The Senate Labor and Human Resources Committee late last week voted 9-7 to approve the nomination of Henry Foster, M.D., as surgeon general. Foster's appointment remains in doubt, however. Sen. Phil Gramm (R-Texas), a conservative and a presidential candidate, is threatening to filibuster the nomination in the full Senate because of Foster's role in providing abortions and in the sterilizations of developmentally disabled women, as well as allegations that he was aware of a controversial study of Southern black men with syphilis. Two Republicans joined all seven Democrats on the 16-member committee to pass the nomination. The vote's fate was sealed when Sen. Bill Frist (R-Tenn.), a fellow Nashville, Tenn., physician, announced his support of Foster. "It should not be our purpose to search for every mistake or imperfection in Hank Foster's life," Frist said. Committee Chairwoman Nancy Kassebaum (R-Kan.), thought to be another possible Republican vote for Foster, echoed the message of other GOP committee members by challenging Foster's credibility in answering questions about his background.
Columbia/HCA Healthcare Corp. filed a registration statement to exchange up to $1 billion of newly issued senior, unsecured debt securities and some cash for $1 billion in Healthtrust debt. Columbia merged with Healthtrust last month. The Healthtrust securities subject to the planned exchange offers are $500 million in outstanding 10.75% subordinated notes due in 2002, $200 million in outstanding 10.25% subordinated notes due in 2004, and $300 million in outstanding 8.75% subordinated debentures due in 2005.
Columbia/HCA Healthcare Corp. and pharmacy manager Owen Healthcare formed a five-year joint venture to pool their purchasing of drugs and other pharmaceutical supplies. Nashville, Tenn.-based Columbia operates 318 hospitals. Houston-based Owen manages 279 hospital pharmacies. Terms of the agreement weren't disclosed. Under it, Columbia continues to manage its pharmacies but may contract with Owen on a case-by-case basis, an Owen spokeswoman said. Recently, Owen also formed a cooperative with two Meridian, Miss.-based hospitals. The cooperative, a limited liability corporation owned jointly by the hospitals and Owen, will combine purchasing, receiving and distribution at 180-bed Riley Memorial Hospital and 205-bed Rush Foundation Hospital. Owen's materials services division will manage it. Both agreements represent significant departures from the historical relationship between contract-management companies and their hospital customers. Contractors often manage departments for an annual fee. More recently, many have taken fees based on the savings they can achieve for their customers.
In a strategic restructuring, Howard University Hospital in Washington has appointed its first-ever board of directors and become a wholly owned subsidiary of Howard University. The 23-member board will appoint a president and chief executive to manage the hospital. Joyce Ladner, the university's interim president, said the restructuring will help the hospital face the changing healthcare marketplace. Washington hospitals have been buffeted by the threat of reduced Medicaid payments and increased uncompensated care as the District of Columbia seeks to reduce its public healthcare costs.
Edward M. Murphy, executive director of the Massachusetts Health and Educational Facilities Authority, one of the nation's largest issuers of 501(c)(3) bonds, will be leaving his post before July 1. Murphy has accepted a position as a senior vice president in the public finance department at Tucker Anthony, a Boston-based investment banking firm. A search committee headed by Robert Flynn, M.D., chairman of the board of Waltham, Mass.-based Caritas Christi Health Care, has been formed to identify Murphy's successor at the authority.
The University of Michigan Medical Center in Ann Arbor and Farmington Hills, Mich.-based Mercy Health Services have advanced their collaboration talks, establishing an oversight committee of executive and physician leaders and several task forces to address ethical, financial and operational issues. A deal would unite two of Michigan's major hospital systems and create the basis for a statewide network. Mercy partly owns Mission Health Care, which owns Catherine McAuley Health System, an Ann Arbor-based healthcare company that competes with the university medical center.