I received an email today from an Emory University doctor expressing support for my Senate Resolution 748 concerning Grady’s employee health benefits plan. He writes:

I have been based at Grady for 11 years as a trauma surgeon. About 8 years ago, a close friend of mine and who was a full-time Grady paramedic (and had health insurance through Grady), was involved in a serious motor vehicle crash and was admitted to the trauma service at North Fulton Hospital (closest trauma center to the site of his crash). When I explored the possibility of having him transferred to Grady, I was shocked to learn that Grady didn’t take his insurance — despite the fact that he was insured through Grady. How absurd! I believe this has since changed… but there is good reason to encourage Grady employees to seek care there.

My resolution points out that Grady’s financial problems stem in large part from a patient mix that is devoid of insured or paying patients and urges Grady to encourage its own employees to use the hospital. Obviously, we need to first make sure that Grady accepts its own insurance. But lower co-pays or deductibles to encourage employee utilization is the logical and next step.

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I was surprised learn about the sudden departure of Otis Story as CEO of the Grady Health System.  I have found him to be open, responsive and seemingly an agent for reform.  In fact, he and I have been working closely on a funding and competitiveness initiative that was to be formally proposed next week.  We were scheduled to meet tomorrow to flesh out some of the remaining details.

Perhaps there was a good reason for this decision, but I frankly doubt it.  Whatever the long term plan for the hospital, now is not a good time to be switching CEOs.

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Grady Health System spends $18 million annually in health care benefits for its 5,000 employees. But unlike virtually every other large hospital employer, Grady makes no effort to encourage its employees to utilize Grady for their primary health care needs.

With bipartisan support, I today introduced Senate Resolution 748 which calls on Grady to consider changes to its health care benefits plan to encourage utilization of its services by its own employees, among other measures to improve the patient mix.

This is the third piece of Grady related legislation that I have introduced in this session.  The Senate Government Oversight Committe which will begin holding Grady hearings on Thursday.  I am hopeful that we will be able to move these bills to the floor next week.

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I today introduced two pieces of legislation addressing problems at Grady Memorial Hospital.

Senate Resolution 722 creates a Grady Oversight Committee. First proposed in 1999 by then Senator David Scott, legislative oversight has been persistently opposed by those who run Grady. Of course, their resistance to legislative oversight has not stopped them from crying the same old lament of legislative neglect whenever the coffers run dry.

The language of the resolution is drawn from legislation creating MARTOC, the highly successful legislative overview committee for MARTA. It will allow the General Assembly to continuously monitor Grady and help make sure that public funds are properly spent.

Senate Bill 353, the Public Hospital Integrity Act, prevents those with a financial tie to either Grady or a major vendor of Grady from serving in a governing capacity for the hospital. This bill will help make sure that Grady’s board gives its loyalty to Grady as an institution and not to those who do business with Grady. Senator David Adelman, Vicent Fort and Kasim Reed are among the Democrats who cosponsored the bill.

As important as they are, governance reform and legislative oversight are just the beginning. I will shortly be unveiling additional proposals for Grady concerning funding, staffing and competitiveness issues. I will keep you posted.

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It has been almost a month since Judge Wendy Shoob unsealed court records related to the case of Grady whistleblower Dr. James Murtagh.  But our review of the thousands of pages of documents has only just begun.  First, it took the Clerk almost two weeks to locate the court records and make them available.  Second, many of the records are not in the courthouse but the hands of a court-appointed arbirtrator.  Third, the confidentiality provisions of the settlement agreement, which remain in force even though the other records have been unsealed, have discouraged the parties from talking with us.

Here is what we know.  In 1999, Dr. Murtagh, a once promising young researcher, Grady doctor and tenured Emory faculty member began cooperating with fraud investigators from the National Institute of Health.  They were apparently looking into the use of federal grant money by Emory at Grady.  Once his superiors learned of his contact with the NIH, Dr. Murtagh almost immediately found himself accused of violating Grady’s do-not-resuscitate policies.  He was subjected to one or more “peer reviews” in which he was found guilty of the DNR violations and then told to undergo a psychiatric examination if he wanted to keep his job.  He was given the option of either quietly resigning or being exposed as a crazed DNR violator.  Instead, Dr. Murtagh sued, contending among other things that the peer review was conducted in bad faith with the retaliatory objective of either halting his cooperation with the NIH or discrediting him.

In 2001, after a federal judge rejected Emory’s and Grady’s motions for summary judgment and ruled that Dr. Murtagh was a protected whistleblower, Emory and Grady opened up settlement negotiations.  They agreed to pay the “crazed DNR violator” $1.6 million, give him positive job references, assign him ownership of three patents and subject their “peer review” policies to an outside review.  In return, Dr. Murtagh agreed to resign his faculty post and stay quiet.  

Dr. Murtagh did not stay quiet.  In the recently unsealed case, Dr. Murtagh trades allegations with Emory and Grady over compliance with the settlement agreement.  Although many of the facts are in dispute, it is clear from my reading of the court records that Dr. Murtagh anonymously emailed the new President of Emory University in 2004 and offered confidential information about alleged wrongdoing at Grady and Emory. The new President wrote back, thanked him for his offer and invited him to send the information.  After receiving the information, the President turned it over to Emory’s lawyers, who traced it back to Dr. Murtagh and accused him of violating the confidentiality provisions of the settlement agreement.  For this and similar “violations,” Dr. Murtagh was found in contempt in late 2005 by Judge Gail Tusan, who later was replaced on the case by Judge Shoob.

It does not appear that Judge Shoob ever ruled on the merits of many, if any, of Dr. Murtagh’s allegations. They were all thrown out earlier this month because Dr. Murtagh was found in contempt again, this time for emailing a newspaper article that made reference to Emory.  In addition to having his claims thrown out, Dr. Murtagh was fined $15,000, ordered to pay Emory’s (but not Grady’s) attorney fees and threatened with jail if he spoke out again.  Emory has submitted motions demanding $1.7 million in attorney fees from Dr. Murtagh.

Sealed settlements and confidentiality agreements are common in litigation involving private businesses and individuals.  They are less common when government entities or public institutions are involved.  In fact, it is my view that they violate public policy on their face.  For this very reason, the Attorney General will not enter into a sealed settlement on behalf of the state or any state agency. 

Former Grady trustee Bill Loughrey tells me that the settlement with Dr. Murtagh was never approved or even accurately described to Grady’s board of trustees.  He says that he was stunned to learn that tax dollars were paid to Dr. Murtagh, conditioned on his silence.  He thinks the agreement is invalid and that the judicial process has been misused. 

I am reserving judgment on the underlying issues of this whistleblower case until our review of the documents is complete.  But one thing is already clear in my mind.  I am convinced tht Grady’s problems stem in part from a culture of secrecy that conceals problems instead of solving them.  It is an issue that must be addressed head on if Grady is to be saved.

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I called up Grady’s Otis Story about a month ago and began the conversation by saying, “I know it might not seem this way to you, but I am trying to help.”  I have met with him more than once in the last several weeks, and I am impressed with him.  I believe that he is committed to Grady as an institution and is willing to fight for its reform.

I agree with everything he said in this AJC guest column about the Disproportionate Share Hospital program.  DSH is neither the cause of Grady’s problems nor the magic bullet that will solve them, but Mr. Story is right when he says that Grady has been adversely and unfairly impacted by all the fiddling with the DSH formula. 

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DeKalb County Commissioner Elaine Boyer has offered a resolution outlining a framework for renegotiating the financial relationship between Emory University and Grady Hospital.  In her plan:

1.  Emory would forebear inadequately documented bills, eliminating debt from Grady’s balance sheet and giving the troubled hospital much needed breathing room.

2.  Grady and Emory would implement audit recommendations requiring full documentation of all future bills.  Grady’s auditors say that new documentation procedures would not only help Grady financially but improve the quality of patient care.  Full documentation would also end the discriminatory treatment of Morehouse doctors who are inexplicably required to provide six times as much documentation of their time than Emory doctors.

3.  Emory would assume liability for its own malpractice.  Not only would this save Grady millions of dollars each year defending and settling lawsuits against Emory employees, it would bring the Emory-Grady contract in line with best practices and likely improve the quality of patient care. 

4.  A new Emory-Grady contract would be negotiated recognizing Grady’s in-kind value to Emory as both a tool to attract tuition-paying students and a source of patient and research revenue.

Commissioner Boyer’s resolution expands on an earlier resolution offered by two of her colleagues, Commissioners Larry Johnson and Connie Stokes.  The Johnson-Stokes resolution called for reductions in payments to Emory based on Grady’s in-kind value to Emory.

I am hopeful the DeKalb County resolution will pass the full Board, but Grady should not wait for that happen.  It should move now to restructure its relationship with Emory along the lines suggested by Commissioners Boyer, Stokes and Johnson.

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Last week I wrote a letter to Commissioner of Community Health Rhonda Medows about the Disproportionate Share Hospital (DSH) program, popularly called “Dish.”

My letter has ramifications for Grady, but I would have written it whether Grady was in trouble or not.

DSH is a federal program designed to aid public hospitals that provide a “disproportionate share” of care to the indigent, hence its name.  But Georgia and many other states have instead been using DSH to subsidize health care delivery across-the-board.

When the program began, only a handful of Georgia hospitals were eligible for DSH funding.  But eligibility has been expanded to the point that hospitals can draw DSH funds without providing a single dollar of uncompensated indigent care.  Now virtually every hospital in the state is drawing DSH funds, and that means that those hospitals that are truly providing “disproportionate” care are being shortchanged.

To its credit, the Department has proposed a new formula that would allocate DSH funds according to the percentage of uncompensated indigent care provided.  Unfortunately, the new formula includes self-defeating ”stop loss” provisions which effectively prevent it from taking effect.

I am not unsympathetic to the larger issues confronting the health care delivery system, particularly in rural Georgia.  Medicaid reimbursement rates, which currently cover only 85% of the cost of a service, should be addressed — but not by using the Disproportionate Share Hospital program as an across-the-board subsidy.

Yes, Grady has been hurt by the redirection of DSH funds.  But as I told James Salzer of the AJC, Grady’s problems are bigger than this one program, and those problems cannot be solved with money alone.  Saving Grady will require a combination of governance, contract and culture reform, and all three must be vigorously pursued. 

Conversely, the issue of DSH funding is bigger than Grady.  As a matter of principle, we should avoid using funds set aside for one program to fulfill the purposes of another.  Medicaid and DSH funding are separate issues, and they should each be addressed on their own merits.

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Grady Memorial Hospital is named for Henry W. Grady, a former publisher of the The Atlanta Constitution.  His successors and my good friends at the AJC are full of ideas on how to save his namesake hospital.  They all involve someone else writing a check and not asking many questions before signing it. 

Several weeks ago, Cynthia Tucker wrote this gem, saying that while she had no real disagreement with my proposals for Grady governance reform, the fact that I was “white, male, consevative and Republican” disqualified me from participating in the debate.  My role should be limited to mutely voting in favor of a government bailout.  It was so outrageous that bloggers across the political spectrum rallied to my defense.

Now Mike King has penned his version of the Tucker column.  It is far less crass.  He complains more broadly about the state legislators and county commissioners who have only recently begun paying attention to Grady.  He wants us to set aside any ”distracting” investigation into Grady’s problems until after the hospital has been saved.

I do not want to be too hard on Mike.  For one thing, he has written a number of excellent editorials about the problems at Grady.  I have shared his columns with other legislators, and we have even linked to them at the Reforming Grady Dot Org website.  He and I have talked privately about Grady, and over the last several months, exchanged a dozen or so emails.  He has been generous with his research and free with his opinions, and I am frankly grateful for his help.  Also, he is not nearly as pompous in person as you would expect from his writing.

But it is ridiculous for him to suggest that contract and culture reform are “sideshows” to Grady’s “revivial.”  They are central to saving the hospital.  Just like you cannot fix a leaky bucket by refilling it with water, you cannot save Grady with money alone.  It takes governance, contract and culture reform, and those cannot “wait.”

I emailed Mike last week offering to write a guest column of rebuttal.  No response as of yet.

Alternatively, I asked him to correct a glaring error in his column.  He stated that I had sought (“chased” was his word) court records in “unsuccessful” lawsuits filed by two different whistleblowers.  In fact, I have only asked for the records in one case, and it involved a $1.6 million settlement with the whistleblower. No response on the requested correction either.

With paid readership down dramatically, I doubt the AJC is in much of a position to help Grady financially.  But the paper has an important role to play, if only it were willing.  Instead of dumping on the elected officials who are trying to get to the bottom of the problems at Grady, its reporters and editorialists should be helping.

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I have had time to think about the events of Friday afternoon when Judge Wendy Shoob called an emergency hearing to unseal the case files of Grady whistleblower Dr. James Murtagh.

I mentioned in my earlier message that Murtagh had recently been sanctioned by the court, apparently for violating the secrecy provisions of the agreement settling his original whistleblower retaliation case.

What I did not mention — because I did not fully appreciate its significance at the time – was the suggestion Friday by lawyers for Grady and Emory that Murtagh be thrown in jail for what they believed were violations of the secrecy agreement in the last 48 hours.

Grady and Emory accused Murtagh of telling the AJC about the the legislative motion to unseal the case files.  They also accused him of being “behind” former Grady trustee William Loughrey’s request that I try to get the records unsealed.

Well, I am the one who told the AJC about the motion to unseal the records.  We gave a copy of our motion and brief — which were public documents — to James Salzer of the AJC.  I also wrote an email to the AJC editorial board members asking for their support of our effort to unseal the records, which they begrudgingly gave in their Friday morning edition. 

As for Bill Loughrey, who was a Grady trustee at the time the original whistleblower suit was filed and settled, he has been telling me for weeks that he was kept completely in the dark about the litigation and that he thought it “outrageous” that it had been settled under seal. Today he told me that he was stunned to learn about the size of the payment to Murtagh – $1.6 million — and the fact that it included tax dollars.

But what surprised him most was that Grady was trying to jail Murtagh for allegedly having talked with him.  He said he had not talked to Murtagh but could not believe that the Grady would try to jail the man if he had.

Everyone knows that Grady has problems.  How can the trustees be expected to solve them if doctors or former doctors of the hospital can be jailed for talking with them?  Who exactly is ”Grady” if not the trustees appointed to run it?  Why on earth would “Grady” enter into a settlement that makes it a jailable offense for a doctor or former doctor to communicate with its trustees — without the trustees apparently even knowing about it?   And why, with all of its problems, would “Grady” be spending legal fees trying to jail a former doctor for allegedly talking to one of its own trustees?

As I have said from the moment I entered this debate, Grady is important to Georgia, and I am committed to trying to save it.  Virtually every dollar Grady receives already comes from the taxpayer, either federal, state or county.  It is becoming increasingly clearer to me that Grady’s problems go well beyond a lack of money.  Grady suffers from a culture of secrecy that would be destructive to any organization but is wholly unacceptable for a taxpayer funded institution.

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