Denver-area HMOs and their trade groups last week sued HCFA in federal court in an effort to hold up a proposed Medicare competitive-bidding demonstration project in Denver. The suit, filed in Colorado, seeks to delay by 10 days the HCFA-imposed May 15 due date for plans to submit bids. That would be long enough for the program to be killed by Congress, which recently passed bills doing so. The plaintiffs said the project would hurt health plans and Medicare beneficiaries by eliminating choices and forcing individuals to change providers.
Houston-based Paracelsus Healthcare Corp. has eliminated 20 management positions as part of its financial turnaround effort in a move expected to save about $5.5 million annually. The company also announced it had net income of $5.2 million, or 9 cents per share, for the first quarter ended March 31, compared with a net loss of $14.3 million, or 48 cents per share, in the year-ago period. Revenues rose 46% to $168.5 million. The company, which owns 28 hospitals in nine states, is attempting to recover after having to restate financial results for the past six years (May 5, p. 36).
The National Health Lawyers Association and the American Academy of Healthcare Attorneys, a subsidiary of the American Hospital Association, last week announced they will merge July 1. The agreement came after a year of discussions among the two attorney groups and the AHA. After the merger, which is pending approval of the AAHA's membership, the group will be known temporarily as NHLA/AAHA.
St. Louis University is thinking about putting its medical center on the market. The 349-bed hospital is affiliated with the faculty practice at St. Louis University Medical School. Possible suitors are expected to be Unity Health System, a Catholic group that controls about 27% of the local market, and Tenet HealthCare Corp., which recently acquired Deaconess-Incarnate Word Health System. The Rev. Lawrence Biondi, university president, said the hospital needs to link with smaller hospitals and primary-care physicians who can refer patients to the specialist-heavy academic facility.