A union and other groups are accusing Queen of Angels/Hollywood Presbyterian Medical Center in Los Angeles of secretly negotiating a sale to Tenet Healthcare Corp.
The accusation follows job cuts last week at the 416-bed hospital.
The union charges that Queen of Angels and Tenet are further along in their talks-essentially having agreed to a sale-than they've indicated publicly. Earlier this year, not-for-profit Queen of Angels acknowledged preliminary talks with for-profit Tenet, but it said it was discussing deals with other area hospitals as well (March 31, p. 13). At the time, officials said no consensus had been reached on the type of alliances that might be undertaken.
A Queen of Angels spokesman last week denied accusations of secret dealings and said no sale contract exists. He suggested critics are overreacting to previous announcements. "This is kind of like throwing a stone in a pond where the initial reaction causes a lot of waves," he said.
The criticism is being spearheaded by Local 399 of the Service Employees International Union, which represents about 800 Queen of Angels employees. Also involved in knocking the potential deal are the hospital's medical executive committee; the Los Angeles chapter of Americans for Democratic Action; Community Health Councils, a coalition of quasi-public health councils representing various Los Angeles-area communities; and the National Health Law Program, another political group. The groups have formed a coalition called the Los Angeles Coalition for Quality Healthcare.
A joint statement issued July 10 by SEIU Local 399 and Community Health Councils accused hospital administrators of draping a "veil of secrecy" over the Tenet negotiations.
"They're not being candid, and they're putting the place in turmoil," said Tom O'Connor, spokesman for Local 399.
O'Conner alleged the layoffs last week are part of preparations to transfer the facility to Tenet. "That's Tenet's M.O., to cut staff," he said.
O'Connor also said Local 399 has learned Tenet and Queen of Angels have notified the California attorney general's office that their negotiations would lead to a transaction.
Tenet and Queen of Angels denied having contacted the attorney general's office regarding their talks.
"We're not acting in secrecy," Queen of Angels spokesman Robert Steward said.
New state law, effective Jan. 1, gives California's attorney general the authority to review and approve any conversion of a not-for-profit hospital to for-profit status (Oct. 7, 1996, p. 18).
Steward said the roughly 30 jobs eliminated last week included several part-time positions. He said the cuts are a reaction to pressure from managed care and don't reflect preparations for a deal with Tenet.
Initially, Queen of Angels was holding talks with OrNda HealthCorp. They had reached the point of due diligence when Tenet and OrNda merged, delaying a deal. Tenet spokeswoman Diana Takvam said the Santa Barbara, Calif.-based company answered a request for proposals from Queen of Angels last month.
If a deal is announced, the SEIU is counting on the new conversion law to give its criticism a public forum. O'Connor said the coalition's greatest concern is that Tenet might ignore Queen of Angels' community mission.
The hospital spends about $15 million a year on outreach programs in conjunction with local churches, and more than half its patients are covered by Medi-Cal, the state Medicaid program.