The controversial sale of Queen of Angels-Hollywood Presbyterian Medical Center in East Hollywood to Tenet Healthcare Corp. seems headed for approval by the state Attorney General’s Office, perhaps as early as this week.
Deputy Attorney General James Schwartz, while refusing to comment directly on the imminent decision, spoke favorably about the revised terms that the parties submitted.
“Quite frankly, in my opinion the revised plan is excellent,” Schwartz said. “Our independent experts are very positive about it. The new plan should provide substantial benefits to the community and assuage the concerns (about charity care) that have been raised.”
A range of community groups and elected officials have raised concerns about the seeming incompatibility between Tenet’s emphasis on profit and Queen of Angels’ emphasis on offering care for the poor and uninsured.
But Schwartz said The Lewin Group Inc., a consulting firm that was hired by the Attorney General’s Office in December to review the sale, determined that medical care provided under the revised deal “would add value to the community and be better than the status quo.”
He also said that consultants with Arthur Andersen LLP determined that terms of the deal meet or exceed fair market value.
Tenet agreed to purchase the 409-bed hospital in December for $100 million.
The Attorney General’s Office originally was to decide in April whether to approve the agreement between Santa Barbara-based Tenet, the nation’s second-largest for-profit hospital chain, and the inner-city Queen of Angels Hollywood Presbyterian Foundation.
That deadline, however, was repeatedly pushed back, amid the criticism. Specifically, opponents cited the loss of the hospital’s charity care under the terms of the sale agreement as well as the absence of a clause protecting Queen of Angels’ current employees and a limited promise to provide basic emergency services.
Queen of Angels and Tenet have worked to address these issues and repeatedly submitted revised terms to the Attorney General’s Office.
Both Tenet and the Queen of Angels now voice confidence that the sale will be approved.
“We look forward to the attorney general’s approval,” said Queen of Angels spokesman Robert Steward. “We are confident that we made a good-faith attempt to address the concerns that have been raised. Our intent, to improve the health status of the poor and the working poor in the greater Hollywood area, has remained constant from the beginning to the end of this process.”
Harry Anderson, Tenet’s senior director of strategic communications, echoed Steward’s comments.
“We are optimistic that the attorney general will approve our deal,” Anderson said. “We have heard what people have had to say, and we have responded in positive ways.”
He said Tenet will build a new emergency room and commit at least $15 million a year in hospital care for the poor.
Even vocal opponents are tempering their complaints in the face of the changes. The revised terms increase the availability and accessibility of the health care services to the community.
“I applaud the board and the Attorney General’s Office for forging such significant improvements,” said Assemblyman Scott Wildman, D-Glendale. “However, I am seriously concerned that there are no plans to have a public hearing about the latest changes. Employee issues and the governance of the foundation are still holes, and the community deserves one last chance to discuss this.”
Schwartz said he has sat down with several groups to explain the latest revised terms, and that the May 15 deadline would be final.
“I haven’t yet had a chance to discuss the latest changes with the others,” Wildman said. “But (the new proposal) has come a long way.”
Tenet faced a similar conflict in St. Louis over the last year, where its $300 million purchase of the Saint Louis University Hospital was challenged by the city’s archbishop. He claimed that Tenet would not maintain the standards of the Catholic hospital.
Tenet ultimately met several conditions and successfully closed the deal in the beginning of March.
