Welcome to Consumer Reports Advocacy

For 85 years CR has worked for laws and policies that put consumers first. Learn more about CR’s work with policymakers, companies, and consumers to help build a fair and just marketplace at TrustCR.org

Military Road Alliance Votes Against Sale of SMH to Tenet

March 20, 2003

Military Road Alliance Votes Against Sale of SMH to Tenet
Opposition to hospital sale grows as April 5th election approaches.

SLIDELL, LA – By a voice vote, members of the Military Road Alliance last night rejected the proposal by Tenet HealthSystem (“Tenet”) to buy Slidell Memorial Hospital (“SMH”), the first and only nonprofit community hospital in eastern St. Tammany Parish. The vote was taken after a committee charged with analyzing the deal presented extensive research that it had conducted. The committee reviewed all of the provisions in the asset purchase agreement, the hospital’s financial reports and potential negative effects of the sale on the healthcare delivery system and concluded it was a bad deal for the community.
“This committee carefully dissected each component of the asset purchase agreement and annual financial statements, and couldn’t find one reason to support this sale,” said MRA President Gene Bellisario and moderator of last night’s meeting. We urge local residents to reject this proposal when it goes before the voters on April 5th.” Tenet, the nation’s second largest for-profit hospital system with 113 hospitals across the country agreed to spend $135 million for the hospital, including $100 million going toward a foundation. Tenet has also stated an intention to spend $40 million on improvements.
“A $100 million foundation sounds good, but when you think about the cost to the community of having Tenet be our only healthcare provider, we are going to be paying more than that every year to Tenet when it increases prices,” Bellisario added. Tenet’s average charges per discharge shows that it increased between 80% to 120% at hospitals in the New Orleans area between 1999 and 2002. “In addition,” Bellisario said, “Tenet hasn’t said where it will spend the $40 million, and that could easily go into its other hospital in town, NorthShore Regional, less than two miles down the road from SMH.”
With the vote on the proposed sale less than three weeks away, Tenet has still failed to make the complete Asset Purchase Agreement and all attachments available to the public. Bellisario requested specific information related to the hospital’s finances. “I couldn’t believe that they weren’t making the entire agreement available to the public. We are still waiting for critical details and that is unacceptable.”
“We are very encouraged by the MRA vote,” said Kathy Goss, co-leader of Save Our Slidell Memorial Hospital. “When I started writing letters and doing research about the hospital sale last summer, it felt like I was a lone dissenting voice. Slowly, I began to notice more people raising questions to the sale and now more and more people are speaking up in opposition.” Jim Towler, co-leader of SOSMH added, “I have met with community groups around the Parish and I haven’t met one person yet who supports this sale.”
The Slidell Chamber of Commerce recently announced its support for the purchase, stating that Tenet has agreed to the “keep the essential number of hospital beds necessary for quality care in our community” and that a “sufficient Emergency Room capacity will be maintained.” However, when Tenet was seeking to buy Daniel Freeman Marina Hospital in Los Angeles in 2001, it made the same promises to the Westchester/LAX-Marina del Rey Chamber of Commerce. The Chamber said it would support Tenet’s proposal on the condition that Tenet keep the emergency room open. “They agreed and regaled us with their expertise on saving troubled hospitals. There was no discussion on any line other than buying it and keeping it open,” said Frank Gleberman, Chamber President. When Tenet announced less than 6 months after the sale was approved that it was going to close Marina Hospital, Gleberman said the Chamber was “shocked.”
“One of the things that concerns us most is whether Tenet will keep SMH open because there is no time commitment in the Asset Purchase Agreement,” cautioned Leslie Bennett, staff attorney at Consumers Union, the nonprofit publisher of Consumer Reports magazine. Bennett has been working with community groups to stop Tenet’s closure of Marina Hospital. “If Tenet is really committed to keeping SMH open, then it should tell the public how long they are willing to make that commitment. That is not too much to ask, especially after Tenet’s recent announcement that it plans to close a number of its hospitals.” Tenet revealed on March 18, 2003 that it will sell or consolidate 14 hospitals in 8 states in an effort to cut costs. Hospitals that will be sold or consolidated are located in Arkansas, California, Florida, Missouri Nevada, Pennsylvania, Tennessee and Texas.
The Military Road Alliance, formed in 1979, is comprised of 13 homeowner associations representing 18 subdivisions in the general Military Road area east and north of Slidell:
Breckenridge, Cross Gates, Forest Ridge, French Branch, Frenchmen’s Estates, Lake Village, Old River Road Association (including Bay Ridge, Doubloon Bayou, Quail Ridge, Quail Valley, Paradise Point and The Settlement), the Park Condo Association, River Oaks, Stonebridge, Turtle Creek and Willow Wood.

Gene Bellisario, Military Road Alliance, (985) 641-2268
Kathy Goss, Save Our Slidell Memorial Hospital, (985) 649-4348
Jim Towler, Save Our Slidell Memorial Hospital, (985) 649-4348
Consumers Union, (415) 431-6747