Five executives of National Century Financial Enterprises, a finance company which bought accounts receivables of small hospitals and nursing homes, have been convicted by a federal jury of wire and securities fraud. The company went bankrupt in 2002 and the executives were accused of hiding losses from shareholders by moving money around in accounts and keeping two sets of books.

Here is the defense attorneys’ position:

Attorneys for the five defendants said prosecutors took the company’s activities out of context by showing jurors only a tiny slice of National Century’s operations.

That’s what federal prosecutors do in some of the cases which criminalize bad business decisions. They also threaten defendants into testifying against their cohorts:

The government’s star witness, former executive vice president Sherry Gibson, testified last month that the company kept two sets of books, one for public consumption filled with false information, the other that showed the firm’s actual shortfalls. Gibson is one of four former National Century executives who previously pleaded guilty to fraud charges and have cooperated with the government.

So it’s really rich when the Feds turn around and prosecute someone on the other side for witness tampering:

Missing from the trial has been National Century’s former president and chief executive, Lance Poulsen, a chief target of the government’s allegations.

Before his own trial on the fraud charges in August, Poulsen is scheduled for a trial Monday before Marbley on charges of witness tampering.

He’s accused of offering to pay a witness for testimony. Well, what is the Federal government doing when it threatens witnesses with long jail sentences and then offers less time for their testimony? Do you think they always get the truth out of witnesses with that tactic?

In a letter dated December 27, the Texas Department of Aging and Disability Services (DADS), informed all Regulatory Services Providers of a food product recall by the U.S. Food and Drug Administration.

The product could pose “a significant health risk” to people receiving services regulated by the agency. From the letter:

On Friday, December 21, 2007, the New Era Canning Company issued a voluntary recall of 171 cases (six cans per case) of Fancy Blue Lake Cut Green Beans because of potential health risks presented by the product. The green beans are packaged in 6 lbs. 5 oz. cans under the GFS brand (GFS reorder #118737, UPC 93901 11873) with lot code 19H7FL printed on the end of the can. Providers and consumers must not use the product even if it does not look or smell spoiled. According to the recall notice, the product may be contaminated with Clostridium botulinum, a bacterium that can cause life-threatening illness or death from botulism.

Download the letter for more information.

Last week, President George W. Bush vetoed a bill that would have expanded the State Children’s Health Insurance Program (SCHIP). His veto caused quite a backlash in the mainstream media and among Democrats. The House of Representatives will vote tomorrow whether to override the veto.

The expansion would add $35 billion over five years to the SCHIP program. Republicans who voted against the bill are concerned it will expand coverage to adults, illegal aliens, and middle-income families who may be able to afford private insurance. According to a USA Today/Gallup Poll of 1,009 people, half agree with those Republicans and the president: the program should focus on low-income families. (Kaiser Network)

An excerpt:

The poll found that 52% of people agree that SCHIP beneficiaries should be children in families with annual incomes up to 200% of the federal poverty level, while 40% say SCHIP should be extended to children in families with annual incomes up to 300% of the poverty level. In addition, 55% of respondents said they are very or somewhat concerned that SCHIP would create an incentive for families to drop private coverage.

According to USA Today, the poll shows that “while Bush may be losing the political battle with Democrats, he may be doing better on policy.” HHS Secretary Mike Leavitt said that policy is most important, adding, “There’s a lot of politics going on right now,” but “the politics will last a matter of weeks” and “policy here will go on for decades. We have to get this right.”

Also see Pelosi says Dems ’still in the fight’ on SCHIP.

Update (10/19): The House failed to override President Bush’s veto of a bill to expand SCHIP, falling 13 votes short of the necessary two-thirds. See the Dallas Morning News for more information.

According to the Congressional Budget Office, Medicaid spending would increase by $10 billion from 2008 to 2012 and by $23 billion from 2008 to 2017, under the current immigration bill. (Kaiser Network)

The bill would open the door to allowing millions of illegal aliens to become U.S. citizens. Lawmakers would need to raise taxes to compensate for Medicaid benefits paid out to these new citizens.

The so-called immigration reform bill was a compromise between national Republicans and Democrats but was unpopular among Republican constituents. The bill stalled in the Senate last night after an effort to end debate and vote on the measure failed. (Associated Press)

Last week, the New York Times ran an extremely troubling story about Long Term Care Insurance. Apparently, some Long Term Care Insurance companies are using bureacratic tactics to delay payment of claims until the insured dies, or is outright denying them.

In depositions conducted on behalf of angry policyholders, Conseco employees described bureaucratic obstacles that prevented payment of claims. Those depositions were sealed in settlement agreements but were obtained by The Times.

In a 2006 deposition, a Bankers Life and Conseco claims adjuster, Teresa Carbonel, testified that she denied claims because of missing records but was prohibited from calling nursing homes or physicians to request the documents. She also testified that when a claim was denied, she was forbidden to phone a policyholder, but instead used a time-consuming mailing system.

Ms. Carbonel’s testimony, recorded during lawsuit on behalf of a 94-year-old policyholder, Rhodes K. Scherer, also disclosed that if policyholders did not mail requested documents within 21 days, Conseco might abandon their claim, sometimes without informing them.

In the case of Mr. Scherer, who was institutionalized after a bathroom fall, it was difficult to obtain a response, Ms. Carbonel said, because the company’s requests were mailed to his home address, rather than the nursing center where the company had been notified that he had moved. Ms. Carbonel, who is no longer with the company, did not return calls. Conseco declined to comment on her testimony.

Long term care insurance is supposed to help alleviate pressure on Medicaid. Yet, if some companies persist in the kind of conduct described in the article, that certainly won’t happen.

And–what does this mean for providers accepting admissions of people with insurance from these companies?

(HT Wesley J. Smith)

Carole Keeton Strayhorn, Texas Comptroller, chastised the Texas Health and Human Services Commission for its $800 million contract with Accenture, a group that administers Medicaid enrollment and other social services. Citing mismanagement, Stayhorn says the contract “must be ended.”

According to the Houston Chronicle, Accenture’s call centers experience computer glitches and lost and backlogged applications. Strayhorn, who is running for governor, asked lawmakers to transfer project management to a “special master reporting directly to the governor and legislative leaders.”

More links at the Kaiser Network.

As I blogged last week, Mark McClellan, current Centers for Medicare and Medicare Services (CMS) administrator, is set to leave his post.

The Hill reports that Andrew von Eschenbach, President Bush’s nominee to lead the Food and Drug Administration (FDA), is facing obstacles to his confirmation. Will the same happen when Bush nominates someone to take over McClellen’s post?

According to The Hill, former “senior officials” for CMS and the FDA say that agency replacements face a difficult time when they haven’t been confirmed by the Senate.

An incoming chief who’s received Senate confirmation has a vote of confidence, so to speak. He or she went through the preferred process (approval by accountable elected officials). If the president appoints a new chief without Senate approval, his or her leadership position may be precarious and less secure.

With all the controversy surrounding Medicare Part D, the timing couldn’t be worse or more politically charged.

Mark McClellan, Administrator of the Centers for Medicare and Medicaid Services (CMS), is resigning. McClellen had been CMS chief since March 2004.

According to Medical News Today, McClellan is headed to the conservative think tank, American Enterprise Institute.

McClellan, born right here in Austin, Texas, oversaw the launch of Medicare’s new prescription drug program, Medicare Part D. He is a medical doctor who’s served in the federal government since the late 1990s. He is the brother of Scott McClellan, former White House press secretary.

Updated 9/12: “Experts” speculate about McClellan’s resignation.

Earlier this month, I wrote a post about a new book entitled The End of Medicine : How Silicon Valley (and Naked Mice) Will Reboot Your Doctor written by Andy Kessler. Today, I had the opportunity to interview Andy as my guest while sitting in as a guest host for my friend Mychal Massie on his show, Straight Talk, which plays on Right Talk Radio. John, at Right Talk, graciously allowed me to download the show in order to reproduce it here. I thank John and Right Talk for giving me permission to air the show at Garlo Ward.

Andy Kessler does a great job on the show and he has some really good insight and information about trends in medical technology and how it will impact us in the future. I also had the chance to read his book and highly recommend it. It’s informative, easy to read and quite humorous. Here is a really good review of the book from the Wall Street Journal.

So, I urge you to click on the little symbol below and listen to the show. It lasts about an hour and is well worth it.

In a move that is sure to cause controversy (although it shouldn’t), President George Bush plans to implement new standards requiring Medicaid recipients to prove American citizenship in order to receive benefits.

Although the Senate and House of Representatives are trying to reach a compromise on the immigration bill, Bush signed the Medicaid citizenship requirements into law back in February. The requirements will take effect on July 1, 2006.

From the New York Times (free registration required):

They vividly illustrate how concern about illegal immigration is affecting domestic social welfare policy. The purpose of the law was to conserve federal money for citizens, reducing the need for states to cut Medicaid benefits or limit eligibility.

Gov. Rick Perry of Texas won enthusiastic applause at a state Republican convention on Friday when he vowed to increase border security and said, “Texas will start requiring every Medicaid applicant to verify that they are in the country legally in order to receive benefits.”

But officials in some other states and advocates for the poor said the new requirements could cause hardship for children, older Americans and poor people born at home in rural areas who never received birth certificates. Children account for about half of Medicaid recipients. People 65 and older account for about 10 percent.

Some critics say the citizenship requirements will cause problems for older Americans and those without birth certificates. I’m sure there’s a work-around for such cases. Regardless of how people feel about illegal immigration, it would seem only fair to require Medicaid recipients to be American citizens. What do you think?

(Image credit: CNN)