OPINION: State Senators Tied to Medical Billing Scam

Of all the vague claims made by candidates this election year, the single most impressive was the oft-repeated promise to root out “waste, fraud and abuse” in our health care system.

The estimated amount of mischief they claimed could be found varied, at times exceeding $700 billion for Medicare alone.

It’s a hard number to fathom, and could easily be dismissed as campaign posturing. But the further you look down the rabbit hole of medical reimbursements, the stranger things get.

State Sen. Josh Green received $4,000 from Automated Healthcare Solutions. Image courtesy Hawaii State Capitol.

A recent article in the Honolulu Star Advertiser shone a spotlight on the seedy crossroads between politics and healthcare. As Rob Perez reported, Sen. Josh Green of the Big Island accepted a $2,000 donation from the billing software firm “Automated Healthcare Solutions” eight days after using his senatorial stationary to assist the company in collecting payments from the city of Honolulu.

That donation brought the total amount given by the billing firm to Sen. Green up to $4,000 (the maximum allowed by law).

The way Green tells it, he’s “fighting” the insurance companies on behalf of health care providers so that they can continue “caring for patients in Hawaii.”

But Green so far hasn’t addressed questions on why he used his position as senator to act on behalf of a private company; if that act was connected to the donation; and whether he shares the city’s view that taxpayers shouldn’t foot the bill for inflated prices on medication.

Meanwhile, Automated Healthcare Solutions is no stranger to controversy, paying handsomely to political lobbying firms to advance its interests (including $82,000 to a single firm in Florida.) The firm pays doctors who dispense medications directly to patients, then bills insurance carriers and governments at a higher amount. To put it mildly.

Proponents of doctor-dispensed medications point out that it speeds care and ensures follow-through on the part of the patient (who may otherwise fail to pick up their prescription.)

Physician-dispensed medications may speed patient care, but the costs to carriers and governments can be shocking. Image courtesy University of Utah.

That may be true, but insurance companies and governments are experiencing sticker shock over Automated Healthcare Solutions pricing. The city of Honolulu estimates that in some instances, the company charged the government a 4,000-5,000% markup over the cost of prescriptions, and anywhere from 30-50 times what it paid to physicians. The city, which owes an estimated $600,000, has so far refused to pay those bills until the company brings the cost of its services closer in line with local pharmacies.

The unique pricing scheme hasn’t escaped the gaze of insurance carriers either, who fought last session to pass a bill capping the prices of directly-dispensed drugs. The bill was killed off in a committee chaired by none other than Senator Clayton Hee, the only legislator besides Sen. Green to receive contributions from Automated Healthcare Solutions.

Whether Senators Green and Hee acted inappropriately is up to the public to decide, but the wasteful and abusive pricing scheme employed by companies like Automated Healthcare Solutions can only be dealt with at the Legislature via a cap on excessive pricing practices.

Taxpayers are left to foot the bill in scams like these, and when made aware of them, legislators should act quickly and decisively. Support legislation to cap excessive pricing practices in our health care system, and hold your representatives accountable.