November 10,2003

Grassley Urges Tenet to Disclose Any Steps to Help Possible Surgery Victims

WASHINGTON – Sen. Chuck Grassley, chairman of the Committee on Finance, today asked the Tenet Healthcare Corporation to describe any actions it is taking to identify and notify any patient who might have received a medically unnecessary surgery or procedure.

The text of Grassley’s letter to Tenet follows.

November 10, 2003

Edward A. Kangas
Tenet Healthcare Corporation
3820 State Street
Santa Barbara, CA 93105

Dear Mr. Kangas:

On September 25, 2003, as Chairman of the Senate Finance Committee (Committee), Iexpressed my concern to you about the lack of significant change in the corporate culture andmanagement team at Tenet Healthcare Corporation (Tenet). You responded, on October 10, 2003,saying, “[o]n behalf of our board of directors, let me assure you that we understand the concerns youhave raised and that we are very serious about the steps we have taken, and are continuing to take,to change Tenet and turn it around.” Recent events, however, appear to mark a significant stepbackwards for Tenet’s efforts to restore its reputation and turn Tenet around.

By letter dated, October 31, 2003, Blue Cross of California (BCC/Blue Cross), notified Tenet Healthcare Corporation (Tenet) that it was referring some of its members to alternative participating hospitals for any medically necessary coronary bypass procedures. The notice states that, “[n]umerous improper, medically unnecessary Coronary Artery Bypass Graft (“CABG”) procedures have been performed on BCC Members and improperly billed to BCC.” On Saturday, November 1, 2003, The Los Angeles Times (The Times) reported that BCC had data suggesting that doctors at Tenet’s hospitals in Redding and Modesto performed unnecessary heart surgeries. Specifically, The Times quoted Dr. Woodrow Myers, chief medical officer for BCC saying that, “a review byindependent cardiologists of 52 bypass operations at those hospitals had concluded that 85% of thesurgeries at Redding had been unnecessary and that 59% at Tenet’s Doctors Medical Center[“DMC”] in Modesto had been unwarranted.” The numbers cited by Dr. Myers, if accurate, are trulyshocking.

It is horrific to imagine what it would be like for a single patient, or the loved ones of thatpatient, to realize that the open heart surgery he or she endured was medically unnecessary. Thenotion that medically unnecessary heart surgeries or procedures are not, in fact, isolated, freakoccurrences, but seem to represent a broader problem, potentially involving tens, hundreds, perhapsthousands of unwitting patients, is incomprehensible.

Yet, the simple fact that Tenet has already settled allegations involving medicallyunnecessary heart surgeries, makes me extremely wary, at the very least, about what else will unfoldwith respect to these latest developments. Tenet’s response to Blue Cross’s concern for its members,however, is mind-boggling – yet utterly in keeping with its corporate history. By letter dated,November 3, 2003, Tenet threatened to sue Blue Cross:

If BCC does not immediately and unconditionally withdraw its notice of termination, DMCwill have no choice but . . . to take whatever legal action is necessary to protect its rights andpursue all of its remedies in that case. BCC should also be aware that Tenet and DMC arecurrently investigating any claims that they and others may have against BCC in connectionwith its communications with any third parties. In closing, please be aware that Tenet andDMC view the reckless allegations and improper threats of termination that were contained in your October 31 letter with the utmost seriousness.

Once again Tenet appears to be protecting its hide before expressing any concern for potentialvictims. When presented with the very real possibility that medically unnecessary surgeries may beoccurring at another Tenet hospital, Tenet elected to respond, in the first place, by quibbling aboutnumbers and percentages, and finally by threatening legal action. Tenet’s letter to Blue Cross isconfounding – mind you we are talking about people’s lives here. Perhaps Tenet’s officers anddirectors missed the significance of an unprecedented piece of news released by the Department ofJustice on August 6, 2003. That press release was captioned as follows:


As Chairman of the Senate Finance Committee, I assure you Tenet’s “issues” are far fromsettled in my mind. The fact that Tenet did not admit liability or any wrongdoing under the termsof its settlement does not lessen the significance of the fact that patients may have suffered fromunnecessary heart surgeries. Nor does it relieve Tenet of its duty to account for what happened andhow it happened.

The unprecedented action taken by Blue Cross on behalf of its members is not the onlyTenet-related news about medically unnecessary cardiac procedures and surgeries, it is just the most recent. On October 31, 2003, Tenet itself announced “that it will voluntarily cooperate with a newrequest for documents from the U.S. Attorney’s office in Los Angeles, primarily regarding certain cardiac physician arrangements, coronary procedures and billing practices at three Los Angeles-area hospitals owned by Tenet subsidiaries . . . [including,] Centinela Hospital Medical Center, Daniel Freeman Memorial Hospital and USC University Hospital.” Numerous media reports indicate thatthe U.S. Attorney’s office in Los Angeles is investigating whether unnecessary heart surgeries wereperformed at these Tenet hospitals, which have increased cardiac services substantially in recentyears. Among other issues, the U.S. Attorney’s office reportedly is seeking to determine whetherTenet improperly recruited physicians to perform cardiac services and whether Tenet improperlybilled for surgeries and procedures that may have been medically unnecessary.

Clearly, something needs to be done about, as you put it, “the companies current troubles.”Tenet understandably wants to put these “troubles” in its past and “chart a new, sustainable course.”The problem with “record-setting” corporate-fraud settlements is that they do not help the untoldnumbers of victims who may have suffered as a direct result of the fraud perpetrated. Manycorporations view such settlements in this day and age, even when they amount to hundreds ofmillions or billions of dollars, as the cost of doing business with the federal government. Anyvictims are left behind to fend for themselves, while the settling company returns to business asusual. Neither, Mr. Fetter’s letter, dated September 5, 2003, nor your letter, dated October 10, 2003,directly addresses any victims who may have died or suffered complications due to unnecessaryangioplasties, coronary bypasses, and heart catheterizations at Tenet hospitals. For your information,my greatest concern is for the untold number of victims who may be involved in this investigation,as well as any future patients who may be at risk.

The notice Blue Cross sent to Tenet on October 31, 2003, demanded that Tenet “shall take all necessary steps to ensure that BCC members who received inappropriate CABGs ... are appropriately notified.” That raises two important questions: (1) what is Tenet doing to notify any Tenet patient who may have undergone a medically unnecessary surgery or procedure?; and (2) what is Tenet doing to see to it that “all due care” is taken to ensure that surgeries and procedures thathave been performed at some Tenet hospitals were indeed medically necessary? By this letter, Irequest that Tenet inform the Committee about what action, if any, it has taken or intends to take toidentify any patient(s) it believes may have undergone an unnecessary heart procedure or surgery.Second, what action has Tenet taken to inform any victim(s) of unnecessary heart procedure orsurgery.

The multiplying questions about medically unnecessary surgeries at Tenet hospitals makes me concerned that Tenet’s ship may be more misguided than originally feared. Tenet’s reaction to these new questions raises additional questions about who is minding Tenet’s helm. It appears that the number of Tenet officers and directors who have clung on board does not bode well for Tenet’s ability to navigate the troubled waters it has charted for itself.

Please reply to this letter no later than the close of business on November 24, 2003.


Charles E. Grassley

cc: Mr. Trevor Fetter
Chief Executive Officer and President
Mark Willett, Government Relations
VIA FACSIMILE: (805) 682-5462