John Livingston

Legalized Corruption in Government Sponsored Medical Care

Who will Stop the Corruption, Malfeasance and Complicity?

Two items crossed my computer screen this morning within minutes of each other. One was an e-mail from an Idaho State Legislator complaining about my use of the word “corruption”. He believed by my describing many of the processes that occur in our state government in the legislature itself and in the various agencies of the executive branch and how they interact with the private sector I was creating an “argument of the extreme”. He felt I was misusing the word “corruption”. I have stated all along that corruption doesn’t have to be illegal to be damaging and devastating, but many times “legal corruption” ends up being illegal. The Medicaid program in Idaho is corrupt to the core. It has grown by almost 350% over the past 10 years. Idaho has been identified as having one of the most corrupt Medicaid programs in the country regarding fraudulent enrollments and fraudulent coding and billing by providers. There have been calls for outside audits of the Department of Health and Welfare and for large institutions that receive more than $100 million of transfer payments/year, for one provider in our State that would be almost $1 billion. The CEO of that “none profit” organization in 2019 received almost $18 million/2yrs according to IRS Form 990. That same person also sat on the Governor’s Covid Advisory Board that would advise our Governor regarding issues surrounding the extension of “Executive” and “Special Orders” that could have impacted reimbursement rates to providers and hospitals.

Just yesterday I was informed about a patient who had recently sold his stake as a franchisee in a large northwestern city because crime was becoming so bad it was impacting his stores significantly. He sold his organization to the parent company for half what the asking price would have been two years ago cashing out today for $10 million! He was attended to last week by a primary care doctor who after rendering services was handed a Medicaid Insurance Card. The guy had just sold his business and within months was paying for his medical services because technically he was qualified for Medicaid—no reported income and no questions about investment income when he qualified. In my opinion, there is not a line between “gaming the system” by fraud or corruption as patients can also be corrupt.

The second item that came to my attention was a review of a book in The Wall Street Journal (WSJ) entitled COMPLICIT by Max Bazerman. Malfeasance and corruption are both legal terms, but Mr. Bazerman like me uses the terms in the ethical sense. In my professional life I often saw doctors receiving gifts like Caribbean or Mexican vacations if they allowed themselves to be “detailed” — have a presentation made to them at their offices by a “drug rep” peddling the newest and latest medication. Big Pharma in their direct marketing to patients on TV, the radio, and internet with claims of peered reviewed data by scientists—who also received vacations from the drug companies, are not only complicit, but actively engaged in malfeasance and corruption. At its very worse we have situations like Purdue’s marketing of Oxycontin that resulted in the deaths of over 45,000 people. The Sackler family that ran Purdue was destroyed, but what about the thousands of employees, doctors and hospitals that participated in the practice of “addictive medicine”?

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Mr. Bazerman notes that there are two types of complications. 1. First there are the “true” complicators whose goals and ethics strongly overlap with the wrongdoers. The distributors and scientists at Purdue would fall into that category because their incomes were impacted by promoting the use of Oxycontin. 2. The second group Mr. Bazerman calls “collaborators” who have different goals and values from the major wrongdoers, but who are happy to “go along to get along” so long as it is expedient for them to do so. In the corporate world we have gross examples like Elizabeth Holmes’s Theano’s fraud and just today the FTX—Democratic Party cryptocurrency fundraising scam. Corruption? Malfeasance? Complicities?

I don’t know about the extent of corrupt behavior, malfeasance or if it is ubiquitous or nonexistent in the corporate world of Idaho Medicine. I do know that there is little accountability and that the promise of “access—quality—cost reduction” of Obama Care has never approached being realized in our State. I do know that in Idaho we never had a hospital system CEO that made $18 million/2yrs until Medicaid Expansion took place. Just how “fungible” revenues are in the corporate medical world needs to be examined and evaluated. When I came to Boise in 1988 the CEOs at Al’s were Sisters Patricia Vandenberg and Patricia Mulvaney who had each taken a vow of poverty and didn’t receive a salary. The CEO at Luke’s was Gil Gilbertson who one time had to take out a second mortgage on his home to ensure that a St. Luke’s building project would be completed. That year he received less than a $250,000 salary. In 1988 CEOs of hospitals served their communities in the same spirit that doctors, nurses, and technicians served. I hardly think $18 million in compensation to CEOs of nonprofits are “serving” anyone but themselves.

I want to point out that my beef is not with the doctors, nurses, and technicians who continue to serve patients today in our healthcare system, and who continue to live up to their professional codes and ethics. My beef is with the administrators, the boards of directors, and their symbionts in government agencies who continue to turn their backs on situations that are corrupt and that are costing taxpayers billions of dollars every year.


It is time for our corporate leaders, those in government in the executive and legislative branches, and we the people take a stand. It is after all the taxpayer that pays for all this corruption—there I said it.

We will see if anyone really cares in January when the wheels of the government start grinding. I bet our Governor doesn’t address the issue in his State of the State address. I bet JFAC doesn’t address accountability and audits before it gives out the people’s money without reconciling where it goes and what it is used for. The ultimate form of irony would be if a Drug company was holding a dinner for doctors and hospital administrators in one room at the Arid Club and in the room next door IACI/IMA/IHA were holding a dinner for legislators.

Corruption? Malfeasance? Complicity? Maybe that has already happened!

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5 replies on “Legalized Corruption in Government Sponsored Medical Care”

One of the most egregious government & corporate created shams is the insertion of screenings that seek out children with “mental health” problems. Practically every child will be screened in some setting for emotional problems, which in turn will most likely put them in either the Medicaid subsidized or other behavioral system, and pharmaceutical system, thus boosting the profits of many corporate run businesses. How genius, create a system that searches for a problem and in turn profits from it. Why limit it to just mental health, why not screen for every possible problem, heck, just let the state become the guardian over the child and in charge of finding issues to monetarily support their corporate buddies rather than the parent.
It is vile the way the state has become such a huge monster of tyranny, increasingly combing over every detail in everyone’s lives. And this does attract the same trait in corporate heads for a consolidated corruption. Yes, the whole medical system has been corrupted from the top while forcing those who are in the field at the lower level to follow the corrupt dictates which has contributed to the loss of good people from the field.

A system without a moral predicate will sooner than later self-destruct, hurting those the most that it was supposed to help. Our State legislators and Governor refuse to attack the corruption that is “Right before their very eyes”. No audits of DHW or the large hospital systems with CEO’s making $18million/2yrs(non-profit)? is beyond being complicit—-some would call it “corrupt.

I know a number of people who are labeled “disabled”, collect benefits and work for cash under the table. All it took was for a medical professional to check the right box and put the right diagnosis on the paperwork. So many of our programs are riddled with fraud and yet not one time have I heard an elected official say “ I will root out that fraud”. They would not be re-elected if they did.

One of the main reasons so many doctors and nurses are leaving their professions early is NOT “burnout”. They see a professional moral code being replaced by a business “ethic” that is based on revenue and profit. The moral tension created by institutions and administrators and boards of directors between what they know is best for their patients and being fired for not following “clinical protocols” has turned the professions of medicine and nursing into employed laborers. Doctors and nurses no longer work for their patients, but for the institutions that sign the front of their pay checks.

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