Health Care Matters

A Complimentary Newsletter From:

Law Offices Of David S. Barmak, LLC

Managing Risk for Long Term Care and Health Care Providers

Volume 12, Issue 1                               ADVERTISEMENT                                   JANUARY 2011

In This Issue
Freedom of Speech v. Employment Retaliation: The Refusal to Provide Oxygen for a Patient in Distress
The Importance of Comparing Your Pharmacy Invoices Against Your Pharmacy Contract Pricing Formula
David S. Barmak, Esq. 
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Licensed to practice law in the States of New Jersey, New York, Connecticut and Pennsylvania 

Freedom of Speech v. Employment Retaliation: The Refusal to Provide Oxygen for a Patient in Distress

IMAGINE an aide is asked by a nurse to increase the oxygen level for a patient in distress at a nursing home.  The aide says to the nurse: "I'm not allowed to increase the oxygen levels on patients; it's not in my job description to do that, only a nurse can do that." The nurse is irritated and yells at the aide to turn up the oxygen now before the patient crashes! The aide adjusts the oxygen even though she believes it is against the State Board of Nursing standards to do so. At the same time, the nurse sets up a blood pressure monitor for the patient. The aide asks to change positions with the nurse because blood pressure monitoring setup is in her job description. The nurse adamantly refuses.  The patient screams at the aide, "What's your problem? Are you going to let me die?" The aide storms out of the room. 


The aide immediately writes a letter and mails it to the State Board of Nursing. In the letter, the aide describes the incident in which she is asked by the nurse to increase the oxygen level for a patient in distress. The aide describes the incident as part of a "hostile environment" that she faces daily at the nursing home. The aide also says that she believes that "following the rules" while providing care is important and that, no matter what the nurses tell her, she will continue to follow state guidelines for Certified Nursing Assistants.  The aide sends a copy of the letter to the nursing home's Director of Nursing.


Four days later, the Assistant Director of Nursing and the registered nurse involved in the incident meet with the aide. The aide is reminded that (1) oxygen is not a dangerous drug; (2) she needed to follow the nurses' instructions; and (3) she had signed a competency sheet that acknowledged the use of oxygen within the job description of a Certified Nursing Aide. The aide's employment is terminated for insubordination based on her initial refusal of the nurse's request to turn up the oxygen.


The aide hires a lawyer to file a lawsuit for wrongful termination based upon retaliation. She argues in court that she contacted the state Board of Nursing because she "wanted to speak out as a citizen of the state" based on her concern about providing safe patient care in accordance with the Board of Nursing's guidelines. She also argues that her termination was based upon unlawful retaliation that flowed from the letter she wrote, thereby violating her First Amendment right to free speech. The nursing home argues that the aide was fired for insubordination, not for sending the letter to the state Board of Nursing, and that the aide sent the letter in anticipation of and to defend against the expected termination of her employment. 


First Amendment Protected Speech and Retaliation


Would a court find that the aide, in sending the letter to the Board of Nursing, engaged in "constitutionally protected" activity - activity protected by the free speech clause of the First Amendment? No.


The most important part of the test that a court uses to determine if the First Amendment protects the speech of employees is whether or not the speech involves matters of public concern. Not all employee speech is protected, only speech that may be considered as relating to issues of political, social, or other concern to the community. In addition, a court must determine whether the involved speech more closely resembles an employee's complaints regarding her superior's actions and her own responsibilities as an employee than a citizen's speaking out on a matter of public decision making. 


In this aide's situation, a court would most likely find that the letter sent by the aide complaining about the nursing home's failure to follow a specific care protocol does not rise to the level of a matter of public concern, such as a hospital failing to discharge its responsibilities in a timely or acceptable manner.  A court would find that the aide's letter reflected her disagreement with her supervising nurse's decision and individual treatment decision and was not a matter of public concern.


The letter, which focused on the aide's claimed "hostile work environment" included only vague allegations of the nurse's failure to follow procedures. Perhaps a court would rule differently if the letter alleged broad violations of unsafe conditions that threatened many of the residents' health or a systemic failure of all of the nurses to provide adequate care, instead of whether or not an aide is allowed to change oxygen levels under the Board of Nursing's regulations.  A court would find that the aide wrote the letter in anticipation of a disciplinary proceeding and that the aide based her comment upon her personal observations of how her supervising nurse was carrying out her duties. Bottom line: the aide was complaining about the nurse's incompetent management of the aide during patient care.


If a court were to find that a "matter of public concern" were present, a court would apply the balance of the test and would find for the nursing home. This is because a greater interest exists in allowing nurses to provide emergency care for patients, than in allowing aides to disagree over what care is pertinent to which job description.


A court would also find that the letter written by the aide was pursuant to the aide's official duty as an aide and that she was not speaking as a citizen for First Amendment purposes; therefore, the United States Constitution does not insulate her communication from employer discipline.  The aide's letter was directly related to what she perceived to be her official duty and whether the directions she was given by the supervising nurse fell within her job description. The nursing home, as the employer, considered her letter inappropriate and imposed discipline. In conclusion, the aide's letter would not be shielded under the First Amendment freedom of speech.

The Importance of Comparing Your Pharmacy Invoices Against Your Pharmacy Contract

Pricing Formula

The Law Offices Of David S. Barmak, LLC recently retained the services of a pharmacy contract manager to review client pharmacy invoices against pharmacy contract charges.


In a recent interview with the pharmacy contract manger these questions were raised and answered:


Q: How likely is it that a pharmacy invoice will not match up with the agreed upon charges in the pharmacy contract?  


A:  More often than you would think. Most of the time there isn't an issue with the pharmacy invoice matching the agreed upon charges in the pharmacy contract; however, I've had more than a few situations where the effort to double check more than paid for the time and expense in doing so.


Q: For example?


A:  I recently consulted with a skilled nursing facility with a fee for service contract with the pharmacy vendor. The contract negotiated charges for drugs was: Brand - AWP-!5% and Generic -AWP-20%.

Upon my initial review, the monthly pharmacy invoice for this facility appeared unusually high.  When I reviewed the invoices that the pharmacy vendor was charging the facility for the Medicare Part A patients for the month, I found that the rate charged to the facility was actually Brand- AWP-10% and Generic-AWP-10%.  The actual charges in the invoice were higher than the agreed upon contract charges!

As a result of my pharmacy review, I alerted the facility that there appeared to be a monthly overcharge by the pharmacy for the past two years. The amount of the over-charge was determined and a credit was issued to the facility. The facility was refunded over $60,000 for the two year period. The charges going forward were correct for the balance of the contract period.

Q:  That's very dramatic. Any other examples come to mind?

A:  Unfortunately yes.  I remember a client I recently serviced. The skilled nursing facility was on a per diem fee schedule for Medicare Part A medications and had not had a "true up" for over a year. The daily rate was very low and the facility mistakenly believed that it was getting a very good deal.  Upon my review of the contract with the pharmacy, I determined that the agreed upon exclusion list pricing was AWP-10%. When I priced the exclusions during my review of the monthly bill, I determined that the pharmacy vendor was actually charging the facility straight AWP for the exclusions. The pharmacy vendor was overcharging the facility every month by 10% and was therefore out of compliance with the pharmacy contract.

I'm glad to say that the pharmacy vendor immediately refunded the over-charges to the facility.

Q: Do you have another situation which resulted in dramatic savings for a facility?

A:  One more example. A facility was on a per diem with an extensive exclusion list. Upon my review of the monthly bill, I found that the facility was not receiving proper credit for its returned medications.

I also determined that the price which the exclusion list drugs were being credited was far lower than the price the facility was initially charged for the drugs.

I assisted the facility in requesting that the pharmacy review all credits for the past year and the result was a credit being issued to the facility.  

Q: So reviewing the pharmacy invoices is really no different, in theory, than reviewing the dietary supply invoices.?  Both reviews should be done.

A: Yes; however, even though the pharmacy invoices are tied to a contract just as are other vendor invoices, pharmacy contract charges are often identified by a formula which often fluctuates on a daily basis. A review of pharmacy invoices requires not only comparing the charges to the agreed upon contract charges but also knowing how the contract charge formulas equate to actual pricing on a day to day basis.


Q:  Thank you very much.

A:  You're welcome.

Mission Statement - Reduce Your Risk Now

Our firm is dedicated to helping health care providers, in particular long term care facilities and their insurers, reduce costs by minimizing the risk of adverse events.

We do this by being proactive (pre-litigation strategies). This includes training and education of employees, review of policies and procedures, implementing communication channels, getting feedback through interviews and focus groups, and continuous monitoring and auditing. Vital to employee education is documentation training and effective communication training. 
If an adverse event occurs, our response is promptly reactive (pre-litigation strategies). Mandatory, non-binding mediation is utilized whenever possible. Our goal is to quickly resolve disputes before they escalate and require resolution through the judicial system. To avoid a repeat occurrence, we continue staff training and education with a focus on prevention, as well as review and revise policies and procedures for greater effectiveness.


If a lawsuit is filed, the risk that existed has been realized (litigation strategies). Defense analysis, expert witnesses, focus groups, and mock trials are all part of litigation defense. Finally, implement post-litigation risk management strategies to remedy the situation.


A comprehensive Compliance Program (also known as a Risk Management Program) focuses on early intervention through training, communication, and policy review. Monitoring and auditing are key elements to reduce medical liability exposure and improve patient safety.


Our firm offers numerous specialty risk management programs including a pharmacy risk management program which involves the review of skilled nursing facility pharmacy contracts and monthly pharmacy bills, assistance in renegotiating pharmacy contracts with an effort to obtain favorable pricing, evaluate Medicaid pending claims for credit after residents become Medicaid approved and/or evaluate pricing for Medicaid pass thru drugs.


David S. Barmak, Esq. received his JD from Cornell University and BA from Duke University. He is licensed to practice and serves clients in the States of New Jersey, New York, Connecticut and Pennsylvania. Before making your choice of attorney, you should give this matter careful thought. The selection of an attorney is an important decision.

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Copyright, 2011.  Law Offices Of David S. Barmak, LLC.  All rights reserved.
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