MODESTO, Calif.-Tim Joslin, chief executive officer of Doctors Medical Center said last week he has filed a defamation lawsuit against Blue Cross of California, claiming that the state's largest health insurer damaged the 391-bed hospital's reputation when it falsely accused its doctors of performing unnecessary heart surgeries. Blue Cross' parent, WellPoint Health Networks, and Health Benchmarks, which conducts studies for healthcare companies, also are named in the lawsuit. Blue Cross last month announced plans to terminate its contract with Doctors, owned by Tenet Healthcare Corp., after a panel of experts determined that 13 of 23 coronary artery bypass graft procedures performed at the hospital were unnecessary. Tenet later released its own independent review that concluded the surgeries were appropriate. Blue Cross has since rescinded its termination notice. "These unfounded and outrageous statements have affected all of our reputations and have impacted all of us in our community," Joslin said. "I feel that it is personally my responsibility to stand up for what is right."
CORONA, Calif.-Universal Health Services received approval late last month from state Attorney General Bill Lockyer to buy three not-for-profit hospitals in California, provided Universal agrees to maintain emergency and obstetric services at all three hospitals for at least five years after purchase. Universal signed a definitive agreement in June to buy three-hospital Vista Hospital Systems for $120.6 million. Lockyer also would require the company to provide charity care totaling $750,000 annually at the three hospitals, based on costs, not charges. The sale still must be approved by U.S. Bankruptcy Court, Riverside, Calif., where Vista filed for bankruptcy in June as part of the sales agreement. Universal owns or operates 26 acute-care and 39 psychiatric hospitals.
SANTA BARBARA, Calif.-Tenet Healthcare Corp. said late last month that it won a $105 million reduction in the judgment awarded to a founder of Tenet's predecessor company, National Medical Enterprises. Tenet had asked California's 2nd District Court of Appeals to reconsider its $253 million award in a wrongful-termination lawsuit originally brought against National Medical by John Bedrosian. The court declined to review the full ruling, but it changed the way interest is calculated on the award to Bedrosian, reducing total damages to $148 million. Tenet said it still plans to appeal the case to the California Supreme Court. Tenet owns or operates 106 hospitals, including five hospitals it has agreed to sell.