Dr. Julian Craig Chief Medical Officer United Medical Center 1310 Southern Avenue, SE, Suite 2000 Washington, DC 20032
By E-Mail November 3, 2017
Mayor Muriel Bowser John A. Wilson Building 1350 Pennsylvania Avenue, NW Washington, DC 20004
Phil Mendelson Chairman Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 504 Washington, DC 20004
Anita Bonds Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 404 Washington, DC 20004
David Grosso Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 402 Washington, DC 20004
Elissa Silverman Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 408 Washington, DC 20004
Robert White, Jr. Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 107 Washington, DC 20004
Mayor Muriel Bowser Council of the District of Columbia November 3, 2017 Page 2
Brianne K. Nadeau Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 102 Washington, DC 20004
Jack Evans Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 106 Washington, DC 20004
Mary M. Cheh Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 108 Washington, DC 20004
Brandon T. Todd Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 105 Washington, DC 20004
Kenyan McDuffie Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 506 Washington, DC 20004
Charles Allen Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 110 Washington, DC 20004
Vincent C. Gray Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 406 Washington, DC 20004
Mayor Muriel Bowser Council of the District of Columbia November 3, 2017 Page 3
Trayon White, Sr. Councilmember Council of the District of Columbia 1350 Pennsylvania Avenue, NW, Suite 400 Washington, DC 20004
Re: United Medical Center and Veritas of Washington, LLC
Dear Mayor Bowser and Council Members:
I write to you as the Chief Medical Officer (“CMO”) of United Medical Center (“UMC”), where I have served since June 2015. I understand that the City Council is scheduled to vote this month on whether to renew the contract for UMC’s independent management company, Veritas of Washington, LLC (“Veritas”), and to discuss whether the hospital should reopen its Obstetric Program. I believe it is my duty to inform you that it is my considered judgment that Veritas’s operation of UMC has included both mismanagement and malfeasance that have adversely affected patient safety and the quality of care at UMC.
Last year, the UMC Board tasked the Strategic Planning Committee, of which I was a member, with evaluating Veritas’s performance. The committee was scheduled to present its findings to the Board in April 2017. Apparently recognizing that Veritas’s performance could not be found to be satisfactory by any objective measure, the Board postponed the presentation indefinitely. Because we have not had the opportunity to present our findings, I am writing to share my concerns so that you will have the benefit of my observations as you consider the crucial issues pertaining to the future of UMC, including Veritas’s contract with UMC and UMC’s Obstetric Program.
First, I have observed time and time again that in its efforts to stabilize the hospital’s finances, Veritas has cut personnel resources that are vital to UMC’s quality of care and community reputation. Likewise, physician staff at UMC have raised concerns that Veritas has undermined their leadership and emphasized financial objectives over quality of care. Within its first month, Veritas terminated the employment of Keisha Wright, the Patient Advocate leading the Patient Experience Department, and Stanley Pierre, the Manager of the Quality Department. Prior to Ms. Wright’s dismissal, the Patient Experience Department responded to complaints as quickly as possible to avoid systemic problems at UMC. The department had improved patient care and satisfaction scores, which are reported publicly and influence the community’s perception of the hospital. The Quality Department employees had used a data-driven approach that generated critical improvements in patient safety and quality. Dismissal of Ms. Wright and Mr. Pierre have impeded much needed efforts to improve patient safety and quality. Veritas also reduced the responsibilities of then-Chief Operating Officer Pamela Lee, the executive leading
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the Quality Department. Ms. Lee is well respected in the healthcare industry and achieved notable success throughout the term of UMC’s previous operator. After having her role diminished by Veritas, Ms. Lee left UMC. Veritas’s poor personnel decisions left the Quality Department understaffed and effectively without a director between May 2016 and December 2016. These actions served as an important catalyst for the downward spiral that the institution faces today.
Veritas failed to improve patient safety and quality after hiring Maria Costino as Director of Quality in December 2016. In her time at UMC, Ms. Costino noted that Veritas staff had discontinued UMC’s adherence to and monitoring of prior plans of correction for the nursing home that UMC had submitted to the Department of Health. In addition to supporting adherence to UMC’s prior plans of correction, Ms. Costino pushed the hospital to increase preparation for Department of Health surveys and to implement a value-based purchasing program in which UMC would receive financial incentives based on the quality of its care rather than the quantity. Ms. Costino resigned in July 2017. At the time of her departure, she expressed frustration that Veritas did not demonstrate a commitment to implementing these policies and others that she believed would improve UMC.
Veritas has made similarly poor decisions with respect to my position as CMO. Within its first month as operator, Veritas greatly reduced the hours of the CMO position and in so doing undermined the CMO’s authority. UMC is a hospital in a community that faces severe disparities in access to healthcare compared to the rest of Washington, D.C. When I joined UMC in June 2015, I had the opportunity to leverage my experience (as president of the Medical Society of the District of Columbia and a Board Certified physician in both Internal Medicine and Pulmonary disease) to be the liaison between the hospital administration and the medical staff and to ensure that appropriate and efficient clinical services are offered to the community. While the hospital has recognized my effectiveness (the hospital has named me “Physician of the Year” for the past two years consecutively), Veritas reduced my role and thus impeded my ability to do my job. Members of UMC leadership, including the former Chair of the Patient Safety and Quality Committee, have publicly stated that a full-time CMO is required for UMC to effectively serve the community, yet Veritas has continued to limit the CMO role. Veritas’s reduction in staff and the responsibilities of the COO and CMO positions raise serious questions about its judgment and commitment to patient safety and quality.
Second, Veritas has disregarded patient care and committed malfeasance in its efforts to increase patient volume. Beginning in the fall of 2016 and continuing through early 2017, I became concerned with Veritas practices that, upon my reasonable, good faith belief, were in violation of federal and District of Columbia law. I saw firsthand and heard from other UMC employees that Veritas, particularly through its then-CEO Luis Hernandez, was pressuring UMC employees to increase hospital admissions numbers in order to improve the hospital’s financial outlook. I saw numerous examples of patients admitted to UMC for medical issues that did not
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meet admissions criteria, or for whom there lacked appropriate documentation to support an admission decision. On several occasions, I directed UMC hospitalists not to admit certain patients who did not meet admissions criteria, and doctors told me that Mr. Hernandez had instructed staff in the emergency room to admit those patients for the express purpose of keeping admissions numbers high. This greatly concerned me, as such a practice would result in unnecessary treatment and expense for medically unnecessary services to a number of UMC patients, and, in situations in which those patients were insured by Medicaid or Medicare, the submission of unjustifiable charges to the government. As a result, I informed UMC management that UMC would be better suited for fewer admissions and that many of the hospitalized patients did not meet admissions criteria.
On February 23, 2017, my concerns were confirmed when I met with UMC’s Chief Financial Officer, Lilian Chukwuma, and learned about a letter that KEPRO, a Medicare beneficiary responsible for review of UMC medical services, had sent to the hospital. The letter stated KEPRO’s finding that numerous patient charts that KEPRO audited involving short hospital stays did not meet criteria for inpatient admission. I was so alarmed at the seriousness of the audit findings that I raised concerns about Veritas the next day, in writing, to the hospital’s Executive Director of Human Resources, Eric Johnson. In my complaint, I explained that Mr. Hernandez’s actions had put “the United Medical Center at serious federal regulatory and financial risk” and had put members of the medical staff’s careers and medical licenses in jeopardy. Within two days of my complaint I met with Mr. Johnson, Erica Alexander, a UMC Compliance Officer, and hospital attorneys to further discuss my concerns. During our conversation I reported that I had learned that Mr. Hernandez had pressured UMC employees to increase hospital admissions, regardless of medical necessity and proper documentation, in order to improve the hospital’s finances. Mr. Johnson and the others present told me that they would investigate my concerns. Since that time, however – more than eight months later – I have not heard anything further about this investigation or any corrective action that resulted from it.
An issue related to the inpatient admissions misconduct has, however, been reported in the media. In May 2017, the Washington Post reported that UMC encountered further financial setbacks due to the discovery of possible Medicare overbilling. The article, apparently relying upon false information provided by Veritas, characterized the problem as one of doctors overbilling Medicare. It did not reveal Mr. Hernandez and Veritas’s instructions to medical staff to admit patients without regard to their medical necessity or documentation. The article also stated that Veritas Principal David Boucree described the Medicare billing problems as a “legacy” issue that began prior to Veritas becoming the UMC operator and as an issue that Veritas “is trying to fix.” Mr. Boucree’s statement did not address the more direct cause of these billing issues, which lay with the practices and culture that Mr. Hernandez and Veritas created. Instead, his response attempted to avoid accountability by Veritas by falsely shifting responsibility to the medical staff when in fact the direction to increase patient volume by
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admitting patients who did not meet the requisite admissions criteria came directly from Mr. Hernandez.
Finally, the major concerns that have been raised in recent months regarding UMC’s Obstetric Program have been largely caused, in my opinion, by Veritas’s inattention to that department. Over the past year, Veritas has failed to make appropriate investments in the department. For example, in 2016, Veritas prepared a Management Action Plan that would have transformed the department into a robust women’s health program, but never allocated funding for it in the 2017 budget. Further, as you know, the Obstetric Program was provisionally closed by action of the D.C. Health Department on August 7, 2017 – a major concern both with respect to addressing the concerns of the Health Department and with respect to promptly restoring a critical component of health services in Wards 7 and 8. To effectively rebuild the Obstetric Program, UMC must engage with the stakeholders of obstetric care in Wards 7 and 8, as well as with neighboring hospitals. There must be opportunities for discussion and participation among these groups in order to restore their trust in UMC’s obstetric program and encourage referrals. Such an undertaking requires significant planning and a financial commitment, which Veritas has not provided.
I believe that Veritas’s mismanagement and improper conduct has harmed the hospital and the patient community, and that it is my duty to bring this information to your attention. A strong investment in patient care and safety is necessary to improve UMC’s quality of care and community reputation. These fundamental conditions must be met to both recover UMC’s financial status and adequately serve the community. Given the serious consequences of Veritas’s performance on the future of UMC and the Obstetric Program, I would welcome the opportunity to testify before the City Council about my observations. Please feel free to contact me if you have any questions or if you would like me to testify.
Sincerely,
Julian Craig Chief Medical Officer United Medical Center