The majority of patients with kidney failure are kept well by regular dialysis on an artificial kidney. This can be done in a hospital, in a day care clinic or, with modern equipment, in the patient’s home. While a kidney transplant gives a better quality of life there are not enough kidney transplants to go around.
This is big business in the USA. As in other health care sectors the big corporations providing this service have been guilty of major fraud and have not always acted in the best interests of their patients. In spite of this Australian governments have welcomed these same multinationals into our country and entered into PPP partnerships with them to provide both public and private dialysis services.
Every sector of the market controlled health service in the USA is plagued by fraud and/or the exploitation of the vulnerability of citizens in order to generate ever larger profits. Dialysis services have been severely affected. Almost all of the large gradually consolidating dialysis firms have been involved in investigations or in fraud settlements with government.
In March 2001 Renal Web <http://renalweb.groupee.net/eve/forums/a/tpc/f/5711014023/m/8841024023/inc/1> run by Gary Petersen described the complex trail of fraud linking Transitional Hospital Corporation (THC), Community Dialysis Centers, Damon Clinical Laboratories (US $119million settlement and exclusion from Medicare in 1996), Vivra Incorporated, and finally Gambro which purchased Vivra in 1998. That has not changed as the sector consolidated.
Apr 2006 Dialysis wide fraud
"...how many patients received unnecessary testing, medications and equipment, and how many patients went without services that were billed for? Also, how much out-of-pocket money did patients lose in co-payments as a result of bogus billings for services not rendered or for services rendered needlessly?"
Having said all that, it will probably come as no surprise that most of the major renal care facilities in the US have come under investigation for fraud in recent years, to include Fresenius Medical Care America, DaVita Inc, Renal Care Group, Quest Diagnostics, and Bone Care International.
Gambro Healthcare - Dialysis Fraud Pays Big Buck Media Monitors Network April 2, 2006 http://usa.mediamonitors.net/content/view/full/28817
Gambro is a Swedish company that grew to become a global provider of blood products, renal care equipment and Dialysis clinics. It grew rapidly and expanded in the USA by acquisitions. It reached a US $54 million fraud settlement in 2000 and entered into an integrity agreement. In spite of this it re-offended. It paid another US $350 million and entered into another integrity agreement in 2004. Faced with a 3rd fraud investigation it sold its US dialysis business to rival DaVita. There were also concerns about the safety of its dialysis products and allegations of deaths and serious illness as a result.
Click Here for the Gambro/Diaverum story.
Fresenius is a German company that has become a global provider of dialysis services. Its operation in China was caught up in a scandal involving the sale of organs from executed criminals.
In the USA Fresenius has expanded by buying firms under investigation for fraud. In 2000 it paid a US $486 million fraud settlement and entered an 8 year integrity agreement. In 2008 it still faces another unresolved whistleblower initiated fraud action, fraud that presumably occurred during its 8 year integrity agreement.
When challenged about its probity Fresenius claimed that the frauds occurred in the companies that it purchased and that it had put a stop to them. The various reports publicly available make one question this.
Click Here for the Fresenius story.
Founded in 1931 Baxter is a US multinational that built its empire in infusion fluids and therapy. It then branched into multiple other areas including dialysis machines and then dialysis clinics. It spun off its intravenous infusion service in 1992 as Caremark, shortly before that subsidiary paid what was then a record fraud settlement.
Baxter's subsequent fraud conduct has been better than its competitors but it has been listed in the top 100 corporate criminals of the 1990s by Corporate fraud reporter. Its track record for safe equipment is however inferior and a large number of deaths have resulted from faulty products.
Click Here for more about Baxter
Dogged by fraud investigations the US dialysis marketplace has consolidated by mergers and acquisitions.
Of the survivors DaVita has been the most successful. It is the renamed Total Renal Care, the company sold off by the notorious recurrent fraudster Tenet Healthcare (previously National Medical Enterprises). Total Renal Care's new name was a response to a chequered past.
It has been repeatedly investigated for fraud but seems able to skate along the limits of the law so has not yet been prosecuted. It has recently purchased Gambro’s US dialysis clinics – another recurrent offender once again under investigation.
Renal Care Group is another large group that is facing whistle blower initiated fraud actions. In spite of this it has now been bought by Fresenius.
These consolidations have brought competition issues. DaVita and Fresenius have been forced to sell off a large number of clinics. This has resulted in the formation of two new companies, Renal Advantage and National Renal Institutes.
Click Here for more about DaVita, Renal Care Group, Renal Advantage and National Renal Institutes.
Until recently dialysis services in Australia were provided in hospitals, usually operated by government or not-for-profit groups. Gambro, Fresenius and Baxter operate dialysis clinics or provide home dialysis services in Australia.
State regulations across the country contain probity clauses specifying that the owners/providers of hospitals and clinics be "fit and proper" people. With their record for criminal fraud settlements neither Gambro nor Fresenius would qualify for a licence by any normal rational process and therefore should not be able to operate dialysis clinics in Australia.
In spite of this these companies have been granted licenses to operate dialysis clinics by state regulators across Australia. The press have been silent about corporate misdemeanours. State governments, particularly in Western Australia, have embraced these companies, entered into Public Private Partnerships (PPPs) to provide care to public patients, and then marketed the companies to the public.
The poor track record of global health care companies operating in the USA is well known in government circles. All state health authorities and health ministers would have dealt with objections to these companies in the recent past. Information about these dialysis frauds has been widely available on the internet since 2000 and readily revealed by the simplest of internet searches.
The only conclusions that can be reached are that
The third seems most likely.
These companies would certainly have been aware of Australia’s regulations and the questionable nature of their conduct. If they failed to disclose their track records then this impacts further on their probity.
In Australia, as contrasted with the USA, these three companies have behaved like model corporate citizens. They have performed well in accreditation processes. It is almost as if they are on notice. This contrasts markedly with the bad press these companies have had in the USA.
The medical press has unquestioningly printed company advertisements. Medical groups have welcomed them as sponsors at their conferences. They have paid for medical scholarships. Anyone challenging these financial relationships and the appropriateness of the profession getting so cosy with organizations with such disturbing track records, would probably not get a sympathetic hearing.
There is insufficient information available in Australia to assess their clinical performance. We do not know if these for-profit multinationals have the same rate of increased mortality found in international studies.
Click Here for a more detailed examination of these operators in Australia.