updated 5/9/2006 5:57:13 PM ET 2006-05-09T21:57:13

Federal health regulators have launched an investigation into a Kaiser Permanente kidney transplant program that reportedly put hundreds of patients’ lives at risk by bungling paperwork that prolonged or canceled procedures.

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Investigators interviewed Kaiser staff on Monday and began reviewing internal documents to determine if Kaiser’s San Francisco center violated federal funding standards, said Jeff Flick, regional administrator of the U.S. Centers for Medicare and Medicaid Services.

Kaiser spokesman Rick Malaspina said the hospital is cooperating with the investigation.

Oakland-based Kaiser, the nation’s largest not-for-profit health maintenance organization, administers health plans, operates several medical centers and employs about 11,000 physicians. Of its 8.4 million members, about 3.2 million are in northern California.

In 2004, Kaiser decided to perform kidney transplants in-house for Northern California members instead of contracting with University of California hospitals in San Francisco and Davis. But it failed to discuss with regulators the transfer of up to 1,500 patients to the new center, delaying some patients’ procedures, the Los Angeles Times reported last week.

In the program’s first full year, only 56 transplants were performed and twice that many people died waiting for a kidney, the newspaper reported. At other transplant centers across the state during that period, more than twice as many people received kidneys than died.

The state Department of Managed Health Care is already investigating whether Kaiser improperly referred patients to a program it knew was having troubles. The agency could fine Kaiser or take its managed care license.

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