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Years of emails show how billing influenced Eleanor Slater patient mix

Target 12

CRANSTON, R.I. (WPRI) – Eleanor Slater Hospital executives have so closely managed what type of patients come in and out of the state-run facility over the past decade that one former top doctor has described the practice as manipulative.

A Target 12 review of emails between high-ranking hospital officials dating back to 2012 shows the effort has involved aggressively discharging psychiatric patients, recruiting new medical patients, and even reclassifying one as the other in an attempt to shift the hospital’s patient mix.

“Psychiatric patients are pounding on our door from all angles,” wrote one former executive in a 2013 email.

“Despite all of those aggressive psychiatric discharges, the psychiatric census shows little change,” she added.

Eleanor Slater provides psychiatric care through three units in Cranston, as well as medical and behavioral care through its Zambarano unit in Burrillville. But the state cannot bill the federal government for any services through Medicaid unless both campuses combined maintain more medical patients than psychiatric patients.

Among hospital experts, that funding rule is known as an Institutions for Mental Disease (IMD) exclusion. But staff mostly refer to it as the “IMD mix.” And while it may seem obscure from the outside, failing to comply puts the state at risk of losing upward of $60 million in federal funding each year, leaving Rhode Island taxpayers on the hook to foot the entire bill.

Budget officials say the cost of care at Eleanor Slater totals about $558,000 per patient per year.

That dynamic has played out in real time over the past two years, as the hospital has failed to keep the rate of medical patients above the 50% threshold. And while state leaders today insist the IMD mix isn’t influencing how the hospital is run, recent comments by its top executive suggest otherwise.

During a town hall-style meeting at the end of September, Richard Charest, director of the state agency that oversees Eleanor Slater, told hospital employees: “So, everyone knows that we became an IMD on [May 1] and the next time we’re measured is on Dec. 1.”

“Between now and then we need to admit medical patients and/or discharge some psychiatric patients appropriately,” he explained, later adding this would be necessary “to make sure we get back to a point where we are no longer considered an IMD.”

Target 12 has obtained and independently verified an audio recording of the meeting.

Asked about Charest’s comments, hospital spokesperson Randy Edgar told Target 12, “The approach the hospital is taking regarding admissions, discharges and the IMD mix is consistent with recent independent evaluations.” He did not respond to follow-up questions seeking specifics.

‘Manipulation’

The emails reviewed by Target 12 were first brought to light in a July 1 resignation letter by the hospital’s former chief medical officer, Dr. Brian Daly, who before his departure tried to convince state leaders that Eleanor Slater had been improperly billing the U.S. Centers for Medicare and Medicaid Services for years.

Daly claimed in the letter that part of that improper billing stemmed from the hospital’s “manipulation of patient census ratios,” saying the evidence was detailed in emails he had collected over the years.  

Target 12 requested and obtained the emails, with some redactions, through the state’s Access to Public Records Act. The correspondence offers a window into how the IMD mix weighed heavily on the minds of staff over the years, spurring some to make decisions that troubled Daly.

“I have many times hoped that I have been wrong about the things I have uncovered and about the issues related to billing,” he wrote. “Indeed, it would have made my life much easier.”

In one 2013 email exchange, Eleanor Slater staff expressed concern about the soaring number of psychiatric patients and the effect that could have on the IMD mix. As a solution, one administrator detailed a plan to send staff out to other hospitals to try and drum up new medical patients.

And while federal law requires that patients must receive care in the least restrictive setting possible, the administrator suggested reaching out to potential patients in nursing homes, which are widely considered less restrictive than Eleanor Slater’s designation as a long-term acute care hospital, or LTACH.

“Although we do not traditionally receive applications from nursing homes, this may be the time to start reaching out to them,” wrote the administrator.

That 2013 exchange wasn’t the only time the IMD mix spurred discussion around medical admissions. In a 2015 email under the subject line “IMD Summary Report,” staff again expressed concern that the hospital had too many psychiatric patients.

“With the mix now almost flipped, any potential medical admissions discussed yesterday?” wrote one administrator.

In response, a second staffer indicated Zambarano’s then-administrator, Dr. Norm Decelles, planned to visit potential medical patients at other Rhode Island hospitals.

When Target 12 contacted Decelles to ask about those visits, the now-retired administrator said seeing potential patients in other hospitals was part of his job. He said he would never make such visits unless the sending facility had submitted a written application on behalf of the patient.

“’Recruit’ is not the correct word here because these are facilities actively seeking [Eleanor Slater] admission for their patient,” Decelles told Target 12. “We did not seek them out, they were seeking us.”

‘Administrative admission’

The emails obtained by Target 12 highlighted other times the IMD mix was top of mind for hospital leadership.

The former director of the state agency that oversees Eleanor Slater wrote in 2012 the hospital should create a permanent subcommittee to focus strictly on the challenges of the IMD mix and overall space for patients.  

“It needs to be at a high supervisory level,” he wrote.

A year later, a top doctor revealed staff members were recoding dementia patients as medical patients so they could send them to Zambarano and help out with the IMD mix.

“We sent several patients from the [geriatric psychiatry] list to Zambarano to hopefully increase the census there, and subsequently also increase the medical census at the hospital as well,” she wrote.  

In 2015, staff appeared exasperated after a man experiencing homelessness was suddenly listed as a new medical admission at Zambarano. At the time, no medical staff had signed off on the admission, and there was confusion around why the man needed long-term acute care.

Expressing frustration, one doctor said they didn’t realize the hospital had “stopped the practice of assessing them before we take them.”  

At the time, Decelles concluded the man must have been placed as an “administrative admission,” meaning someone outside the hospital wanted them there. That decision would “supersede” his medical assessment, the doctor said.

Asked about that patient, Decelles said the man didn’t end up getting admitted because he pushed back at the time. And Decelles said during his nearly three decades working at Zambarano, he could only recall two administrative admissions, with the most recent one happening more than a decade ago.  

“These are extremely rare cases in which my medical denial of admission was overruled by a hospital administrator and I was given a directive to admit them despite my judgement,” he said. “In these two cases, I or my supervisor … received a call from the CEO informing me that the director … needed a particular patient admitted at the request of a legislator after I had denied the applicant admission.”

Decelles for months has pushed back on Daly’s claims that past Eleanor Slater leaders had pressured doctors into making decisions to ensure compliance with the IMD mix. The two doctors have since offered competing narratives about what’s been going on behind the hospital’s walls.

In June, after Daly appeared before a Senate Oversight Committee hearing to detail his concerns, Decelles contacted Target 12 to call Daly’s testimony “both defamatory and a display of incendiary rhetoric.”

“At no time in my 27 years of State service at Zambarano did medical staff ‘manipulate data’ to keep medical patients in the hospital improperly, to preferentially discharge psychiatric patients, to keep the IMD mix in balance, or to preserve their own jobs, nor were they ever asked or instructed to by leadership,” Decelles said at the time.

After reviewing the emails Target 12 obtained from the state, Decelles stood by his previous comments – but asked for one point of clarification.

“I can speak only for myself and the rest of the Zambarano medical staff,” he said.

‘Bill and collect’

The emails highlighted by Daly mostly spanned between 2012 and 2015, but other documents collected by Target 12 over the years show the IMD mix has remained a front-and-center concern at the hospital, and it has affected several decisions and financial issues since 2016.

Facing an influx of mental health patients — who can be ordered into the hospital through the courts system — in 2016 the state stopped accepting civil psychiatric patients entirely. Two years later, state spokesperson Linda Reilly told Target 12 that decision was made “to ensure continued compliance with the IMD requirement.”

But by 2019, the state had stopped billing the federal government altogether after whistleblowers raised concerns that the IMD mix was out of whack and that a long-term acute care hospital was providing a level of care that was far more restrictive than what many of the patients needed.  

Outside reports have likewise noted that dynamic. But so far, state leaders have sided with those who argue there aren’t enough community-based options outside of Eleanor Slater for such patients to be discharged.

When the federal money stopped in 2019, it sparked a series of legislative hearings, outside reviews, bitter infighting and public scrutiny that have kept Eleanor Slater in the headlines throughout 2021.

Today, Attorney General Peter Neronha is investigating patient care and billing practices at the hospital as a result, a probe that’s now been going on for roughly nine months. During an interview Tuesday on 12 News at 4, Neronha said that investigation remains ongoing.

R.I. Executive Office of Health and Human Services spokesperson Kerri White told Target 12 the state wouldn’t comment on the actions and emails during the Raimondo and Chafee administrations. But she insisted that the hospital “does not aggressively discharge psychiatric patients.”

“Patients are discharged if it is determined by their clinician that it is appropriate to do so and if there is a setting that is appropriate for each patient’s needs,” White said.

Charest reiterated that point during his town hall meeting last month, while saying the state plans to make it easier for medical patients to get admitted. He made no mention of making it easier to admit civilly committed psychiatric patients, which haven’t been allowed for years.

“We will broaden categories of patients that we are willing to take, still appropriate with LTACH, but a little less rigorous possibly than it has been in the past,” Charest said, adding that this is the plan even though the state-run hospital — like much of the industry — is facing a worker shortage.

“I know that we have some staffing challenges,” he said. “This is part of the process that we have to go through to reset the IMD.”

Whether Gov. Dan McKee’s administration will be successful in managing the IMD mix remains to be seen. The new administration has already experienced initial challenges.

As of May, the hospital’s census report showed there were more psychiatric patients than medical patients at Eleanor Slater, making the state ineligible for federal funding until at least December.

And while White was adamant that hospital operations are not built around “staying on the right side of the IMD mix,” McKee has said he expects the state will be able to resume billing after December because the hospital can now boost its medical admissions.

“I believe there’s a gap in terms of the collections but that has to do with the patient count,” McKee said on Sept. 7. “But we are accepting new patients and we expect under that situation we will be able to bill and collect.”

Eli Sherman (esherman@wpri.com) is a Target 12 investigative reporter for 12 News. Connect with him on Twitter and on Facebook.

Ted Nesi contributed to this report.

An earlier version of this story misstated Richard Charest’s first name.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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