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Case Study

Memorial Healthcare System/Information Management Consultants in Hollywood, Florida

CLEAR batch services helps keep a children's hospital safe, secure, and free from undue risk "Children's hospitals are deemed to be the safest spaces in any hospital system. So you can imagine our shock when we discovered that an officer of a vendor attempting to bid for work within our children's hospital was a convicted pedophile," stated David Alexander, Vice President of Finance, Memorial Healthcare System. "The potential for disaster would have been immeasurable if our hospital system hadn't utilized proactive methods to protect ourselves from high risk vendor profiles."

Memorial Healthcare System (MHS), headquartered in Hollywood, Florida, is the fifth-largest public healthcare network in the United States. It provides more than 1,900 licensed beds in six hospitals at multiple locations throughout the south Broward County area. Our Children's Hospital, the Joe DiMaggio Children's Hospital, established in 1992, combines advanced technology and the expertise of the largest, most diverse group of board certified pediatric specialists in the region.

This hospital is a premier location for our patients and their specialized needs. As such, our hospitals have always maintained a strong compliance program and we expect our vendor/contractor organizations to abide by these standards in connection with business activities with or for our hospital.

Several years ago, MHS was the victim of a sophisticated collusion and kickback fraud scheme perpetrated by internal employees and vendors. Undetected for years and resulting in the loss of millions of dollars, MHS and its partners took action and implemented a system to take a more proactive approach moving forward to prevent a similar situation from happening again.

At the time, we tracked these vendor companies in a large database, but each bid required massive employee hours and scouring of various databases to gain any insight or visibility into the companies we worked with. We relied heavily on the vendors to be truthful and comply with our compliance and bidding programs. That's when Information Management Consultants (IMC) installed the VETTED® system. VETTED cascades through such Batch data sources as corporate registrations and address finders, to identify third - and fourth-degree relationships to determine potential conflicts of interest.

Additionally, the solution employs Thomson Reuters bankruptcy, lawsuits, liens and judgments, and criminal data to determine potential vendor and vendor leadership red flags. Currently, the VETTED system has flagged for removal of more than fifty vendors from our vendor population that were deemed "high risk". One such vendor had worked with MHS for more than 23 years! It was only after their credentials were run through the program that a past fraud conviction was discovered. Two other vendors were found to be related – a husband and wife team no less – which they chose not to disclose during past registration processes.

Through a request for proposal process, the VETTED system exposed a vendor that had set up two fictitious companies in addition to the legitimate company to bid on a project. Previously, the process of vetting vendor organizations within a few hours was difficult but implementing the VETTED system has now provided greater visibility into vendor business activities more quickly. Thus, we are now able to allocate spending to vendors with the least amount of risk to our patients and hospital system.

It was through this new high level automated analysis that we were able to proactively stop a vendor with a convicted pedophile in its leadership from doing business with our children's hospital. This particular vendor registered in the VETTED portal and made no mention of past criminal convictions even though the opportunity for self-disclosure was available. The conviction was discovered through the automated credentialing process by inputting critical data and sifting through the Thomson Reuters criminal data sources for the best possible match from the waterfall search. Analysts were confident that the data returned from the search was related to the leader of the vendor.

Suspicion was confirmed when the analysts spoke to leadership at the vendor organization and they pleaded for the opportunity for business since the conviction was in the past. That opportunity was denied to the vendor and MHS avoided the possibility of disaster and millions of dollars in potential lawsuits.

"The ability of a healthcare system to recognize the potential for fraud and collusion in their vendor population correlates to their capacity to harness large amounts of data. The VETTED solution streamlines the consolidation process and organizes the data into an analytical format to uncover high risk vendors," stated Tom Green, Director of Vendor Risk Management at IMC. "It's not just the bottom line that will be protected, but the credibility, reputation and livelihood of all involved."

If you aren't utilizing proactive methods to expose the potential for vendor fraud, collusion, and risk, then you are leaving yourself open to undue threats and substantial revenue loss for your organization. Effective screening of employees and vendors in today's environment is critical for a safe and secure workplace. The team at our Children's Hospital can focus on embracing a patient- and family-centered approach to care, working together to best meet the needs of our littlest patients.

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