GATHERING STORM

State, national groups, Wall Street probe alleged violations at Intermountain

Reports of recent troubles at the psychiatric treatment facility Intermountain Hospital have now attracted the attention of state and federal regulators, and even Wall Street stock analysts.

First, BW's report of a recent patient disturbance (BW, News, "Juvenile Patients 'Riot' at Intermountain Hospital" 7/19/2006) alerted a concerned Wall Street stock analyst who said similar complaints arose about two Virginia facilities owned by Intermountain's parent company, Psychiatric Solutions Inc., based in Franklin, Tennessee. The situation also caught the attention of the investigative branch of the Idaho Department of Health and Welfare's Bureau of Facility Standards, which is partially responsible for licensing such operations. Also, a national hospital accrediting body has confirmed that they conducted a review of Intermountain following the most recent incident. The situation might be serious enough to jeopardize at least one of Intermountain's major sources of income, and possibly its state operating license.

On the local level, BW has obtained a copy of a signed formal complaint and letter of resignation from Shawn Huntington, an Intermountain psychiatric technician, dated July 24 of this year, citing repeated assaults from several adolescents in the main unit on the previous Friday. Huntington's letter states, "I was in fear for my life," alleges "multiple cuts and wounds on my arms ... two large welts on my forehead and a scratch on my face," and details injuries severe enough that his wife took him to the emergency room at St. Alphonsus Regional Medical Center. None of the youths involved were punished, he said.

"Prior to this, I was under the illusion that the staff was in control of the unit and that we could work to the unit safe," he wrote. "However, at this moment I realized that the patients held all the power." Huntington stated that he is pressing charges against these patients and "just feel extremely lucky to not have suffered any life-threatening injuries or death."

The official complaint reflects reports made in recent days to BW by some Intermountain staff members who did not want their names used for fear of losing their jobs. These staff, who deal with patients regularly, stressed that the hospital was understaffed and that many of the juvenile patients were violent, out of control, and unwilling to cooperate.

According to reports collected by the Idaho Bureau of Facility Standards (BFS), Intermountain has been subject to six separate investigations since the end of December 2004. Each inspection involved from one to six individual complaints ranging from failure to notify a patient's legal representatives of injuries, to "incident reports [that] were not completed when patient injuries occurred," to the violation of patients' rights to be informed of their health status (March 2006).

BFS also received and substantiated allegations that medical errors and "adverse patient events" were not tracked (February 2006), one patient was held "against their will" (July 2005), "patient units were dirty and crude comments were written on the shelves" (July 2005), patients' rights to request or refuse treatment were violated (June 2005) and the "examination and stabilizing" for one patient was unduly delayed until "this patient was coerced into leaving the facility without treatment because of his inability to pay for care" (December 2004). This last incident compelled inspectors from the federal Department of Health and Human Services to visit the hospital and issue a citation for noncompliance.

BFS reports say that allegations concerning insufficient supervision to prevent self-harm (March 2006), one patient-on-patient assault (January 2006), poor infection control, patient contraband, and verbal abuse by staff (July 2005) were not substantiated.

The recent disturbances at Intermountain have brought the hospital's parent company, Psychiatric Solutions, a publicly-traded company, under greater scrutiny from equity analysts.

One such analyst, who requested that his name not be used, works for the Healthcare Facilities Equity Research branch of the commercial Deutsche Bank Securities, Inc. in New York City. Psychiatric Solutions recently reported that revenue for the second quarter was a record $248,404,000, up 78 percent from $139,490,000 for the second quarter of 2005.

According to the company's news releases, Psychiatric Solutions has purchased 11 facilities during the year 2006.

The Deutsche Bank analyst said his concern as an investment researcher is whether quality controls could get compromised during a phase of heavy acquisition. The value of Psychiatric Solutions stock has fallen since May, from approximately $35 to approximately $26 per share.

New coverage in The Daily Progress of Charlottesville, Virginia, this year documents violations at the Whisper Ridge Health System that were serious enough to motivate the Virginia Department of Mental Health, Mental Retardation and Substance Abuse Services to consider revocation of the facility's operating license. Aside from six attempted adolescent suicide attempts within two months, the state agency cited "23 medication errors." The Charlottesville Police Department is investigating the hospital for allegations of sexual assault and arson. North Spring, a Psychiatric Solutions-owned sister facility in Leesburg Virginia, has also been cited for several violations within the last few months.

According to Ross Mason of the Idaho Department of Health and Welfare (H&W), Intermountain's situation is complicated because two regulatory bodies are involved. The first, the national Joint Commission on Accreditation of Healthcare Organizations (JCAHO), oversees performance, medical standards and patient safety goals in more than 15,000 facilities across America. Failure to meet those accrediting standards entails loss of a state operating license.

"If H&W hears a complaint, we notify JCAHO and, on their request, we will inspect," Mason said.

But because Intermountain contains a residential treatment center-the scene of most recent incidents-it is licensed by the state's Family and Community Services Division. Mason would only say that "we are looking into the problems at the facility and do not know what will happen because we have just begun that investigation."

But officials in JCAHO's Chicago office confirmed that its own inspectors visited Intermountain on July 19, specifically because of violations of patient care and management of human resources standards. Their review is ongoing.

The situation could create a financial problem for Intermountain and perhaps other Psychiatric Solutions-owned hospitals. The federal Centers for Medicare and Medicaid Services has set the year 2007 as its deadline for JCAHO accreditation. Any hospitals that fail to meet JCAHO standards by that time will become ineligible for the kinds of Medicaid and Medicare reimbursement that fund most adolescent detox programs such as Intermountain's. The hospital could then only earn profits from patients with private insurance or who were able to pay with cash.

Despite offers to respond to this article prior to its publication, neither Intermountain nor the media relations office at Psychiatric Solutions returned phone calls before press time.