Community Health gets US subpoena in claims probe

Community Health Systems Inc was subpoenaed by the US government in connection with an investigation of possible improper claims submitted to Medicare and Medicaid, days after rival Tenet Healthcare Corp accused it of bilking the government and insurers. The news sent shares of Community Health down about 14 per cent after hours.

The subpoena, from the US Department of Health and Human Services and dated March 31, requests documents from all of the company's hospitals and appears to concern emergency department processes and procedures, the company said in a securities filing on Friday. It also requests information about Community's relationship with emergency department physicians, including financial arrangements.

Community said it does not know if it is related to allegations made in the lawsuit against it by Tenet, a rival rival hospital operator which filed a lawsuit against Community earlier this week accusing it of admitting patients for needless stays. A spokesman for Tenet declined to comment on the subpoena.