Prime Healthcare, a for-profit hospital operator based in Ontario, Calif., and Kaiser Foundation Health Plan have agreed to dismiss unfair competition and breach of contract lawsuits they filed against each other, some of which have been pending in Los Angeles Superior Court since 2008.
Rather than a public courtroom battle, Prime Healthcare and Kaiser will resolve their disputes through confidential and binding arbitration.
In addition, the two companies came to an agreement regarding payment rates when Kaiser members are treated at Prime Healthcare hospitals. The terms of that agreement are confidential and no other details have been released.
Kaiser notified the California attorney general of its agreement with Prime Healthcare to arbitrate and the agreement on future payment rates.
Although Kaiser and Prime Healthcare have resolved some of their issues that does not mean Kaiser supports Prime Healthcare's transactions in California. Kaiser issued a statement saying, "Contrary to erroneous media reports and erroneous statements by Prime, Kaiser Permanente has not agreed to support Prime's acquisition of the Daughters of Charity hospitals and has not sent a letter of support to the Attorney General."
The sale of Daughters of Charity Health System — a six-hospital network based in Los Altos Hills, Calif. — to Prime Healthcare has been surrounded in controversy. California Attorney General Kamala Harris has until Feb. 20 to make a decision on whether the transaction should be allowed.
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