MINNETONKA, Minn. (AP) -- Allina Health System has accused Minnesota Attorney General Mike Hatch of being heavy-handed and unreasonable in his probe of the giant health-care company's financial and business practices.
Hatch began an investigation last year after a federal audit concluded that about $1 million in administrative expenses for Allina's Medica subsidiary were unreasonable, although not illegal.
At the time, Hatch said the expenditures indicated questionable judgment by the health plan, and indicated that rising health-care costs justified his looking into whether the company was acting in the best interests of its members.
But Allina officials, in a letter delivered to Hatch on Monday, questioned the scope of his investigation, claiming they have already spent $1 million to provide more than 50,000 documents requested by Hatch's office over the past 10 months.
The letter also claimed that Hatch's office last week demanded that Allina turn over thousands more documents in just five days.
"How long is this going to go on?" Gordon Sprenger, Allina's chief executive, asked in an interview. "If he would call me and tell me one thing that he thought was excessive, inappropriate, illegal or against regulations, I'd change it tomorrow."
Hatch's office would not comment on the specifics of Allina's charges.
"While we haven't had a chance to review any correspondence from Allina, we are perplexed that Allina would seek to communicate issues involving a financial audit in the media," spokeswoman Leslie Sandberg said.
In the letter, Allina's general counsel asked Hatch to either set more reasonable deadlines for turning over documents -- such as 30 days rather than five days -- or to let a judge decide which documents Allina should provide and when.
Allina operates Abbott Northwestern and United hospitals, Medica and more than 45 clinics and other hospitals in Minnesota.
Sprenger defended the company's administrative expenses, including items cited in last year's federal Health and Human Services audit that showed the company spent money on luxury suites at Target Center, gold-plated golf divot tools and Waterford crystal vases given as gifts.
Sprenger said he anticipated that Hatch would challenge other expenses but he maintained they were not inappropriate or illegal.
Those expenses include a $1 million mortgage for a warehouse adjacent to a golf course and living expenses for consultants.
The warehouse holds materials used for the former Coldwell Banker Burnet Senior Golf Classic, now known as the 3M Championship, Sprenger said. As a charity recipient of the event, Allina pays for some costs of the event, he said.
However, the mortgage payments are not made using premium dollars or patient-revenue income, Sprenger said. Instead, the costs eventually are covered by the proceeds of the tournament, of which Allina receives $1 million annually.
"From this tournament we have received more than $4 million, which has been invested in cardiovascular and cancer care," he said.
He acknowledged that Allina has paid lodging and personal expenses for consultants, but said that is standard industry practice.
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