Posts Tagged ‘Medicare’

Some Medicare Recipients Will See a Rise in 2010 Premiums

OCTOBER 26, 2009  VOLUME 16, NUMBER 59

The Medicare program has announced its 2010 premium and coinsurance rates. As predicted, an anticipated increase in medical costs will mean a steep rise in Medicare-related premiums, but federal law protects most recipients from having to pay the new rates. One effect of changes in Medicare rate-setting over the last few years will be seen more clearly in 2010. Not long ago, every Medicare beneficiary could expect to pay the same portion of his or her medical costs. Those days are over, and a confusing system of co-payments, deductibles and premiums has now gotten more confusing.

Medicare has set the annual premium increase for Part B insurance at 15%, which translates into a 2010 premium of $110.50 per month. Nearly three-quarters of Medicare beneficiaries, however, will not have to pay that higher amount. Congress limited current Medicare beneficiaries’ premium increases to no more than their Social Security cost-of-living adjustment. Since Social Security announced two months ago that there will not be a COLA increase in 2010, that means that most Medicare beneficiaries will continue to pay $96.40 per month for Part B.

Who will pay the higher figure? Three groups of people:

  1. People who have been receiving Medicare but have not had Part B premiums deducted from their Social Security checks, for whatever reason, are not protected from the increased premiums.
  2. New Medicare beneficiaries are not protected, either. If you start receiving Medicare benefits in 2010 for the first time, you will pay the higher rate.
  3. Wealthy Medicare beneficiaries are not protected from increases. If a single person makes more than $85,000 per year, or a married couple more than $170,000, they will see the increase in their Part B premiums.

Wealthy Medicare beneficiaries actually get a double dose of increased premiums. Not only are they not protected from the 2010 increase, but they may also have to pay higher premiums based on their income levels. For the wealthiest Medicare beneficiaries — those whose individual income is over $214,000, or couples whose income is over $428,000 — the new Part B premium will be $353.60 per month.

Income for these calculations is determined by reference to the beneficiary’s 2008 income tax return. For those whose income has dropped since that year, it is possible to request a revision based on a later year’s tax returns.

Other premiums, co-payments and deductibles are also set to increase in 2010. Among the increases: an anticipated typical rise by about $2 in monthly Part D (drug plan) premiums nationwide.

Medicare Part D Enrollment Period Runs Through Year End

NOVEMBER 20, 2006  VOLUME 14, NUMBER 21

Medicare Part D (the prescription drug benefit plan begun  last year) includes an annual “election period” from November 15 through the end of the calendar year. Seniors—many of whom struggled to understand the program a year ago and waded through reams of information to select the most promising choice—now must review their existing Part D plan, figure out what changes are in store, and make another selection of the best option available for their individual circumstances.

As was the case last year, there is plenty of information about the plan options facing each Medicare beneficiary. The best collection of information about plan choices comes from the Medicare program itself, which operates a well-designed, understandable and informative website at www.medicare.gov. Among the points made by the Medicare site: the real due date for your Part D selection is December 8, not December 31—you need to make sure your new plan is in effect in time to assure coverage for any January prescription needs.

The upcoming year will provide a number of changes affecting prescription drug coverage. A few of those include:

  • The number of available plans continues to proliferate. In the Tucson area, for example, there will be 53 Prescription Drug Plans, 19 Medicare Health Plans, and 10 Medicare Special Needs Plans available—an increase of 20 total options.
  • Premiums will generally increase. Last year’s premiums for the Tucson area ranged from $6.14 to $64.86 per month, while the 2007 premiums will vary from $10.40 to $78.10.
  • Other costs will also increase, and by more than the rate of general inflation. While Social Security payments, for example, will increase by 3.3% next year, the out-of-pocket costs (not including premiums) for 2007 will increase by 7%. That figure includes a $265 deductible (the 2006 figure was $250), a copayment of the 25% for the next $2,135 (last year the copayment was for just $2,000 of drug costs), and a “donut hole” of $3,051.25 (up from $2,850).

Congress’ switch from Republican to Democratic control may lead to other changes, as well. Democratic leaders have made clear that they expect to immediately address the existing ban on government negotiation of drug prices. One Democratic leader has already introduced a bill that would direct the government to offer and operate a Medicare drug plan of its own. Administration officials argue that both measures conflict with the underlying free-market rationale behind Medicare’s prescription drug program, but it is too early to predict the outcome of that debate.

Court Says HHS Secretary Thompson Acted in Bad Faith

MARCH 8, 2004 VOLUME 11, NUMBER 36

In June 2001, four national advocacy organizations and an individual plaintiff sued Secretary of the U.S. Department of Health and Human Services (HHS), Tommy Thompson. The lawsuit sought the court’s help to force Secretary Thompson to follow the law’s requirement that comparative written information about what participating Medicare+Choice Organizations (MCOs) offer be mailed to individual Medicare beneficiaries.

In August 2001, a preliminary injunction issued to compel the Secretary to comply with the law regarding the information mailed to Medicare beneficiaries. In 2002, the Secretary was enjoined permanently from failing to mail the information as required at Section 1395w-24(a)(1) of Title 42 of the United States Code by the U. S. District Court for the District of Columbia.Gray Panthers Project Fund, et.al., v. Tommy G. Thompson, 273. F.Supp.2nd 32(D.D.C.2002).

The plaintiffs to the action filed a motion to secure an award of attorney’s fees against Secretary Thompson on the basis that the Secretary had acted in bad faith in refusing to follow the dictates of the law. On February 23, 2004, the District of Columbia Circuit Court again ruled against Secretary Thompson and awarded the plaintiffs attorneys fees that amount to approximately $173,000.

The Center for Medicare Advocacy represented the plaintiffs against the Secretary to compel him to follow the statutory directive that Medicare beneficiaries, many of whom are infirm, receive the annual description of MCO plan comparisons. Secretary Thompson had argued that the plan comparisons were being left out due to the prohibitive cost of mailing this information. In issuing the preliminary injunction against Secretary Thompson, Judge Henry Kennedy, for the court, wrote that “it was astounded that the Secretary has the audacity to argue that compliance with the statutory mailing requirement is too expensive while simultaneously electing to spend $35 million on advertisements.”

Judge Kennedy summed up his opinion on the permanent injunction by saying “On the whole, the defendant [Secretary Thompson] has simply failed to provide the court with adequate assurances that he intends to cooperate with the applicable provisions in the long run…Agencies may not chose to follow some laws while ignoring others…”

It was undoubtedly this perception that Secretary Thompson wantonly failed to follow what the legislature directed that earned the plaintiff’s their attorneys fees. Attorney’s fees are not awarded routinely.

Medicare Changes Will Include Prescription Drug Coverage

DECEMBER 1, 2003 VOLUME 11, NUMBER 22

With the U.S. Senate’s approval of sweeping new Medicare provisions the public discussion has focused on whether the changes will be good for the program, its beneficiaries and the nation as a whole. Much controversy has also centered on the politics of the changes—including whether Republicans or Democrats won or lost, whether drug and insurance companies benefited at the expense of seniors, and whether senior advocacy groups sold out their members for temporary political gain. Not enough attention has been given to the actual provisions of the new law and the many questions raised by its enactment.

Under the new Medicare law, “Part D” coverage will be the primary payor for prescription drugs for seniors and the disabled, but the new law does much more than just adopt a new drug benefit. We answer many of the questions about the prescription drug benefit here, but in a companion issue of his newsletter Elder Law Fax, our friend and colleague Tim Takacs, a Hendersonville, Tennessee, elder law attorney, answers questions about the non-drug related provisions in the new law.

Q: What benefits will be available before Medicare’s full prescription drug program begins in 2006?

A: Starting sometime early in 2004, Medicare recipients will be offered a discount drug card costing $30. The card should entitle them to receive discounts of as much as 15% to 25% on drug costs. Low-income Medicare recipients will pay nothing for the drug discount card, and will receive $600 credit toward the cost of their drugs—though they will have to pay a co-payment of 5% to 10% of each prescription. The drug card program will end when the full prescription drug benefit takes effect in 2006.

Q: Will Medicare beneficiaries automatically receive the new drug benefit when it becomes available in 2006?

A: Apparently not. What is being called Medicare “Part D” will require enrollment and a monthly premium, currently set at $35 (but subject to changes before the 2006 effective date). This payment will be in addition to the Part B premium ($66.60 beginning next month). Medicare recipients with incomes below about $12,000 (or, for married couples, about $16,000) will pay no premiums for Part D.

Q: Once a beneficiary signs up for Part D, what drug savings should he or she expect?

A: Part D beneficiaries will still pay the first $250 of prescription medications out of their own pockets each year. The beneficiary will pay 25% of the next $2,000 of drug costs, and the entire cost of drugs between that level and $5,100.

Q: What does this mean for a real-life beneficiary’s drug benefit?

A: To take one example, a beneficiary with $500 in monthly drug costs today will pay about $335 per month under the new plan—if the premiums do not increase and the cost of drugs remains fairly stable. A beneficiary with current drug expenses of $50 per month will actually pay a little more than $60 per month under the new plan—but will be insured against catastrophic medication costs for the slight increase in payments. Neither of those examples will apply, incidentally, to poorer Medicare recipients, who will pay less for their drugs. Calculating the actual cost of drugs for a given beneficiary can be difficult; the Kaiser Family Foundation has prepared an internet page to give individuals a better idea of their own savings (or costs) under the Part D coverage.

Q: Are there other limitations on Part D coverage?

A: Yes, there are several other ways in which the drug benefit is limited. For example, after reaching the $5100 level in total drug costs, the participant will still have a co-payment for additional drugs of 5% of the drug costs.

Q: Will private insurance plans pay for the uncovered portion of drug costs?

A: Yes and no. Anyone who already has a “Medigap” (supplemental Medicare) policy that provides a drug benefit can continue to receive that benefit–provided that they choose to opt out of the new Medicare drug benefit program. No new Medigap policies with drug coverage can be sold, and no other private insurers will be permitted to sell policies that cover the deductibles and co-payments in the Medicare drug program.

Q: Will low-income seniors and disabled Medicare beneficiaries receive any additional benefits after 2006?

A: Yes. In addition to the waiver of premiums described earlier, there are also reduced co-payments for poorer participants. They will pay $1 to $2 (depending on income levels) for generic and $3 to $5 for brand name and “non-preferred” drugs. The “donut hole” (the uncovered portion of drugs costing between $2,250 and $5,100 each year) does not exist for poorer beneficiaries. Existing Medicaid coverage for drugs, however, will end—except for benzodiazepines and some other drugs that will not be covered by Medicare’s Part D program.

Q: Who will actually provide the Part D drug coverage—Medicare or private insurers?

A: The new law encourages individual insurance companies to enter the marketplace and provide coverage options under government supervision but without direct government management. In areas where no insurance programs are offered, however, Medicare will provide better subsidies to what the new law calls “fallback” insurance plans. The goal is to make sure that every Medicare beneficiary has at least two choices of drug coverage available. Incidentally, no “fallback” plan is permitted to offer drug coverage for the entire country.

Q: What effect will the new drug benefit have on state budgets?

A: The states are now paying a significant portion of drug costs for poorer Medicare beneficiaries who simultaneously qualify for Medicaid coverage—although the federal government does pay about half of Medicaid costs in most states. States will see some savings as those costs are shifted to Medicare, but the law requires the states to pay most of those savings back to Medicare.

Q: How will eligibility be determined for Medicare’s new needs-based benefits?

A: Medicare has never had a financial eligibility test before, though the little-known QMB and SLMB programs have provided premium assistance for poorer Medicare beneficiaries. The new law provides several additional benefits for Medicare recipients with low income and limited assets. In addition, the Medicare Part B premium will for the first time be increased for wealthier participants. State governments will be responsible for determining eligibility and enrolling low-income, low-asset beneficiaries in the new subsidized programs—probably utilizing the same eligibility staffs now employed to make Medicaid determinations.

There is much more to be considered in the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Some of the changes include provisions to reduce the cost of care in rural areas, a rollback of planned cuts in doctors’ reimbursement rates and an expansion of options available for health care coverage for younger citizens. For answers to questions about some of those other provisions, visit colleague Tim Takacs’ companion explanation in his weekly newsletter, Elder Law Fax.

Hospital Gets No Credit For Care Not Paid By Medicare

NOVEMBER 17, 2003 VOLUME 11, NUMBER 20

While in Via Christi’s St. Francis Hospital in Wichita, Kansas, for tests, Lyle Rose fell out of his bed and hit his head. He suffered a subdural hematoma (a blood clot in the brain) and developed other complications. He stayed in the hospital for over a month, but despite the facility’s best efforts he died from his injuries.

Rather than pay for his intensive care stay itself, Via Christi chose to bill Medicare for Mr. Rose’s time in the hospital. Because Medicare pays less than the full cost of patients’ care, Via Christi ended up writing off over $150,000 of the $242,000 it billed for Mr. Rose’s care. Medicare rules precluded Via Christi from seeking payment for any portion of the bill it was required to write off.

After he died, Mr. Rose’s family sued Via Christi for negligence. They alleged that it was the hospital’s fault that he had fallen out of his hospital bed, and a jury ultimately agreed, if only partially. The jury awarded $582,186.01 in damages for Mr. Rose’s death, and ruled that Via Christi was responsible for 36% of that amount, or $209,586.96.

Via Christi then asked the judge to reduce the award because of the unpaid medical care it had provided. Via Christi argued that it had already contributed more than its 36% share of the medical care portion of Mr. Rose’s care; after all, the facility reasoned, the total amount of damages had included the portion of its fee that had been written off.

The trial court agreed and reduced the judgment against Via Christi to just over $115,000. The Kansas Supreme Court, however, reversed the trial judge and reinstated the original judgment against Via Christi.

According to the court, there were two problems with Via Christi’s position. First, Medicare rules prohibit providers from seeking reimbursement for any unpaid portion of a bill otherwise covered by Medicare. Since the Medicare law is federal, it preempted any Kansas state law which arguably might have authorized the offset.

The “collateral source” rule also keeps defendants from introducing information about a plaintiff’s insurance coverage. Medicare, ruled the Kansas court, is after all just an insurance program, and Mr. Rose’s estate should not be penalized for the fact that he was covered by insurance.

Via Christi argued that keeping this information out of the court case gave Mr. Rose’s heirs a windfall. That may be true, reasoned the court, but if there is to be a windfall, it should benefit the victim’s family rather than the hospital. Rose v. Via Christi Health System, October 31, 2003.

Home Health Agency Declares Bankruptcy, Blames Medicare

NOVEMBER 10, 2003 VOLUME 11, NUMBER 19

Home health care benefits available through the Medicare program have been curtailed in recent years. The effect of the government’s crackdown on home health care costs has been felt not only by patients, but also by health care providers themselves.

Take, for example, the case of Idaho’s Community Home Health agency (CHH). The company had been serving about 500 patients. Then Congress passed the Balanced Budget Act of 1997, directing Medicare to set limits on the costs which could be paid through for home care.

CHH, like other Medicare providers, had been paid a monthly amount based on an estimate of the number of patients it would see. These “periodic interim payments” would then be adjusted for the amount actually due the agency, with a smaller amount either paid or withheld from future payments once the bookkeeping was completed.

With the new law, however, CHH decided that it would not be able to serve the same number of patients. The agency dramatically cut its Medicare caseload in an attempt to anticipate the new government regulations. Its income would be slashed, but its costs would also be contained—or at least that was the theory.

Unfortunately, the agency continued to receive and cash checks based on its prior caseload. By the time CHH figured out it had a problem it had received overpayments of more than one million dollars. The agency told Medicare it needed to set up a plan to repay the money over time; Medicare first denied that there had been any overpayment, then threatened to withhold all payments until the account was corrected.

Although Medicare relented and offered a two-year repayment plan, CHH closed its doors and declared bankruptcy. Agency owners Gary and Verlene Kaiser, who had personally guaranteed CHH’s debts, also filed for bankruptcy. Meanwhile, Medicare investigators were allegedly telling other providers about the Kaisers and CHH, making it difficult for them to do any future business.

The Kaisers sued the government and Blue Cross of California, the “fiscal intermediary” which had handled CHH’s Medicare reimbursements. The Ninth Circuit Court of Appeals threw the lawsuit out, ruling that CHH and the Kaisers had to make their claims through Medicare’s administrative channels. The part of their claim alleging defamation and invasion of privacy was simply dismissed, since the government must give its consent to be sued. Kaiser v. Blue Cross, October 28, 2003.

CHH’s story provides a cautionary example to other providers. While government programs may provide a reliable cash flow, changes in the benefits can have a huge and unpredictable effect on the provider.

Patient’s Daughter Has No Claim Against Nursing Home

JULY 21, 2003 VOLUME 11, NUMBER 3

Helen Hosta of Cuyahoga County, Ohio, was admitted to Century Oak Care Center in February 2001. Mrs. Hosta was unable to sign the Century Oak admission agreement, so her daughter, Roberta, signed for her.

After Mrs. Hosta’s Medicare coverage ran out in March, 2001, her daughter Roberta and another daughter, Lynn Straka, applied for Medicaid to cover the nursing facility bills. Because she had financial resources in excess of Ohio’s Medicaid eligibility limits Mrs. Hosta failed to qualify for Medicaid coverage for another eight months.

Century Oak filed suit in August 2001 against Lynn Straka for non-payment of Mrs. Hosta’s bill. Ms. Straka answered the complaint claiming that she had no liability since she did not sign the contract with Century Oak, and Medicare and Medicaid regulations prohibit holding third parties liable for a patient’s bills. Ms. Straka also counterclaimed that Century Oak’s contract constituted negligent and false misrepresentation, and that the admission agreement contained the false and misleading statement that “’it is a federal crime to unlawfully divest assets to become Medicaid eligible.’”

Century Oak dismissed its claim against Ms. Straka after learning that she had not signed the care agreement. Century Oak pursued Mrs. Hosta for payment, but it also dismissed that lawsuit when payment was received. Ms. Straka, however, pursued her counterclaim against Century Oak for its alleged violation of federal and state law. The Ohio trial court dismissed Ms. Straka’s claim, and last month the Ohio Eighth District Court of Appeals upheld the trial court ruling. SWA, Inc., dba Century Oak Care Center v. Lynn Straka, June 19, 2003.

The Ohio courts found that Ms. Straka had no standing to pursue damages since she was not a party to the Century Oak contract. Interestingly, the Ohio court went further by saying that even if Ms. Straka could have sued her claim would have been over-reaching. Though Ms. Straka argued that Century Oak could not sue a third-party for a patient’s non-payment, the Ohio court pointed out that the federal law relevant to nursing facility admissions only prevents the facility from requiring someone else to guarantee payment as a condition of admission.

Although nursing homes can not require a third party to guarantee payment, someone with access to the patient’s funds (like a conservator or agent under a power of attorney) may be sued for non-payment. Anyone signing a nursing home admission contract should of course read it carefully and seek appropriate legal advice.

Medicare Patients Entitled To Receive Investigation Results

JUNE 30, 2003 VOLUME 10, NUMBER 52

Like other patients, Medicare beneficiaries sometimes receive poor medical care. When a Medicare patient complains about the quality of his or her care, federal law mandates a formal review process. It also requires that the patient be informed of the results of that review. Until a recent federal court decision, the government took the position that simply telling the patient the matter was being “looked into” was enough.

Doris Shipp was a patient at Baptist East Hospital in Louisville, Kentucky, from December, 1998, until her death from cancer in June, 1999. After her death her husband David Shipp wrote to the Peer Review Organization (PRO) responsible for oversight of Baptist and the three physicians treating Mrs. Shipp, asking for a review of the quality of care she had received.

Because two of the physicians refused permission to disclose the results of the PRO review of care, Mr. Shipp received a letter informing him only that the PRO had “carefully examined all the issues raised in your correspondence and conducted a thorough review of the care your wife received.” The notice also, unhelpfully, informed Mr. Shipp that the PRO “will take all necessary action when our review findings warrant it.”

Mr. Shipp sought help from Public Citizen, Inc., a nonprofit consumer advocacy group. Public Citizen filed a federal court lawsuit seeking more information for Mr. Shipp and other patients (or survivors) who have concerns about the quality of Medicare services. The Federal District Court agreed with Public Citizen and ordered the government to change its rules to require PROs to actually provide information to patients about the results of their investigations.

The U.S. Court of Appeals for the District of Columbia Circuit agreed with the trial court, and upheld the order invalidating federal rules. At a minimum, ruled the appellate court, the PRO must “disclose its determination as to whether the quality of the services that the recipient received met ‘professionally recognized standards of health care.’” The case was returned to the District Court for further proceedings—partly to determine whether the new government rules must also provide for disclosure of any corrective action by the PRO. Public Citizen, Inc., v. U.S. Dep’t of Health and Human Services, June 20, 2003.

Since Mrs. Shipp’s death the government has changed the name of PROs to “Quality Improvement Organizations.” As a result of the case pursued in Mrs. Shipp’s name, quality of care should now be somewhat easier for Medicare patients to monitor. Thanks go in part to Mr. Shipp’s persistence, partly to Public Citizen, Inc., and partly to The Center for Medicare Advocacy and AARP, which filed a brief supporting Public Citizen’s position.

Attempt to Force Children to Pay Father’s Hospital Bill Fails

JUNE 2, 2003 VOLUME 10, NUMBER 48

Are adult children liable for the medical care of their parents? Several states (not including Arizona) have laws that attempt to impose what is sometimes called “family responsibility” or “filial responsibility” on children for the care of indigent parents. A recent South Dakota case provides a little insight into such laws.

Before James Nelson died at McKennan Hospital in Sioux Falls, he incurred a bill of almost $75,000. McKennan submitted the bill to Medicare, which paid $15,657.85 and required that the hospital make adjustments of most of the rest of its charges. When the adjustments were completed a $42.73 claim remained against Mr. Nelson’s estate; when that amount was paid the hospital signed a release of any further claims it might have made against Mr. Nelson or his estate.

Unfortunately for the hospital, Medicare audited the payments on behalf of Mr. Nelson and noted that his “lifetime days” had already expired before admission to the hospital. As a consequence McKennan was not entitled to any payment from Medicare, and the agency simply reduced its next payment accordingly.

Since McKennan had already agreed not to pursue Mr. Nelson’s estate, it decided to seek reimbursement from his children. South Dakota law includes a provision requiring children to pay for their parents’ care, and so the hospital filed suit against Mr. Nelson’s three children.

Unfortunately for the hospital, South Dakota’s law requires children to pay for their parents’ care only if the parents are unable to pay for care themselves. Just eight days before Mr. Nelson’s death a pending personal injury lawsuit was settled by payment of $1.2 million into a trust for Mr. Nelson’s benefit; on his death, the remaining trust assets were distributed to his estate and ultimately to his children. He was not indigent, and his estate was sufficient to pay for his care.

McKennan then argued that principles of “equity and social policy” should be applied to prevent Mr. Nelson’s children from receiving his estate without having to pay for his medical care. The South Dakota Supreme Court rejected that argument, noting that the hospital’s “equity” argument was unsupported by any citations to legal authority. Accounts Management, Inc., v. Nelson, May 21, 2003.

Though “filial responsibility” laws exist in over half of the states, they are seldom invoked because both Medicare and Medicaid rules prevent efforts to seek additional payments in most circumstances. The Nelson case provides some insight into how changes in health care financing might affect families.

Administrator’s Sentence For Medicare Fraud Not Reduced

FEBRUARY 10, 2003 VOLUME 10, NUMBER 32

Medicare, the federal health care program for seniors and the disabled, has very clear rules prohibiting providers from paying referral fees. The rules are in place to help prevent fraud and abuse of the giant Medicare program and its funding. Over the four decades the program has existed, however, many providers have tried to skirt—or have blatantly violated—the Medicare Antikickback Act.

Baptist Medical Center, in Kansas City, wanted to ensure that it had a steady stream of senior patients coming into the facility. One way to accomplish that would be to work out a regular relationship with Drs. (and brothers) Robert and Ronald LaHue, who operated a busy geriatric practice under the name Blue Valley Medical Group.

To encourage referrals to Baptist Medical Center, administrators hired the brothers as “Co-Directors of Gerontology Services,” for $150,000 per year. As expected, a steady stream of referrals for Medicare-reimbursed services flowed immediately to the hospital. The doctors, meanwhile, did little work to earn their fees.

One of the administrators involved in negotiating (and later renegotiating) the agreement with the Drs. LaHue was Senior Vice President Dennis McClatchey. He oversaw negotiations with the doctors in 1991 and 1992, when Baptist Medical was being bought out by Health Midwest. During those negotiations, if not earlier, he learned that the brothers were not providing $150,000 worth of service to Baptist, and that some staff members in fact wanted nothing to do with them. Still, he saw to it that their contract was renewed.

The LaHues and Mr. McClatchey were tried and convicted for violation of the Medicare Antikickback Act, and the convictions were upheld by a federal appellate court. At sentencing, the District Court decided to reduce Mr. McClatchey’s sentence. The trial judge determined that Mr. McClatchey’s 22-year-old son, who suffered from attention deficit hyperactivity disorder and a host of other psychiatric illnesses, required full-time care. The judge also found that Mr. McClatchey’s criminal behavior was totally out of character, based on his past history. His sentence was reduced to three years’ probation, home detention for six months, and a $30,000 fine.

The government appealed the sentence reduction, and the Tenth Circuit Court of Appeals agreed that a stronger sentence should be imposed. Although care of his son was a concern, his wife remained at home and could take that responsibility, said the court. As for his past good behavior, the court noted that his criminal behavior stretched over a period of several years. The case was remanded with instructions to eliminate the sentencing reduction. United States v. McClatchey, January 16, 2003.

The Medicare fraud case ended even more tragically for Dr. Robert LaHue. In February, 2002, just two days before he was to report to federal prison to begin serving his own 70-month sentence, Dr. LaHue was killed when the Chevrolet Metro he was driving drifted left of the center-line and struck an oncoming tractor-trailer. Dr. Ronald LaHue, meanwhile, was sentenced to 51 months in prison, as was Dan Anderson, the Chief Executive Officer of Baptist Medical Center.

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