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Phil Murphy runs Crossroads, a home care and hospice agency in San Francisco. He first heard from ValueStar in late 1996. "I called and talked to them about it, found out what they do," Murphy says. "I talked to our head nurse about it, and we decided that it would not be good for our patients."
A ValueStar endorsement didn't seem all that important, Murphy says, since state and federal health agencies routinely examine Crossroads for its licensing, and Crossroads has never been investigated for a complaint.
But after he declined ValueStar's solicitation, Murphy says, the company would not let up. "We continued to get faxes every three to four months," he says. "They were always saying, 'How do you know if you're the best?' and 'Only the best pass the test.' "
Not only were the solicitations unwanted, Murphy says, but they reflected ValueStar's fundamental misunderstanding of the home health care and hospice business. ValueStar wanted to poll a bunch of Murphy's patients to see if they were happy with Crossroads' service.
"A lot of our patients have dementia. Some of them are elderly. Some of our patients are dying," Murphy explains. "They don't need to have one more person calling them unnecessarily at this point in their lives."
And even if he wanted to, Murphy says, it would have been improper, and possibly violated federal law, for him to turn over a list of Crossroads patients. "Without getting written permission from each one [of the patients], it would be an invasion of privacy, and we would likely be in trouble with Medicare," Murphy says.
Apparently oblivious to Murphy's concerns, ValueStar continued pressing Crossroads. At one point, ValueStar offered to slash the price of certification from $470 to $67. "The home health care clients are demanding the ratings of services in your area," said one letter sent to Crossroads. The letter even offered free books as a bonus for signing up -- including one titled Keeping Customers for Life, a particularly insensitive gesture toward a business that tends to the needs of the dying.
Finally, in January, Murphy received what he calls "the ransom note" from a man named Scott Rhodes at ValueStar. It read, in part, "I needed you to know that the next round of radio segments telling consumers not to spend with home health care services who aren't ValueStar certified is beginning very soon."
Murphy felt like ValueStar was trying to hold a gun to his head, implying that failure to win the gold star -- and pay ValueStar's fees -- would result in negative advertising against his business. In the radio ads to which the ValueStar letter refers, consumers are asked, "Why take chances on bad or unverified companies when you could choose a ValueStar-certified company?" The implication seems to be that a noncertified company is not a good company.
But Stein defends his company's tactics, including the radio ads and the mailings, which Stein says are not meant to be intimidating, but are standard fare for direct-mail solicitation.
ValueStar's foray into certifying medical providers is indicative of one of the company's weaknesses -- purporting to be a consumer's friend in a business it knows little about. Other consumer advocates and watchdogs are disturbed by how the ValueStar process works when applied to a field like medicine.
First and foremost is the same issue that prevented Murphy from signing on: patient privacy. ValueStar wants information on patients in order to certify a health care provider. But providing that information might well violate confidentiality laws.
"I think it would be totally unprofessional for somebody in the practice of medicine to give out information," says Vivian Hersh, a lawyer who works with health care issues in the Attorney General's Office. "Most doctors would consider it a breach of confidentiality."
Stein disagrees, arguing that Value-Star's certification process does not vio-late patient rights, because his company just looks at names and telephone numbers of patients, not their medical records.
The law itself is murky on what constitutes a violation of patient privacy. "The question [about ValueStar] has actually come across my desk," says John Puente, attorney for the Medical Board of California. "It's not an easy answer."
The Medical Board itself would have to investigate and review a particular case in order to make a ruling on whether a patient's privacy had been illegally invaded, Puente says.
Even then, how useful is ValueStar's opinion of, say, a nursing home, which is already overseen by the state? "They're performing a redundant service, and probably not doing it as well as the regulators," says Louis Nuyens, a researcher at the California Advocates for Nursing Home Reform, a nonprofit that collects and reports information on nursing homes to the public.
"The chances are, they [ValueStar] are not going to get a good idea of how the facilities are run."
Predictably, the major criticism of ValueStar is that businesses pay to be included, giving ValueStar an incentive to certify as many companies as it can. Stein is quick to dismiss the seeming conflict.
"Every single rating in the United States is paid for by somebody," he says. "The Better Business Bureau is the emperor with no clothes."
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