Report: Calif. hospital chain profited from ER admissions

Andrew Van Dam

About Andrew Van Dam

Andrew Van Dam of The Wall Street Journal previously worked at the AHCJ offices while earning his master’s degree at the Missouri School of Journalism, and he has blogged for Covering Health ever since.

After months of investigation and updates, California Watch reporters Christina Jewett and Stephen K. Doig have unleashed their full report on California hospital chain Prime Healthcare Services and its knack for turning around failing hospitals by apparently pushing for the admission of ER patients who are insured by Medicare or insurance giant Kaiser Permanente, then keeping them in the hospital.

The report includes hyperlink sourcing, a raft of related documents and a great explainer on how they assembled the numbers behind the story. The duo took advantage of court testimony, sources and reams of public records.

The reporters say that evidence points to “an orchestrated campaign of admitting Medicare and Kaiser patients – moving them from the emergency room to a hospital bed – in the interest of changing the fortune of a money-losing hospital.”

State data shows that after the hospital chain took over 11 hospitals beginning in 2005, the percentage of Medicare patients who were admitted from the emergency room to Prime hospital beds increased from about 45 to 63 percent.

That 40 percent increase contrasts with other California hospitals that saw an average 8 percent decline from 2005 to 2009 in Medicare patients moved from the emergency rooms to hospital beds, data shows.

And, as you’ll see throughout the story, the interviews and anecdotes back up the numbers.

Tina Buchanan, the hospital’s former chief nursing officer, testified that [Prime founder and chairman Dr. Prem Reddy] began to require emergency room staff to put a yellow sheet of paper on each patient record that listed their health insurance status.

She said he would go through the “goldenrods,” as the papers were called, and point out the Medicare or Kaiser patients and say, “Make sure you get this one admitted.”

“If it was … an uninsured patient, he would tell them, ‘Get them out of my hospital,’ ” Buchanan testified.

There’s plenty more where that came from, but I will just leave you with this editor’s note, which appears alongside the main story.

It came to our attention late Friday that Prime Healthcare had issued a press release saying it had taken legal action against California Watch. We have not been served and can’t fully comment until we have reviewed any legal filings. In our dealings with Prime over the course of the past several months, the company has yet to present to us a single factual error that has merited correction or clarification. We continue to stand by our reporting.

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  1. Pingback: Reporters uncover Calif. chain’s systematic upcoding : Covering Health

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