Oklahoma U.S. Rep. Dan Boren calls for federal investigation of hospital auditors

Accusing auditors of using overzealous and predatory tactics that are threatening rural hospitals with financial ruin, U.S. Rep. Dan Boren, D-Muskogee, is calling for a federal investigation of Connolly Inc. and other companies that audit hospitals' Medicare and Medicaid billing.
by Randy Ellis Published: August 20, 2012
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Auditors can go back three years and challenge the same bills over and over again, trying to collect more each time, Rogers said.

A lot of money is at stake. In a recent three-month period that ended June 30, the four recovery audit firms reported collecting $647.2 million in alleged overpayments, with Connolly collecting $223.8 million of that amount. The companies also identified $44.1 million in underpayments that were owed back to hospitals.

Endgame situation

The problem is particularly acute for small, rural hospitals in poor, disadvantaged areas where a high percentage of patients are on Medicare and Medicaid.

Pushmataha County Hospital is a prime example, since it is located in one of the poorest counties in the United States. Between 65 and 70 percent of its patients are on Medicare or Medicaid in any given year, Rogers said.

“In the last 10 years, alone, we've written off more than $50 million in uncompensated care delivered to the community,” Rogers said. “Here, keeping our doors open is a struggle at any given time. ... Roughly a quarter of the people who use our hospital have no ability to ever pay their bills. ... This program that Medicare has is forcing us into an endgame situation.”

Rogers said rural hospitals throughout the state and nation are in financial crisis because of the audits, but said administrators are afraid to discuss the situation because talk of financial problems can lead patients to avoid those hospitals for fear they would receive substandard care.

“We are a strong, vibrant hospital that provides good quality of care to people,” Rogers said, adding he felt it was important to speak up because of what's at stake.

Pushmataha County Hospital makes $300,000 to $500,000 in a good year, but will lose money this year, largely because of the audits, which have requested paybacks of nearly $300,000 since January, he said.

“We're having to use our county sales tax to pay Medicare back because of this program,” he said.

Rogers said the recovery audit's cost to his hospital goes way beyond the disputed overpayments. Rogers said he has had to pay staff overtime and hire additional staff just to meet the demands of auditors. And doctors are spending time doing paperwork for appeals that would be better spent caring for patients, he said.

Rogers said he also has had staff members quit because of the added stress.

“My doctors can't close their practices down to defend these things they disagree with,” he said. “We've got a nursing shortage and nurses that should be in a hospital working are sitting in these government contractor cubicles running checklists instead of helping patients where they ought to be.”

Boren has joined with Dave Camp, chairman of the U.S. House Ways and Means Committee, and Fred Upton, chairman of the U.S. House Energy and Commerce Committee, in writing letters to Secretary of Health and Human Services Kathleen Sebelius asking for an investigation into the audit methods used by Connolly and others.

“These practices have the potential to create a life-threatening situation for patient care in impoverished rural communities of Oklahoma,” Boren said.

Officials in Sebelius' office did not respond Friday to requests for comment.


by Randy Ellis
Capitol Bureau Reporter
For the past 30 years, staff writer Randy Ellis has exposed public corruption and government mismanagement in news articles. Ellis has investigated problems in Oklahoma's higher education institutions and wrote stories that ultimately led to two...
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