Hospitals: The cost of admission

Steve Kroft investigates allegations from doctors that the hospital chain they worked for pressured them to admit patients regardless of their medical needs

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Steve Kroft: You're all saying this was codified, institutionalized at HMA?

Scott Rankin: Absolutely, this was a well thought out plan. It even relates to how they had control over us as emergency physicians.

That control, they say, was exerted with corporate wide computer software called Pro-MED which was installed in every emergency room. HMA says it was designed and approved by medical experts to improve the quality of patient care. But doctors, nurses, emergency room directors and hospital administrators told us that HMA customized the program to automatically order an extensive battery of tests -- many of them unnecessary -- as soon as a patient walked into the emergency room.

Jeff Hamby: The minute the chief complaint and their age was placed into that computer, that system ordered a battery of tests that was already predetermined.

Scott Rankin: This was prior to being seen by the treating physician. And we would look at the chart and say, "Why was all this ordered?"

The computer program also generated printed reports like this one evaluating each doctor's performance and productivity. On this document the doctors who hit corporate admissions goals received praise from company managers. Those who didn't knew it.

Cliff Cloonan: The primary purpose of the scorecard was to track how you were doing in terms of revenue generation based on number of tests ordered and number of patients admitted to the hospital.

Scott Rankin: It has nothing to do with patient safety and patient care. It has everything to do with generating revenues.

They say that when a doctor decided send to an emergency room patient home, the computer would often intervene, prompting the doctor to reconsider.

Jeff Hamby: The minute I hit "Home", it says, "Qual Check." And then it comes up with a warning, "This patient meets criteria for admission. Do you want to override?"

Steve Kroft: What was the reaction from the administrators if you overrode the computer?

Jeff Hamby: It was like being called to the principal's office.

Cliff Cloonan: Mind you, this is coming from a non-physician, somebody who never went to medical school, never did a residency. Frankly, has never seen or treated a patient, is telling a physician how they should be taking care of a patient and making decisions related to a patient. And my blood pressure's going up just saying this.

In August, a former executive vice president of the hospital chain - John Vollmer - testified under oath in a deposition, that HMA's aggressive admission policies came directly from the top: CEO Gary Newsome.

[John Vollmer: Mr. Newsome's thought was that an average of 16 percent was accomplishable at all hospitals or more and we should seek to do that and make that happen.]

Vollmer, who was also fired by HMA, became angry when the company lawyers challenged him.

[John Vollmer: I did my duty by informing HMA that what they are doing is wrong. You can't require them all to have 16 percent admission rates and beat up doctors and administrators and all these folks over it when you are doing it to increase your revenue for the facility.

HMA attorney: I'm going to move to strike what you just said.]