Tenet to sell hospital besieged by fraud charges

The for-profit chain expects to complete the sale of California's Redding Medical Center by midyear.

By Katherine Vogt, AMNews staff. Jan. 12, 2004.

Tenet Healthcare Corp. is selling a California hospital in the wake of allegations that hundreds of unnecessary heart procedures were performed there.

The company announced on Dec. 11, 2003, that under an agreement with the Dept. of Health and Human Services Office of the Inspector General, it must sell the Redding Medical Center. Otherwise, the hospital could be excluded from participating in Medicare and other federal health programs.

Tenet revealed in September 2003 that the OIG was moving to exclude Redding Medical Center from the programs because the regulators determined that the hospital furnished unnecessary cardiac procedures and failed to meet professionally recognized standards of care.

That disclosure came little more than a month after Tenet agreed to pay the federal government $54 million to settle claims that unnecessary procedures were performed at the hospital and billed to government programs. Tenet did not admit any wrongdoing. As part of the settlement, the government reserved the right to pursue administrative action against the Santa Barbara, Calif.-based hospital chain.

Tenet said it would seek a buyer for the hospital, and it expects to close the sale in mid-2004. A new owner would be able to buy Redding Medical Center without the threat of exclusion from Medicare, the company said.