Political Correction

FreedomWorks Board Member Has Vested Interest In Private Health Care Industry

August 05, 2009 10:34 am ET

FreedomWorks board member Richard J. Stephenson has spent much of his career in the health care industry.  Not only is he the founder of the Cancer Centers of America but he was also the president of International Capital & Management Co., an organization specializing in making hospitals more efficient and cost-effective.

Cancer Treatment Centers of America

Richard J. Stephenson Founded Cancer Treatment Centers Of America In 1988.  According to its website, Richard J. Stephenson "is the Founder, and has been Chairman of the Board, of Cancer Treatment Centers of America (CTCA) since its inception in 1988." [CancerCenter.com, accessed 8/4/09]

CTCA Focuses On A "Whole-Person Approach" To Cancer Treatment.  The Cancer Treatment Centers of America utilize "the Mother Standard® of care" during treatment.  "In caring for patients like family, our clinicians take an aggressive and individualized approach to cancer treatment. They combine the latest medical, surgical and radiation therapies with supportive therapies like nutrition, naturopathic medicine, mind-body medicine, oncology rehabilitation, and spiritual support. This whole-person approach gives those fighting cancer new options and hope." [CancerCenter.com, accessed 8/4/09]

CTCA Settled With FTC After Allegations Of Making "False And Unsubstantiated Claims" About Treatments.  According to a 1996 FTC News Release:  "Cancer Treatment Centers of America, Inc., and two affiliated hospitals have agreed to settle Federal Trade Commission allegations that they made false and unsubstantiated claims in advertising and promoting their cancer treatments. The FTC alleged that the respondents could not back up claims, among others, that through certain specific procedures such as 'whole body hyperthermia' and 'brachytherapy,' they were able to successfully treat certain forms of cancer unresponsive to conventional treatment. The respondents also allegedly failed to substantiate a claim that their five-year survivorship rate had ranked among the highest recorded for cancer patients." [FTC News Release, 3/13/96, via QuackWatch.com, accessed 8/4/09]

CTCA Paid To Fly Patients To Its Hospitals For Treatment.  The New York Daily News reported "that Cancer Centers would be more than happy to fly you and a guest out to Zion [IL]...The [hospital] rep takes your name and address, and the next day a brochure arrives by Federal Express. It turns out that on landing, a car will be waiting to whisk you from airport to hospital. You and a guest will each be presented with a 'VIP card.'" [Daily News, 12/11/96, via Lexis]

International Capital & Management Co.

2006: Stephenson Was The President Of International Capital And Management Co.  In 2006, the Virgin Islands Daily News reported: "Schneider Regional Medical Center officials celebrated the full transition of medical oncology services into the $18 million Charlotte Kimelman Cancer Institute with a ribbon-cutting ceremony Wednesday...At the ceremony, officials also announced a $250,000 donation to the Kimelman Institute from Richard Stephenson, founder of Cancer Treatment Centers of America and president of International Capital and Management Co. The center's radiation oncology suite will be named for the Stephenson family." [VirginIslandsDailyNews.com, 7/27/06]

International Capital And Management Co. Operates Lean Six Sigma Consulting Group.  According to its website, "ICMC Lean Six Sigma Consulting Group is the leading Lean Six Sigma (LSS) implementation consultant in the U.S. healthcare industry, with more than 75 years combined experience in LSS strategies. Our experienced team aligns its LSS solutions with your strategic business objectives and performance improvement goals." [ICMCLeanSigma.com, accessed 8/4/09]

Lean Six Sigma System Focuses On Making Health Care Institutions More Efficient.  According to its website, Lean Six Sigma (LSS) "can eliminate obstacles allowing your hospital to improve patient flow and clinic turn-around times, and, reduce patient stays. The result: increased patient loyalty and an improved bottom line." [ICMCLeanSigma.com, accessed 8/4/09]

Lean Six Sigma Seeks To Improve Quality For Hospital "Customers."  According to the Akron Beacon Journal: "The goal of Lean Six Sigma is for businesses to improve the experience of their customers, said Doug Dulin, director of Lean Six Sigma for International Capital and Management Co. The consulting firm, based in the U.S. Virgin Islands, is working with Akron Children's on the Lean Six Sigma initiative. The Lean portion of the program focuses on getting rid of 'waste' to improve speed and quality, Dulin said. Hospital customers - patients - face waste when they spend time waiting for procedures or moving from room to room for tests, he said. The Six Sigma concept encourages employees to get rid of variations in the way things are done, Dulin said." [Akron Beacon Journal, 4/12/09]

Citizens For A Sound Economy

CTCA Gave Citizens For A Sound Economy $15,000.  According to Public Citizen, the Cancer Treatment Centers of America gave Citizens for a Sound Economy $15,000 in 1998. [PublicCitizen.org, 10/6/00]

Citizens For A Sound Economy Became FreedomWorks In 2004. According to SourceWatch: "Citizens for a Sound Economy (CSE) is a powerful industry-funded think tank, promoting deregulation. It was founded by Koch Industries interests and continues to maintain strong links. In 2003, an internal rift between CSE and its affiliated Citizens for a Sound Economy Foundation led to a split in which CSEF was renamed as a separate organization, called Americans For Prosperity.  In July 2004, CSE announced it was merging with Empower America to create FreedomWorks." [SourceWatch.org, accessed 8/4/09]

Citizens For A Sound Economy Was Involved In Insurance Policy Scam

CSE/FreedomWorks Was Involved In The Sale Of Insurance Policies.  According to the Washington Post, there existed "an obscure arrangement between a prominent Republican businessman, J. Patrick Rooney, and a free-market interest group that has netted the grass-roots organization hundreds of thousands of dollars and thousands of new members. Citizens for a Sound Economy -- now called FreedomWorks and headed by former House majority leader Richard K. Armey (R-Tex.) -- has netted more than $638,000 and about 16,000 members through the sale of insurance policies." [Washington Post, 1/23/06]

Insurance Plans Were Sold At A Discount To Those Who Signed Up For FreedomWorks Membership.  The Washington Post reported: "Documents produced through the suit against Rooney's company show how FreedomWorks, a political group that made its name fighting for a flat income tax and questioning global warming, has joined the insurance business. Under the deal, proposed by Rooney in 2000, brokers for Medical Savings Insurance Co. sell high-deductible insurance policies and tax-free savings plans at a group discount to buyers who join the conservative political organization." [Washington Post, 1/23/06]

The Insurance Policies Did Not Clearly State Purchaser Would Become CSE/FreedomWorks Member.  According to the Washington Post: "Jeffrey M. Liggio, a lead lawyer in the lawsuit, pointed to the insurance policies themselves, which never mention FreedomWorks or Citizens for a Sound Economy and label the group policyholder simply by a number: 1214. 'The certificates of insurance issued to class members, despite the clear language contained therein, did not disclose the identity of the Group Policyholder of the group policy, despite the fact that each putative insured must 'join' and pay money to such group as a condition of obtaining the insurance,' the suit's motion for class certification states. The motion was granted in December. Larry Butcher, a plaintiff in the case, said in a deposition that he signed on to a policy simply because his insurance broker son thought it was a good deal." [Washington Post, 1/23/06]

CSE Rented Its Member List, Including The Names Of Policy Holders.  The Washington Post reported: "FreedomWorks and its predecessor, CSE, were careful about the deal's financial aspects. In a Sept. 13, 2000, letter, CSE's Quinn said documents should overtly refer to dues, suggesting they be set at $12 a year, to be raised at CSE's discretion upon notifying Medical Savings Insurance Co. She also noted: 'I would assume that these people will become CSE members for all purposes and therefore will go on the CSE mailing list. Since the CSE mailing list is rented, as a matter of course, those names would be rented as CSE members . . . without specific identification as MSIC insureds.'" [Washington Post, 1/23/06]

CSE Had To Change Its Charter To Allow For The Inclusion Of Policy Holders.  According to the Washington Post: "A Sept. 20, 2000, correspondence from Medical Savings President Randal E. Suttles to Rooney said the deal could not go through because the CSE charter states 'the corporation shall not have members' and therefore does not comply with the law governing group insurance. Fifteen days later, Quinn told Suttles the group had solved the problem, amending its charter to allow for voting members." [Washington Post, 1/23/06]

In Six Years, The Sale Of Insurance Policies Brought In More Than $634,000 For CSE.  The Washington Post reported: "The money that Medical Savings collected on behalf of CSE and FreedomWorks trickled in at first, canceled checks show. The first, in December 2000, was for $28. In April 2001, it was $738. But according to financial documents, the program gathered steam quickly. By March 19, 2003, the monthly 'association fees' totaled $10,060. By 2004, they were topping $15,000, peaking that August at $15,309. They have since ebbed, to $10,687 last month. Last month, Lassman said, about four times as many FreedomWorks members dropped out of the organization as joined by purchasing a policy. But the total raised so far, $638,040, is not insignificant, Lassman said." [Washington Post, 1/23/06]


Richard Stephenson Serves On The FreedomWorks Board Of Directors.  According to its website, Richard J. Stephenson is on FreedomWorks' board of directors.  [FreedomWorks.org, accessed 8/4/09]

FreedomWorks Is Creating An Astroturf Movement

FreedomWorks Actively Organized "Grassroots" Protests.  FreedomWorks published several pages on its web site related to the tea parties, including one designed to "make it easier for FreedomWorks organizers to communicate, collaborate and share ideas about the tea parties being planned around the country." [FreedomWorks.com, accessed 5/1/09]

FreedomWorks Designed Amateur-Looking Website Attempting To Appear As A Grassroots Movement.  As reported by the Wall Street Journal, "AngryRenter.com looks a bit like a digital ransom note, with irregular fonts, exclamation points and big red arrows, all emphasizing prudent renters' outrage over a proposed government bailout for irresponsible homeowners. 'It seems like America's renters may NEVER be able to afford a home,' AngryRenter.com laments. The Web site urges like-minded tenants to let Congress feel their fury by signing an online petition. 'We are millions of renters standing up for our rights!' Angry they may be, but the people behind AngryRenter.com are not renters. Though it purports to be a spontaneous uprising, AngryRenter.com is a product of an inside-the-Beltway conservative-advocacy organization led by Dick Armey, the former House majority leader, and publishing magnate Steve Forbes, a fellow Republican. It's a fake grass-roots effort - what politicos call an AstroTurf campaign - that provides a window into the ways of Washington." [Wall Street Journal, 5/17/08]

FreedomWorks Chairman Dick Armey Serves As A Lobbyist With DLA Piper.  Former Congressman Dick Armey is currently employed by DLA Piper, a Washington lobbying firm.  [DLA Piper, accessed 4/16/09]

DLA Piper Clients Include Corporations Opposed To President Obama's Reforms.  According to the federal lobbying disclosure database, past and current DLA Piper clients include:

[Senate Lobbying Disclosure Act Database, accessed 4/16/09]

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