Wow Tenet is NME just different name - sorry but I find this very interesting - I stopped but ya gotta read this last 1

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Tenet Troubles Taking Root in a New AreaBy Senior Writer10/09/2003 10:37 AM EDTURL: http://www.thestreet.com/stocks/melissadavid/10118087.html Federal

prosecutors are now digging for dirt on Tenet (THC:NYSE) down in the bayou. The U.S. attorney's office in New Orleans is looking at some Tenet-owned operations in Louisiana that could bring in fresh evidence of wrongdoing. The troubled hospital chain -- already swimming in investigations -- now faces a criminal probe of the parent to its health maintenance organization in New Orleans. And officers of the HMO are no strangers to trouble. Prosecutors are seeking a wide range of documents related to People's Health Network, a joint venture between a Tenet subsidiary and a number of big physician groups in the New Orleans area. Tenet -- which is suspected of bribing physicians in its stronghold of California -- describes PHN as "an organization that brings together physicians and hospitals to provide integrated healthcare

to members." PHN also manages Tenet Choices, a Louisiana-based HMO that is wholly owned by the company. Federal authorities have ordered Tenet to turn over PHN's articles of incorporation and bylaws, membership data, agendas and minutes of meetings, policy manuals and documents tied to certain physician practices. The subpoena demands information dating back to the beginning of 1999. The New Orleans probe is just the latest in a string for Tenet, which faces a slew of government investigations for allegedly profiting from unnecessary surgeries, paying illegal kickbacks to doctors and bilking government insurance programs such as Medicare and Medicaid. "The subpoena does not indicate the focus or extent of the U.S. Attorney's criminal inquiry,"

Tenet said when announcing the probe this week. But "Tenet expects that PHN will cooperate with the request." Federal prosecutors in New Orleans said they are barred from discussing specifics of the investigation. Meanwhile, Tenet critics expressed only mild surprise at a fresh probe targeting a whole new area of the company's business. "This indicates to me that the government agencies are all talking to each other and sharing information," said Jim Moriarty, a Houston attorney representing hundreds of clients who are suing Tenet's scandalized hospital in Redding, Calif. "They've got investigations going on everywhere now." By now, in fact, such investigations are hardly news. Tenet shares actually inched up Tuesday, the day after the probe was announced, before closing unchanged at $15.29 Wednesday.

Shadows of the Past Founded in 1996, Tenet Choices is a Louisiana-based HMO that provides coverage to patients treated by seven Tenet-owned hospitals and eight big physician groups that refer patients to the facilities. Paperwork from the Louisiana Secretary of State lists three people -- Reynold Jennings, Carol and physician Newman -- as officers of the HMO. The first two, at least, have shadows in their past. Jennings oversaw Tenet's Dallas region when the company still operated as National Medical Enterprises. During 1993 -- Jennings' final year at NME -- hundreds of federal agents raided a number of the company's psychiatric hospitals that were suspected of locking up juvenile patients just to loot their insurance policies. Ultimately,

NME paid $100 million to settle lawsuits filed by former patients of Tenet's psychiatric hospitals in Dallas and other Texas cities. The company also forked over $363 million -- a record-breaking fine at the time -- and agreed to sell its core psychiatric division to settle fraud charges with the federal government. I worked at the new NME Psych Hosp which included a separate juvenile in-pt facility when it suddenly was closed and active medical files were destroyed with rumors of a cover-up of the same type among staff. A year before NME finally settled with the government, Jennings joined New Orleans-based Ramsey Health Care -- ranked as one of the largest psychiatric companies in the nation -- as operating chief and later became president of the

company. Two years into Jennings' tenure there, Louisiana officials began accusing the company of exploiting a loophole to hike its Medicaid reimbursements by some 50%. The state was still trying to collect on the alleged overpayments a year after Jennings left Ramsey to rejoin what had, by then, become Tenet Healthcare. Jennings came on board to oversee Tenet's hospitals in the Gulf Coast, primarily Louisiana. He was promoted to executive vice president of the entire Southeast region in 1999 -- the year federal prosecutors suspect criminal activity may have begun in some of Tenet's New Orleans-based operations. Jennings would go on to win three "Circle of Excellence" awards -- granted partly for hitting financial targets -- before his promotion this year to president of Tenet's eastern division. Jennings assumed the

new position in March 2003, following a management shake-up that eliminated Tenet veteran Neil Sorrentino as executive vice president of the company's western division. Sorrentino has since been ordered to supply documents to Senate investigators probing possible unnecessary surgeries at Tenet's hospital in Redding. doesn't have a spotless record, either. In 1993, she served as acting administrator of a New Orleans hospital suspected of bilking Medicaid. New Orleans General Hospital was filing for payments as an acute-care hospital even though the vast majority of its beds were reportedly reserved for psychiatric patients. As a result, the New Orleans Times-Picayune reported, the hospital could actually triple its Medicaid reimbursements. Less than two years later, went on to become president of a new low-cost HMO serving NME's hospitals in the New Orleans region. Her ethics came under fire after she reportedly used her political influence to expand the HMO's service into a local charity hospital. The Baton Rouge Sunday Advocate also raised questions about 's consulting contract -- just $602 shy of the requirement for competitive bidding -- with the charity hospital. She currently serves as executive director of the Tenet Choices HMO ensnared in the latest probe by federal authorities. Company Man Newman, listed as secretary of the HMO, joined Tenet as vice president of the Gulf State region in early 1999 -- again, around the time when federal authorities suspect wrongdoing there may have started. After just 16 months on the job, Tenet promoted Newman to senior vice president of the region. "It's largely as a result of Steve's personal efforts that our hospitals in New Orleans now have access to several large managed care plans -- a total of more than 100,000 lives covered -- that we had never been able to gain access to before," announced fellow Tenet Choices executive Jennings. Newman has remained a solid company man. Last November -- during the early days of Tenet's latest Medicare scandal -- the executive fiercely defended his company in a letter to the editor of New Orleans' largest newspaper. "As the top Tenet executive in this area, I feel it is important to set the

record straight," he wrote to the Times-Picayune. "Our company has not been accused of any illegal activity, and I can assure you that our operations in this region are being conducted in line with the highest ethical standards." Newman left the area before federal authorities launched their latest probe. He was promoted in April to lead Tenet's California hospitals, a number of which are currently under investigation for possible violations.