News in brief - Nov. 1, 2004

UnitedHealth profits up - Tenet to sell 3 Mass. hospitals

UnitedHealth profits up

UnitedHealth Group announced a rise in profit of 47% for the third quarter of 2004 compared with the like period a year earlier. United reported net profit of $698 million, or $1.04 per share, up from $476 million, or 77 cents per share, in the third quarter of 2003. Minnetonka, Minn.-based United reported third-quarter revenue of about $9.9 billion, up from about $7.3 billion for the third quarter of 2003. The company credited cost-cutting and new customers for the rise in profits and revenue.

Included in the totals were figures from Oxford Health Plans counted after July 29, when United closed a $4.7 billion deal to acquire the Trumbull, Conn.-based insurer. That purchase was challenged in court by the Medical Society of New Jersey, which argued that New Jersey insurance officials neglected to seriously consider the effects of the takeover on competition and patient care. The lawsuit is pending.

Tenet to sell 3 Mass. hospitals

Tenet Healthcare Corp. has agreed to sell three acute care hospitals in Massachusetts as part of an ongoing restructuring effort. Under the deal, a subsidiary of Vanguard Health Systems Inc. would acquire the 348-bed Saint Vincent Hospital at Worcester Medical Center in Worcester and the 420-bed, two-campus MetroWest Medical Center, comprised of Leonard Morse Hospital in Natick and Framingham Union Hospital in Framingham. Tenet expects to raise about $167 million from the sale, which is subject to regulatory approval and is expected to be completed by Dec. 31.

Tenet announced in January that it would sell or divest 27 hospitals as part of a major restructuring effort in the wake of legal and financial woes. Including the three hospitals in Massachusetts, the Santa Barbara, Calif.-based chain so far has definitive agreements to sell or has sold 18 of the 27 facilities.

Vanguard, based in Nashville, Tenn., owns and operates 16 acute care hospitals in four states.