Newspaper article The Florida Times Union

Morning Briefs

Newspaper article The Florida Times Union

Morning Briefs

Article excerpt

FED: CREDIT CARD OFFERS DON'T LEAD TO BANKRUPTCY

The Federal Reserve issued a report downplaying assertions that the banking industry contributed to bankruptcies by offering credit cards to customers who may be unable to repay the debt.

The Fed report released Thursday concluded that credit-card issuers do not solicit customers or extend credit to them without assessing their ability to repay debt. Congress requested the report as part of a 2005 bankruptcy law.

"Despite the large expansion in the proportion of households with credit cards in recent decades, measures of debt repayments relative to income show no signs of a rise in distress in the aggregate," the report stated.

In its review, the Fed was asked to assess whether industry practices encourage consumers to accumulate debt, how issuers determine whether a consumer will repay the debt, and how they solicit and select customers.

Associated Press

OVERBILLING PROBE ENDS WITH $900 MILLION PAYOUT

Tenet Healthcare Corp., the nation's second-largest hospital operator, has reached a $900 million settlement with federal officials to end investigations into alleged overbilling of Medicare, and plans to sell about a dozen hospitals in an effort to regain its financial footing.

The settlement -- valued at about one-fourth of Tenet's stock-market value -- will be paid over four years and ends all federal investigations by the Department of Justice and several U.S. attorneys, Tenet said.

The deal means that there will be no finding that Tenet broke the law.

Tenet will pay $725 million plus interest to settle allegations that it overbilled Medicare for the most costly cases, made illegal kickbacks to doctors to refer Medicare patients to its hospitals, and used improper billing codes to bilk the health care program.

Tenet said it would pay $450 million plus $20 million interest immediately and pay off the balance by mid-2010. …

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