Chances are you’ve never heard of Jim Alderson, and I’m willing to wager that no toy company is going to model an action figure after him. He’s more than a little balding on top and he’s working on a middle-aged paunch. You won’t find charisma to match that of California’s movie-actor Gov. Arnold Schwarzenegger.
But you will find in him a stubborn honesty and perseverance, and
considering what Alderson achieved, we all owe him at least a
"thank you." The Montana whistleblower helped U.S. taxpayers save
billions of dollars by exposing one of the largest cases of
corporate fraud in U.S. history. He did it nearly alone and against
His fight began on a wintry day 11 years
ago this month when he drove from his home in Whitefish, Mont., to
a federal district courthouse in Butte. There, he filed "a
whistleblower complaint" under provisions of the federal False
Claims Act. Alderson was angry, even humiliated. He’d been a
good accountant, he felt, but he’d been fired for refusing to
go along with a phony accounting system initiated at North Valley
Hospital in Whitefish. The system seemed clearly designed to
overcharge federal taxpayers for Medicare services.
billing system was put in place by the giant medical services
provider, Quorum Health Group, a subsidiary of Hospital Corporation
of America, (HCA), the now-notorious bilker of the government.
As Alderson, a career hospital administrator, tells it,
he was ordered to keep two sets of financial ledgers: One
documented expenses for services rendered; another inflated
invoices to be submitted to government auditors for
Alderson was terminated for calling the
practice into question at his hospital, but when he began checking
elsewhere around the country, he uncovered the same fraud being
committed at hundreds of for-profit hospitals.
decade-long quest for justice began, Alderson acted as his own
legal counsel, facing three law firms representing Quorum and HCA,
each with over 1,000 attorneys. Not only did he encounter a legal
counterattack blitzkrieg, but by blowing the whistle he was also
transformed into a pariah within the medical profession. No one
would hire him.
Alderson drained his retirement and
savings accounts while compiling evidence, and he moved 14 times
with his wife, Connie, to make ends meet. Eventually, fearing
retribution, he enlisted attorneys who convinced the U.S. Justice
Department to intervene.
His case was aided mightily when
another health-care insider, John Schilling, came forward and
provided information which led to the FBI raiding 35 hospitals
managed by HCA and Columbia Healthcare Corp. The raids netted loads
of incriminating documents.
Late in 2003, after spending
hundreds of millions of dollars fighting the case, HCA finally
settled with the federal government, which gave Alderson and
Schilling multimillion dollar rewards. HCA and Quorum have also
paid the government nearly $1.7 billion in settlements.
What’s more, experts say that blowing the whistle on the
corporations’ illegal practices cut Medicare and Medicaid
fraud by some $12 billion.
Looking back, this modest
number-cruncher who is descended from a pioneer family in Bozeman,
Mont., credits his family’s support and his membership in
local Rotary clubs with giving him the courage to persevere.
In particular, Alderson points to Rotary’s famous
Four-Way Test, which asks its members a quartet of moral questions
when considering business and other dealings: Is it the truth? Is
it fair to all concerned? Will it build good will and better
friendships? Will it be beneficial to all concerned?
"Government can’t legislate good ethics," Alderson says.
"That’s got to come from ethical individuals who run
Another impetus for Alderson to do what he did
was thinking about the values he was teaching his college-aged
kids. "You see your kids, and you realize you may have lost your
job, your career, most of your savings, everything you’ve
worked for, but if you lose their respect, it’s something
that cannot be replaced," he says.
"I wanted to be able to
look my kids in the eyes and tell them that truth and honesty
really do matter."