REPORT: PRIME OVERBILLED COSTLY DIAGNOSES TO MEDICARE
By Steven Tavares
Steven.tavares@eastbaycitizen.com
@eastbaycitizen on twitter


In June 2009, a slight, dark-skinned Indian man with a bright smile and the words of fast-talking carnival barker thoroughly aroused the hopes and dreams of hundreds of San Leandro when he proclaimed he, not the reviled Sutter Health, would save their hospital.

You Almost Fooled Us: Prime CEO Dr. Prem Reddy.



Prime is alleged to overbilled Medicare for up to $18 million in fraudulent claims, according to California Watch. Reports of high rates of patients diagnosed with septicemia and a rare condition called kwashiorkor were detailed at Prime’s Southern California facilities. Incidentally, treating both conditions could potentially bring Prime an increased windfall from Medicare, according to the article. The health care provider denied the assertion and said its higher level of screening for septicemia was one of the cause for the high rate of diagnosis.

In hindsight, Prime’s introduction to San Leandro and Alameda County was short-lived and never more than a potential bargaining chip against Sutter’s wishes to purchase San Leandro Hospital and lease it the Alameda County Medical Center for acute rehabilitation services. The large contingent of hospital supporters, though, clamored for Prime’s offer to the consternation of some at the county-level. To be sure, Sutter bristled at the possibility of Prime encroaching on their territory with a new facilities sprouting in nearby Castro Valley.
 The fear among county officials was the belief Prime’s business model was not sustainable and could potentially bust the state’s health care system. Its introduction into a local hospital system is somewhat akin to a virus making its home in the host and quickly sapping it of its life.

Its voracious appetite for money at the expense of health care has also had unintended consequences. When health insurance companies covering patients surrounding Prime’s latest pick-up in Reading protested, the insurer urged patients to use the competing community hospital. They followed the insurers lead and subsequently overran the hospital leading to state fines revolving around cleanliness.

Categories: health care, Prem Reddy, Prime, S.L. Hospital, Sutter