UW's 'Culture' of Fraud

The whistle-blower in the medical-billing scandal has more info.

The former University of Washington medical-billing worker who blew the whistle on UW's record-setting Medicare and Medicaid fraud has told a review panel that some illegal billing practices may be continuing, a year after the school paid $35 million to settle the case. The six-member outside review committee, whose report is expected this month, also was informed by whistle-blower Mark Erickson that as many as 40 UW physicians and administrators could have faced federal indictment, although only two were charged and pleaded guilty in the scandal. In a 15-page written statement obtained by Seattle Weekly, Erickson told of a "culture" of fraud that pervaded UW Physicians and Children's University Medical Group—both private, nonprofit university-affiliated billing offices—and said that for the panel's forthcoming report to have any effect, the billing offices must be reabsorbed by UW and placed under state oversight.

Erickson, who earned about $7 million by reporting the widespread fraud under the federal False Claims Act, could not be reached for additional comment. A recent UW Faculty Senate report similarly urged ongoing oversight to keep practices honest and blamed the current UW medical school dean, Paul Ramsey, for mismanagement and failing to impose accountability on the billing system.

Besides the record penalty to settle a five-year probe by the Department of Justice, the UW spent an estimated $28 million on legal costs since 1999 (see "Everybody Knew," June 9, 2004). Even at that, Erickson told the UW Medicine panel that the school got off easy. Overbillings likely exceeded $100 million, he said, through "upcoding," or systematically charging the highest rate for medical procedures. "The over-billing and misconduct was widespread and by no means was it specific to the Harborview Neurosurgery and UW Nephrology departments," whose top officials admitted to breaking the law. (Harborview Medical Center in Seattle is a public hospital run by the university.) "It's my position, based upon my historical knowledge and from working on the case, that no less than three dozen physicians from at least eight departments and no less than seven . . . administrators could easily have found themselves facing criminal charges. . . .

"While UW Medicine has increased their compliance efforts and expressed a goal to have a top-notch compliance plan, I'm concerned that they may become complacent in their efforts. Problems remain. Former and current employees have made attempts to contact me, claiming that the over-billing and 'cover-ups' continue to this day. . . . Given that the federal sentencing guidelines are no longer a factor . . . it's especially important that UW Medicine put in place a viable, responsible compliance program and not merely an ineffective shell designed primarily to mitigate a future investigation."


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