Healthy Skepticism Library item: 5881

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Publication type: news

Lenzer J.
Healthcare group agrees $500m settlement for unnecessary surgery
BMJ 2006 Jul 6
http://bmj.bmjjournals.com/cgi/content/full/333/7558/59-a

Full text:

Healthcare group agrees $500m settlement for unnecessary surgery

http://bmj.bmjjournals.com/cgi/content/full/333/7558/59-a

Jeanne Lenzer, New York

The second largest health provider in the United States, Tenet
Healthcare, has agreed to pay nearly $500m (£270m; {euro}390m) to settle
claims that doctors did unnecessary surgery at the Redding Hospital, in
Redding, California.

The hospital was raided by 40 agents from the Federal Bureau of
Investigation in 2002 after it received reports that doctors were
performing numerous unnecessary cardiac operations (BMJ 2002;325:
1130[Free Full Text]).

The settlement was signed on 14 June and is the largest ever for
unnecessary procedures and ends all civil and criminal actions arising
out of the allegations.

In a separate settlement on 29 June, Tenet agreed to sell 11 hospitals
and pay $900m to resolve charges that they overcharged Medicare $1.5bn.

One of the hospitals that Tenet undertook to sell is the well known
Cleveland Clinic Hospital in Weston, Florida. Tenet, a for profit
hospital company, bought up a number hospitals and non-profit healthcare
organisations to become the second largest healthcare chain in the
United States. Until recently, it owned and operated 73 hospitals,
providing 18 445 hospital beds.

Tenet has denied wrongdoing and says certain “mistakes” in billing have
now been corrected. Harry Anderson, a spokesman for Tenet, wrote in an
email to the BMJ, “Since the Redding matter and other issues surfaced in
October 2002, Tenet has significantly changed its management, business
strategy, and corporate culture.

“We are a stronger and better company today. In fact, we are recognised
as having the best corporate governance among all the major healthcare
companies, and recent statistics from the Centers for Medicare and
Medicaid Services show that clinical quality at Tenet hospitals, as
measured on more than a dozen standard metrics, is the highest among all
the investor owned hospital companies.”

The 14 June “global settlement” resolves multiple claims, including
civil suits by 769 patients and their survivors and claims by three
whistleblowers, including those of a doctor at Redding and a patient who
contacted the FBI.

Tenet will pay $395m to settle the patients’ civil suits, for an average
payout of more than $500 000 a patient.