Fla. AG, Tenet Reach Agreement on All State Issues

Tenet Healthcare Corporation has reached a broad agreement with Florida Attorney General Charlie Crist to resolve all matters involving Tenet that are currently being litigated or investigated by the Florida attorney general’s office.

The matters being resolved include a civil lawsuit regarding Medicare outlier payments that was filed by the attorney general’s office in March 2005 on behalf of 13 county hospital districts, health care systems and non-profit corporations in Florida. None of Tenet’s South Florida hospitals were named as individual defendants in the attorney general’s lawsuit.

The settlement also ends an investigation begun in mid-2003 by the Florida Medicaid Fraud Control Unit of certain Medicaid payments and a separate investigation begun in early 2005 by that unit of certain Medicaid psychiatric billings at a Tenet hospital in South Florida. The lawsuit and the investigations were all previously disclosed by the company. In the settlement agreement the company did not admit, and specifically denied all of the allegations made in the suit.

As part of the settlement, Tenet will pay a total of $7 million, which the company will record as a charge in its fourth quarter ended Dec. 31, 2005. This includes $4 million to establish a fund to pay for care of indigent, uninsured patients at the 13 county hospital districts and systems in Florida who were plaintiffs in the lawsuit. It also includes a $3 million payment to be allocated among the Florida Medicaid Fraud Control Unit and the public hospitals in Florida.

Specifically, the settlement will end the suit pending in U.S. District Court in Miami entitled State of Florida, Office of the Attorney General, Department of Legal Issues, et al. v. Tenet Healthcare Corporation.

The settlement does not resolve a separate purported class action civil lawsuit filed in March 2005 on behalf of Boca Raton Community Hospital and most other private acute care hospitals in the United States. In that suit, which is entitled Boca Raton Community Hospital Inc. v. Tenet Healthcare Corporation, Tenet has filed a motion for partial summary judgment and has asserted in legal filings that the case cannot legally proceed as a class action.