Senators Take Scalpel to Local Medical Equipment Providers' Cost of Doing Business

Categories: News
Six years ago, Cynthia Fitzgerald filed in Dallas federal court a complaint that The New York Times predicted in 2007 "could become one of the largest whistle-blower lawsuits on record." The suit stemmed from Fitzgerald's tenure at Novation -- a company HQ'd on John Carpenter Freeway that sells medical supplies to hospitals, health-care centers and doctors across the country -- and in her complaint, Fitzgerald alleges that the business of hospital purchasing is a help-yourself free-for-all where no one's held accountable except the guy with the biggest check who can afford to purchase a piece of mother lode contracts (worth a guesstimated $60 billion annually) that bleed Medicare dry. The litigation drags on to this day.

Now, Novation has another investigation on its hands: As the health care debate rages on, senators from both parties want to know more about how it and several other medical equipment providers conduct business -- because, at the moment, most of it's done without much oversight despite the enormous amount of government money in play. Also named in the senators' investigation: Dallas-based Broadlane. The industry insists that so-called group purchasing organizations save hospital upwards of $36 billion; the senators aren't so sure.

Oh, and speaking of health care ... Pete Sessions' office sends this reminder of Monday's town-hall what-what that'll also featured Eddie Bernice Johnson. It was gonna be at SMU; instead, it's at Cityplace Conference Center -- starting at 7:30 in the morning.

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