Tenet Faces Another Federal Inquiry

Tenet Healthcare Corp., which is facing a series of government probes, said Friday that another was underway, this time in Texas, where two doctors had received subpoenas requesting documents about financial agreements between them and three of the company’s hospitals.

The subpoenas were issued by the office of the inspector general of the U.S. Department of Health and Human Services, which oversees Medicare, the federal insurance program for the elderly and the disabled. Santa Barbara-based Tenet is under investigation by federal authorities for alleged Medicare fraud.

A Tenet spokesman declined to offer any details about the latest probe. The company said it expected to receive a request for documents related to the subpoenas and would cooperate with government authorities.

“These are not quality-of-care issues” that are being investigated, said Tenet spokesman Steven Campanini. “Tenet is under a microscope.”

The two doctors work with Sierra Medical Center, Providence Memorial Hospital and Rio Vista Rehabilitation Hospital in Tenet’s Sierra Providence Health Network. Tenet would not identify the physicians except to say that they had admitting privileges at the facilities, which are all in El Paso.

Since October 2002, Tenet Healthcare has been besieged by government inquiries into a wide array of practices. One investigation focused specifically on financial arrangements between doctors and Alvarado Hospital Medical Center in San Diego. There, a grand jury indictment alleged that Alvarado and Tenet paid millions of dollars in bribes to induce doctors to refer patients to the hospital, violating laws intended to stop kickbacks.

Tenet last year also paid $54 million to the government to settle allegations that two doctors at its Northern California hospital in Redding performed unnecessary heart surgeries. The government is still investigating whether needless heart operations were performed at three Tenet medical centers in the Los Angeles area.

On Friday, Tenet shares fell 57 cents, or more than 3%, to $17.43 on the New York Stock Exchange. Tenet’s stock has pulled back in recent days, although it had recovered much of the ground lost last year in reaction to its troubles.

New top executives installed at the company last summer have insisted that Tenet is in the midst of a turnaround. Wall Street analysts, however, remain skeptical.

“It’s always just one thing after another for Tenet, but the trouble is you don’t know how many ‘things’ there are,” said Sheryl Skolnick, an analyst with Fulcrum Global Partners who has a “sell” rating on the stock. “It just never ends.”

Tenet owns 100 medical facilities, 40 in California, where it is the biggest hospital operator.