News in brief - May 24/31, 2004

Investor group buys hospital company - Tenet moves headquarters to Dallas - Aetna unveils end-of-life benefits

Investor group buys hospital company

Iasis Healthcare Corp., which owns and operates medium-sized acute care hospitals, is being sold for about $1.4 billion, to a group of investors led by a private equity firm.

The hospital chain announced on May 5 that it had reached a definitive agreement for the sale with an investor group led by Texas Pacific Group, which manages more than $13 billion in assets and has invested in everything from Oxford Health Plans to Burger King. The transaction is expected to be completed by June 30.

Iasis, which has annual revenues of about $1.2 billion, owns or leases 15 acute care hospitals in Salt Lake City, Phoenix, Las Vegas and cities in Florida and Texas. It also has ownership interests in other health care facilities. The Franklin, Tenn.-based hospital chain was formed in 1999 by JLL Partners and other investors.

Tenet moves headquarters to Dallas

Tenet Healthcare has announced plans to move its corporate headquarters from Santa Barbara, Calif., to Dallas as part of the troubled hospital chain's efforts to become more efficient.

Tenet said on May 6 that it would begin the transition this year and close the Santa Barbara office by June 2005. Some of the 115 employees in California will move to the Dallas office, which has more than 700 workers.

The move follows a restructuring effort in which Tenet is shedding dozens of hospitals to focus on 69 core facilities. In January, Tenet said it was divesting 27 hospitals, 19 of which are in California.

Aetna unveils end-of-life benefits

Aetna has announced a new initiative, to be rolled out on a pilot basis next January, that will pay for end-of-life care, including hospice and palliative services, respite care for family members and grief counseling for survivors.

The benefits package will be made available free of charge to several of Aetna's large customers with a subscriber base of about 400,000, said John W. Rowe, MD, chair and CEO. The company will monitor the effectiveness and cost of the program, named Aetna Compassionate Care, and then plans to begin offering the benefits to all group and individual customers, probably about the middle of 2005, Dr. Rowe said.