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Baylor heart hospital investigated

NEWS IN BRIEF — Posted June 5, 2006

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Baylor Health Care System has revealed that federal and state authorities are investigating whether its joint venture with physicians to operate a heart hospital in Dallas violates anti-kickback and tax exemption laws.

In a note to bondholders on May 10, Baylor said that it received a notice in December 2005 that the Dept. of Justice was investigating the financial relationship between its Baylor University Medical Center and a group of physicians. The medical center owns 51% of the Baylor Jack and Jane Hamilton Heart and Vascular Hospital, while the physicians own 49% of it.

Baylor said it was also notified in April by the Texas Attorney General's Office that the partnership was being investigated.

The Dallas-based health care system said it believes both investigations were prompted by complaints from HCA Inc. The national hospital chain has nearly a dozen facilities in the area.

A spokeswoman for the U.S. Attorney in Dallas said federal prosecutors would not confirm or deny an investigation. Representatives of the Texas Attorney General's Office and HCA did not respond to phone messages seeking comment.

Note: This item originally appeared at http://www.ama-assn.org/amednews/2006/06/05/bibf0605.htm.

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