Rapid City (S.D.) Regional Hospital has acquired 29-bed Northern Hills General Hospital in Deadwood, S.D., about 50 miles northwest. Northern Hills is a major referral source, and its services will be expanded, said Don Thrall, vice president of networking for 417-bed Rapid City Regional. The hospitals will maintain separate operating budgets. Northern Hills has assets of $2.5 million, Thrall said, and net patient revenues of $5.2 million, according to HCIA, a Baltimore-based healthcare information company. Rapid City Regional has assets of $232 million and net patient revenues of $120 million, HCIA said. This is Rapid City Regional's second acquisition this year. In March it bought Massa Berry Clinic, a four-physician practice in Sturgis, S.D. It also has affiliation deals with 15 hospitals, manages four healthcare facilities and leases Custer (S.D.) Community Clinic.
PhyCor raised $110.9 million from a public offering on June 28. It sold 3.25 million shares of common stock at $37.75 per share. Proceeds will pay bank debt, buy medical groups and individual practices, and be used to develop and manage individual physician practices and for general corporate purposes. Nashville, Tenn.-based PhyCor operates 26 clinics with about 1,300 physicians in 17 states and manages individual practice associations with more than 4,500 doctors in 14 markets.
Hartford, Conn.'s first comprehensive medical rehabilitation hospital opened last month. The 60-bed Rehabilitation Hospital of Connecticut is a joint project of Hartford's Saint Francis Hospital and Medical Center and Mount Sinai Hospital. The $13.5 million facility began admitting patients on June 2. David D'Eramo, head of Saint Francis/Mount Sinai Health Care System, will also serve as the rehabilitation hospital's president and chief executive officer.
Two former executives of Medical Payment Services of Virginia, a defunct accounts receivable finance company, pleaded not guilty last week to a $3 million fraud against a former subsidiary of Blue Cross and Blue Shield of Maryland. Thomas A. Wilkinson III, president, and Edward M. Conk, executive vice president, of Richmond-based MedPay are charged with misappropriating at least $3 million of a $5 million credit line extended in November 1988 by Health Line, the former Blues subsidiary. The credit line was supposed to be secured by physicians' accounts receivable financed by MedPay. In the indictment, handed up by a federal grand jury in Richmond, MedPay was said to have offered such financing to doctors and other providers in Virginia and North Carolina. The defendants are accused of diverting funds to themselves and fraudulent accounts they controlled. The indictment said they made loans to themselves and used the funds to pay high salaries and consulting fees. Wilkinson, 47, and Conk, 58, also were accused of creating and submitting false reports that prompted Health Line to advance money from the credit line and overstating the collateral securing the loan by at least $7 million.
The Center for Advanced Reproductive Care in Redondo Beach, Calif., and University Infertility Associates, Long Beach, Calif., will collaborate to lower costs and improve success rates. The clinics want to make procedures such as in vitro fertilization, which averages $9,000, affordable for more patients, most of whom pay out-of-pocket. They also will jointly seek contracts with managed-care organizations that are creating plans with reproductive benefits. Together, the clinics see 300 patients a year. "The fertility field has become so high-tech that combining the two centers was the only practical way for us to provide cutting-edge specialization and still control costs," said Arthur Wisot, M.D., the center's executive director.
A U.S. District Court judge in Dallas has rejected a challenge to the Defense Department's award of a military managed-care contract in the South. Blue Cross and Blue Shield of Texas tried to stop the Pentagon from awarding to Foundation Health Federal Services the Tricare managed-care contract in Arkansas, Louisiana, Oklahoma and parts of Texas. The $1.8 billion, five-year contract covers 600,000 military family members and retirees who are beneficiaries of the Civilian Health and Medical Program of the Uniformed Services.
