Tenet, Lockyer Agree To Settle Lawsuit Over Closure of Daniel Freeman Hospital
Tenet Healthcare, the nation's second-largest hospital chain, yesterday agreed to settle a lawsuit filed by Attorney General Bill Lockyer (D) that blocked Tenet from closing the Daniel Freeman Marina Hospital in Marina del Rey, the Los Angeles Times reports. The settlement, which must now be approved by Los Angeles County Superior Court, requires Tenet to give $400,000 to the California Community Foundation for health care services for low-income residents and to reimburse the state $100,000 for court costs. The settlement will allow Tenet to decide whether to continue with the planned closure or keep the facility open, the Times reports (Richardson, Los Angeles Times, 4/2). Last June, Tenet announced plans to close the 166-bed hospital, which it acquired last December from the St. Louis-based Carondelet Health System as part of the $55 million purchase of Daniel Freeman hospitals. Because the sale would switch the not-for-profit Daniel Freeman hospitals to for-profit, Lockyer had the authority to block the acquisition. Lockyer approved the sale, however, after Tenet agreed to 21 conditions to ensure that the hospitals would continue to provide services offered by most not-for-profit facilities (California Healthline, 6/3/02). Lockyer last August ordered Tenet not to close the facility until it met the stipulated conditions (California Healthline, 7/10/02). The settlement acknowledges that Tenet complied with the purchase conditions by consulting with the public; local health and elected officials; and the hospital's governing board and medical staff about the hospital's future, the AP/Fort Worth Star-Telegram reports. Tenet President Trevor Fetter said, "This agreement with the attorney general is an important step toward a positive resolution of this matter that will serve the interests of patients, physicians, the community and Tenet" (AP/Fort Worth Star-Telegram, 4/2).
The Contra Costa County Board of Supervisors yesterday terminated the contract between county-run health plan and Tenet over alleged unfair billing practices, the Contra Costa Times reports. According to Dr. William Walker, Contra Costa County's health director, the county health plan has "become victim" to Tenet's "widely publicized billing excesses." Walker said Tenet's rates are "exorbitant" compared with the other six hospitals with which the county contracts. County health officials told supervisors that members of the county-run health plan at Doctors Medical Center in San Pablo will still be able to use the hospital and receive the same level of care (Felsenfeld, Contra Costa Times, 4/2).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.