Community hits back
Defends admissions policies in face of Tenet’s suit
The fight over data and what they mean continued last week, as Community Health Systems provided its detailed response to the allegations Tenet Healthcare Corp. made in a federal lawsuit regarding Community’s admissions policies.
Executives from Franklin, Tenn.-based Community spoke publicly for the first time last week regarding the lawsuit filed April 11 in U.S. District Court in Dallas. Community made its case using more than 100 slides available in a securities filing and on the company’s website.
Tenet’s lawsuit alleges that Community executives failed to disclose the company’s potential Medicare-fraud liability in its unsolicited, $7.3 billion bid to acquire Tenet. Tenet contends that Community is at risk because of its low rate of observational stays, suggesting that Medicare patients have been improperly admitted for one-day stays instead of observational visits.
“Tenet is misguided and in fact, wrong,” said Wayne Smith, chairman, president and CEO of Community. Community contends the observation rate is an invalid metric, and one slide noted that Tenet’s analysis excluded Universal Health Services, King of Prussia, Pa., which had an observation rate similar to Community’s.
Community notes in the slides that it has updated its Blue Book admissions criteria guide six times since its initial version was completed in 2000. Prior to the lawsuit, Community has said, it decided to adopt the more widely used InterQual admissions criteria. Moreover, Smith said, attending physicians alone make almost every admission decision at Community hospitals, “not Blue Book, not InterQual and not Pro-MED.”
The company uses software by Pro-MED Clinical Systems at most of its hospitals to collect information about emergency room operations. Only three Community hospitals have used its “check module” to help with admission decisions, and the company found that this module was little used, said Dr. Barbara Paul, senior vice president and chief medical officer of Community.
Other presenters included Andi Bosshart, vice president-corporate compliance and privacy officer; Larry Cash, executive vice president and chief financial officer; and Dr. Lynn Simon, senior vice president-quality and resource management.
Community also contends that it is near the industry average on what it says are more relevant, widely used metrics, such as emergency room admission and discharge rates, length of stay and various metrics related to one-day stays. Community’s analysis compared it not only to its investor-owned