New Data Sought in Federal Probe of Tenet

Tenet Healthcare Corp. said Wednesday that the federal government, as part of an ongoing investigation, has requested documents related to the financial relationships between several doctors, two physician groups and two of its hospitals in El Paso.

The Santa Barbara-based hospital chain, the nation’s second-largest, is the target of a number of federal probes into an array of practices, including Medicare billing.

Tenet first disclosed the El Paso investigation in late January. At the time, the company said it received copies of subpoenas issued to two doctors by the Health and Human Services Department’s inspector general. The subpoenas sought information on their relationships with Tenet hospitals.

The probe now appears to involve the financial arrangements of up to 23 doctors with two acute-care hospitals owned by Tenet in El Paso, Sierra Medical Center and Providence Memorial Hospital, according to a company filing detailing what investigators have asked it to turn over.

In addition, the Justice Department has asked Tenet to submit documents related to the financial relationships between those two hospitals and two physician groups in El Paso.

Tenet spokesman Steven Campanini said that the company had anticipated the request and that it would cooperate. Beyond that, he said he could not elaborate on the probe.

A Justice Department spokeswoman in Texas had no comment.

An earlier investigation into physician financial arrangements led to an indictment alleging that Tenet and its Alvarado Hospital Medical Center in San Diego paid illegal kickbacks to persuade doctors to refer patients to that facility.

Tenet has been beset by lawsuits and government investigations for almost 18 months. Government allegations that two doctors at its hospital in Redding, Calif., performed unnecessary heart surgeries were settled for $54 million. But related malpractice suits are pending.

Tenet changed its management team and, in January, announced plans to bolster its long-term financial outlook by putting 27 of its 100 hospitals up for sale. But uncertainty about the price Tenet ultimately may pay to resolve the government investigations and malpractice litigation are contributing to concerns about cash flow.