Plagued by federal investigations into outlier payments and physician recruitment and an additional two new inquiries announced last week, Tenet Healthcare Corp. made a move to shift the spotlight to patient safety and quality of care.
The Santa Barbara, Calif.-based chain announced last week that it has appointed six physicians to new positions as chief medical officers representing the company's five regions. Two CMOs will represent Tenet hospitals in the central-northeast region.
"Their expertise and counsel will be invaluable in helping us meet our goal of being recognized as a quality leader in every one of our markets," Tenet President and Chief Executive Officer Trevor Fetter said in a news release.
Tenet's move comes at a time when physicians and hospitals often find themselves at odds, competing for the same patients. "It's an appeal to the physicians' higher moral sense," said Sheryl Skolnick, an analyst with Fulcrum Global Partners, New York.
"This is one of the most important parts as we rebuild the company's reputation," Tenet spokesman Steven Campanini said. "This reinforces the company's ongoing commitment to quality."
The CMOs are Anthony Ardire, who was medical director for the Studer Group, where he worked with healthcare organizations to develop service and operational cultures; Robert Hendler, a gastroenterologist who came to Tenet in 1998 and serves as vice president of physician relations; David Katzin, medical director at Tenet's Delray Medical Center, Delray Beach, Fla., and West Boca Medical Center, Boca Raton, Fla.; Ronald Kaufman, who was a senior associate dean for administration and associate senior vice president of administration at the Keck School of Medicine at the University of Southern California; Kenneth Kunze, who served as the medical director at Tenet's Hilton Head (S.C.) Regional Medical Center; and Karen Webb, the CMO at Tenet's St. Louis University Hospital.
Analysts will be watching the company's performance to see if the creation of the CMO positions will help the company improve quality of patient care and safety.
"It is consistent with the company needing to be known for something other than high prices and investigations," Skolnick said. "This is the next step the company needed to take (in) building an image of a company around a clinical focus as opposed to a financial focus."
Tenet agreed to pay the U.S. Justice Department $54 million in August 2003 to resolve civil Medicare billing fraud allegations involving Redding (Calif.) Medical Center. In its annual report filed last month, Tenet said it had set aside $30.2 million to pay the tentative settlements of two federal investigations (March 22, p. 8). One investigation involving North Ridge Medical Center, Fort Lauderdale, Fla., alleged the company overpaid when acquiring physician practices as a way to induce referrals and then filed false Medicare cost reports that contained kickback-generated claims. The other investigation alleged the company improperly coded the post-discharge status of some Medicare patients from Jan. 1, 1992, to June 30, 2000.
The CMOs are working with regional and hospital administrative teams and individual hospital medical staffs to promote quality medical care and patient safety. They report to Jennifer Daley, Tenet's senior vice president of clinical quality. They also will help implement Tenet's quality initiative program, which focuses on patient safety, nursing practices and medical staff governance at its hospitals.
"We needed to enhance the clinical presence in the regions," Daley said. "We are creating a network of physician leaders in our regions who are committed to clinical quality."
As a "foot soldier," Kaufman-who represents Tenet's 42 California hospitals-said he would coordinate public reporting to the CMS and the Joint Commission on Accreditation of Healthcare Organizations and also meet with hospitals' governing bodies. He plans to attend focus groups on the appropriateness of procedures and clinical outcomes. The goal is to improve performance at the hospitals, he said.
The creation of the CMO positions helps Tenet "change the public perception of being a publicly traded company to one that is viewed as a high-quality healthcare company," Kaufman said.
Tenet is not the first system to establish CMOs. At for-profit chain HCA, Nashville, Frank Houser is the corporate medical director and senior vice president of quality. Catholic Health Initiatives, which operates 68 hospitals in 19 states, appointed Harold Ray senior vice president and CMO in 1998. Ray has four physicians who report to him as vice presidents of medical operations.
In their positions, the physicians build relationships between the individual hospitals and CHI's corporate office in Denver, Ray said. The physicians help the hospitals develop quality and safety measures while learning about best practices at other CHI hospitals.
"It improves quality and safety issues," he said.
Tenet's creation of the CMO position coincided with the company's announcement that federal officials had launched two unrelated investigations into two of its California hospitals.
The U.S. attorney's office in Los Angeles requested information involving Tenet's Desert Regional Medical Center, Palm Springs, and Centinela Hospital Medical Center, Inglewood, the company said. The office asked for billing and coding documents from 1993 to the present related to 353 patient records at Desert Regional's cancer center. Tenet has operated the hospital since 1997 under a long-term lease.
Investigators also requested information on the relationship between Centinela Hospital and Allied Homecare Consultants, a home health placement service. Tenet is cooperating with the investigation, Campanini said.