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The administrative record does not establish that petitioner
has the resources or ability effectively to oversee or monitor
the Surgery Center’s operations. Petitioner has almost no
resources apart from its assets invested in the General
Partnership. The president of Redlands Hospital also serves as
petitioner’s president and as one of the four managing directors
of the General Partnership.
On brief, petitioner argues that its influence in the
partnerships is evidenced by various changes that it says
occurred in the operation of the Surgery Center after April 1990,
when the amended Operating Partnership agreement became
effective. Petitioner suggests that these operational changes
demonstrate that its influence is sufficient to allow it to
achieve its charitable goals through the partnerships' activities
and demonstrate that for-profit interests do not control the
partnerships and the Surgery Center. As described in more detail
below, the record does not support petitioner’s contentions.
a. Change in Criteria for Procedures Performed at the
Surgery Center
Petitioner asserts that after the General Partnership
acquired its interest in the Operating Partnership, “the decision
to perform a surgery at the Surgery Center was changed from an
economic to exclusively a medical decision. Accordingly, RHS
achieved its goal of providing complete access to freestanding
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