Another kind of end-run: status upgrades.

Professors Zink, Wertleib, Catalano, and Marwin (2005) have discussed several avenues by which the goals of equity and utility in organ donation can potentially be thwarted. I will leave to others the task of evaluating their arguments. Instead, I will discuss an additional source of potential bias. All three of the authors’ major concerns—solicitation, directed donation, and multiple listing—identify ways in which patients who need a transplant can disrupt fair distribution. However, the physicians caring for these patients can introduce disruptions of their own. As Zink et al. note, utility criteria prioritize organ allocation according to need. Though ‘need’ is difficult to define, one salient criterion concerns the patient’s level of care. For example, patients who are sick enough to be in the intensive care unit (ICU) generally have a higher level of priority than those who are ambulatory. Such criteria open the door to potential manipulation by physicians who may, for instance, place a patient in the ICU not because he urgently needs intensive care, but simply to raise his priority on the list. In a familiar gamesmanship borrowed from the battlefields of managed care, the transplant physician may justify his action by reference to fidelity: “my job and my loyalty are to do the best for my own patient; let others worry about distributive justice.” Unfortunately, that ostensibly virtuous reasoning may not just challenge fairness or thwart the organ distribution system. It could also be insurance fraud. One recent case illustrates this. Riley v. St. Luke’s Episcopal Hospital1 is a False Claims Act (FCA) case, also known as a qui tam action. The FCA has a long history as a vehicle by which to prosecute fraud against the government. Citizens who identify such corruption can bring suit and, if successful, reap a portion of any monies the government recovers. Per the statute, treble damages can be collected. During the Civil War, the FCA was used to pursue widespread fraud among defense contractors who provided supplies and services to the Union Army. In 1986 the Act was revitalized by increasing the reward that citizens may receive, and since then it has been applied to health care many times. In the Riley case, Joyce Riley, a nurse who had been employed by St. Luke’s Episcopal Hospital, acted as the “relator” bringing suit on behalf of herself and the government. Among other allegations,2 Ms. Riley alleged that a cardiovascular surgeon, a cardiologist, the Texas Heart Institute, and St. Luke’s Episcopal Hospital all conspired to defraud the government’s Medicare and CHAMPUS (Civil Health and Medical Program of the Uniformed Services) health insurance programs. Allegedly they performed unnecessary heart transplants and illegitimately upgraded patients’ status, such as by admitting a transplant candidate to the hospital or by placing in the ICU a patient who did not need that level of care. Defendants putatively did this “to be known, generally, as the ’hospital that will get you a transplant quicker.’”3 As stated in the plaintiff’s complaint, “[w]hen hospitals falsely upgrade patients the government is forced to pay additional funds.”4 Since 1997 the case has undergone numerous adjudications between the federal district court and the Fifth Circuit, largely on procedural issues surrounding the False Claims Act—under what circumstances a plaintiff has standing to bring suit; whether this plaintiff suffered an injury-in-fact; whether appeals were timely filed; whether an FCA action can be brought even if the government opts not to intervene; and other issues. When judicial attention finally moved in 2002 toward the substantive claims, the federal district court granted the defendants’ motion to dismiss the case. Regarding the question whether the defendants undertook improper patient upgrades, the court summarized the plaintiff’s and the defendants’ arguments. From the plaintiff: “Riley argues that St. Luke’s violated the FCA by allegedly upgrading transplant patients to a higher priority status on the donor list when their condition did not require such an upgrade.”5 The hospital did this, allegedly, to enhance its reputation as a transplant center and as a result caused the government to pay more than it should have for those patients’ care. From the defendants: “[t]he decision to upgrade a patient’s status is a matter of professional judgment exercised by the treating physician. St. Luke’s notes that ‘errors based on faulty calculations or flawed reasoning are not false under the FCA.’. . . As a result, St. Luke’s argues that Riley’s claim of improper patient upgrades should be dismissed as baseless.”6 The district court found for the defendants. The FCA is not a remedy for regulatory mistakes or ordinary noncompliance, but “rather a cause of action for intentional acts of fraud.”7 The court explained that professional judgments are not matters of truth or falsehood, as FCA requires for a claim of fraud. “Falsehood is an objective determination. . . . As a result, ‘expressions of opinion, scientific judgments, or statements as to conclusions about which reasonable minds may differ cannot be false.’ . . . There is no evidence suggesting that St. Luke’s crafted some elaborate scheme to defraud the government—quite the opposite.