Healthcare Finance

As if state healthcare administrators weren't facing enough problems already, they're now battling a lawsuit over free care provided after Hurricane Katrina. Doctors at a New Orleans-area hospital, West Jefferson Medical Center, have sued the state for $100 million. The 381 physicians bringing the suit argue that state officials should reimburse them for treating indigent patients, which they've done since August 2005 in the wake of the hurricane. The physicians estimate that 30 percent …

It's a good time for the Henry Ford Health System, which is coming back strong after suffering major losses a few years ago. The nonprofit system has done well again this year, reporting a 2006 net income of $134.9 million on revenues of $3.25 billion. Revenues are up 6.6 percent from 2005, and net income a whopping 20 percent. Revenue sources included $1.5 billion from the system's Health Alliance Plan and $1 billion from its 920-bed Detroit hospital, physician practices and behavioral …

Boston's Massachusetts General Hospital (MGH) has raked in a giant $284 million windfall on royalty rights for foreign sales of Enbrel. Enbrel, a successful rheumatoid arthritis drug, generated sales of $4.4 billion last year, including $1.5 billion in non-U.S. sales. MGH gets some $213 million, and $71 million goes to biophysicist Brian Seed. Seed, an MGH researcher, discovered a method for fusing proteins that act as decoys, blocking patients' inflammatory response to arthritic joint …

Triggered by a newspaper's disclosure of details on the sale of a medical practice to a local hospital authority, a North Carolina state Senator has filed a bill which would make such contracts confidential. The newspaper, the Wilkes Journal-Patriot, had sued the Wilkes Regional Medical Center Hospital Authority to get details on a physician buyout contract, under which the medical center paid $650,000 to buy the assets of a local gastroenterologist's practice. The medical center …

In an effort to stay in the good graces of the state's Attorney General, Minnesota hospitals have agreed to extend existing pricing discounts for uninsured patients for the next five years. The hospitals will also continue to meet debt-collection requirements, including the establishment of payment plans and riding herd on collection agency tactics. Hospitals must also take several steps prior to pursuing patients legally, including verifying their debt and confirming that any relevant …

It looks like there's more trouble brewing on the charity care front. U.S. Sen. Charles Grassley (R-IA), the ranking member of the Senate Committee on Finance, has asked the Government Accountability Office to conduct an investigation into whether nonprofits are meeting their community benefit obligations. He's also asked the GAO to investigate compensation for executives and board members at nonprofit hospitals. "We need to get a better handle on how nonprofit hospitals are fulfilling …

A new audit by the New York Department of Health has found that the state's Medicaid program overpaid providers by almost $26 million over a five year period. The problems occurred, auditors found, because controls within the Department's electronic claims processing system were not being used, and what's more, that the clinics weren't following the state's Medicaid billing guidelines. The payments, which took place from 2001 through 2006, went to clinic services for hospitalized Medicaid …

A retired Connecticut couple has bequeathed $5 million to a Hartford hospital, a gift which will help finance a new eight-story patient care building planned by the facility. The $5 million bequest from Nancy and Daniel O'Connell is the largest gift St. Francis Hospital and Medical Center has received in its entire 110-year history. The new building will be named on behalf of the couple's son, John T. O'Connell, who died of cancer at age 20. John O'Connell had been treated at St. Francis. …

After months of negotiations, northern California's Sutter Health has gotten final state approval for a $910 million bond issue, but only after the health system agreed to substantial donations to rural hospitals and clinics. Sutter will use $750 million for facility upgrades and new construction, including major expansion of its Sutter Roseville Medical Center and Sutter Amador Hospital. The remaining $160 million will go to refinancing long-term debt at more favorable interest rates. …

Conceding that they just don't have the capacity to deal with the rising flood of poor, mentally-ill patients, North Carolina mental health officials have closed their doors on accepting more than a limited number of patients from community hospitals. North Carolina public health execs say that the volume served by the state psych hospitals has grown rapidly since 2003, with many units serving substantially more people than they're licensed to serve. For example, Dorothea Dix Hospital in …