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January 25, 2013

Mo. Foundation Wins $162-Million Judgment in Hospital Suit

A Missouri judge has ordered HCA, the nation's biggest for-profit hospitals system, to pay $162-million to a foundation for failing to meets its obligations from a 2003 merger, a ruling that could have broader implications as more communities seek to sell struggling nonprofit hospitals, according to The Kansas City Star and The New York Times.

The Health Care Foundation of Greater Kansas City sued HCA in 2009, claiming the firm had not spent what it promised on capital improvements and charity care when it purchased the nonprofit Health Midwest hospital chain for $1.13-billion six years earlier. The foundation was created with proceeds from the sale to monitor HCA's compliance.

Jackson County Circuit Judge John Torrence ruled Thursday that HCA had fallen $162-million short of its pledged spending on improvements to the former Health Midwest facilities, and he appointed an auditor to scrutinize its provision of charity care. Company officials said HCA has consistently met or exceeded its obligations and will appeal the judgment.