Tenet Tangles With Locals on Cutback Plans

The attorney general's office says it did, in fact, intervene by preserving cardiac services offered at Marina's sister hospital. But that victory would soon look hollow. The following month, Tenet laid out plans to shed 19 Southern California hospitals -- including both Daniel Freeman facilities -- in a desperate attempt to regain profitability.

Sobel, for one, worries that Tenet will struggle to find takers for some of the Los Angeles hospitals and wind up closing them instead. If so, entire neighborhoods could be left scrambling for ready access to health care. And the government may have little power to intervene.

"Tenet doesn't believe they can be touched," one L.A. physician noted. "Their feeling about the government is: 'You can investigate us, interrogate us, regulate us -- but you can't make us stay in business.'"

Tenet failed to respond to questions for this story. The company's stock, hammered for more than a year over allegations of corporate fraud, slipped 14 cents Thursday to $11.02.

Con Game

Tenet wound up with Marina, together with sister hospital Daniel Freeman Memorial, after a competing bid fell through three years ago.

Local doctors, worried about Tenet dominating the area, had sought to buy the hospitals for themselves instead. But they unknowingly hired a con artist -- working for a firm with past ties to Tenet -- as a lead negotiator.

Jon Craig had racked up 15 criminal charges when he surfaced in Southern California with a "plan" to save the Daniel Freeman hospitals in the spring of 2001. In his bio for MedSector, a start-up health care acquisition company, Craig portrayed himself as a world-renowned man of finance who had negotiated major transactions on at least three different continents.

But a documentary later aired by the Discovery Channel exposed Craig as a charismatic crook who stole large sums from his wife, her foreign grandmother and several other relatives. Craig ultimately pleaded guilty to three charges of securities fraud -- and landed in a Utah jail -- just months after collecting $5,000 checks from Marina doctors who pinned their hopes on his firm.