FBI: LA hospitals used homeless in medical fraud

LOS ANGELES - For hundreds of homeless people, posing as phony hospital patients provided them a clean bed and cash. For the hospitals that processed them, it meant a full patient-load and a paycheck from the government.

Now some of those allegedly involved in what authorities say was a massive scheme have been charged with billing government programs for millions of dollars in unnecessary health services.

A hospital CEO was arrested Wednesday after federal agents raided three medical centers. City attorney Rocky Delgadillo's office has also sued the hospitals, saying they used homeless people as "human pawns."

Hospitals in Los Angeles and Orange counties submitted phony Medicare and Medi-Cal bills for hundreds, perhaps thousands, of homeless patients — including drug addicts and the mentally ill — recruited from downtown's Skid Row, state and federal authorities allege.

By Nicole Gaouette, Los Angeles Times Staff Writer
July 25, 2008

WASHINGTON -- U.S. drug manufacturers are reaping a windfall from taxpayers because Medicare's privately administered prescription drug benefit program pays more than other government programs for the same medicines, a House committee charged in a report Thursday.

...

"Medicare Part D has given the major drug companies a taxpayer-funded windfall worth billions of dollars," said committee Chairman Henry A. Waxman (D-Beverly Hills).

Waxman said he would introduce legislation to guarantee that federal taxpayers would not be charged higher prices under Medicare Part D than under Medicaid.

"This is an enormous giveaway. And it has absolutely no justification," he said.

UPI

LOS ANGELES, Aug. 3 (UPI) -- A new Los Angeles ordinance requires hospitals to obtain patients' written permission before moving them anywhere other than their homes, officials said.

Los Angeles medical centers have come under fire for allegations of hospital workers transporting homeless patients to shelters before they are healthy enough to be without medical treatment, The Wall Street Journal reported Saturday.

Hospital officials say they are worried that if they are convicted of violating the law, their facilities could be left out of vital federal health programs. They have also voiced concerns about whether or not hospitals can afford to hold homeless patients who do not have homes.

"The most important thing is to get culture change in the way that hospitals discharge patients," said a spokesman for Rockard J. Delgadillo, a Los Angeles city attorney whose office is conducting probes of about 50 dumping allegations that occurred before June 30, when the ordinance was put in place.