The reason for the change in preferred provider, the Wells Fargo document implies, is to save money. In support of that idea the document contains a table showing dramatically different costs for medical procedures undertaken at Alaska Regional Hospital and Providence Hospital, both in Anchorage. This is the fishy part: the cost figures given are so different for the two hospitals that something has to be wrong and probably purposely misleading.…Having previously looked a bit at the pricing structure and markups over cost of these two hospitals, I could not accept the idea that to be treated at Providence, on average, costs AlaskaCare members 3.4 times as much as at Alaska Regional.Following up on this for the July Dose of Reality, Davis discovered that Wells Fargo and Alaska Regional's parent company have a long history together. And that history reveals some shady dealings:
Among the allegations that led to Columbia/HCA’s guilty plea and payment of fines were that Wells Fargo CEO Carl E. Reichardt and four other directors of Columbia/HCA were fully aware that senior management had “devised schemes to improperly increase revenue and profits, and perpetuate a management philosophy that provided strong incentives for employees to commit fraud.” Reichardt and the other four also were charged with knowing about HCA’s improper acquisition practices, which involved offering personal benefits and perquisites to hospital executives during HCA’s negotiations for the purchase of their hospitals.