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CHS Asks Federal Judge to Toss Tenet Suit

John Commins, for HealthLeaders Media, April 20, 2011

Earlier this month, Tenet filed the federal suit alleging that CHS overbilled Medicare by as much as $377 million using medically unnecessary admissions that improved its bottom line and appeal to investors. CHS has denied the allegations, but last week confirmed that it has received a subpoena, dated March 31, from the Office of Inspector General, related to an investigation of "possible improper claims submitted to Medicare and Medicaid."

In its motion on Tuesday to dismiss the suit, CHS also claimed that:
  • Tenet's suit attacks the ethics and professional judgment of thousands of attending physicians at CHS-affiliated hospitals, which has no basis and is not material to the proxy contest concerning the election of Tenet's directors. 
  • Tenet is not seeking to compel CHS to disclose facts, but instead is attempting to compel CHS to confess some sort of culpability, which has no basis under the securities laws. 
  • A ruling for CHS will dispose of this case in its entirety.

John Commins is a senior editor with HealthLeaders Media.

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