Federal Government Might Bar Redding Hospital From Medicare Program
Officials for Tenet Healthcare, the nation's second-largest for-profit hospital chain, said yesterday that the federal government is giving the company 35 days to show why its Redding Medical Center should not be barred from Medicare and other federal health programs, the Los Angeles Times reports (Gellene, Los Angeles Times, 9/5). The announcement comes after Tenet officials Aug. 6 agreed to pay $54 million to settle allegations that Dr. Chae Hyun Moon, the hospital's former chief cardiologist, and Dr. Fidel Realyvasquez, a cardiac surgeon, performed unnecessary heart surgeries and defrauded Medicare. Under the settlement, Tenet did not admit any wrongdoing but agreed to implement new procedures at Redding. The settlement ended civil and criminal investigations into Tenet, subsidiary Tenet HealthSystems Hospitals and Redding, but it allowed federal investigations into the involvement of individuals in the alleged Medicare fraud at Redding to continue (California Healthline, 8/18). In a letter sent Wednesday to Tenet, the HHS Office of Inspector General said that from 1999 through 2002, Redding physicians billed Medicare for services that were "medically unnecessary and failed to meet professional recognized standards of care" (Eichenwald, New York Times, 9/5). "This is a particularly egregious case," Judy Holtz, a spokesperson for the HHS OIG, said, adding, "Our priority is to look out for patients and see that taxpayer money isn't wasted." Tenet officials said that the company would prove that there were no deliberate attempts to defraud the government and that an exclusion is undeserved, the Los Angeles Times reports (Los Angeles Times, 9/5). An exclusion from federal health programs "could be financially devastating" for Redding, the New York Times reports (New York Times, 9/5). Medicare and Medicaid accounted for 47.7% of Redding's net patient revenue in the first half of this year (Los Angeles Times, 9/5). In a statement, Tenet said that it would work with government officials to ensure that services provided by Redding continue uninterrupted (New York Times, 9/5).
Tenet, Redding Medical Center and its physicians also face a lawsuit filed in August by 366 former cardiac patients for allegedly performing unnecessary heart surgeries to increase profit. The lawsuit, filed in Shasta County Superior Court, accuses the company and Redding and its physicians of fraud, negligence, battery and elder abuse. The lawsuit is seeking unspecified damages for past and future medical costs, lost income, pain and suffering and physical scarring, as well as punitive damages. Tenet also faces investigations into a variety of allegations. The Securities and Exchange Commission, the HHS OIG and the Federal Trade Commission have launched several investigations into Tenet since October 2002; the company also faces shareholder lawsuits and investigations by the Florida Medicaid Fraud Control Unit and the U.S. Attorney's office in Los Angeles (California Healthline, 8/18).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.