Ontario government sues Tenet

Ontario sues U.S. medical company

The Edmonton Sun
News Tuesday, April 7, 1998 25

An American medical company whose employees called the Ontario health plan “the Canadian gravy train” is being sued by the province for $175 million US.

A statement of claim filed by the government states the company went trolling for Ontario psychiatric patients to ship to their facilities in Wisconsin and kept them there until their OHIP benefits ran out.

“There were headhunters that encouraged people to come to the United States for treatment; there was inappropriate treatment provided; people were unnecessarily detained,” Health Minister Liz Witmer said yesterday. “So we do believe that we need to do whatever’s possible to recover money that is owed to the Ontario taxpayers.”

The lawsuit was launched against Tenet Healthcare Corp., its former subsidiary National Medical Enterprises and nine former company executives.

Tenet spokesman Lance Ignon said National Medical Enterprises divested itself of the controversial psychiatric division prior to forming Tenet Healthcare Corp.

“We enjoy a reputation for having the most comprehensive and effective ethics and compliance program in the health care industry,” Ignon said.

Ignon said he hadn’t seen the lawsuit and couldn’t comment on it, but he noted that all senior management of the psychiatric division were replaced in 1993 after the U.S. government began an investigation.

The alleged fraud took place between 1989 and 1992, during the NDP government’s reign in Ontario.

NDP health critic Marion Boyd said the problem should never have occurred but it was decided not to go to court.

“The legal advice that we got was that, first of all, the case didn’t have a hope in hell and it was going to be extraordinarily expensive to even initiate and there wasn’t any point in going after them,” Boyd said.

The government alleges company employees referred to OHIP as the “Canadian gravy train” and paid bonuses to headhunters who could bring them psychiatric patients “without concern for the needs or medical diagnoses of the Ontario residents.”

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