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Investigation finds improper spending among organ procurers Date: 11/21/13

By Andrew Conte and Luis Fábregas

Andrew Conte

Luis Fábregas

Every reporter knows the stories that organ recovery nonprofits pitch to media outlets, about donors’ families receiving praise from recipients at annual events with flowers, medals and teary speeches.

The Pittsburgh Tribune-Review has covered these stories for years, often reporting some heartwarming stories of turning loss from death into life for someone else. But investigative reporters Andrew Conte and Luis Fabregas started wondering what happens at these organ procurement organizations the rest of the year.

The national investigation, “Donor Dilemma,” revealed that the nonprofits collected $1.2 billion in 2011 from recovering more than 80,000 organs, bones and other tissue. They paid top executives $320,000 a year on average and, in some cases, hired family members to work at their nonprofits. Other nonprofits rented a private jet, threw large retirement parties, bought Rose Bowl Tickets and held a retreat at a five-star oceanfront resort – with the federal government and taxpayers picking up part of the cost.

The only ones who cannot receive any money from this trade in human flesh and bone are the families of donors, blocked by a federal law that prohibits the transfer of anything of value for human parts. Too often, these families are struggling with medical bills and other expenses and don’t have enough money to pay for a funeral or a headstone.

The Pittsburgh Tribune-Review spent three months examining the nation’s 58 nonprofit organ procurement organizations, or OPOs, and got information on 51. Seven of the organizations are operate as part of hospitals and CMS could not provide information for them. The cost reports provided detailed information about the groups, including how much they are paid for organs and tissues.

Among the documents examined:

Cost reports submitted by the procurement organizations to the Centers for Medicare & Medicaid Services, obtained through a Freedom of Information Act request.

IRS Form 990 tax forms submitted by nonprofits. The reports provided detailed information about salaries, assets and top contractors. They also show when executives hired family members and when they booked a charter flight for board members.

Audits by the Department of Health and Human Services Office of Inspector General that detailed improper and undocumented spending by some of the nonprofits. When the OIG looked at two California organ procurers, it found them billing Medicare for a portion of their costs to host an oceanfront retreat in Laguna Beach, to throw a $19,000 retirement party for a CEO and to pay for the Donate Life float in the Pasadena Rose Parade on New Year’s Day. The investigators deemed that taxpayers should not have been asked to pay any of the float expenses.

Separately, we uncovered that a Pennsylvania fund intended to help organ donor families with funeral and medical bills has been unused for years. The fund was established in memory of the late Gov. Robert Casey, a transplant recipient who wanted to help donor families. But we found that even the family of the man who donated a heart and liver to Casey has had an outstanding $6,200 funeral bill for the past 20 years because they didn’t have the money to pay for it.

Among the obstacles we faced was the lack of response from CMS to their inquiries. The federal agency has refused to talk about what it does to oversee spending by these organ procurers or whether it has sought reimbursement for the improper spending.

The biggest challenge in reporting the series became to not undervalue organ donation and the lives of both donors and recipients. We interviewed survivors of donors and incorporated their stories. We talked with a Virginia surgeon who uses skin and bone grafts routinely – but never stopped to think about the human donors until his son died and became one.

In the end we included an information box with each story how to become an organ donor. Because our job was to present all the facts that many organ donor families knew little about. After that, whether or not to give up a loved ones’ organs was a “Donor Dilemma.”

Andrew Conte (@AndrewConteTrib) and Luis Fábregas (@LuisTrib) are investigative reporters at the Pittsburgh Tribune-Review. In 2011, they reported a yearlong series into billions of dollars of waste in the nation’s health care system, work that was recognized with an Award for Excellence in Health Care Journalism.