In February, Jennifer Smithfield of Robertson County was feeling weak and still having some trouble breathing after nearly two weeks with COVID. To be safe, her primary care physician suggested going to the emergency department. She chose HCA’s Centennial Medical Center, near its corporate headquarters in Nashville.
Like more than 80% of patients who visit an emergency department, Smithfield expected to be sent home without actually being admitted for an in-patient stay. Instead, she was admitted on a Sunday night and wouldn’t leave until Wednesday.
“Even though I did not feel well, I didn’t think it was bad enough to be hospitalized, especially not multiple days,” she said, noting that she wasn’t put on any monitors until the following morning.
Even her primary care doctor who recommended the ED visit questioned why she was admitted. There’s a substantial difference between being kept in the ED for observation — even overnight — and being fully admitted as an inpatient. And one of the biggest differences is the cost — or in the hospital’s case, the potential profits.
Smithfield racked up $40,000 in charges, of which she owes $6,000 out of pocket.
Large health systems have faced scrutiny because of elevated admission rates for more than a decade, and HCA — with 180 hospitals across the country — is the latest to be accused of putting profits before patient care when it’s making decisions to admit patients.
Rep. Bill Pascrell, a Democrat from New Jersey, is pressing the U.S. Department of Health and Human Services to investigate allegations against HCA as potential Medicare fraud.
More: Congressional leader requests an investigation into HCA’s hospital admission practices
“Improper hospital admissions can have cascading effects on patients and workers,” wrote Pascrell, who chairs the House Ways and Means oversight subcommittee, in a September letter to HHS Secretary Xavier Becerra. “Unnecessary admissions expose patients to unnecessary treatments. This creates an added potential risk of complications and the possibility of new infections for patients.”
The Centers for Medicare and Medicaid Services is reviewing the letter, according to an agency spokesperson.
Pascrell’s complaints are based largely on a 58-page investigative report from a powerful labor union that has been challenging health systems for more than a decade. The Service Employees International Union estimates HCA has overcharged the Medicare program at least $1.8 billion in a “remarkable deviation from national norms.”
The claims against HCA are similar to trends the SEIU uncovered that led to a $98 million settlement with Franklin-based Community Health Systems in 2014 and a $262 million settlement in 2018 with HMA, which has already been acquired by CHS. The government alleged that hospitals knowingly billed for inpatient services when only lower paying outpatient or observational services were warranted.
HCA’s public response has grown more pointed as the claims gain a wider audience. Initially, the company dismissed them as a smear campaign led by the union that represents thousands of its front-line employees in California and elsewhere. But HCA is now confronting the central claims.
“We categorically reject any allegation that physicians admit patients to our hospitals on the basis of anything other than their independent medical judgment and their patients’ individual conditions and medical needs,” HCA spokesperson Harlow Sumerford told WPLN News in a written statement.
But even one of HCA’s own doctors has said the corporate headquarters attempts to sway admission decisions.
Dr. Ruiz describes defacto quotas
A whistleblower at a 400-bed HCA hospital in suburban Miami accused the health system of enforcing a defacto quota system. In a 141-page filing, Dr. Camilo Ruiz said HCA supervisors hounded him with warnings and even threatened his job unless he started admitting more patients to meet established targets. Attorneys used publicly available Medicare data to show how HCA hospitals are admitting more and more patients for low-level maladies like abdominal pain, lower respiratory problems, dizziness and nausea while non-HCA hospitals nationwide are sending patients with the same conditions home more often.
At 41 HCA hospitals with the highest admission rates — located in Florida, Texas, Nevada, Virginia and California — attorneys found that 84% of patients were admitted for eight common diagnoses compared to 55% at non-HCA hospitals between 2013 and 2016.
Attorneys for Ruiz declined to comment on the case. But Ken Nolan, an attorney from Fort Lauderdale with Nolan Auerbach & White who has successfully represented whistleblowers alleging fraudulent hospital admissions, said these types of cases act as a check on profit motives.
“Why these cases arise involves the push [and] pull between the incentive [and] the business side of health care,” he said. “There’s a push [and] pull between providing just enough services versus over-utilization.”
The Ruiz case, initially filed under seal in 2018, was unsealed when the government decided not to take on the investigation. Usually, the Department of Justice — which has intervened in similar cases — wants a slam dunk, said whistleblower attorney Jacob Tubbs of Birmingham-based Price Armstrong.
But the government rarely explains why it passes and did not comment to WPLN News.
“We know that what we’re going to have to ultimately prove for the United States government, using our whistleblower, is that the medical care was objectively unnecessary,” Tubbs said. “What you’re talking about is really a subjective standard.”
Shopping for an investigator
Since the case is unlikely to be reopened, the SEIU started taking its report, which incorporates data analysis from the suit, to the Security and Exchange Commission, then to Congress in hopes of prodding some arm of the government to act.
“We wanted to make sure this is investigated by whoever has the authority to do so,” said SEIU research coordinator Joseph Lyons. “If you have a system the size of HCA who’s seeming so brazen with this … this should be looked at by anyone who has authority over Medicare.”
As the nation’s largest hospital company, HCA sets the pace for the American health care system. The company blazed the trail in for-profit health care from its founding in the 1960s to today. Its profits approached $7 billion in 2021, even as other health systems struggled through the tailwinds of the pandemic.
HCA was so flush with cash, even amid COVID, that it repurchased billions of dollars-worth of its own stock. It was one of the only health systems to return COVID relief money. In HCA’s case, the government help — now repaid — totaled roughly $6 billion.
But that financial strength, as pointed out by HCA’s critics, comes largely from the pockets of the American people — both through government-funded programs and privately insured patients — who are increasingly swamped with medical debt.
In Nashville, patient Jennifer Smithfield is now disputing the bill from her February stay at an HCA facility. She said she’s put considerable trust in hospitals over the last decade as she was treated for leukemia.
“I don’t like that spot of questioning whether it’s my best interests being taken into account versus some other motive that the hospital administration might have,” she said. “I don’t want to be in a place mentally where I’m starting to have to question doctors.”
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