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Private Psychiatric Hospitals (the U.S. Health car
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From _The Economist_, February 22, 1992
Psychiatric Hospitals
Money-spinners
(permission to reproduce this article has not been sought)
A private, for-profit psychiatric hospital is a dangerous thing. The
temptations for those who run it is to go out in search of potential
patients--and then to restrain and treat more of them for longer than
justified. A series of revelations in Texas has revealed that such
temptations are not always resisted.
National Medical Enterprises, a fast-growing, California-based,
for-profit, stock-market-traded hospital chain, began operating
psychiatric hospitals in Texas in the 1980s. With employers and
insurance companies increasingly adding psychiatric services, as well
as alcohol and drug-abuse treatment to their policies, the prospects
were good. But disturbing reports soon circulated about unethical
practices at private psychiatric hospitals. In August last year Texas
joined Virginia in specifically banning the payment of fees for the
delivery of patients.
Undaunted, National Medical Enterprises--by 1991 one of the country's
largest hospital-management companies, with nearly $4 billion in
annual revenues--continued to fill Texas television screens with
glossy commercials. But, as the _Houston Chronicle_ reported in a
detailed investigation, the reality behing the pretty commercials was
anything but attractive. Not only were bounties allegedly being
offered to police, probation officers and school counselors who
recommended patients, but international brokers were bringing in
Canadian patients, and other company representatives reportedly
infiltrated Alcoholics Anonymous groups to solicit recruits.
The _Chronicle_ series attracted widespread attention. When the first
damaging disclosures appeared, National Medical Enterprises responded
with a series of full-page advertisements protesting its innocence.
But additional newspaper revelations (including a series by _The
Dallas Morning News_) and hearings by the state Senate's interim
committee on health and human services brought more horror stories to
light. At the public hearing at Rice University in Houston, in the
presence of Texas's governor, Ann Richards, a police chief testified
how a 22-year-old woman, accompanying her four-year-old daughter, had
been wrestled to the ground, put in a straitjacket, and treated at an
NME hospital. He said he and his officers frequently received calls
for help from people wrongly detained at the hospital.
Alleging numerous violations of the new Texas statute against paid
"patient referrals," the state attorney-general sued National Medical
Enterprises and several smaller companies for millions of dollars for
medical fraud and abuse, kickbacks, illegally recruiting patients and
falsely billing a state compensation fund for crime victims. In
December the Texas department of Mental Health and Mental Retardation
instituted emergency rules to put an end to the worst reported abuses.
Meanwhile, the Texas Senate interim committee has proposed a series of
further reforms, including a "whistle-blower" law to protect employees
reporting unethical practices. Public supervision of for-profit
psychiatric institutions would be substantially increased.
While all this was going on in Texas, five other states, including New
Jersey and Florida, and the federal government, launched their own
investigasions. Similar abuses were reported, for example, in
California, home of many private-sector for-profit hospitals. Barbara
Demming Lurie, head of the Los Angeles County patients' rights
program, told _The Los Angeles Times_ that at one unidentified
hospital she saw numerous patients' charges altered to improve
reimbursement by insurance companies. Don Rockwell, director of the
Neuropsychiatric Institute of the University of California at Los
Angeles, said he knew of "iffy criteria used to hospitalize patients,
length of stay extended without good clinical reason, multiple
[treatment] where one would be enough."
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steve
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| tivoli systems | (512) 794-9071 |
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