New Shutdown Feared After Hospital Closes

By LAURENCE DARMIENTO

Staff Reporter

The closure of St. Luke Medical Center in Pasadena this month by Tenet Healthcare Corp. is renewing concerns that the giant hospital chain will dump one of its two newly acquired Daniel Freeman hospitals.

Critics of the Santa Barbara-based company fear that Tenet views the Daniel Freeman Marina Hospital in Marina del Rey as a money maker but more for its underlying real estate value than as an operating facility.

Tenet picked up the facility and its larger sister hospital, Daniel Freeman Memorial Hospital in Inglewood, for $57 million last month from Carondolet Health System Inc., a St. Louis-based Catholic system.

Both hospitals were losing money, but Tenet has a history of making good money on hospitals when it fits them into a network of facilities where it has solid market share. It just reported a record 43 percent jump in operating profits for the quarter ended Nov. 30.

In St. Luke’s case, Tenet picked up the money-losing hospital when it purchased OrNda Healthcorp. and its 50 hospitals for $2 billion in 1997. What it got was a Pasadena hospital isolated from others in the Tenet system. (The closest facility is a Tenet hospital in Encino.)

“We couldn’t create that same mini-network in Pasadena,” said Greg Harrison, Tenet’s director of corporate communications.

Critics, such as the California Nurses Association and other groups that fought Tenet’s Daniel Freeman purchase, believe there could be a parallel in the Daniel Freeman case.

Centinela Hospital Medical Center in Inglewood is just about a mile from Daniel Freeman Memorial a good distance for a network while the Marina facility is relatively isolated. It also sits on property where nearby condos are selling for over $1 million, said Karla Zombro, lead organizer for AGENDA, a South Los Angeles community organization.

Critics are particularly concerned because the state Attorney General’s Office, which had to approve the Daniel Freeman sale since it involved the conversion of non-profits to a for-profit, did not require Tenet to continue operating the Marina facility, as it did with Memorial.

But Harrison said that any parallels to the St. Luke’s case are overblown noting the Pasadena hospital was close to modern facilities like Huntington Memorial Hospital.

“If you look at the Marina population, there is a large senior population there that will need health services,” Harrison said.