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“Big and Famous” Hospitals Fall Short in Quality

In the first effort of its kind, the nonprofit publisher of Consumer Reports magazine released ratings of 2,463 U.S. hospitals in all 50 states on Wednesday, based on the quality of surgical care. The group used two measures: the percentage of Medicare patients who died in the hospital during or after their surgery, and the percentage who stayed in the hospital longer than expected based on standards of care for their condition. Both are indicators of complications and overall quality of care, said Dr John Santa, medical director of Consumer Reports Health.

According to the story in Reuters Health, the ratings will surely ignite debate, especially since many nationally renowned hospitals earned only mediocre ratings. The Cleveland Clinic, some Mayo Clinic hospitals in Minnesota, and Johns Hopkins Hospital in Baltimore, for instance, rated no better than midway between “better” and “worse” on the CU scale, worse than many small hospitals. Because CU had only limited access to data, the ratings also underline the difficulty patients have finding objective information on the quality of care at a given facility.

Nevertheless, “this is a step in the right direction,” said Paul Levy, former president of Beth Israel Deaconess Medical Center in Boston, who was not involved in the project. “To whatever extent you can empower patients to get better care and become partners in pushing the healthcare system to make improvements is to the good.”

CU’s ratings are based on Medicare claims and clinical records data from 2009 to 2011 for 86 kinds of surgery, including back operations, knee and hip replacements, and angioplasty. The rates are adjusted to account for the fact that some hospitals treat older or sicker patients, and exclude data on patients who were transferred from other hospitals. These are often difficult cases that, CU felt, should not be counted against the receiving hospital.

Although the ratings do not explicitly incorporate complications such as infections, heart attacks, strokes, or other problems after surgery, the length-of-stay data captures those problems, said Santa.

Some of the findings are counterintuitive. Many teaching hospitals, widely regarded as pinnacles of excellence and usually found at the top of rankings like those of U.S. News and World Report, fell in the middle of the pack.

“This isn’t the first time we’ve seen this sort of surprise,” said Dr Marty Makary, a surgeon at Johns Hopkins Hospital and author of the 2012 book, “Unaccountable: What Hospitals Won’t Tell You and How Transparency Can Revolutionize Health Care.” “For a complex procedure you’re probably better off at a well-known academic hospital, but for many common operations less-known, smaller hospitals have mastered the procedures and may do even better” with post-surgical care.

CU also found that several urban hospitals did well despite serving many poorer, sicker patients, including Mount Sinai Hospital in New York and University Hospitals Case Medical Center in Cleveland. Rural hospitals did better, on average, than other hospitals, and many hospitals practically unknown beyond their zip code outranked famous ones, including Kenmore Mercy near Buffalo, New York; Arrowhead in Glendale, Arizona; Sacramento Medical Center in California; and Arkansas Heart in Little Rock.

San Gabriel DME Supplier Gets 2 Years in Prison

The owner and operator of a durable medical equipment (DME) supply company was sentenced yesterday to serve 24 months in prison for conspiring to submit nearly $1 million in fraudulent claims to Medicare.

Tigran Aklyan, 37, of Van Nuys, California, was sentenced today by U.S. District Judge Michael W. Fitzgerald in the Central District of California. In addition to his prison term, Aklyan was sentenced to serve three years of supervised release and ordered to pay $653,461 in restitution.

In April 2013, Aklyan pleaded guilty to conspiracy to commit health care fraud. In his plea agreement, Aklyan admitted that he was the owner and president of Las Tunas, a DME supply company located in San Gabriel, California. Aklyan admitted that from in or around October 2007 through in or around May 2009 he conspired with others to commit health care fraud by providing medically unnecessary power wheelchairs and other DME to Medicare beneficiaries and submitting false and fraudulent claims to Medicare. Aklyan admitted that he paid the owners and operators of fraudulent medical clinics to provide him with prescriptions and supporting medical documentation for the power wheelchairs and DME that he billed to Medicare. Aklyan knew that the prescriptions and medical documents that the clinics produced were fraudulent, yet he certified to Medicare with the submission of each claim that the DME was medically necessary. Aklyan also admitted that he knew that it was illegal for him to pay for prescriptions, but he did so anyway.

From on or about December 17, 2007, through on or about February 20, 2009, Aklyan, through Las Tunas, submitted approximately $910,377 in fraudulent claims to Medicare for PWCs and related services, and Medicare paid Las Tunas approximately $653,461 on those claims.

The case was investigated by the FBI and the Los Angeles Region of HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. This case is being prosecuted by Assistant Chief Benton Curtis and Trial Attorneys David M. Maria and Blanca Quintero of the Criminal Division’s Fraud Section.

Lien Claimants File Federal Suit to Invalidate SB 863 Activation Fee

Angelotti Chiropractic, Mooney and Shamsbod Chiropractic, Christina-Arana and Associates, Joyce Altman Interpreters, Scandoc Imaging and Buena Vista Medical Services filed a lawsuit yesterday in the United States District Court, Central District of California seeking to avoid payment of millions of dollars in lien activation fees before the end of 2013. The Defendants are Edmund G. Brown (Governor), Kamala D. Harris (Attorney General), Christine Baker (DIR Director), Ronnie Caplane (WCAB Chair) and Destie Overpeck (DWC Acting Director)

The suit requests declaratory, injunctive and other relief and challenges the constitutionality of certain provisions of SB 863 that retroactively impose a $100 “activation” fee on workers’ compensation liens filed prior to January 1, 2013. Plaintiffs allege that they filed valid liens prior to December 31, 2013 that constitute “vested property rights.” They allege that the mandatory dismissal provisions of the activation fee law interfere with those rights.

The Plaintiffs also complain that other “large holders of workers’ compensation liens are arbitrarily exempted from the fee” such as insurance companies, HMOs and labor union benefit plans. Thus they say that SB 863 “specifically targets independent providers of services to workers’ compensation claimants and was adopted with the purpose of destroying their liens.”

Thus, they allege that these “provisions of SB863 are unconstitutional under the Takings, Due Process and Equal Protection Clauses of the United States Constitution. Accordingly, this action seeks preliminary and permanent injunction preventing Defendants from enforcing these provisions of SB863.”

Christina Arana and Associates Inc. holds approximately 4,500 liens, Joyce Altman Interpreters, Inc. holds approximately 4,745 liens, Sandoc Imaging Inc. holds approximately 2,300 liens and Buena Vista Medical Services Inc. allege they hold approximately 20,888 liens. In total Plaintiffs allege they hold “tens of thousands of liens” which require activation fees in an amount of “more than $2 million” and the Plaintiffs allege they presently lack the ability to pay the lien activation fees.

The complaint will now be served on the defendants, who will likely demur the complaint. This will test the legal validity of the Plaintiff’s’ constitutional theories before a federal judge. After that step, should they survive the demurrer, it is likely that the case will be submitted by way of the summary judgment process inasmuch as there are no substantial disputes as to the facts. This case will move rapidly through the federal system, at least at the trial level.

Study Says Non-Guideline Back Pain Treatment Increasing

Despite guidelines to treat back pain conservatively, the proportion of people prescribed powerful painkillers or referred for surgery and other specialty care has increased in recent years, according to a new study reported in Reuters Health. “This is kind of concerning,” said Dr. Steven Cohen, an anesthesiologist and critical care doctor at the Johns Hopkins School of Medicine in Baltimore who didn’t participate in the research. Surgery, injections and scans for back pain “have all gone up pretty dramatically,” he told Reuters Health. “We have increased utilization, yet we don’t have better treatment outcomes.”

The American College of Physicians and the American Pain Society recommend that people with low back pain consider treatment with Tylenol or non-steroidal anti-inflammatory drugs (NSAIDs), as well as heating pads and exercise. The groups say doctors should only order CT and other scans when they suspect nerve damage. Opioids are only recommended for patients with “severe, disabling pain” that doesn’t get better with over-the-counter medicines – and their risks, such as for abuse and addiction, should be weighed against potential benefits.

For the new study, Dr. Bruce Landon from the Harvard Medical School in Boston and his colleagues tracked nationally-representative data on outpatient visits for back and neck pain collected between 1999 and 2010. The researchers had information on about 24,000 visits, which represented a total of 440 million appointments across the U.S.

During that span, they found the proportion of patients prescribed Tylenol and NSAIDs dropped from 37 percent to 25 percent. At the same time, the proportion given narcotics rose from 19 percent to 29 percent. About 11 percent of people with back pain had a CT or MRI scan in 2009 and 2010, compared to seven percent in 1999 and 2000. Finally, although the rate of referrals to physical therapy held steady during the study period, the proportion of patients referred to another doctor – likely for surgery or other treatments – doubled from seven to 14 percent, the researchers reported Monday in JAMA Internal Medicine. “Physicians want to offer patients treatments that are going to work sooner and patients are demanding them and sometimes it’s just easier to order the MRI or order the referral,” Landon said. But, he added, “They often lead to things that are unnecessary and expensive and maybe not better in the long run and maybe even worse,” such as surgery or injections that haven’t proven to be effective.

According to the National Institutes of Health, eight out of ten people have back pain at some point in their lives. One of the difficulties of treating back pain, Cohen said, is that there are so many possible causes – including disc, joint and nerve problems. He said the strongest evidence supports treating the pain with exercise, including stretching and some aerobic activity. Landon said 95 percent of patients will recover from back pain with a little bit of time and conservative treatment. “They key thing for patients is, give it time,” he told Reuters Health. “Patients expect and want it to get better in seconds and that’s not always going to happen. But if you give it time, work on it, do stretching and physical therapy exercises, that’s what’s going to make it better in the long run.”

Occupy Movement Plans August 13 WCAB Protest Over Cop’s Psyche Claim

John Pike, the former police officer who pepper-sprayed students during an Occupy protest at the University of California, Davis is applying for worker’s compensation, claiming he suffered psychiatric injury from the 2011 confrontation.

Pike has a settlement conference set for Aug. 13 in Sacramento, according to the state Department of Industrial Relations’ website. Organizers are already planning a demonstration outside the state building in the hopes of urging the WCAB to reject the former cop’s claim. “It’s so outrageous,” Protest Organizer Bernie Goldsmith said. “While he might be entitled to receive workers compensation, the idea that his own actions of brutality would entitle him to a payout is absolutely unjust. It’s crazy.”

Pike was fired in July 2012, eight months after a task force investigation found that his action was unwarranted. Online videos of him and another officer casually dousing demonstrators with pepper spray went viral, sparking outrage at UC Davis leaders. The images became a rallying symbol for the Occupy Wall Street movement.

Hackers posted Pike’s information online. The former Marine sergeant received scores of threats that led an Alameda County Court judge to rule against releasing the names of other officers at the scene.

This week, a state appeals court ruled news organizations are entitled to know the names of a dozen University of California police officers who were interviewed about the use of pepper spray on demonstrators at UC Davis. The Los Angeles Times and The Sacramento Bee are seeking the officers’ identities, which were redacted from two reports on the incident.

In the aftermath, the University of California agreed to pay $1 million to settle a lawsuit filed by demonstrators and the chief of the UC Davis police department resigned. Ian Lee was one of the protesters pepper-sprayed. He and about 20 others shared in a million-dollar settlement. The college junior hopes Pike’s claim is denied. “It’s wrong what he’s trying to do,” Lee said. “When you reward people like Pike by giving them benefits, you tell people it’s okay to hurt students. That’s the message we absolutely cannot send.”

DWC Now Accepting Applications for October 19 QME Exam

Applications are now being accepted for the Qualified Medical Evaluator examination, which will take place Saturday, Oct. 19. Applications for the QME exam may be downloaded from the DWC Website. The QME application form is included in the exam packet. Applicants may also contact the Medical Unit at 510-286-3700 to request an application via U.S. mail, email or fax. The deadline for filing exam applications is Sept. 12.

The QME exam will be given at two locations. The northern California exam will be given at the South San Francisco Conference Center, 255 South Airport Blvd,.South San Francisco. In southern California the examination will be at the Irvine Marriott Hotel 18000 Von Karman Ave., in Irvine.

The examination content is based in part on the information contained in the Physician’s Guide to Medical Practice in the California Workers’ Compensation System, An IMC publication, Winter 2001, 3rd edition, and the DWC Medical Unit, “Study Guide” 2013 version, (available Summer 2013). As a result of 2003 and 2004 legislative changes and 2009 and 2013 regulatory changes, some portions of this Physician’s Guide may be inconsistent with current law. Therefore, it must not be considered authoritative, and should only be consulted as an historical document. Effective January 1, 2001, a physician seeking appointment as a QME on or after January 1, 2001, shall also complete prior to appointment, a 12 hour course on Disability Evaluation Report Writing approved by the DWC. (LC§139.2).

For more information please contact the Medical Unit at 510-286-3700, Joanne Van Raam at 510-628-2004 or Francine Wooley at 510-628-2038.

Navy Employee Sentenced to Two Years for Comp Fraud

United States Attorney Laura E. Duffy announced that veteran Leray Shurn was sentenced to serve two years in federal prison by United States District Court Judge Thomas J. Whelan for running a landscaping business while claiming worker’s compensation and unemployment benefits from the Department of the Navy and Department of Veterans Affairs to which he was not entitled. Judge Whelan also ordered Shurn to pay $357,977 in restitution and a $5,000 fine. Shurn’s fraud spanned more than five years and cheated two U.S. government agencies out of over $350,000.

According to evidence presented during trial, Shurn falsely represented to the Navy and VA that back and later knee injuries prevented him from working as a Navy civilian employee, and that he was not engaged in any employment where he received payment of any kind, was not self-employed, was not involved in any business enterprises, and did not have an ownership interest in any business enterprises. He also falsely claimed that his disability prevented him from being able to obtain employment.

In January 2013, a jury returned guilty verdicts on all 16 counts of fraud (5 counts of mail fraud, 4 counts of wire fraud, 5 counts of fraud to obtain federal employee’s compensation, and 2 counts of false statements to the VA). During the trial, the jury heard and saw evidence, including video recordings, that Shurn operated a landscaping business in which he personally performed landscaping work for numerous customers, provided customers with his business card for “Leray’s Landscaping” as well as monthly invoices, and represented to landscaping suppliers that he was in the landscaping business. The jury also received evidence that while Shurn was concealing his landscaping business from the Navy and VA, he completed a survey in which he indicated that he was a business owner.

United States Attorney Duffy added, “During these difficult budgetary times, submission of fraudulent claims harms our community and government agencies by diverting financial resources away from those with legitimate claims who are most in need of benefits payments and prevents agencies from funding other priorities.”

New FDA Law Fast Tracks Breakthrough Drugs

In July 2012, a provision in the new law called the Food and Drug Administration Safety and Innovation Act, or FDASIA for short, gave FDA another powerful expedited development tool, known as the “breakthrough therapy” designation. This new designation is now helping FDA assist drug developers expedite the development of new drugs with preliminary clinical evidence that indicates the drug may offer a substantial improvement over available therapies for patients with serious or life-threatening diseases. Although the designation is not yet even a year old, FDA has received 62 requests to grant this new designation to products under development. The FDA has already granted the breakthrough designation to 20 potential innovative new drugs that have shown encouraging early clinical results.

To help industry better understand each tool, including when the tools can be used and the features of each, the FDA has just published an industry draft guidance titled Expedited Programs for Serious Conditions – Drugs and Biologics. Among other important information, the draft guidance describes FDA’s policies and the threshold criteria for each expedited program, defines and discusses important concepts, including serious condition, unmet medical need, and available therapy, and provides some general considerations for products utilizing an expedited program, such as manufacturing and product quality, nonclinical considerations, and clinical inspection considerations.

The FDA previously had three other programs for over 20 years: Fast Track, Accelerated Approval, and Priority Review. But breakthrough designation required early clinical data in people showing an “unprecedented effect.” The close relationship allows the company to “design collaborative, multidisciplinary development plans that hasten timelines to approval and minimize the number of patients exposed to less efficacious treatment or placebos.”

Yesterday, there was a congressional briefing on the status and efficacy of breakthrough status designations. Jay Siegel, Johnson and Johnson’s head of global regulatory affairs, spoke about the accelerated drug development process, and how it has shaved two years off of the close to 10 years that a typical drug takes to go to market. “This has had an enormous impact,” Siegel said. “There is a very pro active role on the part of the FDA. They’ll pick up the phone and call us and say ‘Have you thought of this way to do this faster? Have you thought about this problem?'” The FDA suggested some avenues the companies should take to seek approval that they hadn’t thought of, Siegel said, without being specific. The agency also helped J and J and Sunnyvale, California-based Pharmacyclics determine which trials must be done before submitting an approval application and which could be conducted after potential approval, he said.

Vertex Pharmaceuticals Inc., based in Cambridge, Massachusetts, was the first to receive a breakthrough designation for expanded use of its cystic fibrosis drug Kalydeco.

LAPD Reserve Officer Not An Employee for FEHA Claims

In 1990, Frank Estrada became a reserve officer for the Los Angeles Police Department. As an applicant for the reserve officer position, Estrada acknowledged in writing that “As a member of the Police Reserve Corps, I am not a regularly salaried officer of the [Department] and am not entitled to compensation for services rendered as a Police Reserve Officer.” Although Police Reserve Officers are volunteers who serve gratuitously, the City deems these individuals to be “employees” for the limited purpose of extending them workers’ compensation benefits. Such benefits are not remuneration; rather, they help to make the volunteers whole, in the event they are injured while performing their duties.

In 1995, while on duty, Estrada was involved in a traffic collision and sustained leg and back injuries. In 1996, while on duty, Estrada again was involved in a traffic collision and injured his right shoulder. In both instances, he obtained workers’ compensation benefits and continued to receive benefits, as his injuries were not fully resolved.

In October 2004, the Food and Drug Administration (FDA) served a search warrant on Estrada’s nutritional supplement company, Body Basics, Inc. Thereafter, Estrada was the subject of a personnel complaint by the Department’s Internal Affairs Division. The personnel complaint alleged that while Estrada was off duty, he “inappropriately sold a product containing sildenafil citrate, the active ingredient of Pfizer’s trademark prescription drug Viagra.” Administrative proceedings following an investigation resulted in Estrada’s termination in December 2007, after 17 years as a reserve officer.

Estrada filed suit against the City, alleging: disability discrimination under FEHA (Gov. Code, § 12945.2, subd. (l)) (first cause of action); retaliation for filing workers’ compensation claim (Lab. Code, § 132a) (second cause of action); and intentional infliction of emotional distress (IIED) (third cause of action). Estrada subsequently withdrew the second cause of action, and the third cause of action was eliminated on demurrer. Thus, this matter proceeded only on the first cause of action, the FEHA claim.

The trial court determined “as a matter of law that [Estrada] could not prove the elements of his first cause of action for disability discrimination in violation of the [FEHA] on the ground that [Estrada] is not an employee for purposes of the FEHA.” Estrada appealed the decision claiming that the trial court erred in concluding the definition of “employee” for purposes of his FEHA discrimination claim is governed by the City’s civil service rules; a charter city, such as Los Angeles, cannot opt out of complying with state laws that address statewide concerns; FEHA defines “employee” broadly and looks to case law for a more useful definition; FEHA reflects matters of statewide concern and cannot be trumped by the City’s civil service rules; including the City’s police reserve officers within the definition of “employee” is consistent with the public policy expressed in FEHA and is reasonably related to the statewide concerns addressed in FEHA.

The Court of Appeal rejected these arguments and sustained the dismissal in the published case of Estrada v City of Los Angeles. In “order to recover under the discrimination in employment provisions of the FEHA, the aggrieved plaintiff must be an employee.” However, the statutory definition of ‘employee’ found at Gov. Code section 12926, subdivision (c), does not actually define who is an employee under the FEHA. The definition of ‘employee’ contained in FEHA regulations is more helpful. These were interpreted in the case of Mendoza v. Town of Ross (2005) 128 Cal.App.4th 625, 632. Mendoza found “there is nothing within the FEHA or its legislative history evincing an intent to depart from the requirement that compensation of some sort is indispensable to the formation of an employment relationship.” Thus the Court concluded that “Estrada was a volunteer who served without remuneration. He was appointed to a volunteer position, rather than to a position in the classified civil service. Accordingly, Estrada was not an employee of the City.”

Feds Cut Back on Health-Care Fraud Investigations

Federal officials are scaling back several high-profile health-care fraud and abuse investigations as a result budget and staff cuts, including an audit of the state insurance exchanges that are set to open later this year as a key provision of the Affordable Care Act.

The Department of Health and Human Services’s Office of Inspector General, which investigates Medicare and Medicaid waste, fraud and abuse, is in the process of losing a total of 400 staffers, about 20 percent of its workforce from its peak strength of 1,800 last year. About 200 of those staffers will have departed by the end of this year, and the other 200 are slated to be gone by the end of 2015.

“As OIG’s budget resources decline, so do our enforcement and oversight activities,” reads an agency document obtained by the Center for Public Integrity. The OIG noted that it “will not be able to keep pace” with the rapid growth of taxpayer-subsidized health care anticipated under the Affordable Care Act, the signature health reform effort of the Obama administration.

Several of the canceled projects were included in the agency’s 2013 “work plan,” which serves as a barometer for suspected fraud or billing abuse. One of them was a planned audit into computer security at state marketplaces – known as exchanges – that will sell individual health insurance policies under the Obama health-care law. The inspector general’s office said “time pressures” to get the exchanges up and running by Oct. 1 may increase risks that states will fail to shield private medical information from “hacker exploits, unauthorized data access and data theft or manipulation.” In addition, the OIG document said, about $3.8 billion in grant money to develop the exchanges is “potentially at risk for wasteful spending.” Seventeen states are planning to run their own exchanges, while the rest will be operated by the federal government or in state-federal partnerships.

An investigation to determine if nursing homes overuse controversial antipsychotic drugs in treating the elderly and which of these drugs are prescribed most often has been cancelled. The canceled initiative was supposed to identify nursing homes that failed to follow federal rules requiring that patients “be free from unnecessary drugs.”

Another canceled probe includes a study of crooked suppliers of costly durable medical equipment, such as wheelchairs and other medical devices used in the home, who manage to stay in business even after federal officials revoke their billing privileges. The durable medical equipment market has long been troubled by questionable expenditures. The audit was to target merchants in South Florida, a hotbed of Medicare and Medicaid fraud.

OIG officials contend their investigations typically return $8 for every dollar invested. They reported fiscal 2012 expected recoveries of about $6.9 billion and more than 1,100 criminal and civil investigations of individuals or health care businesses. News of the budget crunch first surfaced during questioning at a June 24 hearing of the Senate Committee on Homeland Security and Governmental Affairs. One official said at the hearing that existing staff was stretched so thin that the agency had failed to act on 1,200 complaints over the past year alleging wrongdoing – a number expected to rise.