Charter Medical Corp. last week received clearance from the Federal Trade Commission to buy 11 psychiatric hospitals from National Medical Enterprises, but the FTC denied the sale of six others. In June, Charter completed the purchase of 27 NME psychiatric hospitals for $129 million. The sale of 17 others was held up pending further review by the FTC. Last month, the Atlanta-based chain said it would likely complete only 11 of the deals because of the antitrust scrutiny (Oct. 24, p. 4). As part of the agreement last week, Charter agreed to withdraw offers for six NME hospitals in Atlanta; Memphis, Tenn.; Orlando, Fla.; and Richmond, Va. The FTC said the sales would eliminate competition among psychiatric hospitals in those cities. NME is selling the hospitals to divest its troubled psychiatric operations. Charter also agreed to get prior approval from the FTC for 10 years before buying or selling psychiatric facilities in those cities.
Universal Health Services has agreed to buy Manatee Memorial Hospital in Bradenton, Fla., from Baptist Hospitals and Health Systems, Phoenix. Terms weren't released. The deal is expected to be completed in mid-1995. Until then, Baptist and Universal will jointly manage Manatee, officials said. King of Prussia, Pa.-based Universal operates 15 acute-care and 13 psychiatric hospitals.
Acute-care hospital prices rose 0.8% last month, compared with a 0.4% increase in September, according to the U.S. Labor Department's producer price index for hospitals. The hospital PPI measures changes in net prices for single episodes of care. The hospital PPI for the 12-month period ended in October was 3.4%. Prices for physician services, meanwhile, rose 0.1% last month, the Labor Department said, compared with a 0.1% decrease in September.
A federal judge in Alexandria, Va., has ruled that Capp Care did not violate Virginia's "any-willing-provider" law by denying a Virginia physician membership in its Washington-area network. In his Nov. 1 ruling, U.S. District Judge Claude M. Hilton ruled that Capp Care-a Newport Beach, Calif.-based managed-care provider-didn't discriminate against orthopedic surgeon Geraldine Richter, who was denied provider membership after the company discovered that she had been disciplined for professional misconduct by the Virginia Board of Medicine. In addition, the judge ruled that Capp Care isn't subject to provisions of the any-willing-provider law-which requires insurers to accept all providers who agree to a health plan's rules-because Capp Care isn't an insurance company.
In a move to secure managed-care contracts nationwide, Cypress, Calif.-based PacifiCare Health Systems is forming a PPO in 46 states through a contract with Affordable Medical Networks. The contract, effective Nov. 1, adds more than 125,000 providers and nearly 1,700 hospitals to the PacifiCare network in states where the company didn't operate a commercial, Medicare or Medicaid HMO. The national PPO also may be offered in states where PacifiCare offers HMOs. Its HMOs serve 1.2 million enrollees in California, Florida, Oklahoma, Oregon, Texas and Washington.
The New York City Health and Hospitals Corp. will offer to buy out 2,500 employees under an agreement announced last week by the mayor's chief labor negotiator. HHC, which operates 11 acute-care and five long-term hospitals, had planned to lay off 3,000 workers to help close a $452 million gap in the corporation's $3.5 billion budget. Most of the layoffs will be avoided through buyouts and attrition. The buyouts range from $3,150 for those who have worked for HHC less than a year to $15,000 for employees with 25 years or more of seniority. Funding will come through a change in the corporation's payroll system and other revenues.
MetraHealth, the company formed by combining the group health businesses of Metropolitan Life Insurance Co. and the Travelers Insurance Co., will locate its headquarters in northern Virginia, outside of Washington. MetraHealth plans to operate offices across the United States. It's discussing economic incentives with the state of Connecticut to place insurance operations in Hartford.