SEC Looks Into Stock Trades at Tenet Healthcare
Tenet
Healthcare Corp. (THC) disclosed that the Securities and Exchange Commission
has "opened an informal file" on the hospital company to focus on the
huge trading volume in its stock that preceded some company announcements,
including statements about certain Medicare payments, Tuesday's Wall Street
Journal reported.
"We
don't know if the SEC intends to launch a formal investigation. We will work
closely and cooperate with them," the
The
shareholder letter also revealed that an independent hospital accreditation
organization has begun a review of Tenet's hospitals, and that initial talks
began last week with federal auditors who are studying the company's so-called
outlier payments, which Medicare pays to defray costs of the most expensive
cases.
Tenet also disclosed that it repurchased 10 million of its shares last week as part of an effort to restore confidence during a crisis that has tarnished its reputation and clobbered its stock price. Monday, the stock jumped 15% on the buyback news, the biggest bounce since the crisis began three weeks ago.
The
meltdown was triggered by concerns about the Medicare payments, as well as a
federal investigation into allegations that two doctors who practice at a Tenet
hospital in Redding, Calif., have performed unnecessary heart surgeries and
other invasive procedures. The U.S. Attorney's Office in
Wall
Street Journal Staff Reporter Rhonda L. Rundle contributed to this report.
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(c) 2002 Dow Jones & Company, Inc.