NCJ Number
82661
Date Published
1981
Length
52 pages
Annotation
The Pennsylvania Crime Commission conducted a 3-year investigation into the influence of organized crime in profitmaking health care plans and the questionable marketing, accounting, and investment practices of three health care providers with union contracts.
Abstract
Examples from other State and Federal investigations document the involvement of organized crime in union health care plans. The Pennsylvania investigation focused on three companies: Labor Health Plans (LHP) of Chicago, the A.M.M.A. Health Center in Philadelphia, and American Health Programs (AHP) in Bucks County, Pa. Direct links were found between the LHP, the A.M.M.A., and organized crime, along with indications that unions knew organized crime would benefit financially if contracts were awarded to particular companies. Although AHP had no ties with organized crime, the company had union contacts which increased its likelihood of obtaining a contract; it often paid these individuals fees or commissions. Further investigations of the A.M.M.A. and the AHP revealed that services were substantially overreported to the client unions. For example, the AHP reported over $2 million in services which were never received. Union officials accepted these claims because the providers falsified utilization reports and omitted actual profits in statements to the union. The companies were also involved in such questionable investments as loans to high-level employees or other businesses that have shown no appreciable return to date. Photographs, charts, excerpts from testimony given to the Commission, a falsified utilization report, and an index are included.