SENATOR RICK SCOTT, COLUMBIA/HCA, AND ME
HOW TO GET RICH ON MEDICARE FRAUD AND BECOME A SENATOR
In the mid-90s, I worked for a small, Dallas-based healthcare consulting firm. We traveled the country assisting hospitals in establishing skilled nursing units, inpatient rehabilitation beds, comprehensive outpatient rehabilitation facilities, and senior health centers. My area of expertise was inpatient and outpatient rehabilitation. My company contracted with Columbia-HCA to assist them in developing comprehensive outpatient rehabilitation centers in association with their two hospitals in El Paso. They already operated outpatient rehabilitation facilities, but comprehensive rehabilitation is a higher level of service, and thus, receives a higher Medicare payment.
I made weekly trips to El Paso to assist them in upgrading their existing facilities and offering suggestions for new builds. One of my first areas of concern was that they were paying physicians for referrals, which federal law prohibits. Fortunately, this ceased immediately when I discovered the payments. Comprehensive rehabilitation regulations allow a physician to be part of the team to develop individual treatment plans, follow the progress, and meet weekly with the team. I arranged for one of the doctors, the most significant referral source, to become the “Medical Director,” which was legally allowable.
During my trips to El Paso, I became acquainted with many corporate personnel who would travel from the headquarters in Nashville to El Paso to provide expertise to the local staff. We frequently had dinner together and became traveling buddies of sorts. One of my closest new friends from the corporate office had the role of training coders to “up-code” Medicare claims. She would teach them to review the diagnoses from doctors and to substitute a higher-paying diagnosis, thus increasing Medicare payments to the hospital and company. I remember asking her if this wasn’t illegal. She responded that all hospital corporations employed experts to help them “code claims correctly.”
One very early morning, while I was in El Paso, I received a phone call from one of the directors of the outpatient rehabilitation centers. The FBI had entered their facility and seized computers and office files, including documentation. They were terrified and did not know what to do. I immediately let them know to cooperate. After they realized there was nothing they could do to stop the seizure, I shared with them all the changes they had made to upgrade their program. I knew they had sufficient evidence for properly coding their services.
Over 200 FBI agents descended on the two hospitals and hundreds of physicians in El Paso that day. The FBI had been investigating the many ways Columbia-HCA had been defrauding the government. My little world of outpatient rehabilitation had nothing to hide and did well in the investigation, but the rest of the company did not fare well.
Rick Scott was the CEO of Columbia-HCA. He founded Columbia a decade earlier, with his first two hospitals in El Paso. Three years later, Columbia merged with HCA, which considerably grew his empire. It seems obvious that his company's practices were continued after the merger.
Scott originally wanted to fight the federal government, but his board forced him to resign the same year as the FBI raids. He was given $10 million cash and $350 million shares of stock. The company was charged with 14 corporate felonies and eventually paid $1.7 billion in criminal fines, civil damages, and penalties.
In 2001, Rick Scott used his disgraceful pay-off to form Solantic Corporation, a new healthcare company located in Florida. Once again, I would soon be a hair’s breadth away from associating with his company.
I was recruited to open and manage a comprehensive rehabilitation inpatient facility named Cornell Institute for Rehabilitation Medicine in 2004. The facility was under the umbrella of Bethesda Healthcare System (now Baptist Health Bethesda Hospital). I hadn’t been there long when I caught wind of the corporate staff from Solantic meeting with the bigwigs of Bethesda Healthcare System to partner with them for an urgent care center. I didn’t let the grass grow too long before I marched into the Bethesda executive offices and requested a meeting. I shared my experiences with Rick Scott’s hospitals in El Paso, the day of the FBI raid, and my conversation with their corporate “up-coder.” I advised them to steer clear of any company associated with Scott. Fortunately, they listened to me.
Scott used his ill-gotten gains to run for Governor in 2010 and won by 1% of the vote. He won again in 2014. In 2018, ran for the US Senate and won by 10,000 votes out of 8 million votes cast. Two years ago, Scott introduced “A Plan to Save America,” which called for the lapse or sunsetting of all federal legislation, including Medicare and Medicaid.
Oh, the dishonest, despicable irony.
Wow! That’s an important inside experience. Wish this could be widely published.