Sharp settles billing case. Sharp HealthCare, a San Diego-based hospital system, last week agreed to pay $825,000 to settle charges that one of its leased hospitals, 384-bed Grossmont Hospital in La Mesa, Calif., overbilled Medicare and other federal health insurance programs for the work of medical residents. In a 1997 False Claims Act lawsuit filed against Sharp, two whistleblowers accused Grossmont and a group of its teaching physicians of billing Medicare between 1994 and 1997 for the work of attending physicians that was actually performed by medical residents. The suit was joined in July of this year by the U.S. Justice Department. Under the settlement, Sharp admitted to no wrongdoing.
AHERF creditors sue former officials. Creditors of bankrupt Allegheny Health, Education and Research Foundation have sued 11 of the system's former executives and trustees for more than $1 billion. One of the defendants in the lawsuit, filed earlier this month in U.S. Bankruptcy Court in Pittsburgh, is Sherif Abdelhak, AHERF's former president and chief executive officer. AHERF filed for bankruptcy last year (July 27, 1998, p. 2). It subsequently sold eight hospitals to Tenet Healthcare Corp., Santa Barbara, Calif., and four to Western Pennsylvania Healthcare System, Pittsburgh.
Study: Death rates higher at for-profit dialysis centers. Patients treated at for-profit freestanding kidney dialysis centers have higher death rates than patients treated at their not-for-profit counterparts, according to a study that appeared in the Nov. 25 New England Journal of Medicine. The study, conducted by researchers from Johns Hopkins University and Harvard Medical School, is based on the clinical outcomes of more than 3,500 patients with serious kidney disease treated at 950 dialysis centers over a period of three to six years. The study found that patients treated at for-profit centers had a mortality rate of 21.2% compared with 17.1% for patients treated at not-for-profit centers. The study also found that patients treated at for-profit centers were 26% less likely to receive kidney transplants. The researchers speculated that for-profit centers respond more aggressively to cost-cutting measures than not-for-profit centers and that those responses could harm the quality of care.
NovaCare nears end of the line. NovaCare sold its last business line, 623 outpatient occupation and physical therapy clinics, to Select Medical Corp, a Mechanicsburg, Pa.-based operator of 45 long-term acute-care hospitals and about 50 clinics in the U.S., for $200 million, including $40 million in assumed debt. NovaCare, once a major provider of rehabilitation services, no longer operates any businesses. The King of Prussia, Pa.-based company, which reported a loss of $320.3 million, or $5.06 per share, in its first quarter ended Sept. 30, has said it may liquidate next year.
Kimberly-Clark to acquire Safeskin. Kimberly-Clark Corp., Dallas, said earlier this month that it will buy Safeskin Corp., San Diego, a maker of disposable gloves, for stock and the assumption of debt in a deal valued at $850 million. The transaction is expected to close in early 2000, subject to shareholder and regulatory approval.
Recruiter, consultant will partner. Oakbrook, Ill.-based executive recruitment firm Witt/Kieffer Ford, Hadelman & Lloyd and Chicago-based healthcare governance consultant Orlikoff & Associates are partnering to improve trustee leadership at hospitals and healthcare systems. The firms will jointly operate a trustee leadership practice, recruiting trustees for boards that can't find individuals with specialized skills through local searches. Officials with both firms say more hospitals and healthcare systems are seeking trustees from outside their geographical service areas to enhance the quality of their governance.