Labor Federation Urges California Attorney General to Stop the Sale of Six Hospitals to Prime Healthcare

[July 29, 2014] SAN DIEGOWorkers attending the California Federation of Labor’s convention overwhelmingly passed a resolution today urging California Attorney General Kamala Harris to halt the sale of any hospital in California to Prime Healthcare at least until the federal government completes its criminal and civil investigation of the company, and called on state legislators, legislative candidates and political parties to reject any contributions received from Prime Healthcare.

“We urge the attorney general to recognize that too many communities have suffered after Prime gobbles up their safety-net hospitals and then cuts services, wipes out jobs, and jacks up prices in the name of raising profits,” said Dave Regan, president of SEIU-United Healthcare Workers West, which sponsored the resolution. “Prime should not be allowed to get an even bigger slice of the California hospital system while it under investigations for allegedly overcharging Medicare.”

The resolution says Prime Healthcare has undermined the affordability, quality and accessibility of healthcare in the state. More than 350 union members voted to adopt it at the biennial convention of the California Labor Federation.

Prime Healthcare acknowledges it is under federal investigation, and a whistleblower lawsuit filed in 2013 alleges the company fraudulently overbilled Medicare and Medicaid about $50 million. A separate lawsuit filed last year by a group of doctors in San Bernardino County claims they are being denied access to their patients because they refuse to participate in Prime’s scheme to unnecessarily keep patients overnight in the hospital in order to increase revenue.

Prime Healthcare is based in Ontario, Calif. and operates 14 hospitals in the state. It is trying to buy six more safety-net facilities in California that are currently owned by the Daughters of Charity Health System, a non-profit organization that has been losing $10 million a month since January 2014. The affected hospitals are in Los Angeles, San Jose, Daly City, Gilroy, Lynwood and Moss Beach.

SEIU-UHW represents workers at three Prime-owned hospitals in California and currently has a labor dispute with the company.

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