UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

July 3, 2009

OBAMA'S HEALTH CZAR WAS DIRECTOR OF COMPANIES THAT FACED SCORES OF FEDERAL INVESTIGATIONS.

Fred Schulte, Investigative Reporting Workshop - Nancy-Ann DeParle, President Barack Obama's health policy czar, served as a director of corporations that faced scores of federal investigations, whistleblower lawsuits and other regulatory actions, according to government records.

Several of the companies were investigated for alleged kickbacks or engaging in other illegal billing schemes, while others were accused of serious violations of federal quality standards, including one company that failed to warn patients of deadly problems with an implanted heart defibrillator. Several of the cases ended with substantial fines paid to the federal government, even though the companies admitted no wrongdoing.

Since leaving her government job running Medicare for the Clinton administration, DeParle built a lucrative private-sector career. Records show she earned more than $6.6 million since early 2001.

After leaving government, DeParle accepted director positions at half a dozen companies suspected of violating the very laws and regulations she had enforced for Medicare. Those companies got into further trouble on her watch as a director.

Now she's back in government as a leading voice in deciding the shape of health care reform. Named by Obama in March as director of the White House Office of Health Reform, making $158,000 a year, DeParle is the point person in pushing for the administration's plans for changing health care and the ways Americans pay for it - changes in which her former companies have a great deal at stake.

Among DeParle's corporate connections:

- DaVita Inc., which owns and operates kidney dialysis centers, has been the subject of several government probes into its billing and drug-prescribing practices, most recently in December by Justice Department investigators in Georgia.

- Boston Scientific Corp. reported to the SEC that it received five state or federal subpoenas during 2008, including ones from the Justice Department and Health and Human Services, which oversees the Medicare agency. In addition, Defense Department criminal investigators are looking into the company's "marketing interactions"
� with doctors at a U.S. Army hospital in Tacoma, Wash.

- Guidant, which already was in legal trouble for failing to disclose 12 patient deaths when DeParle joined the board in 2001, has since then faced new problems. After a college student died in 2005 when his implanted defibrillator failed on a biking trip, his doctor told Congress that Guidant officials had known of similar problems for three years, but failed to tell the public.

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