Gray Matters


While caring for a patient, a nurse notices that potentially hazardous material has been thrown into the hospital room’s trash can. But the nurse figures that trash disposal is not part of her job and ignores the problem. Later, that trash is taken out with the nonhazardous garbage.

What should the nurse have done?

She should have done or said something to make sure a biohazard container was in the room, according to a scenario given to employees at Tenet Healthcare Corp., the country’s second-largest for-profit hospital chain. Whether she likes it or not, every employee must take responsibility for such lapses.

These days, Santa Barbara-based Tenet, like many other hospital companies, is giving its employees a lot of food for thought regarding ethical dilemmas. And it’s Neil Hadley’s job to make sure employees learn how to make the right decision involving patient care, conflict of interest and fraud, among many other issues.


Hadley, vice president of ethics and business conduct, launched and began running an ethics program for Tenet in the mid-'90s. It has become a model program for the health-care industry, which has been plagued by scandals and beset by a crisis of confidence.

Now, many hospitals and health-care companies in different parts of the country are setting up ethics programs.

“We’ve gotten many calls from other people who want to pick our brain,” Hadley said. “They’re jumping on the bandwagon.”

Another high-profile program is at Columbia/HCA Healthcare Corp., the nation’s largest for-profit hospital chain. Since last year, Columbia has been at the center of a federal investigation into Medicare fraud and physician payments for patient referrals. Last fall, the company hired ethics veteran Alan Yuspeh as a senior vice president to create and oversee an ethics and compliance program. Columbia has since started training more than 500 designated hospital and surgical center ethics officers in its facilities nationwide.


Other health-care facilities that are not currently under investigation are initiating programs because the federal government has become more aggressive in investigating fraud. If a hospital has an existing regulatory-compliance program, penalties from an investigation can be reduced.

Tenet has had its share of troubles too. Its predecessor company, Santa Monica-based National Medical Enterprises, settled federal fraud charges in its psychiatric hospital division in the mid-1990s. As part of the settlement, Tenet agreed to develop its ethics program. It’s coming in handy. In July, OrNda HealthCorp, which Tenet had acquired just months before, agreed to pay $12.6 million to settle federal claims that several of its hospitals paid physicians for Medicare patient referrals.

Although these programs start with regulatory compliance, they often don’t end there. Billing problems, financial conflict of interest, harassment and staffing levels all can fall under the ethics umbrella. And they all ultimately affect quality of care if resources are diverted from patient care.

“To have just a compliance-driven program will not ultimately be successful,” said W. Michael Hoffman, executive director of the Center for Business Ethics at Bentley College in Waltham, Mass. “Ethics without compliance is a program without teeth. Compliance without ethics is a program that employees will not buy into.”


There is considerable variation from one health-care company to another in these programs. And there is no agreement in the industry about what ethics means.

“Professional organizations are trying to develop a common ground,” said David C. Blake, executive director of the Center for Healthcare Ethics in Orange. “So far, their members are so diverse that it’s been hard to come to an agreement.”

People who gravitate to health-care ethics include doctors, lawyers, theologians and community activists as well as hospital administrators. Each group tends to have different priorities. So far, there is no defined path for becoming an ethics officer. Bentley College and a few other institutions have formal programs for health care and other industries. But most people enter the specialty mid-career and beyond.

Columbia’s Yuspeh is an attorney who was coordinator for the Defense Industry Initiative on Business Ethics and Conduct, a major effort by 48 defense contractors to develop ethics and compliance programs.


Hadley was a hospital administrator at Tenet tackling special corporate projects when he was tapped for the job, possibly the first full-time ethics position in a major health-care company.

With no blueprint to follow, he built Tenet’s ethics program from scratch. It starts with a code of conduct that is issued to every employee. And everyone must go through an ethics training program within weeks of joining the organization and take refresher courses every year after that. The training includes discussions of conduct standards and case studies taken from the company’s toll-free ethics hotline.

The hotline is available to anyone--including patients--who makes an anonymous call to Hadley’s 12-person department. Hadley and his staff get about 500 calls a month and deal with a wide range of issues, such as a staffer reporting that an executive may be padding an expense account. Hadley will even deal with calls that are not strictly ethics issues, such as a complaint about a missed promotion.

“It may not truly be an ethics problem, but it’s important to the individual,” he said.


Lately, calls to the ethics hotline have increased. Hadley considers the trend a positive one, because it indicates that employees are more comfortable with the concept. Hospital executives also are using the hotline to ask for advice before they make decisions.

Unlike some ethics officers, Hadley has clout. He works closely with Tenet’s audit, law, human resources and quality-management departments. He also is strengthening his relationship with the more traditional hospital ethics committees of doctors and nurses that most often deal with clinical issues.

“We do not take the role of an advocate,” Hadley said. “We remain neutral and work with the chain of command.”

If anonymous callers give their location, Hadley can start the ball rolling on an investigation. He approaches a hospital’s senior administrator unless a complaint involves that person. He has the authority to enlist any person or department’s help. He can, for example, ask the audit department to launch an investigation into billing practices at any given facility.


“We can go to whoever we feel is necessary if we are not getting cooperation,” Hadley said.

What will these programs do in the long run? They are designed to keep the government off the backs of hospitals, but there’s more to it than that.

“At a minimum, we want to ensure compliance with complex laws and regulations,” Yuspeh said. “But in a larger sense, we want to do the right thing.”

To do that, employees at all levels must recognize an ethical dilemma when they face one. Then they must either know how to make the right decision or ask for help. Once word gets out about the process, the entire health-care industry will benefit.


“We hope better decisions will be made,” said Hoffman of Bentley College. “That will lift the general public’s confidence, because nothing is more important than the delivery of health care.”