News in brief - Dec. 1, 2003

Anthem-WellPoint deal attracts suit - ID theft clearinghouse created - Boston hospitals set up $3 million challenge - GE Healthcare buys HPSC - Physician-owned MSO acquires EMR

Anthem-WellPoint deal attracts suit

WellPoint Health Networks Inc. is being sued by shareholders over the planned $16.4 billion merger with Anthem Inc., the Associated Press reports.

WellPoint told the Securities and Exchange Commission that the shareholder lawsuit accuses WellPoint directors of breaching their fiduciary duties by agreeing to the proposed deal while possessing "nonpublic information" about WellPoint's financial results.

The complaint asks the court to rescind the terms of the merger plan.

The day that Anthem announced its intent to acquire WellPoint, the latter plan released third-quarter earnings showing an increase of nearly 17% in net income, the AP said.

ID theft clearinghouse created

The Financial Services Roundtable is creating a clearinghouse to make it easier for victims of identity theft to report the crime and receive help. The organization, representing the country's 100 largest financial services institutions offering banking, insurance, investment and other services to consumers, said it plans to launch the clearinghouse -- The Identity Theft Assistance Program -- in the second quarter of 2004.

Under the program, victims of identity theft would report the crime to their primary financial institution. After issues are resolved at that institution, that company would forward information to the clearinghouse, with the theft victim's consent. The clearinghouse then would contact all other companies where the theft victim has an account and where the fraud occurred, sparing the victim from making those calls.

Boston hospitals set up $3 million challenge

Three hospitals in Boston have pledged to donate a total of $3 million to charity if they are unable to meet goals to improve patient care.

Massachusetts General Hospital, Brigham & Women's Hospital and Dana-Farber Cancer Institute, which are part of a joint venture, have put aside $3 million as a financial incentive to meet new goals for clinical integration. If they fail to reach the goals in a year, the money will go to unspecified charitable causes.

Thomas Lynch, MD, director of the oncology service line for the joint venture of the hospitals, said the reason for putting up the money was "to hold our feet to the fire. We wanted the financial incentive to help us achieve these goals."

The goals include better utilization and appropriate use of certain drugs, increasing the number of patient discharges that happen before noon, and learning from the other hospitals.

"These goals have been put together to enhance patient care and the efficiency of delivering that care across all three hospitals," Dr. Lynch said.

The program began in July and is expected to be ongoing. Dr. Lynch said evaluations will be conducted each October, the end of the fiscal year. After assessing whether goals were met, program leaders will then determine what the next year's goals will be.

GE Healthcare buys HPSC

Chicago-based GE Healthcare Financial Services recently agreed to acquire HPSC Inc., a Boston-based financing services company for medical and dental practices, in a $72.4 million deal. GE officials said the all-stock deal will allow GE to expand its scope of service and client base.

"The combined organization will be able to introduce a broad mix of financial solutions to physician and dental practices," including financing for real estate transactions, practice acquisitions, equipment purchases, liability insurance and employee benefit programs, said Rick Wolfert, president and CEO of GE Healthcare Financial Services. The transaction is expected to close by early 2004.

Physician-owned MSO acquires EMR

Physician Strategies LLC, a physician-owned medical service organization, recently announced it acquired Wang Healthcare, a manufacturer of electronic medical records software.

Officials from Physician Strategies, based in Pembroke, Mass., said the acquisition aids the company in its goal to provide a comprehensive set of products to medical practices. The company previously had been focused on billing and consulting services.