SB 1274 and the Governor's attitude towards insurance companies

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Civil Beat this morning published an interview they did with Governor Abercrombie on Friday. Abercrombie is somewhat fixated on AARP, and threatens to "roll over" them if they try to oppose his pension tax proposal next time. His biggest beef with the association is that they are just a front for insurance companies.

I responded, and since it has to do with SB 1274, I want to put my questions out to the public.

I'm floored by the incredible irony of Abercrombie's statement about AARP, that "This is when your special interest becomes a private interest at the expense of the public interest." AARP is bad because they are an insurance company, but that attitude apparently doesn't spare him from playing nicey-nice with actual insurance companies like Unitedhealth and Wellcare.

The governor is putting business with crooks ahead of the public interest. Florida is trying to recover millions in stolen Medicaid funds destined for children's programs from both companies.

But SB 1974 will accomplish nothing other than saving these two corporations potentially millions of dollars in legal fees. With no outside challenges to their medical decisions, they save the money on the services as well as the fees. When it looked like SB 1274 was going to be made retroactive, Rafael del Castillo calculated it would save Unitedhealth about $500,000 in legal fees, just for five months of case work.

The Office for Civil Rights at DHHS just opened at least its fifth investigation in Hawaii since February 2010. All five have been over Medicaid cuts in services to children with disabilities, cuts that put these children at risk of institutionalization. Two cases were closed with decisions in favor the children last summer. All of the cases involved either Evercare/Unitedhealth or Ohana/Wellcare.

Of course, the way Hawaii's contracts with Evercare and Ohana are written, they get a bigger capitation payment every month if the child is institutionalized.

Given Hawaii's role in the recent federal Medicaid fraud settlement with Wellcare, the Governor owes the public an explanation of how his office could support legislation that helps companies that hurt children. That, too, seems to exemplify "when your special interest becomes a private interest at the expense of the public interest."

Would you hire a pedophile as a babysitter? Why do we hire companies who hurt children and their families to provide them with this kind of care?

DHS, DOH and Conflicts of Interest in Hawaii

On June 23, Larry Geller reported in Disappeared News about a class action suit filed against Hawaii's Department of Health.  The general point of the suit is that DOH has been decimating its adult mental health medical services without the state regulatory authority to do so.

The suit was filed by the Hawaii Disability Rights Center and Alston Hunt Floyd & Ing, a Honolulu law firm just honored in February by the American Civil Liberties Union of Hawaii.

A state employee has provided me with the following information on the regulatory oversight required of the Department of Human Services.  The document is technical enough that I am presenting it in its entirety as I received it, without trying to rewrite it.

The point of the email is that it is inevitable that DHS will have to be drawn into the suit.  Once they are, it will be impossible to continue to disregard the fact that AHFI is the law firm representing UnitedHealth/Evercare in the company's fight to cut services to children with disabilities like Audrey, H.M. and my own ten year old daughter.

This is the second time AHFI were involved in a case against the Department of Health.  In January 2009 they were part of the legal team planning a class action suit against the Developmental Disability Division.  Around January 27, the company discovered they had a "glitch" because they represented UnitedHealth.  When the suit was filed on February 2 (the day after UnitedHealth took over the Medicaid services for the disability population) it did not include AFCI.


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Letters show Hawaii out of compliance with ARRA and CHIPRA since April 2009

On April 8, 2009, Lillian Koller sent a letter to Governor Lingle asking approval for 41 positions needed for Hawaii Medicaid to "effectively implement" new federal Recovery Act and Children's Health Insurance Act regulations.  A virtually identical letter, asking for the same positions, was sent today by Hawaii Medquest Administrator Kenneth Fink to Lillian Koller.

The implication appears to be that Hawaii has knowingly been out of compliance with the new Medicaid regulations for the past fifteen months.

Both letters state that "these programs can generate in excess of $327 million in new Federal funds for the State if we meet all the requirements".

In our current economic situation, it is difficult to understand why the State would knowingly forego $327 million in funds to benefit children and adults with disabilities as well as the elderly and blind.

Both letters cite the immediate need "to expedite State Plan Amendments and Hawaii Administrative Rules....Both of these bills generate millions of Federal dollars for Hawaii, but we need to be able to do the work in order to be able to access thyese funds.  Due to two vacancies, staff will not be able to execute the provisions of the ARRA and CHIPRA."

Both letters cite possible violation of federal regulations for Medicaid agency personnel training. "Federal financial participation (FFP) is being claimed for training costs at 50%. This office currently has a 43% vacancy rate...If the funding for this position is not approved, the State will not be able to provide the required level of training for existing andnew employees and will not be able to claim the federal funds for its training costs."

Both letters cite a 56% vacancy rate in the Customer Service Branch.  "The average number of monthly calls has dramatically increased due to QUEST Expanded Access (QExA) [QExA is omitted in June 2010 version], and is expected to only further increase as a result of the ARRA."

A recent article noted that DHS had received only 62 phone calls in April 2010 with complaints from UnitedHealth and Wellcare members.  I recently discovered, however, that DHS had no record of my complaints regarding my daughter's services, nor that anything for her had been denied, which casts some doubt on the figure quoted in the Advertiser.

The article also noted that UnitedHealth and Wellcare receive about 15,000 phone calls a month, not all of which are about "problems".  Enrollment in the two companies is only about 40,000.  These numbers may be more representative of the dramatic increase in calls to Medquest's Customer Service about the program run by UnitedHealth and Wellcare that is referred to in both letters.

The letters do not state what the cumulative cost to the state will be for the 41 positions.  I would assume, however, that it is significantly less than either the $327 million to be gained, or even the $15 million a month that UnitedHealth and Wellcare are making in net profit from premiums.

Hawaii Medicaid employee says FBI investigating deaths from budget cuts

According to a long-time employee of the Hawaii Department of Human Services, the FBI has been investigating almost forty deaths that have occured in the past year linked to cuts in Medicaid services enacted by UnitedHealth (Evercare) and Wellcare (Ohana).

My source says the list ranges from infants to the elderly.  This list is representative of the 36% increase in deaths of Medicaid enrollees I reported yesterday has occurred since UnitedHealth and Wellcare took over Hawaii's medicaid program on February 1, 2009.

I was also told that Martin Boegel is not the first criminal victim whose problems could possibly be linked to UnitedHealth or Wellcare not assigning a physician who could authorize their medications.

The FBI investigation was begun some time last fall, it seems.

I have emailed the FBI agents who I have been told are involved in this investigation. Here is part of the text of that email:

On Monday, the Criminal Investigation Office at DOJ did suggest that I contact the FBI directly regarding a current investigation of [name redacted] in Hawaii.

If the FBI or DOJ are already actively investigating issues related to Hawaii's QExA program, the public needs to know.  If the FBI or DOJ are already investigating the list of more than twenty people who reportedly died from care-related issues under QExA, the public needs to know.

Certainly the forty-some thousand aged, disabled and blind enrolled in Evercare or Ohana, along with their families and caregivers, deserve to be made aware that the life and death decisions currently being enacted by the two companies may not be in their best interests.

[Name redacted] avoidable death in March, and the Boegel shooting on Sunday, demonstrate that.

I look forward to receiving your response.

We all do.  

Are DC lobbyists being paid to advise Hawaii on how to violate federal Medicaid law?

A Washington, D.C. law firm, Covington & Burling, appears to have been paid more than $3 million (as of December 2008), for consulting with the state on its Medicaid QExA program.

All of the contracts appear to have been issued with exemptions from the normal procurement process; in other words, they all appear to be no-bid contracts.

Contracts have been issued in the name of Charles Miller of Covington & Burling, making him a "Special Deputy Attorney General" for Medicaid issues.  Those were issued by the state AG's office, and total $850,000 (of which $375,000 was to be paid through Federal funding).

The remaining contracts were all issued through the Hawaii Department of Human Services.  The contracts that I've located begin in December 2003, and the final one is an extension through December 31, 2008.  Since the latter contract mentions services will likely be needed to extend for several months after the February 1 QExA implementation, I suspect there may be another additional contract that I haven't been able to find.

Part of Covington's responsibility was to "provide strategic advice, consultation, project management and technical assistance on issues and policy decision as needed."  "Covington & Burling is well-established among Medicaid programs nationwide as an expert in the area of Medicaid program structure, compliance, and federal revenue maximization."

My question then is what role Covington has played in the ongoing discussions between state officials and federal Medicaid regulators.  The purpose of the discussions is to resolve potential violations of federal Medicaid law (including EPSDT).  Since Covington is a nationally known expert in Medicaid policy, it seems possible that they are advising the state on this issue.

What a waste of money, in my opinion.  Legal battles have already been fought across the country over Medicaid "policy" issues such as EPSDT, the concept of "medical necessity", and the rights of people with disabilities to remain at home with their families as opposed to institutionalization.

And as with Evercare and Ohana, presently crying poor to the state and asking for more money in their contracts, Covington & Burling overshot their estimate of $750,000 for one project by $1.25 million.  That contract had to be increased to $2 million as a result.

Is it possible that Hawaii is paying this firm to justify Hawaii's policy decision?  Just this week, Dr. Anthea Wang, Medical Director of Hawaii Med-Quest, sent me a document with the official DHS opinion on who decides "medical necessity", and says it's been signed off by the Policy folks.  Would that include anyone from Covington? 

How much money does the state of Hawaii want to waste trying to figure out how to avoid following federal Medicaid regulations?  The language is there to be followed, in recent (the past six months) regulations and official documents published by the federal Medicaid regulatory agency.  The money is probably even there, considering Hawaii's projected budget deficit through 2011 is about equal to the amount of additional stimulus funds the state is receiving.

The problem is the funds are being spent on lawyers and profits for private insurance companies, not on services to our elderly and disabled populations.

Here are links to the five contracts I found: 

http://bit.ly/8pOSqY
http://bit.ly/7CGP6G
http://bit.ly/6L47av
http://bit.ly/8V7Vib
http://bit.ly/8j9nks

Happy Holidays from Hawaii Medicaid: When $2.5 billion isn't enough

Apparently the almost $2.5 billion that Hawaii agreed to pay to UnitedHealth and WellCare in exchange for providing care for the state's disabled and elderly just isn't enough.

Less than a year after the two companies (UnitedHealth as Evercare and WellCare as Ohana) took over the state's Medicaid program that allows the elderly and disabled to stay in their homes, they're reportedly crying poor to the state.  All the actuaries screwed up.  The state has to renegotiate the contracts.  Woe is us.

And to prove it, they're slashing budgets from every which way.  Medically fragile children are having their nurses cancelled.  Quadraplegics are being told they can just sit at home by themselves all day and hope nothing happens.  Prescription medications are being cut to 21 day supplies, denied outright, or substituted by cheaper drugs that can worsen what they're supposed to be treating.

Hawaii's Attorney General's office has been investigating since September if WellCare is trying to defraud the state and a local quadraplegic man.  UnitedHealth admits outright they are in discussions with the state on how to weasel out of EPSDT's definition of case management on the basis of the state's 1115 Medicaid experimental project.  

In August, Federal regulators began discussions with Hawaii officials over potential violations of federal Medicaid law.  The DHHS Office for Civil Rights has been aware of the situation since July, and supposedly is now monitoring it directly from Washington, D.C.

Yet nothing has happened.  Families are spending the holidays wondering if they're going to have to institutionalize their child or parent or sibling so that UnitedHealth and WellCare can make a big enough profit.

I did a rough calculation of the profit off the top of the two contracts, and it comes to about $203 million over three years.  For a sense of comparison, the entire state budget for home services in FY2007 was only $140 million.

That doesn't include profits built into sub-contracts with wholly-owned subsidiaries.  Those end up disguised as direct medical payments in the budget so the 8% profit off the top includes 8% of the profits made by these subcontractors.

Apparently their budget woes in Hawaii aren't affecting the rest of UnitedHealth's and WellCare's contracts.  Both reported increased profits for the three months ending September 30, 2009 accompanied by increases in Medicaid and Medicare state contract clients.  UnitedHealth had third quarter revenue of over $21 billion, WellCare of $1.67 billion.

Meanwhile, UnitedHealth paid out over $405.7 million in fines in 2009 and WellCare paid $80 million in restitution to Florida in May and another $10 million to the SEC.

That doesn't even begin to touch on the subject of how much of Hawaii's federal stimulus funds that could only be spent on Medicaid (almost $175 million received as of December 4 with more on the way) are being directed towards the two companies.  If UnitedHealth and WellCare getting their standard 8% of off that, it's another $14 million. 

Nobody, including the state legislature, seems to know what's happened to that money.  I've gone so far, personally, as to ask CMS (the federal Medicaid regulatory people) how Hawaii is spending its Medicaid stimulus funds since its slashing budgets to the point of violating the ADA and federal Medicaid law.  They said they'd find me somebody to talk to, but haven't yet.  Rumor has it that it's a sensitive topic in Washington, which tells me Hawaii probably isn't the only state potentially violating civil rights and federal law by cutting services to disabled children, cognitively or physically impaired adults and the elderly.

A happy holiday it isn't.

CDREA publishes new CMS definitions of case management for kids with disabilities

The Children's Disability Rights Education Association (CDREA) has published an article on the latest definition of case management services issued by the federal Medicaid regulatory agency.

The broad scope of required activities that must be included in "case management", coupled with the role that the individual or their designated health care decision maker play in determining these activities, gives families more control over the services they need than ever before.

While the document in question related specifically to children covered by EPSDT (i.e., under the age of 21 and receiving Medicaid), similarly written documents have been issued that cover individuals of any age who receive Medicaid because of their enrollment in what's called a "Medicaid waiver" program. 

In the state of Hawaii, for instance, anyone currently enrolled in the state's QExA program, and therefore receiving their Medicaid services through either Evercare or Ohana, plus anyone currently enrolled in the states Developmentally Disabled waiver program, are entitled to case management services.