U.S. Attorney’s Office Launches Two New Investigations Into Tenet Healthcare Hospitals
Federal prosecutors have opened two new probes into hospitals owned by Santa Barbara-based Tenet Healthcare, company officials said Wednesday, the Wall Street Journal reports. According to Tenet, the U.S. Attorney's Office in Los Angeles has sent the company voluntary requests for documents (Rundle, Wall Street Journal, 4/15). In one of the cases, which could result in criminal charges, the U.S. attorney's office is examining a possible kickback scheme involving Tenet's Inglewood-based Centinela Hospital and Allied Homecare Consultants, an independent contractor that refers patients to providers of in-home care services (Girion, Los Angeles Times, 4/15). Centinela is one of 27 hospitals that Tenet is planning to sell as part of an ongoing restructuring plan. The other document request is part of a civil investigation that focuses on coding and billing practices at the comprehensive cancer center at Desert Regional Medical Center in Palm Springs. The request includes information dating back to 1993 and records on 353 patients. The cancer center is operated by Salick Health Care under a contract with Tenet, which has operated Desert since 1997 under a long-term lease with the public Desert Healthcare District (Wall Street Journal, 4/15).
Tenet spokesperson Steven Campanini said, "These are two new, separate, unrelated inquiries. Tenet is under the microscope. And we continue to work and cooperate with the federal government in its review, ongoing, of Tenet and its hospitals" (Los Angeles Times, 4/15). Tenet has been the subject of a number of government investigations since late 2001, including probes into its billing practices and cardiac surgeries at two of its California hospitals (Wall Street Journal, 4/15). Andreas Dirnagl, an analyst with Harris Nesbitt Gerard, said the new investigations will likely strengthen the government's position in settlement negotiations, noting, "The more these investigations pop up, the less likely you are to have some grand final settlement" (Los Angeles Times, 4/15). Sheryl Skolnick, an analyst at Fulcrum Global Partners said that government attorneys are more inclined to investigate individual whistle-blower complaints about Tenet now because of the company's recent problems, adding, "you never know when one of these could mushroom into something bigger" (Wall Street Journal, 4/15). The U.S. attorney's office declined to comment on either new investigation (Los Angeles Times, 4/15). Shares of Tenet stock fell more than 1% to $10.86 Wednesday on the NYSE (AP/Hartford Courant, 4/15).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.