Fraud and Truth

Those of us in healthcare, and even those not in healthcare, and at one time or another have witnessed a business practice that could be constituted as questionable fraud. Fraud could be defined a couple of different ways: a) the wrongful or criminal deception intended to result in financial or personal gain, and b) a person or thing intended to deceive others, typically by unjustifiably claiming or being credited with accomplishments or qualities.

In my many years in healthcare I have viewed questionable coding practices and even outright fraudulent billing (and these were reported to my superiors). As a healthcare consumer I have also seen false advertising in healthcare and duplicate billing of laboratory services (you can’t bill for both the bundle CPT code and the individual test CPT codes that make up that bundle at the same time – that is a “no no”). But even through all of this, one person and her company has been able to take healthcare fraud to a whole new level.

Can you guess?

If you answered Elizabeth Holmes, then you would be correct. Six days ago a new book written by John Carreyrou entitled Bad Blood: Secrets and Lies in a Silicon Valley Startup hit the shelves and it delves deeply into the how this whole scheme unfolded. It is an amazing book that reads like a John Grisham thriller, except it is all true!

Many of us in the medical laboratory community have known for many years, and attempted to be vocal about, the issues at Theranos. We knew that what was being promised was too good to be true. Yet no one would listen. Ms Holmes graced magazine cover after magazine cover being touted as the best and most revolutionizing person to ever meet the laboratory industry while medical laboratory professionals tried to counter otherwise. Yet no one would listen. Even when Walgreen’s was negotiating their contract with Theranos, Walgreen’s had a very knowledgeable person who tried to communicate the issues to their board. Yet no one would listen. There were even a couple of articles published in laboratory trade journals raising suspicions to the quality of testing and ensuing patient care from the tests being performed by Theranos. Yet no one would listen.

It took an investigative journalist for the Wall Street Journal to essentially “blow the lid” off of this company and reveal the fraud and malpractice within. To his credit, the journalist, who is also the above mentioned book’s author, did an amazing job in both revealing the company’s deceit and in writing the book about it.

I remember sitting in the audience at AACC (American Association for Clinical Chemistry) national meeting in 2015, which was standing room only and full of representatives from various media, eagerly waiting for the Q&A session so that Ms Holmes could finally face the medical laboratory community and answer questions. During that session she refused to answer questions about the then recently published Wall Street Journal article and issues looming over her company. Instead she only talked, and answered questions about, her latest minilab invention, that subsequently didn’t work either. More avoidance of the issues in a ballroom filled with well over a thousand of laboratory professionals including some of the most respected individuals in the profession, confirmed what we had known all along, and the recently published article, to be true.

It took another three years after for her to have formal fraud charges applied towards her and her company from the SEC (Security and Exchanges Commission).

So my question to all of you is: why did no one listen to the medical laboratory community?

Her company performed testing on patients for years, putting patient’s lives in jeopardy in the process. There are multiple class-action lawsuits from patients, patient family members, and even physicians whose made treatment decisions based on Theranos test results that resulted in patient harm. There was also a Theranos scientist who committed suicide over the test inaccuracies being reported on patients. Patients were harmed. Individuals were harmed.

Why did it take a media journalist to publish in the Wall Street Journal to bring to the public the healthcare atrocities that were occurring at Theranos? Why did no one listen?

Was it because we were vocal to the wrong people? Was it because Theranos tried to hide behind the laboratory-developed test loop-holes in an attempt to avoid regulators? Was it because everyone outside of the medical laboratory profession eye’s were glazed over with dollar signs and refused to listen to an entire community who live and breathe quality test results? Why? Why? Why?

We have to do better! This lady made a complete mockery of our profession. This lady put patients lives in danger. This lady made it appear that the medical laboratory community doesn’t care about patient safety. Every laboratory professional and every laboratory student should read this book to understand how it happened so that it doesn’t happen again. Every business professional and business student who wants to be involved in any kind of healthcare business should read this book to know what NOT to do when patient’s lives are on the line.

We have to do better. We must do better. We can do better. … Our patient’s lives depend on it.


One thought on “Fraud and Truth

  1. Well said, Dr. Gunsolus! I followed the entire story via Gen. Eng. News and Forbes magazine from first announcements and you hit the nail on the head. Yes, there are things that do “work” and have been branded “too good to be true” because they are outside the accepted knowledge base at the time or because their economic impact would be massively disruptive those currently benefiting from existing technology practices. What is, unfortunately for so many people, true in this case is the inverse where people focus upon the potential of the disruptive economic benefits and ignore the science facts. While many people were hurt financially by losing their money (emotionally painful), those permanently physically injured from this massive fraud cannot possibly be made whole. If there is a life lesson from this entire mess it would be, in my mind anyway, to always look at the motives of those on both sides of a situation where new science clashes with existing scientific knowledge. In retrospect, if this had been done in this case the fraud could have been detected, despite being well hidden. Those scientists not representing or connected to companies with ties to status quo, challenging the results, had no strong economic motive to challenge the purportedly new science. However, on the other side, those supporting the new science claims had major economic motives to ignore the challenges. According to The Scientist magazine (and other sources) we have had a major increase in the publishing of fraudulent science in papers – some estimate as much as 1/3rd contain major misrepresentations, even in peer reviewed journals. Why is that? Why do all licensed professions now require at least one annual “course” in ethics as part of the continuing education process? Why have so many put their ethical reputations in jeopardy by knowingly engaging in fraud? Frankly, I think the answers lie in progressive liberalism that has come to dominate every aspect of the education process over the past 6 or 7 decades, but that is a discussion for another day. I close my comments by saying we should all be thankful to that investigative journalist who would not stop until the truth was told. I can’t imagine the damage that would have been done if the fraud had not been exposed….damage far beyond the billions of dollars lost by investors.


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