Good grief it's been a rough week for Tenet Healthcare (NYSE:THC). On Wednesday, hospital administrator Mina Nazaryan surrendered on charges that she received kickbacks from doctors associated with a relocation scheme at the Alvarado Hospital. She also allegedly later tried to obstruct investigators that were looking into the mess.
Today, Tenet announced that its general counsel and chief corporate officer, Christi Sulzbach, is out the door effective November 1. Sulzbach becomes the fourth top official to leave Tenet in the past year, following in the steps of its chief executive, chief financial, and chief operating officers.
Tenet has been in a whirlwind of trouble and controversy all year long. From Medicare over-billings, to unnecessary surgeries, to illegal kickbacks for doctor relocation expenses, Tenet appears to be rotten from the inside out.
A Senate Finance committee investigating Tenet's attempt to right its corporate standards of compliance and disclosure seems to agree. A letter from Senator Chuck Grassley (R- Iowa) sent to Tenet and also posted online probably sealed Sulzbach's fate. Grassley said, among other things, "Apparently, neither Tenet nor Ms. Sulzbach saw any conflict in her wearing two hats as Tenet's general counsel and chief compliance officer."
Sulzbach has been with Tenet for 20 years, so any true clean slate for the company likely couldn't survive her presence. Still, investors shouldn't take today's news as evidence that Tenet has turned the corner. With a company as dirty as this one, until we are certain that all facts are out and old business practices truly left behind, investors should stay away.
