Tenet gets $340M From Insurers for Hurricane Damage

July 10, 2006

Dallas-based Tenet Healthcare Corp. said insurance companies paid it $340 million to cover claims from Hurricane Katrina, which damaged five of its hospitals in the New Orleans area and one in Biloxi, Miss.

Tenet said it settled with the insurers to avoid a dispute that could have lasted years. The company said it was one of the first major commercial property insurance settlements from last summer’s hurricane.

The settlement was paid by insurers who underwrote Tenet’s property insurance in 2005 and 2006.

Tenet said it would record $240 million of the settlement in the quarter that ended June 30. The other $100 million had already been recorded.

All of Tenet’s hospitals and its five diagnostic imaging centers in the hurricane’s path suffered significant damage, the company said.

Two of the hospitals in New Orleans, Memorial Medical Center and Lindy Boggs Medical Center, have not reopened.

Last week, the company announced plans to sell the two hospitals and two others in Kenner, La., and Gretna, La., by the middle of next year.

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