Medicare Advantage plans took the top spot in this year’s Shkreli Awards, the annual list from the Lown Institute that calls attention to some of healthcare’s most greedy and unethical behavior.
The plans’ penchant for defrauding or overbilling Medicare by an estimated $25 billion in 2020 alone by saying beneficiaries were much sicker than they actually were earned them their top marks, according to the Lown Institute.
Others who made the 2022 list included Texas hospice leaders who tried to hasten patients’ deaths to avoid losing federal funds; a Wisconsin dentist who broke patients’ teeth so they would need crowns; and a Virginia hospital that diverted federal discounts from its poorer hospital to its wealthier ones.
The annual ranking is named after pharma executive Martin Shkreli, who raised the price of a life-saving drug for AIDS patients from $13.50 to $750 per pill, and who was sentenced in 2018 to seven years in prison for securities fraud. Patient activists, health policy experts, and journalists were among the judges.
Lown Institute president Vikas Saini, MD, told MedPage Today that this year’s list reads like “a tragic comedy of grift and profiteering.”
If the actions of these companies and individuals seem to be worse than in past years, Saini said that’s because governmental agencies and media organizations appear to be “more vigilant in calling out bad actors.”
Medicare Advantage companies were selected as the worst offenders because the prevalence of fraud was so overwhelming, Saini said: “It struck a chord with our judges.”
“It was pretty prevalent in that nine of 10 insurers in terms of market share were among those named, so it’s not just one or two bad actors,” Saini said. “If anything, it is their business model. A pervasive and systemic problem with immense costs that in my view really represent foregone opportunities to make us all healthier.”
MedPage Today, in a series of stories on the downsides of Medicare Advantage plans, focused on enrollees’ problems getting access to specialists, deceptive and fraudulent MA plan marketing, and federal attempts to approve all TV ads before they can air. The series also pointed to a federally approved commission structure that results in brokers receiving two or three times as much in commission for selling MA plans than Medicare supplemental plans.
The winners are:
1. Most large Medicare Advantage insurers now face federal accusations that they have been defrauding the Medicare program by mining patients’ charts for diagnoses that have resolved or which they never had, or exaggerating their severity. The amount of overpayment is estimated at $25 billion in 2020 alone, according to a New York Times investigation and numerous other investigations by the Office of Inspector General, as reported by MedPage Today. The huge amount of overpayments has raised questions about continued federal payment policies to these companies and the health of the Medicare Trust Fund.
2. Private equity-backed startup Noble Health bought two rural Missouri hospitals, then left employees with drug and supply shortages that led to unsafe conditions for patients. Noble also stopped paying for employees’ health insurance, despite deducting premium funds from their paychecks. Then Noble closed the two hospitals after taking $20 million in COVID relief funds.
3. Safety net hospitals that have a disproportionate share of low-income patients benefit from the federal 340B program, which provides hefty discounts on medications. But Richmond Community Hospital, in the Bon Secours Health System, profited from this program even though it lacks an ICU, maternity ward, or even a consistently working MRI machine. It diverted profits incurred by Richmond to its other hospitals in wealthier, whiter neighborhoods, “basically laundering money through this poor hospital to its wealthy outposts,” according to a former Richmond ER doctor.
4. Leaders of Novus Hospice in Frisco, Texas provided their employees with pre-signed prescription pads with directions to give patients morphine and hydrocodone without guidance or oversight from physicians. CEO Bradley Harris instructed employees to give higher doses of the painkillers to hasten patient death. The goal was to avoid longer lengths of stay that would result in a cap on government reimbursement to the hospice.
According to the Federal Bureau of Investigation, Harris sent an employee a text message saying, “You need to make this patient go bye-bye.” The Lown Institute said it was unclear whether any patients were actually overdosed or died because of Harris’ instructions.
5. Johnson & Johnson sold talc baby powder products for years knowing that they contained asbestos, a deadly carcinogen. Now faced with lawsuits from 40,000 cancer patients, many of them Black women to whom J&J marketed its powder products, the company created a subsidiary with all the baby powder-related liabilities. Then, it declared this company bankrupt. It ranked in the top 50 of Fortune’s largest companies last year.
6. Tobacco company Philip Morris has spent 175 years selling cigarettes known to cause heart disease, chronic obstructive pulmonary disease, and other health problems. According to STAT News, it now is reaping profits by acquiring companies that make inhaled therapeutics that treat the conditions cigarettes cause. The Lown Institute said that experts have concerns the company could use research on these inhalation therapies “to hook even more people” on their products.
7. Rather than counsel low-income patients on financial assistance programs they might be entitled to, Washington state-based Providence healthcare system instead “hounded them to pay and sent debt collectors after them when they didn’t.” The “Rev-Up” campaign, developed with help from corporate consultant McKinsey, directed employees to inform patients about financial assistance programs only as a last resort.
More than 55,000 patients were pursued by debt collectors when they should have been offered a discount. Providence told New York Times reporters that they stopped the practice and will issue refunds to about 760 patients.
8. Three North Texas laboratories got $300 million more from Medicare by bribing physicians to order unnecessary drug tests and blood work. The founders of the three labs pleaded guilty to fraud in April 2022.
9. Catholic Medical Center in Manchester, New Hampshire, continued to let cardiac surgeon Yvon Baribeau, MD, operate on patients despite knowing his high number of malpractice case settlements, including some involving 14 patient deaths. Yet the hospital system continued to support him and promote him in ads. His malpractice record was said to be among the worst in the country.
10. Wisconsin dentist Scott Charmoli went from fixing 434 crowns a year to 1,000 by breaking patients teeth starting in 2015. He “intentionally broke their teeth with his drill in order to convince the insurance companies to pay for the crowns. In March 2022, a jury found him guilty of five counts of healthcare fraud and two counts of making false statements to insurance companies.” He was sentenced to 54 months in prison and ordered to pay more than $1 million in fines.