The state of California is expected to join Florida in a lawsuit against the federal government to recover costs the state has incurred in providing social and healthcare services for undocumented immigrants (April 18, p. 22). The state estimates it will spend $3.6 billion this year to provide services for illegal immigrants. Sources close to California Gov. Pete Wilson said last week an announcement involving a multimillion-dollar lawsuit against the federal government is set for this week. California is one of several states, including New York, that have criticized the federal government for failing to adequately curtail illegal immigration while refusing to reimburse states for providing services such as emergency medical treatment.
Health Management Associates, a Naples, Fla.-based chain of 21 hospitals in 11 states, reported a 53% increase in profits for its second quarter ended March 31. The company reported net income of $14.4 million, or 46 cents per share, compared with $9.4 million, or 32 cents per share, in the year-ago period. Revenues grew 32% to $115.8 million. For the six months, HMA reported net income was up 39% to $20.2 million, or 65 cents per share, compared with net income of $14.4 million, or 50 cents per share, in the year-ago period. The results included a $2.6 million charge for changes in accounting for income taxes. Revenues increased 30% to $217.2 million.
Some 12 executives are being interviewed for the top job at American Healthcare Systems, San Diego, MODERN HEALTHCARE has learned. The names of the candidates weren't disclosed. Heidrick and Struggles, Chicago, is conducting the search to replace Monroe Trout, M.D., AmHS' president, chief executive officer and chairman. Dr. Trout announced last year he would retire after eight years with AmHS (Aug. 23, 1993, p. 4). An AmHS spokesman said the board most likely will vote on a successor this fall.
John F. Gillespie, senior vice president of strategic programs of the Cuyahoga County (Ohio)-owned MetroHealth System in Cleveland, has stepped down from his post to become an independent consultant to MetroHealth's new president and chief executive officer, Terry R. White. Mr. Gillespie's last day as a MetroHealth executive was April 1. He served for nine years in various strategic planning-related executive posts at MetroHealth. During Mr. White's transition into MetroHealth's top job, Mr. Gillespie will provide consulting services to the CEO on strategic issues. Mr. White joined the system Feb. 28 from 707-bed University of Cincinnati Hospital, where he served as CEO. Mr. Gillespie said last week he'd been eyeing a move into healthcare consulting for about a year but remained on board at MetroHealth at the request of its board until the CEO search, launched after the ousting last year of then-CEO Henry Manning, was completed. MetroHealth operates the 1,014-bed MetroHealth Medical Center, a 172-bed rehabilitation hospital and various county-owned health centers and clinics.
Two months after being ousted as president and chief executive officer of Abbey Healthcare Group, Victor Chaltiel this month filed a $6 million lawsuit against his former employer. The lawsuit, which was filed in state court in Torrance, Calif., accuses both Abbey and its chairman, Timothy Aitken, of breach of contract, fraud, deceit and bad faith. In addition to the $6 million in actual damages, Mr. Chaltiel is seeking unspecified punitive damages from the Costa Mesa, Calif.-based company. Abbey executives said the company has fully complied with the terms of Mr. Chaltiel's employment agreement. The company declined to comment on the specifics of the complaints because it hasn't reviewed a copy of the lawsuit and the demand for arbitration.
A new purchasing group formed by five Roman Catholic hospital chains said that it will award its first contracts in July. The pharmaceuticals contracts will be worth about $275 million. The group, Catholic Materials Management Alliance, also will incorporate in July. One of its members, Daughters of Charity National Health System in St. Louis, will manage the program. Its other members are Sisters of Charity Health Care Systems, Cincinnati; Franciscan Health System, Aston, Pa.; Holy Cross Health System Corp., South Bend, Ind.; and Alverno Administrative Services, Mishawaka, Ind. (Feb. 14, p. 48).