TENET PLAN TO SELL 19 HOSPITALS IN STATE SPARKING CONCERN.
Tenet Healthcare Corp. announced Wednesday it will sell or close 19 hospitals in California, most in the Southland, a move Los Angeles County Supervisor Zev Yaroslavsky said will place an enormous burden on a health system teetering on the brink of collapse.
The Santa Barbara-based health care chain announced it plans to sell 14 hospitals in Los Angeles County, four in Orange County, one in Northern California and others in Louisiana, Massachusetts, Missouri and Texas.
At a news conference, Yaroslavsky said he fears Tenet - the target of recent government investigations into its Medicare billing and accusations of unnecessary heart procedures - will have trouble selling all the hospitals. This could lead to closures of some facilities and create a ``ripple effect'' on emergency rooms throughout the county.
``I am very, very disappointed and frankly a little frightened at this announcement,'' Yaroslavsky said. ``In a sense, the entire community of Los Angeles is held hostage to a decision by some company that owns 4,100 beds in this region. If a third or more end up not getting sold, that means 1,300 to 1,500 beds will go off the market.''
But James Lott, executive vice-president of the Hospital Association of Southern California, which represents 200 hospitals, said it's premature to speculate about the closure of Tenet hospitals.
``Tenet is working aggressively on a very, very aggressive sales strategy,'' Lott said. ``We are optimistic it will be successful. I understand the angst everyone is having about this, but it's too early to start talking about closures.''
In announcing it will seek buyers for 27 hospitals, Tenet cited the estimated $1.6 billion it would cost to do required seismic upgrading on the facilities.
``Internal and external challenges have severely impacted the performance of the 19 hospitals we have decided to divest in California, thus making it impossible for Tenet to justify the $1.6 billion investment we now estimate these hospitals require to comply with the state's seismic standards,'' company President Trevor Fetter said.
``The 17 California hospitals we will continue to operate are expected to require less than $300 million to meet seismic standards, and we will meet that requirement.''
Among the hospitals Tenet plans to sell is Encino-Tarzana Regional Medical Center, the company's only facility in the San Fernando Valley.
Tenet executives said retrofitting the medical center's Encino and Tarzana campuses - with a total of 387 beds - was too expensive for them to handle.
``Unfortunately, because of the age and design of both campuses, the buildings are virtually unable to be seismically retrofitted,'' said Dr. Stephen Newman, chief executive officer of Tenet California.
Newman said Tenet expects to find a buyer for the Valley facility, and current employees would probably continue to work at the hospital under new ownership. The company is intent on finding a buyer before Dec. 31.
Troy Anderson, (213) 974-8985
The Los Angeles hospitals to be put up for sale are:
--Brotman Medical Center, Culver City, 420 beds.
--Centinela Hospital Medical Center, Inglewood, 370 beds.
--Community Hospital of Huntington Park, 81 beds.
--Daniel Freeman Marina Hospital, Marina del Rey, 166 beds.
--Daniel Freeman Memorial Hospital, Inglewood, 358 beds.
--Encino-Tarzana Regional Medical Center, Encino, 151 beds.
--Encino-Tarzana Regional Medical Center, Tarzana, 236 beds.
--Garfield Medical Center, Monterey Park, 210 beds.
--Greater El Monte Community Hospital, South El Monte, 117 beds.
--Midway Hospital Medical Center, Los Angeles, 225 beds.
--Mission Hospital of Huntington Park, 109 beds.
--Monterey Park Hospital, 101 beds.
--Queen of Angels/Hollywood Presbyterian Medical Center, 434 beds.
--Whittier Medical Center, 181 beds.
FOR SALE (see text)