Wednesday, April 3, 2013

Fwd: qotd: The Intermountain scandal that isn't

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-------- Original Message --------
Subject: qotd: The Intermountain scandal that isn't
Date: Wed, 3 Apr 2013 13:16:05 -0700
From: Don McCanne <>
To: Quote-of-the-Day <>

Fox 13 News, Salt Lake City
April 3, 2013
Intermountain Healthcare pays $25.5M to settle violations of federal law
By David Wells

Utah's largest health system self-disclosed violations of federal health
care laws and agreed to pay the United States $25.5 million to settle
its claims, according to a statement from the United States Department
of Justice.

"These issues were primarily technical in nature and involved things
such as lack of proper paperwork involving leases of physician offices
and service agreements," said a statement on Intermountain Healthcare's

The DOJ statement said Intermountain Healthcare admitted to violating
the Stark Statute by employment agreements under which the physicians
received bonuses that improperly took into account the value of some of
their patient referrals; and office leases and compensation arrangements
between Intermountain and referring physicians that violated other
requirements of the Stark Statute. These issues were disclosed to the
government by Intermountain Healthcare.

"People should expect that hospitals and doctors care more for their
patients than their bottom line profits," said Gerald Roy, Special Agent
in Charge for the Office of Inspector General of the U.S. Department of
Health and Human Services region including Utah. "So I applaud
Intermountain for recognizing their liability and coming forward to
self-disclose these violations. We will vigilantly protect
taxpayer-funded health programs against Stark violations through tight
coordination with our partners at the Department of Justice."

This link includes statements from Intermountain Healthcare and from the
United States Department of Justice:

The Settlement Agreement:

Comment: Most of us have grown weary of the scandalous behavior of our
corporate health care system, and so we are no longer surprised by the
by headlines notifying us of multimillion dollar penalties assessed
against these nefarious entities. In fact we say, "Good riddance."
However, in this instance involving Intermountain Healthcare, it is
almost refreshing to see that the story behind the headlines can renew
our faith in our health care system.

Intermountain Healthcare is a large, non-profit, highly ethical,
integrated health care system in Utah. It has an excellent reputation
for providing efficient, high quality care, and for being innovators in
improving the delivery of health care. That is why it was surprising to
see their name in the headlines reporting yet another scandal.

But a scandal it isn't. Intermountain Healthcare violated provisions of
the Stark statute designed to prevent referral arrangements that could
provide perverse incentives for personal profit in health care. The
Intermountain violations were technical, involving a flawed formula for
physician compensation, and involving improperly documented rental
arrangements for use of medical space.

Intermountain discovered these violations on their own. Instead of
trying to cover them up, they reported them to the U.S. Attorney for
Utah. Considering the total lack of criminal intent, the technical
nature of the violations, the lack of harm done, and the self-disclosure
of the errors, it can be argued that the $25.5 million penalty was

What does this have to do with single payer reform? Simply that there is
a world of difference between a health care system structured on a
business model with a primary mission to make money, and a health care
system structured on a service model designed to take care of patients.
Intermountain functions as the latter. It is a non-profit, integrated
health care system that would be an ideal component of a single payer
national health program.

Technical violations will always be with us, but they are understandable
errors when the goal is to take care of patients, but not when the goal
is to deliberately siphon off health care dollars for personal gain.

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