Insurance Fraud NEWS
Florida cancer firm seeks to rehab image after data breach
February 19, 2018, Tallahassee, FL
With bankruptcy proceedings and $500 million of its debt now a memory, cancer-care giant 21st Century Oncology wants to rehabilitate its image, boost staff morale and expand its operations, the company’s new CEO said in an exclusive interview with The News-Press.
Interim CEO Kim Commins-Tzoumakas is the Fort Myers-based company’s fourth chief executive in 16 months. She is the first who has agreed to speak to a reporter about the company’s two years of financial troubles and legal scandals.
"We have 4,000 employees. We have people up and down the state of Florida that depend on this company for a job," Commins-Tzoumakas said. "We now owe it to them to have the image and reputation this company deserves. That’s my number one priority."
Commins-Tzoumakas said the company has no plans to reduce its workforce or close clinics. Instead, she said 21st Century Oncology is drafting plans to expand and create new business partnerships.
"In some places, it's expanding and it's developing our relationship with not-for-profit hospitals who may be looking to expand their cancer-care footprint in those communities," she said. "There are other situations where we're going to organically grow it and look at other opportunities where we may be able to acquire existing centers and bring them into the fold."
Commins-Tzoumakas previously served as managing partner for the Michigan office of Hall, Render, Killian, Heath & Lyman – the nation’s largest healthcare-focused law firm.
As such, she served as a chief legal adviser to 21st Century Oncology for its handling of high-profile legal cases, including the company’s Chapter 11 bankruptcy case, a federal settlement over the breach of 2.2 million patient records and recent Medicare fraud investigations.
The company has launched a national CEO search, but Commins-Tzoumakas said she is a candidate to take over the post on a permanent basis. She has consulted for the company since 2014.
"I think that I built the confidence of the leadership team that was here, built the confidence of our physicians — most importantly because they're the key to what we are and do for the future," she said. "And, as we looked at the issues that needed to be addressed to make this company the success we all want it to be going forward, they believed that I had the right skill set to jump in and quickly do that."
21st Century Oncology emerged from bankruptcy last month with nearly half of its $1.1 billion in long-term debt erased and new owners and a new top leadership team.
The company's previous primary stakeholder, the private equity firm of Vestar Capital, and the Canada Pension Plan Investment Board, which invested $325 million in the company in 2014, took the biggest hit from the debt write-off.
21st Century Oncology's new owners are a collection of hedge fund firms: Beach Point Capital Management, Governors Lane, J.P. Morgan Investment Management, Oaktree Capital Management, Roystone Capital Management and HPS Investment Partners.
Commins-Tzoumakas said the company lost "very few" physicians and was largely able to retain its patient base through the last few years, which has seen a laundry list of public relations disasters.
Commins-Tzoumakas agreed to comment on most of them.
The company disclosed in March 2016 that an unauthorized person had accessed a company database containing private information on about 2.2 million of its patients the previous October.
Company officials say that the hacker was from an uncertain foreign country and had somehow obtained an employee password. The breach reportedly lasted under an hour.
"We don't know how many records that individual accessed, looked at, saw," Commins-Tzoumakas said. "So we took the abundance of caution approach, and we noticed every patient that had information in that database. We took the political hit for that, but we felt that we owed it to our patients to say, 'There was somebody in a database you had information in and you have a right to know that.'"
A federal investigation ultimately faulted 21st Century Oncology for failing to adequately protect its records and for improperly disclosing protected health information to third-party vendors.
Subsequent legal filings allege that some of the information in the database, which contained patient names, Social Security numbers, patient diagnoses and treatments, and insurance information was later offered up for sale via hidden "darknet" exchanges on the internet.
The company provided affected patients with a year of free fraud protection. Even so, a number of them claimed they had been subject to identity theft attempts and sued the company in federal court. The case is still pending.
Commins-Tzoumakas said the company has since tightened its security system to make it unlikely that a single password could access private information. The company has also invested in security training for its employees and services to monitor its computer systems.
21st Century Oncology also paid $2.3 million to the U.S. Department of Health and Human Services to end a federal investigation into the company's potential blame for the breach.
Roger Severino, director of the department's Office for Civil Rights, later said in a statement: "It's not just my hope that covered entities will learn from this example and proactively find and address their security risks, it’s what the law requires."
Medicare fraud investigations
Two years ago, 21st Century Oncology paid nearly $20 million to settle a federal whistleblower lawsuit alleging its doctors submitted payment claims for "FISH" (fluorescence in situ hybridization) genetic tests for bladder cancer that were medically unnecessary.
The following March, it paid another $34.7 million to end another such lawsuit over the allegedly improper use of GAMMA function analyses, which measure radiation emitting from patients after certain treatments.
21st Century Oncology admitted no wrongdoing in connection with either case.
And Commins-Tzoumakas — again, the attorney who helped the company weather the investigations — blamed most of these legal issues on inadequate "checks and balances" in the company's billing system and a handful of doctors acting inappropriately.
A number of physicians made their own multimillion-dollar settlements to end similar investigations of them.
“It was an issue related to having the appropriate tracking and internal auditing mechanisms to make sure that the complex billing rules coincide with what the physicians were documenting," Commins-Tzoumakas said. "We didn’t have the systems built up to be able to catch that on the front end."
But the company did admit in December, as part of a $26 million settlement, that it had filed false information to the government about its electronic medical records system to obtain subsidies and avoid Medicare penalties. The deal also resolved a government investigation of improper self-referrals of patients in violation of the so-called Stark Law.
21st Century Oncology is still facing allegations as part of another whistleblower lawsuit that it and Florida Cancer Specialists & Research Institute had a "gentleman's agreement" to divide up Southwest Florida patients in violation of anti-trust laws.
2 SWFL cancer centers accused of fraud, unsafe practices
Commins-Tzoumakas did not comment on the case. But she said the company is committed to moving past its previous legal issues and earning the public's trust.
"There’s certainly no guarantees we won’t have issues along the way, but we’re doing everything we can to be one step ahead of those issues," she said. "And we’re being very transparent and open about it with all of our payers and certainly with our physicians and the rest of the community."
Source: Naples Daily News