Jessica Vernabe Controversy is still brewing for Prime Healthcare Services Inc., the Ontario, Calif.-based company that owns Sherman Oaks Hospital, as it tries to add another hospital to its system. Over the past year, the Service Employees International Union-United Healthcare Workers West has made claims that the hospital system has alarmingly high rates of septicemia, or blood infections, and malnutrition. California Watch has published similar findings, and it released a report in July that Prime has much higher emergency room-to-hospital admission rates for Medicare patients when compared to other hospitals. Sherman Oaks Hospital was initially one of the Prime facilities placed in the spotlight by union. In a letter from Congressmen Pete Stark and Henry Waxman to the Department of Health and Human Services’ Inspector’s General office, the elected officials cited SEIU data that Sherman Oaks Hospital had 22.5 percent septicemia diagnosis for Medicare inpatients compared to the national average of less than 5 percent. The union has suggested that Prime either has a health crisis or is engaging in Medicare billing fraud. Those claims have more recently snagged the attention of California Senator Ed Hernandez, who wrote a letter to the California Attorney General earlier this month. In the letter, he asked the Attorney General to hold off on approving Prime’s purchase of Victor Valley Community Hospital in Victorville. “Given the serious nature of these allegations, we should do everything in our power to ensure this organization is not allowed to expand until all investigations have concluded and we are provided explanations for the anomalies brought to light by the California Watch reports,” Hernandez said in the letter. Prime officials are calling the allegations a smear campaign by a disgruntled union. “It’s distorting the data,” said Prime spokesman Edward Barrera, referring to the union. “It’s basically creating controversy because we will not concede to SEIU’s demands.” SEIU’s allegations were also discredited by Prime Healthcare Services Foundation Secretary and Treasurer Michael Sarrao, who spoke at public hearing held this month by the Attorney General’s office. The office will soon decide whether to approve or deny the purchase. Sarrao called the claims “misstatements, distortions and outrageously false statements,” according to a copy of Sarrao’s hearing speech provided by Prime. Barrera said the allegations have not negatively impacted operations at Prime’s hospitals. Bob Bills, the CEO of Sherman Oaks Hospital and Encino Hospital Medical Center, agreed. “It truly hasn’t affected the hospitals from a local perspective other than just having to deal with the negative press that has been generated by SEIU and California Watch,” he said. “As long as we continue to negotiate in good faith with SEIU … we’re going to continue to have (allegations) brought up.” Bills also said the septicemia rate the union released for Sherman Oaks Hospital is incorrect. Officials from the California Department of Public Health visited the hospital this year to look into its septicemia and malnutrition rates, but Bills said he has not yet heard of any conclusive findings. When asked why Prime’s hospitals might have higher septicemia and malnutrition rates than other hospitals, Bills said: “The vast majority of our patients come from nursing homes, board and care facilities, assisted living facilities. The elder population has greater rates of malnutrition and, in many cases, septicemia.” In a statement released by the company last month, Prime said California Watch relied on “manipulated data” in its hospital admissions analysis and announced it is seeking legal action against the organization. In July, California Watch said it used data from the Office of Statewide Planning and Development for its hospital admissions analysis. Investigation The California Department of Public Health is still investigating some of the union’s allegations, said Pam Dickfoss, acting deputy director of the department’s Center for Health Care Quality. After looking into the septicemia rates of four Prime hospitals, the department found that those facilities violated licensing standards, Dickfoss said, in an email. The four hospitals — West Anaheim Medical Center, Chino Valley Medical Center, San Dimas Community Hospital and Desert Valley Hospital — were chosen because they were ranked the top four hospitals in the state for billing of septicemia, she said. The department is now reviewing an appeal of those findings by Prime and is in the process of investigating the hospital system’s malnutrition rates. Dickfoss said the department has not yet made a decision about whether to approve Prime’s license application to operate Victor Valley Community Hospital. An official from the U.S. Department of Human and Health Services Inspector General’s office said he could not confirm nor deny whether the department is conducting an investigation on Prime.