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Thursday, Mar 28, 2024

Hospital Owner Denies Allegations

Federal officials are responding to reports that Prime Healthcare Services, owner of Sherman Oaks Hospital and Encino Hospital Medical Center, has extremely high rates of the blood infection septicemia among its Medicare patients and that the numbers could be a sign of Medicare billing fraud. Meanwhile, state officials are investigating other allegations of financial mishandling by the company. Ontario-based Prime Healthcare Services recently denied the fraud allegations and said they are part of a smear campaign against the company. The U.S. Department of Health & Human Services’ Office of Investigator General received a letter in July from lawmakers expressing concern over a report from the Service Employees International Union, or SEIU, about the company, said Donald White, spokesman for the office. In the letter, Congressmen Henry Waxman and Pete Stark said the labor union’s report showed that far more Medicare patients are diagnosed with septicemia at the company’s hospitals than at any other hospital chain in the country. The letter cited the union’s findings that the company had an average septicemia rate of nearly 16 percent for Medicare patients ages 65 and older while the comparable national rate was less than 5 percent. The findings also showed that some individual hospitals in the company had even higher levels, such as Sherman Oaks Hospital with a rate of 22.5 percent, the letter said. Two possible explanations were provided by the labor union, according to the letter – either the company had a system-wide pattern of overbilling the Medicare system, which led to $18 million in excess payments, or there is an infections crisis at the company’s hospitals. Federal and state action White would not confirm whether his office is conducting an investigation but said officials are reviewing the letter. “Any time we get a letter from the public requesting review, that letter will be reviewed by the Office Inspector General (of) the Department of Health & Human Services and then handled as appropriate,” he said. Christine Gasparac, press secretary for the California Department of Justice, said her department is investigating separate allegations of financial misdealings, which have nothing to do with septicemia. Gasparac would not give any further information about the investigation. Prime denies fraud Meanwhile, Prime Healthcare officials said the allegations are nothing but a campaign by SEIU to extort union concessions from the company, which is in contract negotiations with Centinela Hospital Medical Center in Inglewood. The company attributed its hospitals’ high septicemia rates to its focus on the company’s practice of seeing sicker patients as a result of its emphasis on emergency departments. The rates were also attributed to the company’s strict compliance with Medicare coding guidelines and its implementations of campaigns designed for early septicemia detection and treatment. “While these campaigns of early detection has resulted in better patient care outcomes and substantially lower mortality rates as compared to other hospitals, it has also resulted in higher septicemia rates,” the company said in a statement.

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