Sunday, July 24, 2016

Greedy and Stupid in the News


A California attorney has testified regarding a large workers' compensation scandal involving workers' compensation. That testimony recently became public and is causing some discussion. His testimony illustrates problems in this industry, driven by greed and poor character. Some will say greed and fraud are old news. However, stories like this are cautionary tales and they remind us all of the perils that may confront us. 

Attorney Sean O'Keefe admitted to bribes, according to news sources. That in itself is newsworthy. But his crimes are making headlines in part because Mr. O'Keefe is said to be publicly known in his community. His advertising has apparently made him a recognized and familiar figure in California. His website advertisement stressed that he "put injured workers’ needs first." However, it appears that instead he put himself first, focusing on his income and his needs. 

This story says that Mr. O’Keefe paid for referrals to his law firm. And, he made sure his clients "ran up bills at certain medical providers." His clients underwent "MRIs, sleep studies, psychology, medications and toxicology screenings" not because they were demonstrably reasonable or medically necessary, but because those services generated income for medical providers, and those providers engaged in the process of making sure Mr. O'Keefe had clients. They all appear to have looked out for each other and their "bottom lines," instead of looking out for those who came to them for help. How is this best described: "quid pro quo," "you scratch my back, I'll scratch yours," "one hand washing the other?" 

Whatever metaphor is applied to describe this, the article says that in California "injured workers are used for profit." That is troublesome. People are not commodities. We do not exist for people to make money from our pain. We will all have problems, injuries, and illness. The point of medicine is to treat those conditions, by doing what is best for the patient. Doctors, lawyers, or anyone are inappropriate when they use people's pain and misfortune focused on maximizing personal profit.

Essentially in this scheme, a quasi-legal firm called Centro Legal (Center Legal) would recruit clients and make the referrals to attorneys. The attorneys would seek care or seek payment for care already rendered. In California, workers can seek care from physicians and other medical providers. The providers perform services that they deem necessary and later file "liens" in the state workers' compensation adjudication system, themselves seeking payment for their services. Critics say that this system "has allowed questionable providers to reap millions for medical care that otherwise would go unpaid." 

This referral firm marketed by promising workers "they could earn up to $4,000 per month if they were injured at work," apparently indiscriminately passing out business cards  or flyers that said this. The firm would then refer the workers to attorneys like O’Keefe. Centro Legal apparently told the attorneys which medical care provider the workers should consult. Those providers made money and made referrals to other involved providers for medical services or diagnostic studies. 

Similarly, medical care practitioners in this scheme would apparently also refer their patients to Mr. O'Keefe so that they could pursue workers' compensation representation. Knowing he was acting inappropriately, Mr. O'Keefe testified he “'spread the clients around a little bit' so workers’ compensation insurers wouldn’t cry foul over his practices." 

This model apparently brought O'Keefe many clients. He pursued claims on their behalf, for his own gain. It brought him "$1.1 million a year representing injured workers, mostly by collecting a 15 to 18 percent fee from the settlement of their injury cases." 

In a grand jury appearance last December, Mr. O'Keefe acknowledged his culpability and testified that he "was greedy and stupid.” Mr. O'Keefe has already pleaded guilty in a federal case. He admitted to "health care fraud and agreed to cooperate with prosecutors in hopes for a more lenient sentence."

The medical services could be almost anything. One oft-discussed has to do with medications. In another California case discussed in that article, a group of co-defendants are accused of fraud. Allegedly, they mixed medications costing about $20.00 into a cream and billed workers' compensation about $5,000. This "compounding" is allegedly engaged in to avoid fee schedules and other regulatory constraint. That is about a 25000% profit (well, before you pay the bribes to the doctors that sign the prescriptions to explain the exceptional need and to justify it). The news from California suggests that this is not uncommon and describes another similar case involving charges made against Medicare and other healthcare plans. 

So, what happens to Mr. O'Keefe? He is disbarred. Even in California is it unlikely he will ever be readmitted to the bar. California has a reputation for being a forgiving bar. Some perceive that it affords a location of second chances for attorneys. But, it seems likely that active fraud like this will mean the end of a legal career. 

Shortly after the California story, news hit of a medical scheme in Florida. Fox News Reported the Justice Department charges three in $1 billion Medicare fraud scheme. This fraud scheme is said to involve Medicare and Medicaid billings exceeding $1 billion. Yes that "billion" with a "B," right here in Florida. This scheme is said to involve "a network of doctors, hospitals and health-care providers across South Florida." 

Similarly to the California situation, the principals of this Florida conspiracy are alleged to have "paid and received bribes and kickbacks to get thousands of patients admitted to facilities" (emphasis added) in order to benefit the principals (the consipirators). Then, the patients "were often given medically unnecessary and sometimes harmful treatments, which were then billed to Medicare and Medicaid." The Florida principals deny wrongdoing and apparently look forward to their day in court.

There is a symbiosis between lawyers and doctors. Each is a noble profession. Each is a profession that can bring relief to people, can help people. But, the professional focus has to remain on those people, and their individual best interest. The focus of these professions cannot be on maximizing profit, particularly when this works to the detriment of the everyday people involved. 

Where has this industry seen this? It has appeared in diagnostic testing. There was a time when doctors were seemingly infatuated with referrals for thermography. The practice has decreased in recent years, as some have declined to pay for this testing. There was some perception, even when the testing was popular, that the doctors who found this testing compelling were doctors who owned thermogram machines. 

There has been a perception in physician dispensing. Some believe that doctors who dispense medications in their office, and thus profit from the dispensing, write more prescriptions than other doctors. The question is asked, why are patients more likely to receive a higher volume of prescriptions when the doctor dispenses?

In the first decade of this century, spinal fusion rates increased 70% in America. Some allege that a portion of these surgeries are "unnecessary and potentially dangerous." Data in a recent study reported by CBS News supports that "a small group of doctors performed these procedures far more frequently than their peers." This article concedes that there are appropriate cases for spinal fusion, but that some of the high-volume providers may be performing ten times the surgeries performed by the national average. It notes "there is also a financial incentive to performing a spinal fusion. It can earn a surgeon thousands of dollars - and five times as much as less risky alternatives."

These are examples. And, while there are doubts and concerns created by various procedures, testing, patterns and trends, in the end the real focus should be this particular human being. What is in the best interest of this person? That focus should be considered, extensive, and honest. Is the diagnostic testing for this patient going to make a difference in reaching conclusions? Is the medication necessary for this patient to relieve symptoms or improve function? Does the surgical procedure make sense for this patient, and do the odds in this case favor the treatment in this case? In each of these, is the patient well-informed of the probabilities of success and the potentials for detriment or side effects, complications, or other harm?

When people become commodities, society has a problem. When profit becomes the singular core motivation, people are likely to be harmed. Individuals can be harmed through the process directly, undergoing procedures which are inappropriate, unnecessary and potentially damaging. But, it causes a greater harm to other individuals who really need diagnostics and care. They may face skepticism and delay, because some test or procedure is inappropriately over-recommended. In the forest of such a practice a patient may struggle to focus payer attention on their individual tree. 

Worse, resources are limited, including time. Only so many people can undergo any medical test in a given day. Testing requires equipment and personnel. Anyone undergoing an unnecessary test or procedure is taking the time and resources that might otherwise be used by someone that legitimately, and perhaps urgently, needs the testing or care.

So, conflict occurs. Doctors make recommendations and referrals. Authorization for that care may be denied in some settings. Care may be provided without authorization in other settings. Payment or authorization may then be sought in the legal system, with zealous attorneys presenting both perspectives on those questions, and judges may be asked to decide who gets care, what care, who is reimbursed, etc. As an aside, litigation is rarely an efficient process. It requires time, patience, intellect, focus and more. 

There are difficult questions presented. Do attorneys (on either side) make referrals to, or insist upon, certain doctors because of their perception of what that doctor will or will not recommend? Do doctors make referrals to specialists or facilities because of their perceptions of what outcomes are likely? Do physicians recommend performing certain procedures because of financial gain? Are incentives misaligned?

The answer seems to be that some attorneys, some doctors and some other professionals act inappropriately. Those who misbehave make our world harder for the rest of us. They raise skepticism, they consume resources, and periodically they make the news. By their actions, they unfortunately color the rest of us similarly, and impact the way in which all professionals are perceived in this system called workers' compensation. 

It is troubling when the "greedy and stupid" harm people, harm processes, harm systems, and harm us all.

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