Orange County Physicians Group Pledges To Acquire Tenet Hospitals
Physician and investor Kali Chaudhuri on Thursday at a public hearing said that he has agreed to back out of a deal to purchase four Orange County hospitals owned by Tenet Healthcare, the Los Angeles Times reports. The Orange County Physicians Network agreed to replace Chaudhuri as principal investor (Pasco, Los Angeles Times, 1/21).
The original deal called for Chaudhuri to own 88% of Integrated Healthcare Holdings, the Costa Mesa company hoping to buy Western Medical Center-Santa Ana, Western Medical Center-Anaheim, Chapman Medical Center and Coastal Communities hospital from Tenet for $70 million (Wolfson, Orange County Register, 1/21).
Chaudhuri purchased and then closed a chain of medical clinics in 2000, affecting the medical care of 56,000 Orange County patients and 300,000 patients statewide. He also invested in clinics that failed in 2001 and 2002 (Los Angeles Times, 1/21). At the four-hour hearing, doctors, activists, government officials and citizens "warned that health care in Orange County could be jeopardized if the proposed deal were not carefully vetted," the Orange County Register reports (Orange County Register, 1/21).
OCPN representative Anil Shah said the physicians' group would at least match the $20 million pledged by Chaudhuri to buy the hospitals. If the revised proposal were approved by the state, Chaudhuri could own up to 49% of the land upon which the hospitals sit and would have an option to buy up to 25% of the business in two years (Los Angeles Times, 1/21).
Despite this agreement, the medical staff at Western Medical Center-Santa Ana and IHH are at an "impasse" over whether Chaudhuri-owned companies are allowed to provide goods and services to the hospital. Doctors fear such deals "could siphon off money," the Register reports. Sen. Joe Dunn (D-Santa Ana) is mediating the discussion (Orange County Register, 1/21).
A similar public hearing is scheduled for Tuesday, with testimony to be sent to the Department of Health Services. DHS has said it will decide by Jan. 31 whether to approve the sale (Los Angeles Times, 1/21).