Thursday, August 20, 2009

Blog Mentioned in Wash. Times, PP Spokane Overbilling Gets National Attention

The Washington Times yesterday published a story on the DSHS audit of Planned Parenthood of Spokane, including the requirement to repay $629,000 by today. The story appeared in Amanda Carpenter's daily Hot Button, and cited this blog as the original source.

Perceptively, the Times linked the Spokane audit with the massive case of Medicaid fraud that Planned Parenthood was comitting over the course of many years in California.

While PPINW mulls an appeal, P. Victor Gonzalez, a former vice president of finance and administration at Planned Parenthood of Los Angeles, is pursuing a whistleblower lawsuit against PPLA on grounds that he was fired for speaking out about "illegal accounting, billing and donations practices of Planned Parenthood."

He is seeking $1.2 million in damages and says he has evidence that PPLA overbilled the state close to $180 million.

A state audit released in 2004 of Planned Parenthood of San Diego lends some credence to Mr. Gonzalez's allegations. It found the state made $5.2 million in overpayments in 2003.

There are two notable differences between the California case and the Spokane case. First, the California fraud primarily involved the 340B Drug Discount Program, in which PP purchased huge quantities of drugs at enormous discounts -- about $2 per unit for oral contraceptives and the abortifacient 'morning-after pill' -- under the federal 340B program, and then illegally billed Medicaid at standard rates, about $20, when the law clearly required them to bill at "acquisition cost".

The Spokane audit didn't contain any findings of 340B Medicaid fraud, but we are conducting a separate investigation of that. What we do know so far is that there was at the very least some confusion between the federal government and the Washington State government as to whether or not Planned Parenthood of Spokane was enrolled in the program.

The second difference was that in California, PP shockingly and successfully lobbied the state Medicaid department, known as Medi-Cal, to call off the audit before it was completed. This was revealed in the lawsuit. You are not supposed to be able to lobby to get an audit stopped, but there have been widespread allegations of corruption in California, and critics argue that the Medi-Cal bureaucracy is filled with individuals friendly with and sympathetic to DSHS.

The same allegations have been made about Washington, but it does at least appear that they were unable in this state to get the audit canceled.

Interestingly, Washington State's Medicaid director, Doug Porter, was the chief executive of Medi-Cal before he came here in 2000. The lawsuit, which has been explained in detail here, doesn't cover the period of Mr. Porter's tenure.

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