‘Skimming’ of County Patients Investigated

Amid calls Monday for a crackdown on county doctors’ moonlighting practices, Los Angeles County health officials confirmed that they have opened fraud investigations into allegations that some doctors are improperly “skimming” insured patients away from county hospitals and into their private practices.

The specific allegations that launched the patient-skimming investigations involve obstetrics doctors at Martin Luther King Jr./Drew Medical Center. According to information received by the Department of Health Services, some King doctors are suspected of sending pregnant women who show up at the South-Central Los Angeles hospital to private hospitals nearby where the doctors have private arrangements, county officials said.

But fearing that the alleged practices are widespread--and not just related to obstetrics--Assistant Director of Health Services Walter Gray asked his department’s investigators to open a full-fledged probe at all county hospitals about 10 days ago.

“We are going to be looking at all county hospitals to see what is going on,” said Fred Leaf, head of the health department’s inspections unit. “In these times, with the various [private] affiliations and the fact that these private hospitals are much more desirous of Medi-Cal patients, there is an increased potential for fraud.”

It is common for doctors to practice medicine at several health facilities, and it is not illegal for a doctor employed by the county to deliver babies at a private hospital where the doctor has a private practice.

But what is potentially illegal, county officials said, is for doctors working at a county facility to divert insured patients to a private facility where they stand to gain financially. Such arrangements are very lucrative to the private hospitals and the doctors themselves, but county officials say they deprive the financially troubled county of potentially millions of dollars in much-needed Medi-Cal revenues.

Officials at King and nearby privately operated St. Francis Medical Center said many doctors do work at both facilities, but they denied any wrongdoing on the part of doctors on the county’s payroll.

Jacob Colbert, department administrator for obstetrics/gynecology at King, said allegations of such patient skimming among King doctors are fairly commonplace but wrongly based on incomplete knowledge of the facts.

“I’ve heard talk; if you walk through the halls here you hear that talk,” Colbert said. “But it has no merit. We welcome an investigation at King. We have no problem with it. We are completely covered.”

Gray said it’s more than just talk in the hallways.

“We have reviewed statistics and admissions [data] and we feel very strongly, based on appearances, that there are some things going on that we need to know and understand,” Gray said.

County records show that most birthrates at most county hospitals have dropped precipitously in the last six years as they rose at private hospitals nearby, Gray said. At King, for instance, births dropped from 8,850 in 1990 to 6,026 in 1993, and at County/USC Medical Center they dropped from 17,257 in 1990 to 12,425 in 1993, county records show.

Meanwhile, one confidential health department investigative report obtained Monday by The Times underscored concerns expressed by county investigators in a Times article on Sunday.

The Times reported that health officials have launched various investigations of moonlighting doctors, and that the department’s lax oversight has allowed some doctors, who are paid well over $100,000 a year, to work far less than the required 40 hours a week and moonlight excessively at other jobs. It also said calls for reform and crackdowns on doctors in the past have gone mostly nowhere.

The report obtained Monday concluded that two doctors in the King emergency room have had serious attendance problems due to moonlighting, which in at least one case affected patient care.

On Monday, Supervisor Zev Yaroslavsky castigated the Department of Health Services for not monitoring doctors more closely, especially when the county is in its worst fiscal crisis ever and is laying off thousands of health workers.

“It is absolutely mind-boggling,” said Yaroslavsky. “I think you have a situation of abuse that has not been checked. Nobody has stopped it. You have to wonder why the health department didn’t police itself.”

“It’s outrageous. We have to have management controls in place to make sure we get what we pay for,” said Sally Reed, county chief administrative officer.

Yaroslavsky said his office has received “more than a handful” of similar allegations, including reports of doctors not treating a single patient for three years while on the county payroll and working “one hour a week and making six-figure salaries.”

Unsatisfied with the investigations done by health officials, Yaroslavsky said he has forwarded those allegations to the “appropriate investigative agencies” in the county, saying he believes that some doctors are breaking the law.

“I am hopeful that the agencies that have been asked to look at it will get to the bottom of it,” he said. “There may be some criminal liability here . . . if they knowingly take money for work they do not perform.”

Yaroslavsky would not comment on which agencies he has contacted for help. But several county sources said some allegations were serious enough to have been forwarded to Dist. Atty. Gil Garcetti. His office had no immediate comment.

The Department of Health Services investigation into obstetrics/gynecology doctors disclosed Monday is in its early stages, and Leaf and other health officials said there was little they could comment on.

The initial allegations came from King, where investigators say there has been serious political infighting among doctors and administrators in recent years.

The investigators stressed that they believed the potential for any wrongdoing at the teaching hospital and trauma center is no different than at any of the county’s other five hospitals where investigations also are under way. They are County-USC, Olive View, Harbor-UCLA, Rancho Los Amigos medical centers and High Desert Hospital.

Gray and other county officials with knowledge of the probes say they fear that doctors are diverting patients to private practices and even delivering babies for their private practice while they are scheduled to work at county hospitals.

If skimming is found, it could violate a number of laws and regulations regarding doctors’ self-referral of patients, particularly when it involves state and federal money, said Leaf, whose 12 investigators and auditors will conduct the probes.

Documents obtained by The Times reveal that the county counsel’s office has the case of one King doctor alleged to have been engaged in patient skimming now under review to determine if any laws were broken. That doctor works in the emergency room, not obstetrics, they say.

County investigators plan to determine the outside employment of all obstetrics/gynecology doctors, look at referral patterns and patient records and interview doctors, staff and patients themselves, Leaf said.

Colbert said one potential cause for confusion is that many such doctors at King have recently entered into what is known as the Drew Practice Plan, in which they give up their private practices and work in an organized private practice that is affiliated with the Drew Medical School.

“If a doctor is working at King and a [private practice] patient is ready to deliver, and he leaves [King] to go deliver that patient at St. Francis, his pay stops for the county when he walks out the door and starts for the practice plan,” Colbert said, adding that doctors are careful to schedule outside work around their county shifts. “When he walks back into the hospital, his county work starts again.”