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After the iPass IPO, Parker went back into investment banking, where, by all accounts, he was a very successful dealmaker and financier. After a stint at the helm of another tech company, he landed a high-level job in 2009 at DaVita, a large health-care corporation.
It was at DaVita where Parker's business skills shone brightest. He spent five years overseeing a crucial part of the company's business operations as vice president of real estate and internal growth. "I took it from a $400 million business to a $800 million division," said Parker. "I'm really proud of Foothill Square, a brand new DaVita center that's opening here in Oakland," he added, referring to a new DaVita clinic in East Oakland. "That's sixty to eighty living-wage jobs."
DaVita became extraordinarily profitable under the leadership of CEO Kent Thiry, who took over the struggling company in 1999 when its total annual revenue was around $1 billion. In 2009, when Parker came on board, DaVita had roughly $6 billion in yearly revenue. Last year, DaVita's revenues were almost $12 billion. Investment guru Warren Buffet recently increased his holdings in DaVita by more than 23 percent. Parker helped lay the groundwork for this success, and he thinks his skills will translate into running a city. "Oakland has a billion-dollar budget," he said. "City Hall is broken."
Parker talks about the public sector as you'd expect a Bay Area businessman would. "Innovation has to be a part of your DNA," he said.
At DaVita, Parker was a member of the Hilton Group, a prestigious circle of high-level executives. He was also steeped in DaVita's corporate culture, a culture that includes a wacky love for the Three Musketeers. DaVita CEO Thiry often dresses up as a Musketeer — sword, cape, the whole nine yards — for corporate gatherings. The company's "team members" (employees are told not to call themselves employees or workers) are encouraged to shout swashbuckling mottos like "all for one, and one for all!," and "if we must dialyze, let it be like this!" when talking about their work.
Everything is growing at DaVita: Stock values, income, the number of clinics. But there's a dark side to the Denver-based company's expansion: DaVita has been rocked by numerous lawsuits that have alleged malpractice, wrongful death, Medicare fraud, corruption, harassment, and retaliation. The company also has been the target of federal and state investigations, and has paid hundreds of millions of dollars in legal settlements.
DaVita's business model is founded on federal health-care subsidies. With the passage of the Social Security Amendments of 1972, Congress extended Medicare coverage of kidney dialysis to anyone with End Stage Renal Disease (ESRD — more commonly known as chronic kidney failure), regardless of age. The company's annual report shows that Medicare and Medicaid reimbursements made up 58 percent of DaVita's revenue last year.
According to the company's many critics, DaVita's ever-growing profitability relies on lowering the operating cost of dialysis treatment, a goal that runs counter to patient welfare. And when DaVita pushes the line of legality a little too far, into the gray zones of fraud and neglect, it has a history of silencing allegations with cash. Last year, DaVita allocated almost $400 million to settle legal disputes, and many of these included nondisclosure agreements that forbid people from talking publicly about their allegations against the company.
"DaVita is a well-run organization," Parker said. "Look at any of the biggest healthcare companies and you'll see similar types of things they're involved in, similar problems."
According to Parker, DaVita actually loses money on its Medicare and Medicaid patients, and earns its profit instead from privately insured patients. "DaVita is doing an extremely valuable service for the country, but yes, it's involved in lots of [litigation]," he said.
Larry Hall of Wilmington, North Carolina is writing a book about his experiences as a DaVita dialysis patient. He's calling it Blood Money. Hall started receiving dialysis treatment from the Southeastern Dialysis Clinic in 1998. After DaVita acquired the clinic in the early 2000s, he noticed changes in the quality of care: The number of patients per medic increased and the level of technician experience decreased.
Due to the invasiveness of dialysis, any error by a nurse or medical technician can be dangerous. Hall said that it was common for one DaVita technician to be responsible for hooking five patients to machines and monitoring them simultaneously. "It felt like we were on an assembly line, getting us on and off the machines," he said.
In 2005, Hall discovered that a social worker was having patients sign a release form that allowed the clinic to rinse out and reuse their dialyzers, the tubular filter that cleans a patient's blood. Although all dialysis patients have the legal right to request a single-use filter, which assures the dialyzer is sterile, Hall said DaVita staffers were not informing the patients of their rights or explaining the contents of the release.
"I told other patients, 'We have a right to get a new [filter].' They weren't telling people that," Hall said. "After that, that's when stuff happened to me. They were harassing me, using the wrong meds, wrong needles .... It was retaliation, yes."
Shortly after, a DaVita nurse stopped administering the drug Heparin, a commonly used anti-coagulant and blood thinner that helps prevent clotting and increases the efficacy of dialysis. For 42 treatments, Hall was dialyzed without the doctor-ordered drug. When he discovered why he had been exhausted for three months, he sent an official complaint to the North Carolina Department of Health and Human Services. The agency investigated the clinic and substantiated Hall's allegations.