News in brief - Dec. 4, 2006

HCA buyout approved - Aetna introduces PHR - Delegates act on HIPAA

HCA buyout approved

HCA shareholders on Nov. 16 approved a $33 billion leveraged buyout, which had been announced in July.

HCA had reached an agreement to be taken private by a consortium of investors for $21 billion, plus the assumption or repayment of nearly $12 billion in debt. The investor group included Bain Capital, Kohlberg Kravis Roberts & Co., Merrill Lynch and the family of HCA co-founder Thomas F. Frist Jr., MD.

A group of shareholders sued to stop the deal, arguing that the stock price was undervalued under the terms of the deal. But the lawsuit was unable to prevent the shareholder vote from proceeding.

This is HCA's second leveraged buyout, taking the company from being traded publicly to private hands. In 1989, it went private in a management-led buyout for $5.1 billion. Three years later, HCA launched an IPO and returned to public trading. Like the latest deal, the 1989 deal was done in part because management saw the company's stock price dropping and considered the firm undervalued.

The Nashville-based hospital chain owns and operates about 172 hospitals and 95 freestanding surgery centers and facilities.

Aetna introduces PHR

Using technology created by one of its stand-alone businesses, Aetna is introducing an interactive personal health record that sends personalized messages and alerts to individual members and physicians.

Aetna's CareEngine System scans an individual's health data and claims information and then alerts members and physicians about possible urgent situations and opportunities to improve care, the company said.

In addition, the tool allows members to enter their personal health history into the system as CareEngine searches the additional information for opportunities to improve care, according to the company.

Aetna also said that beginning in 2007, all members will have access to a basic health history report automatically populated by each member's Aetna claim activity. The health history report is designed to allow members to coordinate care.

Delegates act on HIPAA

The AMA House of Delegates took steps to help physicians protect themselves from violations of the Health Insurance Portability and Accountability Act when they contract for services with foreign vendors.

The house adopted policy last month encouraging doctors who have entered into or are considering entering a business associate agreement to undertake due diligence about the business associate and to consider adding several contractual provisions.

Those provisions include: strong confidentiality clauses; required steps to mitigate any harmful effects of wrongful use or disclosure of protected health information; and assurance that all protected information is returned to the physician when the contract is done and no copies are kept by the business associate, except as required for legal or audit purposes.

The policy also said doctors should make sure the original contract contains provisions addressing costs involved with the return and maintenance of the health information at the end of the contract.