HCA's Growing Profit

http://www.nytimes.com/2012/08/15/business/hca-giant-hospital-chain-creates-a-windfall-for-private-equity.html?_r=1&ref=business

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"It takes 2 to speak the truth - one to speak and one to hear." (Henry David Thoreau)
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Today's nytimes.com has a heavily researched article on how the HCA hospital system has achieved dramatic profit growth. According to the Times, HCA controls 163 hospitals from New Hampshire to California. 

The article attaches excellent graphics depicting "Total Margin" (total margin is defined as total revenue minus total costs, divided by total costs) for HCA vs competitors. Since 2006, when it was taken private in a leveraged buyout, profits at its acute-care hospitals are up substantially. Essentially, three private equity firms made the buyout possible: Bain Capital, Kohlberg Kravis Roberts, and Merrill Private Equity (now owned by BOA).

Without getting into all of the detail, in 2008 HCA changed all of the billing codes it assigned to emergency room patients. As a result, many more patients began to be coded at the highest levels of emergency care which are reimbursed by Medicare at higher rates.

So, I'm probably just old fashioned (or just "old") but I think I'm seeing profit-oriented management looking to game the system - in this case, Medicare - for improved profits. This is the difficulty I have with "for profit" hospitals. If "profit" comes first, where's patient care on the list?

Here, I have to insert a quote: "Several years ago, digital billboards began popping up along highways throughout Florida, featuring the image of a painter falling from a ladder and the message: 'Accidents happen fast. Emergency care should too.' Like highway signs that list the travel times to various destinations, the billboards flashed in real time the emergency room wait times - 17 minutes for example, or 45 minutes - at nearby HCA hospitals."

Continuing the Times quote: "HCA wanted to attract more patients to its emergency rooms, and it did. Annual visits climbed 20% between 2007 and 2011." Emergency rooms "...are frequently money-losers because many patients do not have insurance. HCA found a solution: it figured out how to be paid more for the patients it was seeing." Its new billing codes charged more using higher level Medicare codes.

I could go on but what really causes me some heartburn is that HCA is simply charging more for what they do and charging it to Medicare which is at the heart of what needs to be fixed as part of the U.S. social safety net. And, just like Social Security, doesn't Medicare come out of our U.S. tax base?