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Judge poised to toss ridiculous Prime Healthcare lawsuit

April 05, 2013|By Michael Hiltzik
  • Prime Healthcare Services founder Prem Reddy
Prime Healthcare Services founder Prem Reddy (Anne Cusack / Los Angeles…)

U.S. District Judge Gonzalo Curiel of San Diego has signaled that he's prepared to dismiss a bizarre lawsuit filed by Prime Healthcare Services against the Kaiser Foundation Health Plan and the Service Employees International Union.

In a tentative ruling handed down Thursday, Curiel said he found no merit in Prime's claim that Kaiser and the SEIU had conspired against the Ontario hospital company.

Curiel's dismissal is subject to a hearing in his courtroom Friday and a final order to be handed down later.

A dismissal order would be the second against the lawsuit: U.S. District Judge Janis Sammartino of San Diego originally tossed the lawsuit last year, but allowed Prime to file a new version. That's the one Curiel is ruling on.

A Prime spokesman said Friday, before the hearing, that the company "is confident that it ultimately will succeed on the merits." 

Prime has had a history of run-ins with regulators. It recently disclosed that it has received a federal subpoena related to allegations that it has inflated its billings to Medicare.

It is also under federal investigation for an alleged breach of confidentiality of a patient's medical records. California regulators have already fined Prime $95,000 for the latter offense, which occurred after a patient gave an uncomplimentary news interview about her treatment at a Prime hospital.

In 2011, California Atty. Gen. Kamala Harris, saying the move was "not in the public interest," turned down an application from a Prime-related nonprofit foundation to take over what would be its 15th California hospital.

The company has had a bee in its bonnet about Kaiser and the SEIU. It blames the union for fomenting the government's suspicions about its Medicare billings. It has fought with Kaiser over billings for Kaiser enrollees who are treated at Prime emergency rooms. 

In his tentative ruling, Curiel said Prime's "circumstantial evidence" falls far short of its conspiracy claims. The company had pointed to the fact that SEIU and Kaiser officials had met numerous times -- hardly unusual, given that the SEIU represents employees at Kaiser.

The judge also noted that the SEIU's complaints to regulators about Prime's business and medical practices are immune from lawsuits under federal law.


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