Modern Healthcare – 11/5/02

FTC eyes Poplar Bluff again

Story posted November 5, 2002 4:45 PM ET

Tenet Healthcare Corp., Santa Barbara, Calif., said the Federal Trade Commission has subpoenaed documents related to Tenet's consolidation of the only two private hospitals in Poplar Bluff, Mo., confirming an exclusive report in the Sept. 16 edition of Modern Healthcare. Tenet received the subpoena yesterday, spokesman Gary Hopkins said. Tenet said its record since combining the hospitals' operations into two-campus, 294-bed Three Rivers Healthcare would validate the merger. The FTC attempted to block Tenet from buying the hospitals on antitrust grounds, and the government won a district court ruling in its favor; however, the 8th U.S. Circuit Court of Appeals, St. Louis, overturned the decision in 1999, allowing the merger to be completed. In an unrelated development, at least two more class-action shareholder lawsuits have been filed against Tenet, these in U.S. District Court, San Diego. Tenet also said a shareholder derivative lawsuit was filed against the company in Los Angeles County Superior Court. The company's share price has been cut nearly in half over the past eight days -- to $25.40 as of midday today -- on a string of bad news, including a federal investigation of two physicians at a Tenet hospital and a stock analyst's report questioning the company's future earnings growth. -- by Vince Galloro