SCAN Health Plan, Los Angeles, said an arbitrator awarded it $8 million in a billing dispute with Whittier (Calif.) Hospital Medical Center, which is owned by Tenet Healthcare Corp., Santa Barbara, Calif. The arbitrator agreed with SCAN, a Medicare HMO, that it inadvertently paid more than Medicare rates for services at Whittier over a two-year period because of rapid increases in the hospital's gross charges, SCAN said. In December 2002, Tenet identified rapid increases in its hospitals' gross charges, or list prices, as the key driver behind its unusually high Medicare outlier payments. The uproar over Tenet's outlier payments also sparked disputes with insurers over similar provisions -- known as stop-loss payments -- in commercial insurance contracts. When reached by phone, Tenet officials did not immediately have a comment on the arbitrator's decision. Tenet owns or operates 99 hospitals, including 30 that it is divesting. -- by Vince Galloro
HMO wins dispute involving Tenet hospital's prices
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