Background--The USA--Australia--Business Practices--Mayne--Conclusion--References
IMPLICATIONS OF THE ENTRY OF COLUMBIA/HCA
(written 31 March 1997)
Part 7 : References
Columbia/HCA announced its plans to enter Australia in February 1997. I was aware that my contacts in the USA were more concerned about Columbia/HCA than Tenet/NME. I thought it very likely that, like Tenet/NME in 1991 their expansion into Australia was because they were in trouble in the USA. I gathered all the documents I could immediately lay my hands on, copied them and sent them to the Foreign Investment and Review Board (FIRB) and to key people. I followed this soon afterwards with the US documents I had used in 1996 to show that Mayne Nickless business practices were not dissimilar to those which had caused so much trouble in the USA. The intention was to delay any decisions while information was obtained. It was essential to prevent FIRB from making the same sort of snap decisions which it had done in the past.
US television programs and large numbers of documents were rapidly secured from the USA over the succeeding weeks. During this time a total of 11 bundles of documents were photocopied and sent to FIRB and to key persons involved in health care decisions. News reports describing the first FBI raids on Columbia/HCA's hospitals in El Paso on 23 March 1997 were available in Australia within 24 hours. These confirmed my assessment of the reason for Columbia/HCA's expansion into Australia.
BUNDLE 1 First documents submitted to Foreign Investment and Review Board(FIRB).
1. The US health scene and Columbia/HCA's entry into Australia :- The first review sent to FIRB when Columbia/HCA's entry into Australia broke. i. A review of the application of corporate thought processes to medicine in the USA. ii. Corporate medicine in Australia. iii. Columbia/HCA enters Australia iv. Conclusion
2. Letters to Minister for Health in SA and to SA Health Commission dated 17 Feb 1992 urging caution and not a repeat of NME debacle.
3 Health Care Vultures, The New York Times 9/7/96 Documents fraud settlements by SmithKline Beecham and NME.
4. News clippings Sydney Morning Herald Feb 1997:- These describe the entry of Columbia/HCA into Australia, US business practices, the business practices of Mayne Nickless and the attempt by SmithKline Beecham (recent US $325 million fraud settlement) to involve itself in clinical care in Australia.
5. Kuttner R- "Columbia/HCA and the resurgence of the for-profit hospital business New Eng J Med 1/8/96 p 362, 8/8/96 p 446
6. Herron Senator J "Doctor pursues answers as Tenet Healthcare vacates Australia" Healthcover Feb-March 1996 p 54 :- Some aspects of National Medical Enterprises demise in Australia.
7. Extracts of evidence given in Singapore court in August 1993. The allegations made against staff at that time running NME hospitals in Australia were denied by the hospital but no evidence was given and none of the hospitals witnesses gave evidence to refute them. Less than a year later over half of NME's hospitals pleaded guilty to similar practices. The hospital has since been sold, to a more reputable Singapore company.
8. Rewards of Deviance 6 July 1993:-Document submitted to Mr Justice Yeldham objecting to a hospital licences for NME in NSW. Introduction only.
9. Letter Director General of Health 12/8/96 and Submission: "The Use of Incentive Bonuses in Medicine Summary" This submission was made objecting to licences for Mayne Nickless in Queensland on the basis of its 1994 criminal record and its use of incentives linked to profits. It provides an overview of corporate practices and corporate perceptions and sets out to show that fraud was widespread in the USA and not localised to NME. A case is made that this is the consequence of the corporate approach to medicine, particularly the use of incentives and coercion linked to profits. A case is made that the press reports indicate that Mayne Nickless was adopting a US corporate approach to medicine and that it displayed "closed minded" thought processes and might therefore offend again. Shortly after this it pleaded guilty to misleading its customers again.
10. Columbia/HCA nabs Healthtrust. Modern Healthcare 10/10/94 p2. This article gives an overview of Columbia/HCA's rapid expansion before it started buying "not for profit hospitals.
11. Big Hospital Chain Makes a Bid to Buy Blue Cross of Ohio. New York Times 30/3/96.
12. Ohio Blues Execs to net millions in deal Modern Healthcare 13/5/96 p 6
13. Columbia, PPP Healthcare Group Form Joint Venture in United Kingdom. PR Newswire 13/11/96
14 California Challenges Deal on Nonprofit hospital New York Times 9/11/96: The deal to buy Sharp Healthcare
15. Freudenheim M "Health Care in the Era of Capitalism." New York Times 7/4/97
16. "Healthcare ads getting aggressive" Modern Healtrhcare 23/9/96 p 50
17. For-Profits to feds: Keep out of local business Modern Healthcare 20/1/97 p 10
18. Outlook 1997: For-Profits face challenges: Acquiring not-for-profits will be tougher. Modern Healthcare 6/1/97 p 40
19. Prepared Statement of Dr XYZ to US House of Representatives Inquiry 1992:- This was an HCA hospital. Subsequent to this statement Dr XYZ was fired from the hospital using the peer review process to accomplish this.
20. Columbia/HCA settles shareholder suit and Charter paying big insurance settlement. Modern Healthcare 21/11/94
21. When Your Community Hospital Goes up for Sale. 40 page handout prepared by supporters of not for profit hospitals to act as a guide to those forced to enter into negotiations with for profit hospitals..
22. "System for Docs, Pols and Mobs" U.S . News and World Report 2/9/96. Describes the developments in the US Heath system and the Mafia's involvement.
23 Calif. MD turns the tables on unfair peer reviews. Amer Med News 4/9/87. Peer review has been used by corporations to rid themselves of "disruptive" doctors who speak out for years. Dr ABC formed a society to support colleagues who had the courage to blow the whistle on corporate activity.
24. Letter Dr ABC to Dr Wynne 2/4/96. Dr ABC describes what happened to Dr Clarke who blew the whistle on HCA and Dr DEF who spoke out about NME in Texas. Both companies subsequently paid large settlements but this did not help the doctors.
24. Olmos D.R., Hospital Giant's Plans Stir Concern About Charity Care.
25. More fraud cases seen. Mod Healthcare 24/10/94
26. HCA agrees to settle charges in Texas probe Mod Healthcare 11/1/93 p 6
27. IRS watching for deal inducements. Mod Healthcare 4/9/95
28. Catholic group bans for-profits. Mod Healthcare 12/6/96
29. Nurses Nationwide air gripes against hospitals. Mod Healthcare 10/4/95
30. Stark calls for Columbia probe. Modern Healthcare 31/5/96 Stark alleges that Columbia/HCA is violating the laws he introduced to stop financial incentives to refer patients.
31. House gets nursing bill Modern Healthcare 6/5/96. The situation has become so bad that it has become necessary to pass legislation to ensure that staffing levels are maintained and that nurses who speak out are not victimised. What has happened to medicine?
32. Expert spells doom for healthcare reform. Mod Healthcare 18/3/96
33. Study says U.S. healthcare costs more, has lower quality. Mod Healthcare 12/2/96 p126
34. With Malik toward none. Mod Healthcare 12/2/96 p126. Executive states profit motive openly.
35. N.Y. legislators hit HMO "gag rules" Mod Healthcare 5/2/96. Managed Care corporations are no different in approach to for profit providers.
36. "FBI seels power to make health fraud more costly" and "FBI: Health care fraud the crime of choice." Mod Healthcare 27/3/95 p 4. Drug dealers are switching to health care.
37. Hospitals must avoid repeats of recent fraud. Mod Healthcare 17/10/94
38. More fraud cases seen:- Mod Healthcare 24/10/94 p 24
39. Submission to ICAC extracts include "The Yeldham Conditions" and the conclusion:- Yeldham was appointed by the same government in NSW which had previously overseen an investigation of his sexual practices, an investigation which probably caused him to resign from the supreme court. The investigation was then dropped. He committed suicide in 1996 after public revelations about his conduct. The submission requests an investigation of the circumstances which caused him to overrule contrary conclusions and advice from two health departments and grant licences to NME.
40. Field J.H. "Abusive Peer Review and health Care Reform" in "Health Care Crisis? The Search for Answers." edited Misbin RI, Jennings B, Orentlicher D and Dewar M
BUNDLE 2 Documents submitted in support of an objection to hospital licences by Mayne Nickless on the basis of its use of incentives linked to profits.
41. Newspaper reports about Mayne Nickless. The Australian 7/12/94, 17/2/96, Courier Mail June 95, Financial Mail 19/1/95. The Australian surgeon Dec 1995 p 35, Australian Health & Aged Care Dec 1995. "Hospital put profit before life, say nurses". in Sydney Morning Herald 20/5/95. These articles describe the guilty plea made by Mayne Nickless in 1994 including statements made by witnesses. They describe the incentives offered to two senior executives in the Health care chain of command. Mayne's expansion and agreement to run public hospitals, its international expansion, and concerns about standards of care are reported in the press. Subsequently the company pleaded guilty to defrauding customers again in 1996. A recent Four Corners program revealed its practice of running large clinics, employing many doctors and advertising these clinics to the public. This is the sort of situation which has caused so much trouble in the USA. In the USA doctors were induced to refer patients to corporate hospital using incentives and the threat of dismissal. Tenet paid US $379 million and Columbia/HCA is alleged to have indulged in similar practices.
42. Multiple Articles addressing the contrasts between corporate and medical ethical issues in healthcare.
Boyd J.W. et al The tobacco/health-insurance connection. The Lancet 8/7/95 p 64
Woolhandler S & Himmelstein D.U., Extreme Risk - the new corporate proposition for physicians. New Eng J Med 21/12/95 p1706
Pellegrino E.D. "A matter of integrity" Australian Medicine 20/7/92
Relman A.S. "What market values are doing to medicine" The Atlantic Monthly March 1992 p99
Weedon D. "The challenges ahead". AMAQ News April 1996
43. Waite V.S. and Walker R. "Editorial: Medical and Surgical Peer Review" Am J Surg July 1994 p1
44. What are the government's broad objectives for competition policy in health. Hon Michael Wooldridge. Ministers lecture May 1996. Th minister's economic rationalist arguments in which he ignores the medical ethic which is dealt with in other documents in this bundle.
45. Letter to Medibank Private 11/12/95. This letter sets out the similarity between the corporate style and advocacy patterns adopted by Australian managed care insurers such as Medibank to the practices of National Medical Enterprises. The intention of both was to seduce the medical profession into corporate patterns of thought and so change the professional culture of patient first to the business one of loyalty to the corporation.
46. Williams Ron "Remission Impossible". 1992, Jacaranda Press, Queensland. Extracts from his book predicting the corporatisation of medicine in Australia. His predictions are disturbing.
47. Departments Submission in Reply. NSW Health's 1993 submission to Yeldham advising him to reject a licence for NME in Sydney. (front page only)
48. Investigation and submissions by West Australian Department of Health Feb/Mar 1993. The submission stresses the threat which National Medical Enterprises and US style corporate medicine in general pose for Australia. The reports recommend that a structure be set up to remove licences and that legislation be enacted in all states to address the emerging problem, The advice was not acted on and the documents remained hidden until FOI legislation was passed some time in 1995.
49. Extracts from stockbrokers reports which equate financial success positively with care and which support the offering of financial inducements to doctors.
50. Selection of newspaper reports, court documents, corporate documents and other material documenting the situation in the USA. This relates to the exploitation of the vulnerable in psychiatry, substance abuse, rehabilitation, children, the aged and in surgery in The USA, UK and Singapore by large numbers of US and a French corporation. Business practices are touched on. The intention of these was to show that fraud and dysfunctional practices were not isolated to psychiatric care, not to NME and not to the USA. It is a problem in most of those situations in which corporations involve themselves in humanitarian endeavours such as health care; situations where humanitarian considerations are in conflict with the corporate profit motive. The documents expose some of the aberrant thought patterns in corporate hospitals owned by NME and Charter. Insurance companies are shown to have invested billions in the hospitals they pay for treating the people who insure with them.. A similar situation to Columbia/HCA owning managed care companies.
51. Can we defuse the NHS timebomb, BusinessAge 1996:- This article describes the introduction of US corporations into the UK and the consequences of US corporate medicine.
52. The Observer 8/1/95 "Care fears after death in 'factory' hospital" by Mark Gould:- A much faxed copy of this report on the conduct of the French company GSI which attempted to buy hospitals in Australia in 1995. When this report and the lengthy Woodley report were obtained from the UK GSI backed away. It seems that corporations see Australia as a haven when they are in trouble elsewhere.
53. UK Community Care & U.S. Healthcare Multinationals" and "The Privatisation Network" from Public Services Privatisation Research Unit, London. These are two extracts from reports of two extensive investigations, one addressing the dysfunctional practices and fraudulent conduct by multinationals globally in a general sense and the other dealing more specifically with the introduction of multinationals into the U.K. health scene. The remainder of these documents have a wider relevance to the issues of economic rationalism, corporatisation, globalisation, and the loss of social control which follow these developments. The corporate environment and globalisation give free reign to what Robertson et al called "successful sociopathy".
US Television Programs
54 "DAY ONE" US Television program June 1993 - exposure of HCA's practices in Nevada
55 "60 MINUTES" US Television program October 1996. - exposure of Columbia/HCA's business practices
BUNDLE 3 Columbia/HCA - Further documents 25/2/97
56. The patient as a profit centre: Hospital Inc. Comes to Town. The Nation 18/11/96
57. Sharpe Healthcare pulls out of deal with Columbia/HCA. Press release by Consumers Union. the Consumer's Union was active in California in raising the issues which led to action.
58. Sharpe Pulls Out of Joint Venture Plan LA Times 22/1/97
59. Columbia/HCA's California Expansion Falters Wall Street Journal 24/2/97
60. Conversion and Preservation of Charitable Assets of Blue Cross and Blue Shield Plans
61. Columbia Healthcare Juggernaut Goes Blue. National Law Journal 29/7/96 Purchase of Blue Cross in Ohio by Columbia/HCA
BUNDLE 4 Articles and Submissions written by Volunteer Trustees .
The Volunteer Trustees Foundation for Research and Education has done extensive research on Columbia/HCA's practices . Included are articles and brochures put out as well as the text of statements made before public committees of inquiry in several states.
63. Miller L.B. When Your Community Hospital Goes Up for Sale: Who wins and who loses in Health Care Systems Economics Report Vol No 6 1996
64. Miller L.B Public Hearing Michigan 29/7/96
65. Miller L.B Public Hearing Kansas 25/11/96
66. Miller L.B Submission to the US Treasury re Columbia/HCA's purchase of a hospital in Florida 17/7/96
BUNDLE 5 The Response of the USA to Columbia/HCA practices
67. CHA Head to Retire: For-profit foe Curley to step down
68. Columbia, NLRB at odds in Ky. Modern Healthcare
69. For-profit healthcare will make you sick. in The Road to Radical Democracy 31/1/97
70. Columbia rebuffed in Colo deal Modern Healthcare 12/4/96
71. Columbia goes to court in bid to build Kan. Hospital Modern Healthcare 17/2/97 p 6
72. Northern Exposure: Columbia bid in Alaska frozen as opposition mounts. Modern healthcare 3/3/97 p 46
73. State Bills Target for-profits
74. WSHA's about-face: Group backpedals on bill regulating not for profit sales
75. Letter from Mr GHI, Arizona House or Representatives 14/2/97
76. Big Hospital chain makes bid to buy Blue Cross of Ohio The New York Times 30/3/96
77. Ohio Blues Exec to net millions in deal, Mod Healthcare 13/5/96 p6
78. Hospital Companies opponents question Ohio Blues deal Mod Healthcare 22/4/96 p6
79. Columbia, Blue Cross and Blue Shield of Ohio Extend Agreement. Columbia/HCA
80. Columbia was a determined suitor. Mod Healthcare 3/3/97 p 40
BUNDLE 6 Case Study: The 50-50 Venture between Sharpe Healthcare and Columbia/HCA.
Several articles about this deal in California which was stopped by the attorney general. Criminal proceedings are possible.
81. California Challenges Deal on Nonprofit Hospital. The New York Times 9/11/96
82. California's Roadblock latest of Sharp Healthcare's merger woes. Mod Healthcare 18/11/96
83. Not-for-profits should act to prove value of conversions. Editorial Mod Healthcare 25/11/96 p30
84. News At Deadline: Bethany Medical Center in Kansas City. Mod Healthcare 27/1/97
85. Sharp experiences supply shortages, management turmoil. San Diego Union-Tribune 2/2/97
86. Sharp's lease of employees worries state. San Diego Union-Tribune 8/2/97
87. Sharp is urged to drop deal with Columbia. San Diego Union-Tribune 14/2/97
88. Hasty Retreat: Sharp abandons supply, employee deal with Columbia. Mod Healthcare 17/2/97 p3
89. Sharp may drop merger plan/What would come next is far from clear. San Diego Union-Tribune 20/2/97
90. Sharp's doctors and nurses hail news Columbia/HCA deal is dead. San Diego Union-Tribune 22/2/97
91. Sharp kills plan to join giant for-profit chain. San Diego Union-Tribune 22/2/97
92. What now for Sharp?; Demise of Columbia deal leaves system at crossroads. Modern Healthcare 3/3/97 p 33
93. Letters attorney general California to Sharp re deal and making charges 8/11/96
BUNDLE 7 Relevant Reports about Health Scene in USA
94. Columbia: A vision for Healthcare that became reality --- Columbia/HCA's web page - note the big three include T.F. Frist previously founder and chairman of HCA
95. Virginia Foes targeted: Columbia manoeuvres to derail rivals merger plans. Mod Healthcare 3/3/97 p3
96. A not for profit spin: PR firm takes up battle against for profit healthcare. Mod Healthcare 3/3/97 p86
97. Checkmate: Docs are pawns in game of creating integrated systems. Mod Healthcare 3/3/97 p74
98. Scrutiny from the states: Except for Columbia, probes having little effect on deals. Mod Healthcare 24/2/97
99. Gold Medal Award Winner Mod Healthcare 3/3/97 p70
100 Manipulated care: gagging doctors, blinding patients. Editorial in The Lancet 5/10/96
101 Jabs and Jibes: A dogs life The Lancet 11/1/97 Private care for dogs contrasted with managed care for humans.
102 What Price Cost Control - Editorial in The Lancet 1/2/97
103 Spin Doctors Amputate Health Reform. PR Watch Second Quarter 1995 p 1
BUNDLE 8 Additional reports from the USA 18/3/97
104 Attorney General in Michigan vs Michigan Affiliated Healthcare and Columbia/HCA: Court documents when attorney general moved to block Columbia/HCA deal
105 Columbia's big ad bucks: Giant Chain outspends other hospitals on advertising. Mod Healthcare 10/3/97
106 News reports from Destin in regard to Columbia/HCA -- The Destin Log 3/5/95 -- Daily News 16/5/95 -- Modern Healthcare 30/10/95
BUNDLE 9 OBJECTIVE EVALUATIONS
107 Testimony of J H Parker Jr to Michigan public inquiry and CV of Mr Parker
108 Analysis of Hospital Cost Efficiencies, Staffing Levels, and Pricing Behaviour in Florida Dec 1996 -- Columbia/HCA
109 Analysis of reported Community Benefits in Florida Dec 1996 -- Columbia/HCA
110 Georgia Hospitals: Analysis of Hospital Community Benefits Dec 1996
BUNDLE 10 FBI raids Columbia/HCA hospitals (19/3/97)
111 FBI seizes health-care giants files. The Tennessean 20/3/97
112 U.S. expands probe of Columbia/HCA The San Diego Union Tribune 21/3/97
113 Columbia shares dip on fears of wide probe. The San Diego Union Tribune 22/3/97
114 Congressional Record 6/1/97 -- 13/2/97 and 10/9/97 Fortney Pete Stark speaks to legislation to contain for profit hospitals, particularly Columbia/HCA and also to ensure that accreditation bodies such as JCAHO are no longer subject to control by corporations.
115 For-profits take a hit: A study in 'New England Journal' says sector is less efficient. Modern Healthcare 17/3/97 p2. Report of recent study from New England Journal of Medicine and of increasing opposition by those critical of Columbia/HCA
116 More public hospitals to be run privately Sydney Morning Herald 21/3/97 The minister for health persists with his level playing field and the corporatisation of private hospitals.
117 John Ralston Saul, "Meaning lost in corporate world" and "The man in yellow socks with a scathing message for the masses. " Sydney Morning Herald 21/3/97 In the same paper as reported on the ministers plans to corporatise us Saul is scathing about the corporate world.
118 Queensland Health --- For sale. The Queensland Nurse Sept/Oct 1996
119 Exerpts from the New South Wales Auditor General's Report for 1996 Vol 1
120 Page from NSW Hansard in regard to Port Macquarie hospital deal with Mayne Nickless 29 May 1996
121 El Paso on health care frontier. The San Diego Union Tribune 21/6/96.
122 San Diego medical system at crossroads / For-profit group may take over bug hospitals. The San Diego Union Tribune 16/10 /96
123 Taking on giant of all hospital chains / Columbia/HCA runs into resistance here. The San Diego Union Tribune 28/12/96
124a Public asks more voice in fate of health care The San Diego Union Tribune 13/3/97
124b County will ask experts to map health-care plan The San Diego Union Tribune 19/3/97
125 Regulators KO Blue Cross Deal. Washington Post 13/3/97
126 Hospital chain is rebuffed / Columbia/HCA plan for acquisition fails The San Diego Union Tribune 14/3/97
127 Analysing Columbia/HCA Failure Washington Post 13/3/97
128 Ohio Blues Throws in towel on Columbia deal. Mod Healthcare 19/3/97
Bundle 11 More documents 27/3/97
129 Trying to have it both ways: S<C> docs sue over management deal just like their own. Mod Healthcare 24/3/97 p26
129 Report adds fuel to local benefit debate Mod Healthcare 24/3/97 p19
130 Kuttner R "The Limits of Markets" The American Prospect No 31 Mar-Apr 1997: p 28-41
131 Pear R., New York Times 10/3/97
132 Still more scrutiny: District of Columbia legislation would add obstacles to for-profit deals. Mod Healthcare 24/3/97 p21
133 Punishing Costly health care fraud. The San Diego Union Tribune 22/11/96
134 Ohio Blues gives up: Insurer agrees to call off Columbia deal, remove CEO. Mod Healthcare 24/3/97 p2
135 Ohio unbowed by its Ohio setback. Mod Healthcare 24/3/97 p2
136 News at deadline. Mod Healthcare 24/3/97 p4 Introduction of a bill to make hospitals disclose nurse to patient ration and other information,
137 Inside lobbying for Health Care Reform. Summary of report by The Center for Public Integrity. Describes the way corporations spent vast sums on lobbying and media exercises to defeat the Clinton reforms.
138 Doctor lets patient die, is rewarded with raise. The San Diego Union Tribune 19/1/97
139 U.S. Healthcare: Physician Gag Clause
140 Many HMOs don't put patients first. The San Diego Union Tribune 23/3/95
141 Lindorff Dave, Marketplace Medicine: The Rise of the For-Profit Hospital Chains Bantam Books
142 Jones Rochelle The Supermeds: How the Big Business of Medicine is Endangering Our Health Care. 1988 Charles Macmillan
143 The Profits of Misery: How inpatient psychiatric treatment bilks the system and betrays our trust. Hearing in Washington April 28, 1992, US Government Printing Office -- Proceedings of US House of Reps Inquiry 1992
144 Rokeach Milton The Open and the Closed Mind, 1960, Basic Books, New York
145 Robinson W.I., "Globalisation: nine theses on our epoch". Race & Class 38,2(1996) p13
146 Eva Cox, A Truly Civil Society in 1995 Boyer Lectures
147 "The Human Costs of Managerialism" 1995 edited by Rees S and Rodley G Pluto Press, Australia
148 NSW Auditor Generals Report for 1996
149 NSW Hansard 29 May 1996
150 Arnold P.C., "Price competition, professional cooperation and standards MJA 2/9/96 p 272
151 Robertson et al, Sociopathy; forever forensic MJA 4/3/96 p 304
152 Wynne J.M. "The Impact of Financial Pressures on Clinical Care: Lessons from Corporate Medicine." in Access to Surgery: A National Symposium on the Planning and Management of Health Care Programs under Medicare. Townsville, May 23-24, 1996, editors Prof. P.K. Donnelly and Assoc. Prof. L. Wadhwa, published by the University of Queensland Press. (in press)
153 "Emergency in Christchurch" Sunday Star-Times Feb 2, 1997 A5
154 The New York Times and The Wall Street Journal - articles Columbia/HCA 24-29 March 1997
155 Berger P.L., The Sacred Canopy: Elements of a sociological theory of religion. 1969, Anchor Books, New York page 8
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Background--The USA--Australia--Business Practices--Mayne--Conclusion--References
Last modified October 1998 J.M. Wynne