Cardiology monopoly: a lucrative game

February 3, 2010

Second in a series: Profit share versus patient care on the Central Coast


On Jan. 20, Barbara Williams, a retired civilian Army nurse who was born and raised on the Central Coast, went to French Hospital Medical Center in San Luis Obispo complaining of chest pains. She was sent home. Two days later, she again suffered chest pains.

On this occasion, she went to Sierra Vista Regional Medical Center, also in San Luis Obispo, and was diagnosed as having had a heart attack.

Emergency room staff transferred Williams to French where cardiologist Michael Famularo performed a balloon and a stent procedure. Following the surgery, Famularo told Williams to take it easy and see him in seven days.

However, when Williams arrived at Famularo’s office for her appointment, the receptionist explained she needed to pay them in cash because they did not accept her insurance, Williams said.

“How do you do surgery and then not see me afterwards?” Williams said with tears running down her cheeks. “He did a procedure on me and then left me out to dry.”

As access to cardiac care is dwindling in San Luis Obispo County, a number of local physicians, patients and others claim that a group of doctors and hospitals are conspiring to create a “cardiology monopoly” to the detriment of some cardiac patients.

These sources have told CalCoastNews during a year-long investigation that this monopoly – actually called a “cartel” by some critics – appears to have violated federal laws.

Concern is centered on a group of 13 cardiologists known as Coastal Cardiology (CC), and its practice of transferring patients to French Hospital Medical Center in San Luis Obispo from competing medical facilities in the county.

These cardiologists partly own the land on which French is located, leading some critics to question whether the transfer of cardiac patients to French presents a potential conflict of interest. An unknown number of doctors, including those from CC, purchased the land where French is located in 2005 and currently lease it back to Catholic Healthcare West (CHW), according to a $12-million promissory note.

Critics also allege that hospital administrators have struck a deal with CC to transfer lucrative cardiology care to French, providing financial incentives to these doctors.

Calls seeking comment from CC and French Hospital Medical Center were not returned.

Because CC transferred all but 18 cardiology patients to French in 2009, surgeons pronounced the patient volume too low at Sierra Vista to do work there.

Numerous local doctors and nurses allege that CC’s program of diverting patients has delayed care and, as a result, permanently harmed patients.

For example, a patient last year who suffered a heart attack and was subsequently transferred from Twin Cities to French, was left in a hallway for an hour and a half because the French cath lab, a cardiac patient examination room equipped with diagnostic imaging equipment, was already being used (French has two cath labs but normally only staffs one).

The doctor refused to utilize the cath lab at Sierra Vista.

Delays can cause permanent damage to heart muscles. Since the surgeons stopped providing backup to cardiologists at Sierra Vista last April, heart attack victims have had on several occasions to wait for treatment while the cath lab at Sierra Vista remained unused.

As a result of declining numbers, surgeons with another group, Central Coast Cardiothoracic of Pismo Beach, stopped providing surgical backup for cardiologists at Sierra Vista. Cardiologists require a backup surgeon in order to do emergency room acute interventions.

“I feel the evidence is quite strong that places with marginal volume have better results than places with small volume,” said David Canvasser of Central Coast Cardiothoracic. “If we could have two programs with adequate volume, we would be very happy.”

In 2005, CHW purchased French. A short time later, CC began transferring patients who needed cardiology tests to French from Sierra Vista in San Luis Obispo and from Twin Cities Community Hospital in Templeton, which are owned by Tenet Healthcare Corporation, even though the tests could be run at Sierra Vista.

At that time, Sierra Vista’s cardiac equipment was considered superior to that at French. Sierra Vista’s management had already purchased a high tech scanner that CC doctors chose not to use. However, when French eventually purchased the same scanner, it was then touted as a great piece of equipment.

Even though CC doctors are paid to be on-call at the Tenet and CHW hospitals, they currently transfer to French most of the Sierra Vista and Twin Cities patients they are called in to treat.

From 2005 through 2009, the number of patients CC doctors transferred from Sierra Vista and Twin Cities to French increased until almost all cardiology patients were transferred away from Sierra Vista.

For example, in 2006, CC physician Mark Bocchicchio performed 105 procedures at Sierra Vista. In 2008, that number had fallen to 83.

Last year, Bocchicchio performed only five procedures at Sierra Vista.

In 2008, CC physician and CHW board member Michael Famularo was paid $44,000 for serving as a director of French Hospital Medical Center according to French’s 2008 IRS filing.

Critics say that as part of the sweetheart deal with French, CC doctors received financial incentives to move their practices from Sierra Vista to French. As part of the move, the doctors bought out the last two years of their lease.

The Stark Law, a federal law named after United States Congressman Pete Stark who sponsored the initial bill, prohibits physicians from referring Medicare patients for certain designated health services to an entity with which the physician or a member of the physician’s immediate family has a financial relationship.

Last year, three doctors in Tucson, Ariz. who had set up a nuclear imaging business in 2006 agreed to pay the federal government $355,000 in a settlement with the U.S. Department of Justice involving violations of the Stark Law.

In another twist to this story, CC doctors routinely transfer patients needing nuclear scans away from French – to CC’s nearby office, where patients can be billed for both technical fees and professional fees, sources say. If a doctor performs a procedure such as a nuclear scan at the hospital, the physician only receives the professional fees while the hospital is paid the technical fees.

“As a former employee of CC, I can tell you that the physicians consider French’s nuclear camera to be substandard,” one insider told CalCoastNews. “French could be getting $8,000 or more in technical fees. Why are they allowing them to do this?”

In addition, local doctors allege that CC and French officials have used a number of tactics to keep other cardiologists from practicing in the area in order to protect their share of the lucrative cardiac market.

One of two non-CC cardiologists in the county, Ken Stevens, has been unable to get full privileges at French after more than a year in the area. It usually takes a highly rated, experienced doctor approximately three months to get full privileges.

Even though Stevens was asked to come from the Midwest to San Luis Obispo to run Sierra Vista’s cardiology department, he is no longer able to perform interventions there because he does not have surgical backup and French has not signed a transfer agreement with Sierra Vista.

As a result, if Stevens is working on a critical heart patient who requires an acute intervention, he has two choices: either transfer the patient to a Santa Barbara hospital or perform a procedure that requires surgical backup by himself – something his malpractice insurance carrier will not approve.

“I can’t start a procedure and then say I can’t do a full. . . ” Stevens said. “I can’t do acute interventions because there is no transfer agreement.”

As a result, patients with insurances such as Tricare and Anthem Blue Cross – insurances that CC does not accept – are not able to have numerous cardiac surgical procedures done locally. Many of these patients drive hundreds of miles to hospitals where the cardiologists accept their insurance.

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Kudos to CalCoastNews for enlightening the general public on the corrupt practices that are CC. As a former employee of the healthcare industry in the Central Coast area, I can assure you that people’s lives have been and will continue to be on the line because of this particular monopoly that CC has in SLO and the surrounding areas. When someone is having a heart attack, time is muscle. The longer you make one wait to get appropriate treatment by holding them in an ER while waiting until CC’s Cath Lab of choice (French) is available; the more heart muscle is lost. It makes you wonder, how many lives have been lost and/or negatively affected by this monopoly?

SLO Visitor you learn fast;”These cardiologists partly own the land on which French is located, leading some critics to question whether the transfer of cardiac patients to French presents a potential conflict of interest.” not much to question here, if you followed the earlier articles you know I feel Catholic Health Care West are as big of crooks as Gearhart and Miller, they just charge $35.00 for one over the counter pain pill, if no one else can tell from this one little pill, that they are being hosed, clean-ex is also $35.00 a box, soon it will be per tissue, hmmmm, sounds like it could be already.

It has been known in the health community for a long time that there is an unspoken “old boys” club.

This club has been made up Coastal, the Cardiovascular Surgeons, and some PCP doctors.

This group has been known to intimidate, bully, and harass others that do not play the way they want.

The time to put a spotlight on these antics is now.

Patients should be the first priority. I know it is money that is the priority but it should not be. Did all these doctors really go into medicine with just the thoughts of fattening their wallets or was it to help save


It is so appalling that someone would ship one patient in one hospital to another facility all because of $$$.

This whole thing makes me sick to my stomach. Same on you French Hospital for allowing this, and Shame on you Sierra for not having the balls to do anything about it.

Hmmmm… as Miyamoto Musashi once said, “the best defense is not being there!” Staying out of hospitals and away from doctors is often good for your health. It’s time to take responsibility for ones own health.

I don’t want to say I am giving up ‘hope’, but for those who think they can depend on a better state of healthcare to ‘save themselves’ are being unrealistic.

The best any person can do today is to take the logical steps that will improve their situation. You are never too old to lose weight and exercise doesn’t mean you have to sweat … it only means to get out and simply walk… walk to the store… walk to the coffee shop every day. This isn’t rocket science.

Oh yeah, if you have a handicapped sticker on your car and really don’t need it… take it off.

Do I sound like I am blaming the victim… well, sometimes the patient is to blame.

Roger Freberg

Roger, joking again huh? I do agree with a lot of your information on staying healthy and I am a firm believer, but for some this is not the issue and your comment is quite out of place as usual, have a heart for there are sick people who need these services and they should not be compromised, by the greed of some!

I know for a fact that French Hospital accepts Blue Cross. Also, this article relies heavily on statements prefaced by “critics say” or “insiders told us” rhetoric. I am always suspicious of such rhetoric. Makes me think the reporter is making stuff up and then hiding behind fictitious sources.

French Hospital accepts Anthem Blue Cross, but as of January 1, 2010 CC does not. They also dropped Tricare, and as of January 1, 2010 there is only one Cardiology Practice in town still taking those carriers.

“Makes me ……… hiding behind fictitious sources.” Said the anonymous commenter.

Irony, I likes it.

Healthguru, you are dead wrong, I was there! I saw the corruption! I proved there doctor lied to avoid a complicated operation, and was complimented with a free operation done by a doctor who works for himself and they payed him, proof enough? Call Karen Traft and ask her about Alice 10/21/04, facts don’t lie!

Consider that at least some of these caring people are concerned for a job that a family depends on.


Although Karen writes great articles and is a very nice lady she loves tabloid type reporting.

I am sure there are some facts here but otherwise you are correct. Gossip is the blood that runs through the veins of our county (probably everywhere else too) and the medical profession at every level is the gossip hub.

As a patient advocate and a patient I can attest to that.

For whatever reason the article appears, it has brought the old, bitter, angry healt care people out of the woodwork.

That alone should make people think twice about healthcare in general.

We desperately need to get first hand info and be our own advocate before we get sick, not after.

This is indeed a very important series regarding local health care. I might add that while French might accept Anthem Health Care, if the doctor performing the procedure doesn’t accept it, then doesn’t the patient still end up with a bill from the doctor who performed the service while the patient was in French Hospital? I find it odd that Sierra Vista maintained a top of the line scanner and the cardiac cadre chose not to utilize it and rather opted for a substandard diagnostic scanner over at French, whats particularly disturbing is that this same type of scanner when purchased by French was then touted as top of the line! Wonder how many blocked valves and arteries were missed during that year?

Heart Health is certainly a concern for many of us however what scares me more is a stroke. Stroke is often so debilitating and can leave an individual half paralyzed, speechless, drooling and completely dependent for all their needs. This county has the worst statistic’s for reversing a stroke (and quality of life following a stroke) in THE ENTIRE COUNTRY. Yes, that’s right! Generally a stroke can be reversed if properly treated in the first 6 hours. Warn your relatives to get you the heck out of here (and fast) if you ever suffer from one.

To you Cardiologist that have been putting the bucks ahead of your patients, this might be over the DA’s head but there are plenty of capable professionals in this county that know how to document your ill deeds and drop the information on the right desks.

Keep us informed CCN.

Yes, the bill does end up with the patient. This is why it was so scary when the CV Surgeons originally pulled out of Sierra Vista. At that time, CCPN and Tricare were only contracted with Sierra Vista and the insurance held by the Tenet employees were not considered “in network” at French. Alot of moves have been made in this power struggle that focused more on money and nothing on the care of the patient. Really, the surgeons moved from one low volume program to another.

Well isn’t this just great, so if a person has a heart attack, they will be forced to be treated at French Hospital. The doctor will be from CC and will not accept the patients Anthen Blue Cross, so the patient will end up with a hugh doctors bill and no follow up care unless they pay cash. What a bunch of SNAKES.

I think it is Coastal Cardiology that does not accept Anthem Blue Cross not French. If you have an emergency reason to be treated, you will get service. However, if you have to have a planned cardiac care procedure, you will have to pay them cash or find another town with more options.

I know of a guy who was sent to French from Sierra Vista about 4 years ago, for a scratchy poor image. It was at the time that French’s machine was old and Sierra Vista’s was state of the art. This has nothing to do with what is best for the patients. Show me the money.

Might be worth a piece listing which insurance plans the local hospitals will accept for cardiac care. Most folks I know have Anthem-Blue Cross, and therefore are out of luck with French.

It should. THis community needs to start some real, honest dialoge about the state of health care in our community. This can no longer be the white elephant in the room……..

This could be the most important story CalCoatNews has done. My god. These are people’s LIVES we’re talking about. Of course I feel terrible for the seniors who lost money to EFI and the animals that lost their lives at Dancing Star, but this story terrifies me.

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