Carlyle Says Hospitals Don't Need Disaster Plans

In a stunningly bizarre legal defense, Carlyle Group affiliate LifeCare Hospitals blames the federal government for patient deaths after Hurricane Katrina. This follows the similarly stunning White House Lessons Learned report omitting any mention of the hospital with the largest number of patient deaths post hurricane, the LifeCare Unit within Memorial Hospital.

LifeCare argues that once the Federal Emergency Management Agency and the U.S. Coast Guard assumed control of evacuations and other emergency procedures in New Orleans during the flood, it was no longer responsible for the patients at Memorial. The patients essentially became wards of the federal government, not LifeCare, the company's attorneys argue.

To bolster their chances of using their political influence and avoiding sympathetic juries LifeCare wants the cases heard in federal court. LifeCare's attorneys filed motions to transfer the proceedings to federal court, and the case is frozen while the parties await a ruling on that matter.

If LifeCare prevails with this argument then no hospital or nursing home needs a disaster plan, it's all the federal government's responsibility. This sounds the kind of corporate coddling that leads to underperformance. But then we're used to that, recall Exxon's foot dragging after the Exxon Valdez...