Universal Health Services, King of Prussia, Pa., said the chief of its acute-care division has resigned, and two executives, including founder Alan Millers son, were named to replace him. Kevin Gross is stepping down as senior vice president and president of the division after only 15 months since his appointment was announced in February 2006. Gross joined Universal Health from Ardent Health Services, Nashville, where he had been president of the privately held companys Oklahoma division. Mike Marquez and Marc Miller most recently have served as vice presidents of the acute-care division, overseeing the western and eastern regions, respectively. Marquez has been with the company for 16 years, including seven years in the western regional position. Miller, who is also a member of the companys board, has worked for Universal Health for 12 years.
For-profit Merit Health Systems, Louisville, Ky., closed on its acquisition of Mountainside Hospital, Montclair, N.J., purchased from the not-for-profit Atlantic Health for $30 million. Mountainside is now only the second investor-owned hospital in New Jersey, including 110-bed Memorial Hospital of Salem County. C. Barry Dykes was named chief executive officer, effective immediately. Dykes, 56, arrives from Tenet Healthcare Corp.-owned Desert Regional Medical Center, a 279-bed facility in Palm Springs, Calif., where he was president and CEO until the end of 2006. Atlantic Health, Morristown, N.J., announced last summer that it would transfer ownership of the financially troubled 232-bed Mountainside. Founded in 2002, Merit owns and operates community hospitals in the Chicago, Dallas and San Antonio areas.
HealthSouth Corp., Birmingham, Ala., said it has signed an agreement to sell its corporate headquarters for at least $60 million. Proceeds from the sale will be used to pay a portion of the companys long-term debt. The sale is expected to be completed by the end of July. The sale property includes a 200,000-square-foot building on 85 acres and an adjacent parcel of 19 acres that was the site of HealthSouths erstwhile digital hospital, which is only partially built. The buyer is an investment fund sponsored by a real estate developer, Trammell Crow Co., which is an independently operated subsidiary of developer CB Richard Ellis, Los Angeles. The move is the latest in a series of transactions that are reducing the companys debt load and focusing the company on inpatient rehabilitation services. HealthSouth operates 93 inpatient rehabilitation hospitals and 10 long-term acute-care hospitals.
The U.S. Bankruptcy Court in Delaware approved measures providing protection to InSight Health Services Holding Corp. investors holding $300 million in senior secured notes due for payment in 2011. The court ruling will also allow InSight, a diagnostic-imaging services company based in Lake Forest, Calif., to maintain a revolving credit line up to $30 million, according to a company news release. The company, along with subsidiary InSight Health Services Corp., filed for Chapter 11 bankruptcy protection in an effort to reorganize and satisfy growing debt. The court also has scheduled a July 9 confirmation hearing to review reorganization plans for InSight, which include the companys current effort to offer common stock to investors holding senior notes. Company officials attributed its decline in earnings to decreased reimbursement and increased competition. InSights operating subsidiary, InSight Health Corp., is not a party to the bankruptcy proceedings and will continue normal operations, according to InSight officials.
Computer Sciences Corp., El Segundo, Calif., one of four lead contractors that each developed a prototype of the National Health Information Network under contract with HHS, announced it discovered significant errors in its accounting for tax liabilities in fiscal years 2000 through 2006, and as a result has delayed filing its annual financial reports with the Securities and Exchange Commission. In a news release, the company said: The correction of these errors, and other insignificant errors, will result in a cumulative charge of $300 million to $400 million through March 31, 2006. CSC also said its annual report for the fiscal year ended on that date along with the accompanying report of CSCs independent registered accounting firm should no longer be relied upon because of errors in the financial statements. Publicly traded CSC said it will restate prior periods when it files its annual SEC report, or 10-K, for the fiscal year ended March 31, 2007, expected to be filed by June 13. In late 2005, HHS awarded $18.6 million in contracts to four consortia to develop prototypes of a future NHIN led by Accenture, CSC, IBM Corp. and Northrop Grumman Corp.
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