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Tenet Healthcare on Shaky Ground

by Jerry Flanagan, 11:30 a.m. PST, (415) 633-1320

Tenet Healthcare's announcement -- that it will sell 19 of its oldest and least profitable California hospitals -- has unleashed a flurry of finger pointing. Today, Tenet faces a public hearing in Van Nuys. The best outcome at the hearing would be for the finger pointing to stop and the truth be told: the Tenet pull out is yet another casualty of an unregulated hospital system.

Tenet blames the sale on a $1.6 billion price tag to make the hospitals earthquake proof as state law required after damage from the 1994 Northridge earthquake caused 23 hospitals to suspend some or all of their operations.

But Tenet plans to sell 8 hospitals outside the state too, so the seismic sidestep could not have been the only reason for the sale. The seismic upgrades are an easy target, but the hospitals in question would have been sold anyway as soon as Tenet decided that its profits were at risk.

Prior to federal lawsuits alleging Medicare fraud and a F.B.I investigation into unnecessary cardiovascular surgeries, Tenet was one of the industry's most profitable players -- albeit on ill gotten gains.

Last week, Los Angeles County Supervisor Zev Yaroslavsky expressed concern that many of the 14 Los Angeles hospitals now on sale would not find buyers and be forced to close. If he is right then it's the people of Los Angeles that stand to lose.

Tenet's decision sets a dangerous precedent for a state with a lack of oversight of its hospitals. As of January 30, 154 of the state's approximately 470 acute care hospitals had requested extensions to the seismic safety deadlines. For a list of hospitals that have requested extensions, visit: http://www.oshpd.cahwnet.gov/SB1953/seismic_ext.pdf

Those who experienced the Northridge earthquake are likely to remember images of patients emptying into parking lots because our hospitals were unsafe. That 6.8 earthquake caused 57 deaths and 9,000 injuries. At that time, a survey found that 83% of the state's hospital beds were in facilities that did not meet modern seismic requirements; 26% were in buildings considered at significant risk of collapse.

Legislators should respond to the failures of the unregulated market by creating independent oversight such as a Los Angeles hospital district to watchdog finances and ensure that hospitals take their commitment to our communities more seriously. Independent oversight will allow for the kind of long-range planning necessary to make our hospitals safe.