PHA Digs for Truths, Rejects OIG Report

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) released a report in January concerning the ability of physician-owned specialty hospitals to handle medical emergencies. The report, titled, “Physician-Owned Specialty Hospitals’ Ability to Manage Medical Emergencies,” (Daniel R. Levinson, Inspector General, January 2008, OEI-02-06-00310) assesses 109 physician-owned specialty hospitals, reportedly identified from a list provided by the Centers for Medicare & Medicaid Services (CMS). However, at the end of the report, the OIG also notes that CMS currently does not have a system in place to track physician- owned specialty hospitals or to identify newly enrolled physician- owned specialty hospitals.

The OIG reports that this investigation comes in response to the two deaths that occurred last year at specialty hospitals.

The Senate Finance Committee requested that the OIG conduct an evaluation of patient care and safety in physician-owned specialty hospitals. This study focuses on emergency departments, staffing patterns and written policies for managing medical emergencies.

The study relies on four primary sources of data, according to the OIG:

1. a review of physician and nurse staffing schedules for eight sampled days, 
2. a review of hospitals’ staffing policies, 
3. a review of hospitals’ policies for managing medical emergencies, and 
4. structured interviews with administrators at each hospital.

The OIG findings include:

• About half of all physician-owned specialty hospitals have emergency departments, the majority of which have only one emergency bed.
• Not all physician-owned specialty hospitals had nurses on duty and physicians on call during the eight sampled days.
• Administrators report that less than one-third of physician-owned specialty hospitals have physicians on-site at all times.
• Two-thirds of physician-owned specialty hospitals use 9-1-1 as part of their emergency response procedures.
• Some physician-owned specialty hospitals lack basic information in their written policies about managing medical emergencies.

Physician Hospitals of America (PHA) has since called on CMS and Congress to conduct the same review of similar size tax-exempt community hospitals. PHA is the national association representing hospitals that are governed and owned by physicians.

In addition, PHA investigated the report’s findings and, they say, all of its conclusions are “wrong.” PHA executive director Molly Sandvig wrote a fiery letter to Modern Healthcare and Modern Physician magazines stating the truths her group uncovered and blasting the OIG and some media outlets for not confirming the allegations included in the report.

“In the opinion of PHA, the OIG report is either an example of lazy reporting, failure to understand standard hospital policies and procedure, or blatant and purposeful misrepresentation,” asserts Sandvig in the letter. “PHA and physician-owned specialty hospitals are outraged by the OIG’s willingness to release such an erroneous report and by the failure of many in the media to seek independent confirmation of the report’s allegations.”

The letter provides the following details:

The OIG suggests that certain policies regarding emergency response and patient transfers might violate Medicare’s conditions of participation.

PHA: This suggestion is without merit. All of the hospitals have been surveyed and inspected as part of the process of obtaining Medicare certification. Review of policies is part of the survey process.

The OIG further concluded that 37 of these hospitals allegedly use 911 as a substitute for the hospital’s ability to stabilize its patients.

PHA: So far, 29 of these hospitals have challenged this conclusion and provided documentation to PHA that supports this reaction. (One hospital has closed since the OIG began work on the report and six of the nonresponding hospitals are not PHA members.) According to the 29 hospitals, OIG staff did not contact them following the interview and document submission to discuss their concerns and to seek clarification or additional data. The OIG made no effort to allow these facilities to answer these allegations prior to the publication of the report.

The OIG listed eight hospitals which had supposedly violated Medicare conditions of participation due to improper staffing.

PHA: Again, all eight of the named hospitals have come forward with documentation showing that they were, in fact, properly staffed according to CMS guidelines during the times in question. The OIG’s conclusions were wrong and the agency erred in forwarding these hospitals to CMS for further investigative review.

The OIG also reported the number of hospitals with emergency rooms and the size of those emergency rooms.

PHA: The report made no mention of the fact that these issues are controlled by state law. The OIG failed to include a statement that each of these hospitals met their state law requirements, thus inferring impropriety where none exists.

Moreover, PHA notes that many of the hospitals named are fivestar ranked and/or listed by independent quality authorities as the No. 1 hospital in their specialty and state. “The OIG report does a disservice both to the medical professionals of these hospitals and, more critically, to the patients who are served by them.

“We are proud of the high quality of medical care that our members provide,” Sandvig adds. “Numerous government and private studies support the high quality of care offered to patients by the physician hospital industry.” 

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