From the TCHB Sacramento bureau, Matt Quinn has some comments on a HCA hospital that is on the verge of losing Medicare reimbursement status due to violations of the Medicare safety regs. Matt writes:
Is HCA the next Tenet (hasn’t it already been one?)? Tenet – allegedly -didn’t have the systems and processes in place to notice that its cardiologists in Redding were doing 10+ times the level of procedures of other hospitals in the country. It is scary to think that HCA is similarly missing the compliance monitoring systems and processes that would make it totally unaware of serious deficiencies in three major areas – nursing services, emergency services and patients’ rights. Or perhaps (like HealthSouth) they were intentionally filling staff spots with the wrong folks in an effort to save a buck, make more revenue at a lower cost and deceive themselves on internal reporting efforts. It’s kind of like in the Army when supply and personnel clerks are "battle rostered" into combat engineer squads for reporting (but not training) purposes; the numbers look good on paper (i.e. squads have their full complement of soldiers) until someone (periodically) blows the whistle on the whole charade and demands to see the real numbers. It usually takes an outside (GAO-type) agency to do this because everyone in the succession of command has an interest in everything appearing "good" under them (i.e. the BDE commander will appear to be deficient if one of his BNs has personnel problems; the DIV CDR appears to be deficient if one of his BDEs has problems, etc.). In other words, either reporting the true numbers or calling "BS" on someone under you reporting bad numbers is career suicide. I wonder if similar careerism is at hand at HCA. Or if they’re just negligent or greedy?
Extra points for you non-military types if you actually know what a BDE is, but the problems Matt’s hinting at were there at at Tenet, Healthsouth and of course HCA when it was called Columbia/HCA and when "health care never worked like that before". I’ve posted before on why Wall Street hates health care services but doesn’t know it.
However, in the short term Tenet’s stock looks close to a bottom to me, as there can’t be much more bad news, can there? (Full disclosure: I’ve bought some for a short-term play).