CalPERS, the nation's second-largest purchaser of health insurance, said Tuesday that it planned to analyze claims data from patients of Tenet Healthcare Corp.'s hospitals in California to determine whether medical costs have risen excessively.
The California Public Employees' Retirement System, which provides retirement and health benefit services to more than 1.3 million members and nearly 2,500 employers, has asked its health plan administrator, Blue Cross of California, to provide claims data for the last five years. The pension fund also requested information on quality of care at each of Tenet's 40 hospitals in California.
Tenet, the nation's second-largest hospital chain, already faces a Medicare audit from federal regulators and an investigation of the company's billing practices by California law- makers. In addition, federal officials are investigating whether two heart doctors performed numerous unnecessary surgeries at Tenet's Redding Medical Center.
CalPERS spokesman Clark McKinley said the analysis was expected to begin in mid-January. It is premature to talk about what actions the pension fund may take upon completing the review, he said.
CalPERS' scrutiny of Tenet was prodded in part by the Service Employees International Union, which has been organizing at some of Tenet's hospitals.
In a Dec. 9 letter requesting the data from Blue Cross, Nancy J. Welsh, chief of CalPERS' Self-Funded Programs Division, made special reference to several Tenet hospitals that have received large payments for complicated medical cases. The letter, released Tuesday, mentioned Tenet hospitals in Modesto and San Luis Obispo and Garfield Medical Center in Monterey Park.
Tenet spokesman Harry Anderson said the Santa Barbara-based company was cooperating with CalPERS and Blue Cross. Michael Chee, a spokesman for Blue Cross, said it was not unusual for self-insured customers to request such claims data.
CalPERS said it had asked Blue Cross for advice on whether payments or referrals to Redding Medical Center and the two doctors under investigation should be suspended. Chee said, "That's going to be a CalPERS decision. It's their money."