Jordan Pediatric Bridge Hospital COO Brett Moorehouse has been named interim president and CEO, and a hospital board member will serve as interim CFO, according to the St. Louis Business Journal.

 

Despite shift to value-based care, hospitals still paying doctors with fee-for-service expectations, AMA says

http://www.healthcarefinancenews.com/news/despite-shift-value-based-care-hospitals-still-paying-doctors-fee-service-expectations-ama-says?mkt_tok=eyJpIjoiTXpGak1qTmhNbVUxWVRsaSIsInQiOiJwQlwvU1ZxcTU2bExreng4NXpEZ0Q2WkRYeldUbzlNM3kwWlJFeER5WlwvS3NqQ0lvMFwveHVNRExjdmVkdkRNMTBOb3FlZlwvOUJIMTYzR0tVWlNlcDJWMlRkMVM4TzZCK1I3XC9NSkFkc1U5QjhYaTZXKzhaUnY0M2RKNGNubTR5dk84In0%3D

 

A quick breakdown of the different approaches hospitals are taking to compensate physicians amid the massive shift from volume to value.

The shift from fee-for-service payment models to those based in value has been occurring steadily over the past few years. Increasingly, providers are determining physician pay through a number of different means. But what does that mean for the ways hospital pay doctors? And what approach are your competitors taking?

The options include straight salary, compensation based on personal productivity (as has been the case in a fee-for-service world), bonus structures and tieing pay to an organization’s overall financial performance.

Salary is the most common model at 52.5 percent, while productivity still accounted for 31.8 percent. Only 9 percent was based on the practice’s financial performance, meanwhile, and bonuses comprised 4.1 percent, according to an American Medical Association analysis.

Here’s where the plot thickens a bit. “Over half of physicians (54.4 percent) indicated that their compensation was based on more than one method, greater than what was observed in 2014 and 2012,” AMA said.

Productivity was a greater chunk of compensation for private practice owners, at 44.7 percent; that number dipped to 22.3 percent for employed physicians.

Partly that’s because employed physicians were more likely to have a salary, decreasing the need for productivity to factor into their overall compensation equation, the AMA said. The group said some physicians are likely feeling pressure to increase their productivity by doing things like increasing their patient volume, or hiring outside help to perform more menial tasks.

It’s worth noting that while the AMA just published the findings, they are based on surveys conducted during September of 2012, 2014 and 2016 with approximately 3,500 respondents each year — and a lot has happened in value-based care since then.

“We also find evidence that the use of multiple methods to determine physicians’ overall compensation has been on the upswing,” AMA said.

 

Trinity Health chooses Epic for integrated EHR, revenue cycle management

http://www.healthcarefinancenews.com/news/trinity-health-chooses-epic-integrated-ehr-revenue-cycle-management?mkt_tok=eyJpIjoiTXpGak1qTmhNbVUxWVRsaSIsInQiOiJwQlwvU1ZxcTU2bExreng4NXpEZ0Q2WkRYeldUbzlNM3kwWlJFeER5WlwvS3NqQ0lvMFwveHVNRExjdmVkdkRNMTBOb3FlZlwvOUJIMTYzR0tVWlNlcDJWMlRkMVM4TzZCK1I3XC9NSkFkc1U5QjhYaTZXKzhaUnY0M2RKNGNubTR5dk84In0%3D

St. Joseph Oakland is part of the Trinity Health system in Pontiac, Michigan. Credit: <a href="https://twitter.com/sjmo_hospital/status/988871404237086721" target="_blank">Twitter</a>

 

The Michigan health system, one of the largest in the U.S., says it wants to roll out a single, enterprise platform to deliver “people-centered care.

It’s a big week for Epic implementations in the Upper Midwest. The world-class Mayo Clinic is ready to go live with its newly-minted system on May 5, after more than three years of work. And today comes news that sprawling Trinity Health, based in Livonia, Michigan, has selected Epic to build out its own enterprise-wide electronic health record and revenue cycle management system.

It’s a process the Catholic health system expects will take four years to implement across its 94 hospitals and 109 continuing care locations. The expected cost of the deal was not disclosed.

Trinity officials said the integrated Epic platform will allow the health system to improve experiences for patients and clinicians across the board.

“People deserve customized and convenient healthcare experiences, including simple access to a complete health and billing record,” said Mike Slubowski, president and chief operating officer of Trinity Health.

“At the same time, physicians and clinicians need tools that make it easier to practice medicine,” he said. “We look forward to implementing a single, enterprise solution enabling us to deliver excellent, people-centered care.”

It’s the same appetite for a seamless and enterprise-wide system, across all locations and functionalities, that Mayo Clinic CIO Christopher Ross said was a factor in its choice of Epic back in 2015. That health system had been “steadily working toward a convergence of its practice” for several years, he said at the time, and best-of-breed would no longer suffice for achieving those goals.

At Trinity Health, the plan is to leverage Epic as a fully-integrated system for a single, comprehensive health record for every patient.

Trinity tapped Epic on the strength of the different products offered on that single, unified platform, officials said – not just enterprise EHR and revenue cycle, which will eventually go live at all of its hospitals, ambulatory centers, physician offices and continuing care programs, used by some 100,000 employee – but also online scheduling, e-visits and  online bill pay.

“We are confident a single platform will enable new levels of innovation, consumer focus, clinical and business integration and efficiency to help us build our people-centered health system,” said Slubowski. “It will also help align people, process and technology to create a culture in which people-centered care becomes the standard way we care for the communities we serve.”

CHS beats expectations with cost cuts despite volume slump

https://www.healthcaredive.com/news/chs-beats-expectations-with-cost-cuts-despite-volume-slump/522579/

Dive Brief:

  • Community Health Systems beat Wall Street expectations Tuesday when it reported a small adjusted net profit during the first quarter, as its cost cutting helped offset weak admissions volume. Its net loss narrowed to $25 million, compared to a net loss of $199 million in the year earlier period.
  • Net operating revenues dropped nearly 18% to $3.69 billion, compared with $4.49 billion for the same period in 2017. The health system continues to struggle with declining admissions, reporting a 2.4% decrease for the quarter.
  • CHS sold off 30 hospitals last year and continues its divestment strategy this year.

Dive Insight:

The Brentwood, Tennessee-based hospital operator is hoping to pare down its outsized debt, much of which was acquired when the company bought the financially-distressed Florida-based system Health Management Associates for $7.6 billion in 2014.

In January, CEO Wayne Smith told investors his goal is to slim down to 100 hospitals in “significantly improved markets.” The company is attempting to make $1.3 billion off of divestitures this year, counting six pending divestitures this year in Florida, Louisiana and Tennessee.

The strategy might be paying off. With 30 fewer hospitals, the company’s inpatient and outpatient revenues for Q1 each increased 0.1% on a same-store basis, and income from operations skyrocketed 198% to $212 million, compared to $71 million in 2017.

Jefferies noted the system offset lower volumes by keeping labor and staffing costs low.

Still, it said future growth “hinge[s] largely on seeing a stabilization in organic volume trends, which has eluded the company for eight consecutive quarters.”

The analysts said new initiatives like an accountable care organization were promising, “though their benefits will likely take a few quarters to materialize.”

Last year, ASL Strategic Value Fund sent a letter to CHS’ board of directors saying “it is time” to replace the CEO. The letter, dated Aug. 8, argued that action is needed immediately as management’s “previous missteps have resulted in billions of dollars of shareholder losses.”

In a comment issued with the earnings report, Smith argued to investors that the company’s turnaround strategy is beginning to work.

“We achieved continued progress across a number of our strategic and operating initiatives,” he said. “During the first few months of the year, we expanded our transfer and access program, launched Accountable Care Organizations, and invested in both outpatient capabilities and service line enhancements across our markets. These efforts helped drive a good financial performance during the first quarter and position the Company for further anticipated improvements during the balance of 2018.”

However, CHS still has a long way to go. The company recently brought in financial advisors to help restructure $13.8 billion in long-term debt.

 

Adventist Health’s net income nears $230M in FY17

https://www.healthcaredive.com/news/adventist-healths-net-income-nears-230m-in-fy17/522093/

Dive Brief:

  • Adventist Health’s net income grew 366% to $229.8 million in fiscal year 2017, up from $169.1 million in 2016.
  • Operating income was $203.9 million for the year ended Dec. 31, an 11.6% increase from $812.8 million the previous year, according to recent released financial documents.
  • The 90-hospital, Roseville, CA-based nonprofit health system reported $4.1 billion in revenue, a 5.8% gain over 2016’s $3.9 billion.

Dive Insight:

Adventist’s rosy performance gain reflects at least a short-term upward trend in financials as nonprofits show some signs of bouncing back from several years of rough currents fueled by shrinking volumes and reimbursement cuts. Geisinger Health System saw net income jump nearly $200 million to $324.9 million in the first half of fiscal year 2018, compared with the prior year, providing an excess margin of 9%.

Mayo Clinic reported $707 million in operating income and $12 billion in revenue for 2017, an increase of more than $225 million and $1 billion, respectively, from the previous year. Meanwhile, UPMC’s net income rose to $1.3 billion last year, spurred by strong operating and investing results and integration of UPMC Pinnacle into UPMC operations. Operating revenue and operating income also increased.

Adventist is looking to expand its brand footprint. Earlier this month, the system inked a deal to acquire Florida-based 421-bed Munroe Regional Medical Center from Community Health Systems. It has also broadened its reach in northern California through an affiliation agreement with Fremont-Rideout Health Group, which become effective at the first of this month.

Net patient service revenue at Adventist was $3.8 billion, up from $3.6 billion a year earlier. Total expenses rose to $3.9 billion, versus $3.7 billion in 2016. Of that, $1.9 billion was for employee compensation. The system recorded total cash and investments of $1.9 billion for last year.

Occupancy of licensed beds stayed mostly flat at 55.6% across the system. Average length of stay was down slightly and outpatient revenues as a percentage of gross patient revenue was down to 44.7% from 45.1% in 2016.

 

SEIU health workers set to protest potential Kaiser layoffs

https://www.healthcaredive.com/news/seiu-health-workers-set-to-protest-potential-kaiser-layoffs/522428/

Dive Brief:

  • “Thousands of healthcare workers” organized by SEIU-UHW are set to protest from May 1-18 at 33 California hospitals owned by Kaiser Permanente, the union said Friday.  At issue are a variety of announced plans to lay off pharmacy warehouse workers and relocate call center jobs.
  • Kaiser Permanente wrote to Healthcare Dive in an email that the decision to outsource the pharmacy storage and distribution network came after extensive discussions with SEIU-UHW and other unions. The company pointed to the “many regulatory, technological and efficiency challenges we face now and in the future,” as factors that influenced its decision.
  • But Service Employees International Union-United Healthcare Workers West argues that the decision is unbecoming of a nonprofit organization that had its profits rise 22% in 2017 with $28 billion in reserves on hand.

Dive Insight:

The protests appear to be the continuation of similar actions earlier this year when SEIU organized protests at 32 hospitals in February and March.

The company recently issued an official notice to lay off 61 pharmacy warehouse workers in Downey, California. According to SEIU-UHW, the company plans to lay off 175 more pharmacy warehouse employees in Oakland, Livermore and Los Angeles and relocate 700 call center jobs to cheaper areas of the state.

The union noted that 55,000 Kaiser Permanente employees in California are members of SEIU-UHW. The national agreement with Kaiser for a broader group of unions expires Sept. 30.

John Nelson, vice president of communications at Kaiser Permanente, called the claims by SEIU-UHW misleading.

“Kaiser Permanente is growing, and we are adding jobs overall. As one of the largest private employers in California with more than 149,000 employees and 16,000 physicians in the state, since 2015, we have added more than 13,000 jobs in California and continue to add jobs with more than 12,000 open staff positions and hundreds of physician positions,” Nelson said in a statement.

It appears that politics may be coming into play. Several elected officials have sent letters including California Democrat Reps. Tony Cardenas, Grace Napolitano, Adam Schiff, Lucille Roybal-Allard and Brad Sherman urging Kaiser Permanente to reconsider its plans.

“It is imperative that Kaiser Permanente continue to flourish by providing quality healthcare to patients while also being a good partner when it comes to job creation which benefits our community,” former California Senate President Pro Tempore Kevin De León wrote in a letter.

 

Adventist Health, St. Joseph Health sign definitive agreement for Northern California joint venture

http://www.healthcarefinancenews.com/news/adventist-health-st-joseph-health-sign-definitive-agreement-northern-california-joint-venture?mkt_tok=eyJpIjoiT1RrME5HWmxNV0kyTkRZeCIsInQiOiJzQ2N6dzlKclF2QmpZaGZraHhUYWRwZThOSit4NjFJZ003dUtnU3NKem9WSkN0QXZUdVJVcUFIRWhMRHJZQ2I3a0N6YWNiR1pLVVFTdzdcL0hvSFl3WVR5ZVpJRWFhSUM1Y3Jyd0FRZVk0YXdOYjF3bXRWUXFXMkN1VlwvMkRMTGNpIn0%3D

 

Details are still being worked out about physical locations or shared access to care services and they hope to finalize the arrangement this year.

Adventist Health and St. Joseph Health will partner on a new joint operating company that will integrate clinical activities and services across clinics and facilities in Northern California.

The joint operation will include a new president and CEO, and a few other positions still to be determined. A governing board of consisting of 5 appointees from each system will also be formed. Adventist and St. Joseph facilities would keep their existing hospital names, licenses, capital assets and employees.

“By establishing a network that combines the parties’ footprints in this six county area, we intend to increase patients’ access to care,” said Kevin Klockenga, President & CEO, St. Joseph Health Northern California. “We intend to improve our ability to deliver better care on a number of fronts, including developing a comprehensive care continuum strategy; collaborating on centers of excellence, health information sharing, and care management; and developing a value based provider network.”

Adventist Health President of the Northern California region Jeff Eller added that “patients will benefit from more access points, better health outcomes and controlled costs by coordinating their care across the spectrum of their health needs.”

The new operation will serve municipalities of Humboldt, Mendocino, Sonoma, Lake, Napa and Solano counties.

A definitive agreement has been signed, which covers a joint venture, not a merger. The proposed operation will be under regulatory review. Officials at Adventist Health and St. Joseph Health are working toward a closing of the proposed transaction sometime later this year.

A St. Joseph Health spokesperson said details are still being worked out and it is not clear whether services at the included facilities will expand or whether the joint venture simply means patients in both systems will have access to the other system’s facilities under the new network.

Atrium Health releases 92 physicians looking to break away

https://www.beckershospitalreview.com/hospital-physician-relationships/atrium-health-releases-92-physicians-looking-to-break-away.html

Hospital-Physician Relationships

Charlotte, N.C.-based Atrium Health said April 25 it will grant the request of a group of physicians looking to separate and end their employment agreements with the health system Sept. 1, according to The Charlotte Observer.

In an emailed statement to Becker’s Hospital Review April 25, Atrium confirmed it will release a group of roughly 92 Mecklenburg Medical Group physicians from their noncompete agreements, effective Sept. 1. The physicians will continue practicing as part of the health system until Aug. 31.

“While we were hopeful that our many months of discussions would lead to an acceptable solution for everyone involved, we will not seek to prevent these physicians from forming a standalone practice,” the health system told Becker’s.

Atrium said it will also offer the physicians new employment agreements “in the hopes they remain at Atrium Health and their MMG practice … and join the other 1,900 physicians who provide care for our patients,” the health system told Becker’s.

The group of roughly 92 Mecklenburg Medical Group physicians filed a lawsuit against Atrium April 2, arguing the health system engaged in monopolistic and anticompetitive behavior. Atrium said the same day it would allow the physicians to leave the organization. On April 16, the physicians filed a complaint against the health system with the North Carolina Medical Board, alleging the health system violated board regulations by intentionally misleading patients.

Atrium acquired Mecklenburg Medical Group in 1993, according to The Charlotte Observer. In a statement to the publication, the physicians said their attorneys will meet with Atrium’s lawyers to further assess the situation.

Atrium Health CEO Eugene Woods told The Charlotte Observer the health system is in the process of hiring roughly 20 physicians to help fill the vacant positions left by physicians planning to leave Mecklenburg Medical Group. The health system also previously offered to give employees who choose to say a bonus of up to 10 percent of their salary if they remain through the end of the year.

“We feel for our staff, and our first concern was making sure that they feel that we’re with them,” Mr. Woods told the publication. “We offered them retention bonuses because some of them were scared about what the future is going to be.”

 

 

What creates a toxic hospital culture?

https://www.kevinmd.com/blog/2015/10/what-creates-a-toxic-hospital-culture.html

Image result for toxic culture

 

Hospital culture is largely influenced by the relationship between administrative and clinical staff leaders. In the “old days” the clinical staff (and physicians in particular) held most of the sway over patient care. Nowadays, the approach to patient care is significantly constricted by administrative rules, largely created by non-clinicians. An excellent description of what can result (i.e., disenfranchisement of medical staff, burn out, and joyless medical care) is presented by Dr. Robert Khoo.

Interestingly, a few hospitals still maintain a power shift in the other direction — where physicians have a stranglehold on operations, and determine the facility’s ability to make changes. This can lead to its own problems, including unchecked verbal abuse of staff, inability to terminate bad actors, and diverting patients to certain facilities where they receive volume incentive remuneration. Physician greed, as Michael Millenson points out, was a common feature of medical practice pre-1965. And so, when physicians are empowered, they can be as corrupt as the administrations they so commonly despise.

As I travel from hospital to hospital across the United States (see more about my “living la vida locum” here), I often wonder what makes the pleasant places great. I have found that prestige, location, and generous endowments do not correlate with excellent work culture. It is critically important, it seems, to titrate the balance of power between administration and clinical staff carefully — this is a necessary part of hospital excellence, but still not sufficient to insure optimal contentment.

In addition to the right power balance, it has been my experience that hospital culture flows from the personalities of its leaders. Leaders must be carefully curated and maintain their own balance of business savvy and emotional IQ.  Too often I find that leaders lack the finesse required for a caring profession, which then inspires others to follow suit with bad behavior. Unfortunately, the tender hearts required to lead with grace are often put off by the harsh realities of business, and so those who rise to lead may be the ones least capable of creating the kind of work environment that fosters collaboration and kindness. I concur with the recent article in Forbes magazine that argues that poor leaders are often selected based on confidence, not competence.

The very best health care facilities have somehow managed to seek out, support and respect leaders with virtuous characters. These people go on to attract others like them. And so a ripple effect begins, eventually culminating in a culture of carefulness and compassion. When you find one of these gems, devote yourself to its success because it may soon be lost in the churn of modern work schedules.

Perhaps your hospital work environment is toxic because people like you are not taking on management responsibilities that can change the culture. Do not shrink from leadership because you’re a kind-hearted individual. You are desperately needed. We require emotionally competent leaders to balance out the financially driven ones. It’s easy to feel helpless in the face of a money-driven, heavily regulated system, but now is not the time to shrink from responsibility.

Be the change you want to see in health care.