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| Greed, Scandal & Wrongful Deaths at Tenet Healthcare Corp. |
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Part Four
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Greed, Scandal & Wrongful Deaths at Tenet Healthcare Corp.
January 31, 2005
A multi part series from the Tenet Shareholder Committee
As the Tenet Shareholder Committee enters its sixth year, we have prepared a summary of what, from our point of view, went wrong at Tenet and a history of our effort to reform this company. We are publishing this multi part series on our web site.
Today: Part 1 – Past and Present Scandals
Find below a brief description of each section in Part 1.
Click here to see Part 1 in full (PDF file 500KB).
Tenet Healthcare – Repeat Offender
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The criminal history of Tenet Healthcare Corp., operating under the name of National Medical Enterprises
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The abuse of patients
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A guilty plea on seven federal felonies
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The 1994 Corporate Integrity Agreement (CIA), which the federal government now alleges the company knowingly violated
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The team, brought in as reformers, are later shown to be recidivists as Tenet is caught up in a new round of scandals involving credible allegations that patient’s lives had been sacrificed on the altar of corporate profits. [For example: Redding Medical Center & Palm Beach Gardens Medical Center]
- The formation of the Tenet Shareholder Committee
- Background of the committee’s chairman.
- The growth of Tenet with the acquisition of AMI and OrNda
- The strategy to dominate regional markets and raise prices
- Charging 3 times more for bypass surgery than the average payment in other hospitals
- Having 64 hospitals on the list of the country’s 100 most expensive hospitals.
- How before the pricing strategy fully kicked in, Tenet had written off .4 billion after tax
- Had debt below investment grade
- Had negative cash flow after capital expenditures
- Tenet chairman and CEO Jeffrey Barbakow assembles his team
- The aggressive price increase strategy is fully launched as the Corporate Integrity Agreement expired in June of 1999.
- The 2000 proxy contest
- Reform promises made, and not kept.
- The accelerated growth of earnings, margins, and cash flow in 2000 to 2002
- Barbakow’s frequent claims that these results were directly related to the strategies his team had adopted.
- The bursting of the bubble, beginning with questions, raised by an industry analyst, about Medicare outlier reimbursements and the FBI raid on Redding Medical Center in late October 2002.
- Barbakow’s incredible claim that he did not know about the abuse of Medicare
- The remarkable recovery revealed to be a scam, far more abusive and destructive than the NME scandal.
- The aggressive corporate culture at Tenet is exposed
- The harmful impact of greed on Tenet’s patients.
- The highest paid CEO in America departs
- Others on the Barbakow team also go out the door with bags of money, while shareholders take it on the chin.
- Unfortunately, Barbakow’s dysfunctional Board of Directors has not followed senior management out the door. Barbakow era directors are still a majority of the current Board.