Malpractice reform legislation passed in two House committees, with approval by the full House expected this week. The bill's centerpiece is a $250,000 cap on noneconomic damages. The movement followed a declaration by the American Medical Association, a chief supporter of the legislation, that six more states-Arkansas, Connecticut, Illinois, Kentucky, Missouri and North Carolina-have entered a medical malpractice crisis, bringing the total to 18. Meanwhile, the Medical Group Management Association said malpractice premiums for its members increased more than 53% from last year, according to an online survey.
Fiscal misconduct alleged
Local and federal investigators said they found evidence of financial mismanagement at 126-bed Halstead (Kan.) Hospital, which closed in January after filing for Chapter 11 bankruptcy protection last year. The hospital apparently took deductions from employees' paychecks but did not use the money for health insurance, retirement plans and tax withholdings, said Steve Bayless, senior investigator at the Harvey County (Kan.) Sheriff's Department. "We think they were using it to pay the light bill, the phone bill, everything to keep the doors open," Bayless said. A local alcohol and drug addiction treatment organization is expected to take possession of the property after paying $560,000 in an auction. The hospital had been slated for closure in 2000 by then-owner LifePoint Hospitals, Brentwood, Tenn., but was sold to a local foundation, which later sold it to a local businessman.
No expedited hearing on Health Midwest
Health Midwest, Kansas City, Mo., expressed disappointment after the Kansas Supreme Court denied its request for an expedited hearing to help close its $1.1 billion sale to HCA, Nashville, before a March 31 deadline. The court is considering the distribution of sale proceeds between Kansas and Missouri, where the system operates. HCA Chairman and Chief Executive Officer Jack Bovender Jr. said he believed the issues would be resolved by the states' attorneys general before the deadline. If not, HCA could walk away or renegotiate. A Kansas state court approved the sale, but blocked Health Midwest from merging its Kansas and Missouri operations for the purpose of the sale and ruled that 20% of proceeds must go to a Kansas foundation.