Professional Ethics

HAS 4400

Dr. Burton

Milton Friedman has long maintained that the "sole aim of corporations is to maximize the profits for its stockholders.“

Yet, the events through the last third of the 20th century demanded that powerful corporations "be attentive" to the consequences their means to profit making was having on the environment, employment levels, and fair wages, among other things.

As this latter view became more pronounced, it was referred to as the stakeholder theory,1 which challenges the Friedman theory as too narrow.

1 William E. Evan and R. Edward Freeman

Addressing complex ethical questions must consider:

• State, federal, and local laws and regulations

• Organizational policy and procedure• Organizational principles and values• Professional and individual values of the

decision maker• Expectations and demands of the local

community and a broader society

Guidance from Law and Regulation

• Externally imposed rules• Addressing both• Practice of medicine• Business• Extends beyond the institution and individual

to relationships with:– Suppliers– Agents– Patients and – Third party payers

Guidance from Policy and Procedure

• Internally imposed– Institutional equivalent of of law and regulation

• Specific expectations and requirements for those doing the work of the organization

Guidance from Organizational Principles and Values

• Self-descriptive statements that define actual or aspirational standards of:– Personal– Professional – Organizational conduct

• Business terms– “customer service/customer satisfaction”

• Ethical terms– Integrity, honesty, and compassion

Guidance from Personal/Professional Values

• A set of principles and values that describe standards of conduct

• Professionally focused– Patient well-being and privacy

• Integrity

• Honesty

• Compassion

Guidance from Society and Community

• Some expectations of society are codified and others are not.– Respect for the patients and their family– Bedside manner– Responsiveness to unusual circumstances

The ethics spectrum

Guidance fromLaw and Regulation

Guidance fromPolicy and Procedure

Guidance fromOrganizational PrinciplesAnd Values

Guidance fromPersonal/Professional Values

Guidance from Society and Community

Generic decision-makingprocess

1. Define the situation

2. Identify the options

3. Evaluate the options

4. Select the optimal option

5. Implement the decision

6. Evaluate the outcome

Ethical decision-making process1. Define the situation using the 5points of the ethics

spectrum• P = Policy and procedures

– Are there policies and procedures that I should consider in this situation?

• L = Law and regulation– Are there laws and regulations that I should consider in this

situation?

• U = Universal organizational values– What organizational values apply to all situations and decision

makers?

• S = Self– What guidance do my personal values provide in this case?

• S = Society – How do community/society values and expectations apply to this

situation?

Ethical Decision-making Process

2. Identify the options:

• Typically characterized as a creative step

• Encumbered and degraded by premature evaluation

Ethical Decision-making Process

3. Evaluate the options– Use the five PLUSS questions for each.

4. Select the optimal option5. Implement the decision

– Until the decision is implemented nothing happens

6. Evaluate the outcome– Examine the consequences (intended and unintended)

of the decision.– Once again apply the 5 PLUSS questions.

Chinese Saying:“He whose virtues exceed his

talents is a superior man; he whose talent exceeds his virtues is a dangerous man.”

Source: Porter-O’Grady & Wilson

HCA Corporate Strategy

…..put the patient first in all of our decision-making. ….the core value of the company lies in the inherent

worth of our individual facilities and groups of facilities in local communities. It follows that this value is created by locally-generated visions, strategies, and market initiatives…

 …simultaneous need for both standardization and

decentralization…. THOMAS F. FRIST, JR., M.D. CHAIRMAN & CHIEF EXECUTIVE OFFICER

JACK O. BOVENDER, JR. PRESIDENT & CHIEF OPERATING OFFICER

Del Sol Medical Center

Mission StatementAbove all else, we are committed to the care

and improvement of human life.

In recognition of this commitment, we strive to deliver high quality, cost effective healthcare in the communities we serve.

Value Statements• We recognize and affirm the unique and intrinsic

worth of each individual.• We treat all those we serve with compassion

and kindness.• We act with absolute honesty, integrity and

fairness in the way we conduct our business and the way we live our lives.

• We trust our colleagues as valuable members of our healthcare team and pledge to treat one another with loyalty, respect and dignity.

Therefore I say:One who knows the enemy and knows himself

will not be in danger in a hundred battles.

One who does not know the enemy but knows himself will sometimes win, sometimes lose.

One who does not know the enemy and does not know himself will be in danger in every battle.

Sun Tzu

ACHE Code of EthicsPreambleI. The Healthcare Executive’s Responsibilities to

the Profession of Healthcare Management II. The Healthcare Executive’s Responsibilities to

Patients or Others Served, to the Organization and to Employees

III. Conflicts of InterestIV. The Healthcare Executive’s Responsibilities to

Community and SocietyV. The Healthcare Executive’s Responsibility to

Report Violations of the Code

Sample Organizational Values

People are important

Learning is essential

Timing is critical

Integrity is paramount

Ethical dilemma

The support of your board chairman is crucial for a new project that is not popular with your hospital's doctors. You want to spend $10 million on a needed renovation in the intensive care unit, while a good number of the doctors want that money spent on new equipment. The board chairman, who has a lot of influence with the doctors, has told you that his friend’s son would like to do the bond work for the renovation.You fear he won’t get behind the renovation if the hospital doesn't use the firm he wants.

-TERESE HUDSON THRALL

KEITH PRYOR Governance consultant and former system CEO, Bryn

Mawr, Pa.

There are often more valid requests for resources than there is funding. I may improve my position by following a disciplined process for spending money that incorporates physician input. I'm not looking to build doctor support, but to use a process that produces an objective answer. Maybe the ICU renovation isn’t the best thing to do. If that process shows that the renovation should go forward, I'd follow a similar process for selection of legal counsel. Companies should disclose relationships to those in leadership positions at the hospital. If the friends son is recommended via this process, any conflict should be disclosed to the board. In the meantime, I'd give my board reports outlining conflict-of-- interest questions posed by the attorney general of Pennsylvania to the leadership of the Allegheny Health System Board.

WILLIAM GONZALEZ Health care adviser and former system CEO, Chicago

I would erode my relationship with the doctors if they discover that the chairs favored firm did the bond work for a project they don't support. It would look as though I were trying to improve my position with the chair at their expense. Instead, I would reopen the discussion of the ICU renovation, involving physicians and the board's construction committee. Even if I'm not able to get doctor support, I've made an attempt to justify it. I'd also talk with the chair about conflict of interest. He should inform the board about his ties to the law firm, which should be considered along with others based on best terms and interest costs. The chair shouldn't participate in voting or discussion. A trustee should never use his or her position to influence the choice of a vendor, even if that vendor does quality work.

Fraud and Abuse

• False Claims

• Kickbacks

• Self-referral

False Claims• Gov’t purchasing services vs. goods• Services provided to beneficiaries of programs

rather than gov’t agents• Services provides at thousands of remote sites• Complexity of prof services make it difficult to

question quality and appropriateness• Personal and confidential nature prevents direct

observation by the gov’t at time of service.

Problem!!!

• Gov’t must rely on the word of the provider or written documentation.

Types of fraud

• Claims for services never rendered

• “Upcoding”– Some providers see nothing wrong with false

statements to justify service to patients need service and cannot afford it.

Federal offense

• False claims for Medicare/Medicaid is a felony

• New federal offenses apply to private as well as public programs.

Examples of Fraud(False Claims)

• One physician billed $350,000 over a 2 year period for comprehensive physical exams of residents without ever seeing a single resident. Falsified medical records to indicate nonexistent services were rendered.

(False Claims)

• A psychotherapist working in nursing facilities manipulated billings codes to charge for 3 hours of therapy when he spent only a few minutes with each resident. 3 hours of psychotherapy is highly unusual and often clinically inappropriate.

(False Claims)

• Speech therapist overstated time spend on each session claimed

• Claim showed 20 hours with residents every day.

• Some residents never met the specialist and some were dead at the time the specialist claimed to have provided service to them.

(False Claims)

• Mobile x-ray unit billed for two x-rays when only one was taken.

• Company personnel were not certified to take x-rays.

Circumventing coverage limitations on specialists

• Podiatrist: excessive toenail removals.– $100,000 one year’s billings, – 11 toenail removals for one resident

• Optometrist: 25 consultation in one day.

• Audiologist: Orders for hearing exams not medically necessary.

Nursing facilities(alerts)

• “Gang visits”

• Frequent and recurring “routine visits”

• Unusually active presence in facilities with unlimited access to resident medical records.

• Questionable documentation.

U.S. v. Mackby• Mackby was managing director of a clinic.• He was obligated to be familiar with legal

requirements for Medicare reimbursement for PT services.

• Ignorance of the law was no excuse.• 20% percent of clinic patients were Medicare• Acted with reckless regard or in deliberate

ignorance with knowledge of false claims.• Penalty: $5,000 - $10,000 per claim, plus 3 times

damage incurred by government.

Kickbacks(Medicare Anti-kickback Act)

• It is unlawful to knowingly and willingly give or receive anything of value to induce someone to refer a Medicare/Medicaid patient

• Or induce someone to purchase something from which payment may be made under these programs.

• Felony: <$25,000 fine, 5 years imprisonment, exclusion from government payment programs..

Self-referral

• Physicians refer patients to facilities that they own in whole or on part.

Theories of Moral Obligation

Theories of Moral Obligation

• Utilitarian and Other Teleological Theories– Choosing the alternative that produces the

greatest balance of good over evil for members of a moral reference group.

• Deontological Theories– A duty-based theory

Utilitarianism

• Three questions are left unanswered:– Who is to be included in the moral reference

group?– What is to count as good or bad?– What sort of alternative is to be considered?

Source: Graber 1989

Moral Reference Group

• Egoism

• Racism

• Sexism

• Nationalism

• One’s patients

• Utilitarianism “all sentient beings” (human?)

Theories of Value

• Subjective Preference– Maximize satisfaction of preferences and minimize

frustration.

• Hedonism– Pleasure is good, pain is bad.

• Pluralism– Four fundamental intrinsic goods

• Pleasure• Knowledge• Virtue• Justice

Act versus Rule

• Should a standard be applied to individual concrete actions or more generally in formulating policies for action in all situations of a certain type?

Kant’s Deontological Theory

Maintained that it is absolutely and always wrong to treat persons “merely as a means and not at the same time as an end in themselves.”

Absolute duties:It is wrong to kill an innocent person.

It is wrong to tell a lie.

It is wrong to do physical harm to an innocent person.

Ross’s Prima Facie Duties

• Fidelity

• Reparation

• Gratitude

• Justice

• Beneficence

• Self-Improvement

• Nonmaleficence

Beauchamp and Childress(Four basic principles)

AutonomyFree to make choices

NonmaleficenceDo no harm

BeneficenceDoing good

JusticeStrive for equality in welfare and opportunity

Making ethical decisionsEdmund Erde

• A methodology

1. Characterize the dilemma as fully as possible

2. Keeping the nature of morality in mind, discard those constituents that arise as a result of inclinations and prejudices.

3. If step 2 does not suffice to solve the problem, consider fully the characterized case in the light of the available moral theories.

Common Rationalizations

• “It’s not really illegal or immoral.”

• “It’s in my (or the organization’s) best interest.”

• “No one will find out.”

• “Since it helps the organization, the organization will condone it and protect me.”

Exhibit 5-7 Three views on ethics.

Ethical questionsEthical questions

TheUtilitarian

View

TheRightsView

TheJusticeView

Does it providethe greatest goodfor the greatest

number?

Does it providethe greatest goodfor the greatest

number?

Does it respectthe rights of the

individualaffected?

Is it fairand equitable?

Is it fairand equitable?

Times are changing. Individual rights and social justiceare challenges which will require supervisors to base ethical standards on nonutilitarian criteria.

A guide for ethical behavior.Questions to ask yourself.1. How did this problem occur in the first place?

2. Would you define the problem differently if you stood on the other side of the fence?

3. To whom and to what do you give your loyalty as a person and as a member of your organization/

4. What is your intention in making this decision?

5. What is the potential for your intentions to be misunderstood by others in the organization?

6. How does your intention compare with the probable result?

7. Whom could your decision injure?

8. Can you discuss the problem with affected parties before you make the decision?

9. Are you confident that your position will be as valid over a long period of time as it seems now.

10. Could you disclose your decision to your boss or your immediate family?

11. How would you feel if your decision was described, in detail, on the front page of your local newspaper?

Group Decision-making

Advantagesmore informationmore alternatives

solution acceptancelegitimacy

Disadvantagestime consuming

minority dominationconformity

ambiguous responsibility

Ethics

Ethics

Morality

Conscience

Legality

Trust

Values

Responsibility

Integrity

Blanchard and Peale’s Three Questions

1. Is it legal?

2. Is it balanced?

3. How will it make me feel about myself?

Tests of Ethical Behavior

• Morning-after Test– How will you feel about this tomorrow morning?

• Front-Page Test– How would you like to see this behavior written up on the

front page of your hometown newspaper?

• Mirror Test– How will you feel about this behavior when you look in

the mirror?

• Role Reversal Test– How would you feel about being on the receiving end of

this behavior?

• Common Sense Test– What does every common sense say about this behavior?

Full Potential Approach

Full Potential Approach

Black & White Approach

Black & White Approach

Approaches to Ethics

Best-Ratio Approach

Best-Ratio Approach Pragmatic,

Situational Ethics

Figure 4 - 4:Guidelines for Handling Ethical Dilemmas

Before taking any action in situations involving ethical

dilemmas, answer the following questions: – What solution is most likely to build trust among

those involved?

– What solution fits best into the company’s value system?

– What solution will pass the morning-after, front-page, mirror, role reversal, and common sense tests?

– What solution is most likely to enhance the organization’s integrity?

– What solution is the most responsible option?

“There’s a tendency today to absolve individuals of moral responsibility and treat them as victims of social circumstance. You buy that and you pay with your soul. What limits people is a lack of character.”

Tom Robbins

Character

• What sort person should you strive to become?

• What are your core virtues?