Forbes had an interesting article on the question of whether a corporation can really investigate its own behavior especially if that behavior is profitable.  Do internal compliance programs really work, or does their mere existence give well-compensated employees plausible rationale not to question conduct that would otherwise be questionable?  Can we count on a corporation to investigate itself, to fully and accurately disclose its conduct so that victims may take recourse, and at the same time take action to prevent recurring wrongdoing – all of which may cause the business to lose money?  And if a corporation were able to fulfill these tasks, would the reported result have sufficient integrity to withstand public scrutiny? Do we really trust the reports of corporations that investigate their own improprieties?

The False Claims Act – dating back to 1864 – allows private citizens to bring suit on behalf of the United States Government where they have knowledge that wrongful or fraudulent conduct has caused the expenditure of government monies.  All cases filed under the False Claims Act are filed under seal allowing the government to investigate the case before public litigation actually proceeds. Sometimes civil litigation initiated by whistleblowers under the False Claims Act has resulted in parallel criminal proceedings. Examples include cases against Pfizer, GlaxoSmithKline, and Abbott Laboratories. Civil and criminal sanctions exceeding $6 billion in total were imposed against these companies for unlawfully marketing drugs that caused the expenditure of Medicare/Medicaid dollars. And in each of these cases the defendants or their subsidiaries pleaded guilty to a criminal infraction because – as the plea agreements made clear – they were guilty.

Each of these companies had internal compliance programs, and yet in each case the wrongful conduct was pervasive, brought billions of dollars of revenue to the Defendant, and persisted for years.  These are not isolated examples. Enron, Tyco, and WorldCom all had internal compliance programs that proved incapable of addressing pervasive and, at least initially, profitable wrongdoing.

Where wrongful conduct actually results in increased revenue that rewards corporate officers and employees, is it plausible that a corporation’s internal compliance mechanism can freely and fully investigate and right wrongful behavior? Do corporations, and those individuals that guide them, really have an incentive to fully address wrongful conduct that generates significant revenue? The truth is that even after Pfizer, GSK, and Abbott collectively paid billions of dollars to settle charges of unlawful marketing, these pharmaceutical giants still walked away with billions of dollars in profits from their unlawful conduct.  Even the public announcement of settlements and guilty pleas had little or no impact on their market capitalization.


A little known Arkansas exemption for charities is a big stumbling block for a family trying to sue over a relative’s death. See full article at Arkansas Matters.
The so-called “charitable immunity protection” was first used for a hospital taking care of patients for free. The status means charities including some nursing homes cannot be sued. Attorneys and families like the Newborns question the charity designation since these days most patients pay through private insurance or government subsidies like Medicaid.  While most states have abolished these protections, it still stands in Arkansas and applies to some nursing homes and hospitals.

Three years after Johnny Newborn died in a Pine Bluff nursing home, his family is still trying to learn what happened.   “When we would go see my brother he would be screaming help me help me,” says Gracie Newborn Neal. Relatives were alarmed when his body was sent to the state crime lab and they were told he choked to death. Then they received photos showing fresh cuts on Newborn’s face.  But before they could go to trial, a judge stopped proceedings, agreeing with facility’s claim of charitable immunity.  Consumer experts argue it gives facilities the freedom to operate without accountability.

The Hill reported that Democratic Reps. Jan Schakowsky (Ill.) and Doris Matsui (Calif.) asked the Centers for Medicare and Medicaid Services (CMS) why a March 2012 deadline to implement a provision of the Affordable Care Act has still not been met. Currently, nursing homes only have to self-report their staffing data on an annual basis. Schakowsky and Matsui said this policy can lead to inaccurate information for individuals looking for a nursing home.

Meanwhile, a section of the 2010 healthcare law directs nursing homes to display staffing information based on payroll data. By using a payroll-based system, Schakowsky and Matsui argued, nursing home staffing information can be reliably accurate.

“CMS itself has acknowledged that its nursing home staffing data are not accurate,” they wrote. “We need accurate staffing data — such as that from a payroll data collection system — to ensure that our most vulnerable Americans get the quality health care services they need and deserve.”

“We urge CMS to make this matter a priority. We look forward to hearing from you soon on when we can expect the payroll-based staffing system to be operational,” Schakowsky and Matsui wrote.

The New York Times: What really sets Rosewood apart, however, is its five-star rating from Medicare, which has been assigning hotel-style ratings to nearly every nursing home in the country for the last five years. Rosewood’s five-star status — the best possible — places it in rarefied company: Only one-fifth of more than 15,000 nursing homes nationwide hold such a distinction. But an examination of the rating system by The New York Times has found that Rosewood and many other top-ranked nursing homes have been given a seal of approval that is based on incomplete information and that can seriously mislead consumers, investors and others about conditions at the homes.

 Iowa City’s Press-Citizen recently reported an alarming story of gross sexual misconduct in the Legacy Senior Living Community. Facility employee William F. Chambers, 50, was recently fired for sexually harassing fellow employees and doing sexually explicit acts at the facility. His transgressions include: pushing a co-worker down on a bed and asking for sex, making suggestive comments to a 16-year old kitchen aid, sending explicit photos from his cell-phone, and masturbating in the facility.

 After being fired for his misconduct, Chambers filed for unemployment which brought this case to a public hearing. Judge James Timberland ruling denied Chambers’ request for unemployment benefits stating:

What the text messages indicate is a number of women having to fend off a man behaving like an animal in rut, Timberland wrote in his ruling. The evidence is also sufficient to establish that Mr. Chambers masturbated in the workplace and advertised the conduct when speaking to female co-workers. It appears that Mr. Chambers used the workplace as his sexual hunting ground as much as his source of employment.

Mr. Chambers’ actions show a blatant disregard to the actual merits of his job, which should include focusing on resident care. Press-Citizen also reports that among these transgressions, Chambers also had a previous rap sheet which included six drunken-driving convictions, three theft convictions and one assault convictions. Despite this seedy past, Chamber is still convinced: “I am an outstanding guy, but I made a (expletive) mistake”.

In summary, the nursing facility neglected to hire safe and diligent workers to care for the residents. This all goes to support a need for improved staffing standards in these facilities to ensure the best care for our loved ones.

How many preventable medical errors occur in your local hospital?

Research shows 440,000 patients die each year from preventable medical errors. But finding out how safe your local hospital is can be a difficult task. Write to Congress TODAY to fix this problem.

Recently, an arm of the federal government called the Centers for Medicare and Medicaid Services (CMS) announced it was going to stop tracking and publicly reporting eight egregious medicals errors that included when foreign objects are left in patient’s bodies after surgery and when a patient receives the wrong blood type in a hospital!

The good news is that after the USA Today exposed this policy decision and after many patient safety groups weighed-in, the federal government reversed its decision and will now resume reporting these errors.  See CMS has reversed. Currently, there is no simple way for patients to find out the safety record for their local hospitals. If you agree that we should know how safe our hospitals are, send a message to Congress TODAY!

Tell your representatives about the preventable medical error epidemic plaguing this country and urge them to prioritize patient safety and transparency!

Take Justice Back launched an action item to tell Congress we need more transparency and accountability in our health care system. Be sure to take action here:

Addicting Info website had an interesting story about a beloved Grandmother who fell 11 times at a nursing home that received 5 stars on the CMS website.  In the video a Medicare five-star nursing home fails patients miserably.  And the children of this elderly woman had no idea it had over 150 complaints against it.

“He’s not doing very well,” the nurse said as he did a hand-off before ending his shift. So the nurse just coming to work went to check on the old guy. And indeed he was not doing well. Rigor mortis had already set in, meaning the elderly resident had been dead for hours.

Why would this happen? The first nurse just didn’t want to do the mountain of paperwork required when a patient dies – especially when nurses are already burdened beyond belief.

Barbara Christie Mansfield worked in Topeka, Kan. nursing homes for thirteen years on the 11:00 p.m. to 7:00 a.m. shift. She loved working with the patients with Alzheimer’s disease and had a special knack in caring for them. But Mansfield had to care for 60 patients with advanced Alzheimer’s disease, severe diabetes and other serious conditions. Oh she had two nurse’s aides to assist her — when she could find where one of them was sleeping.

It was an impossible situation. But out-of-state owners cut back the number of nurses in order to improve their bottom line. And they knew that nursing home inspectors did not come during the darkest hours of the night. One would think surprise visits at any time would be a good idea, but no, inspectors schedule their visits and give the nursing homes time to get their act together — just enough to pass inspection.

The nursing home knew that they could blame tell-tale bruises on falls or the reality that old people bruise more easily than the young. They knew that they could hide that they gave patients baths just once a month. And they knew no one checked in the middle of the night.

Beloved people frequently come to nursing homes to die. When even five-star federally rated nursing homes neglect those who cannot defend themselves, what must the lower rated home be like?

The Connecticut Post reported that regulators in the state have approved a bill requiring for-profit nursing homes to report profits and losses from related businesses. The state’s House and Senate have passed the legislation, which also delegates examining quality of care, staffing levels, and financial solvency of facilities to a Nursing Home Financial Advisory Committee. The bill also requires nursing homes to report the financial status of any businesses that contract with them, including associated companies and spinoff businesses, if the business receives more than $50,000 a year from the facility.

District 1199 of the New England Health Care Employees Union pushed the bill in light of the industry’s recent bankruptcies, takeovers, and scandals, intending to bring more transparency to the business. The Union’s workers were recently threatened by the HealthBridge chain, which blamed its financial crisis on employee costs. The Union says that the bill will help identify whether the chain, as well as any other chain that clams to be financially unstable, is actually in financial distress.

The Connecticut Association of Health Care Facilities, which represents the affected nursing homes, called the bill invasive, and claimed that the financial information released by the bill is exploitative and will only serve the Union in contract negotiations.



The Boston Globe reported that the new standards passed by the Massachusetts Public Health Council include changes that were made to the ones proposed in 2012.  As a result of the new regulations, all nursing home employees working with special dementia care units will receive a mandated eight hours of training initially and an additional four hours annually. This training is required to start within 90 days of the laws going into effect. The care units are also required to have a “therapeutic activities director,” who will have the specific job of planning meaningful activities appropriate for the residents with dementia.

In addition to these changes, each facility with dementia care units will be required to have a fence to prevent the residents from eloping and injuring themselves. There was also a suggestion to prohibit overhead paging systems, which could potentially startle dementia patients, in the care units, but the standard was not added because of the costs that shutting the systems off would have. Also included in the new standards is the mandate that all nursing homes, including those without dementia-specific care units, must provide dementia training for all direct-care employees.


A nursing home accused of using morphine to keep difficult residents sedated has paid $1.5 million to settle a wrongful death lawsuit after offering to settle for $100,000 during mediation.  The son of a former resident brought the suit on behalf of his mother, who had Alzheimer’s and had stayed in a locked unit at the nursing home. He alleged that she was so heavily sedated that she fell on her face, became bedridden as a result of her injuries and later died.

An attorney for the son and his family, Anne Duvoisin Fisher of Henson & Fuerst in Blowing Rock, said the settlement agreement prevented her from identifying the parties in the suit. Fisher, who worked on the case with her co-counsel Carma Henson of the firm’s Raleigh office, said her client’s mother died in a different nursing home after being discharged from the hospital following her fall.

According to Fisher, the nursing home contended that no one could prove the woman was given unprescribed morphine or link the drug to her death. The home did not admit liability in settling the case.  Fisher added that the home and its trial attorney had offered to settle the case for $100,000 during mediation and also had “informed the plaintiff that they anticipated a directed verdict at trial.”

But a few weeks later while Fisher and Henson were preparing to depose the home’s CEO and owners, the defense agreed to settle the suit for $1.5 million – 15 times the initial offer. In an unusual move, the home had hired another attorney who negotiated the settlement without the original trial attorney or the
home’s in-house counsel, according to Fisher.