2021 Shkreli Awards

JANUARY 11, 2022 — The Lown Institute has issued its top ten list of the worst examples of profiteering and dysfunction in health care, named for Martin Shkreli, the price-hiking “pharma bro” that everyone loves to hate. This year we’re highlighting “innovative” profiteers, who have particularly creative ways of milking the health system for money.

Nominees for the Shkreli Awards are compiled by Lown Institute staff with input from readers of Lown Weekly. An esteemed panel of patient activists, clinicians, health policy experts, and journalists help determine the winners. (press release | previous winners)

Photo credit: STEVEN MOLINA CONTRERAS/The Ne​w York Times/Redux

Lenox Health Greenwich Village, a division of Lenox Hill Hospital in New York City, routinely charged more than $3,000 for Covid-19 nasal swab tests, although these tests usually only cost $100, the New York Times reported. Directing patients through their emergency department allowed the hospital to bill the Covid-19 tests as ER visits and tack on substantial fees.

Northwell Health, which owns Lenox Hill, said that the charges were appropriate because patients received “more advanced care” in the ER. The Lenox Health Greenwich Village executive director also responded in a letter to the Times, saying that patients were notified that these tests were considered emergency visits and did not incur any out-of-pocket costs. While insurers, not patients, were on the hook for these bills, these inflated prices contribute to rising premiums and out-of-control health care costs that affect us all.

SOURCE: Sarah Kliff, The New York Times

JUDGES’ COMMENTS:

“You get charged before you are seen. Not for being seen.” That’s what Emory Healthcare wrote to Taylor Davis in an email, after her trip to the Emory Decatur Hospital ER for a head injury. Even though Davis left after waiting for seven hours and never met with a doctor, the hospital still billed her $700 for the trip, Fox 5 Atlanta reported. “I didn’t get my vitals taken, nobody called my name. I wasn’t seen at all,” Davis said.

The hospital told Davis that their protocol is to charge everyone who enters the ER a facility fee, whether or not they get seen. Emory Healthcare told Fox 5 in a statement that it was “looking into this matter and will follow up directly with the individual.”

SOURCE: Janice Yu, Fox 5 Atlanta

JUDGES’ COMMENTS:

Several hospital systems have been exploiting lien regulations to charge accident victims more for care, the New York Times reported. Rather than bill insurers with lower reimbursement rates like Medicaid, some hospitals opt instead to place a lien on patients’ accident settlements for a higher amount — sometimes tens of thousands of dollars more than what they normally would have billed.

One of these hospitals was Parkview Regional Medical Center in Fort Wayne, Indiana. Although Indiana has a law requiring hospitals to bill patients’ health insurance before taking anything out of a settlement, Parkview ignored the rule for Medicaid patients, insisting in a 2020 legal brief that Medicaid is “government assistance” and not health insurance.

In a statement to the Times, a Parkview official said that they no longer file liens against Medicaid patients, and that their debt collection policies have always been “conservative and fair.”

SOURCE: Sarah Kliff and Jessica Silver-Greenberg, The New York Times

JUDGES’ COMMENTS:

During the Covid-19 pandemic, some hospitals halted their practice of suing patients for unpaid medical bills, but others have continued to use the legal system to hound patients with medical debt. Community Health Systems, Inc, one of America’s largest hospital chains, filed at least 19,000 lawsuits against patients for unpaid medical bills from March 2020 to May 2021, CNN reported. 2020 was CHS’s most profitable year in a decade, in part because they received $705 million in pandemic-related aid from federal, state, and local governments. 

In a statement to CNN, CHS said its hospitals only sue patients after it is determined that they have the ability to pay, and that “legal action is always the last resort.” CHS said they adopted a policy in 2021 to withdraw lawsuits against anyone making less than 200% of the federal poverty threshold, but noted that many patients did not fill out the paperwork to qualify for this aid.

SOURCE: Casey Tolan, CNN

JUDGES’ COMMENTS:

Drug manufacturer Merck’s pill molnupiravir was recently approved for emergency use to treat Covid-19 in the US, after it was shown to modestly reduce the risk of hospitalization or deaths in people with mild Covid-19. What’s the catch? Merck charged the US government $712 for a five-day course of the drug, although it costs only $18 to produce and was created using millions in government funding, according to The Intercept. Emory University originally developed this drug as a possible treatment for a mosquito-borne virus, aided by nearly $30 million in government grants.

Merck has granted a royalty-free license for molnupiravir for use in low- and middle-income countries, but the company still stands to make $5-7 billion from the drug.

SOURCE: Sharon Lerner, The Intercept

JUDGES’ COMMENTS:

^{Photo credit: National Nurses United}

Ascension, the nation’s largest Catholic nonprofit health system, has created a $1 billion private equity operation that has been investing in other health care providers, and even a debt collection company, a STAT News investigation found. While other hospital systems have made money passively from investments, Ascension is unique in partnering with a global private equity firm.

Ascension says that profits from capital gains helps them care for the “poor and vulnerable,” but the system’s charity care spending has not increased along with its investment income, and Ascension initiated cuts in services at two of their safety net hospitals. One of these hospitals was closed and converted into an urgent care center, over the protests of local health care workers and community leaders. 

*Note: The Lown Institute provided data to STAT News about safety net hospitals for this piece.

SOURCE: Rachel Cohrs, STAT News

JUDGES’ COMMENTS:

^{Members of the Sackler family in 2014 at a celebration of their gift to the Yale Cancer Center.
Photo credit: Smilow Cancer Hospital Facebook}

The Sackler family which owns Purdue Pharma, the drug company whose aggressive marketing of Oxycontin fueled the opioid crisis, may come out of the legal proceedings relatively unscathed. A bankruptcy deal approved in September 2021 would have required the Sacklers to give up about $4.3 of their $11 billion fortune, but they would have received immunity from future civil lawsuits and would not have to admit any wrongdoing, NPR reported. The US Centers of Disease Control and Prevention estimated the societal cost of opioid use disorder and overdose in America at more than $1 trillion in 2017.

As of December 2021, the bankruptcy deal was rejected by another federal judge. Purdue has stated they plan to appeal this decision, and other courts will likely weigh in on the case before the details are decided.

SOURCES: Brian Mann, NPR; Geoff Mulvihill, Associated Press

JUDGES’ COMMENTS:

Though not one member of its advisory committee supported approval of Biogen’s drug for Alzheimer’s Disease, the US Food and Drug Administration (FDA) gave it the green light anyway, using a regulatory shortcut to accelerate the process. The drug, Aduhelm, has not been shown to significantly reduce memory loss or cognitive decline. The drug did reduce amyloid plaque in the brain, but this has not been shown to improve Alzheimer’s symptoms. Side effects include brain swelling or bleeding, falls, headache, and diarrhea. A STAT News investigation found that the FDA was abnormally proactive in supporting Biogen, even drafting a road map to how they could get Aduhelm approved. 

The high price of the drug and large eligible population means Medicare could spend hundreds of billions each year just on Aduhelm. Already, Medicare premiums are projected to rise 15% in 2022 partly due to the cost of the drug. In response to the STAT findings, the FDA Commissioner requested an investigation of the approval by the Office of Inspector General (OIG); the OIG expects to have a report by 2023. An independent group of Alzheimer’s experts and advocates recently called for the FDA to take the drug off the market.

SOURCE: Adam Feuerstein, Matthew Herper, and Damian Garde, STAT News (Update)

JUDGES’ COMMENTS:

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Judges for Shkreli Awards