CtW Investment Group Challenges HCP Board Re: $6.1B ManorCare Deal Citing Questionable Billing Practices

Today the CtW Investment Group sent a letter to the HCP Inc. HCP board of directors calling for an independent review of the REIT's proposed $6.1 billion acquisition of HCR ManorCare's skilled nursing facilities and other real estate assets which is expected to close in the first quarter of the year In its letter, CtW cited concerns regarding questionable Medicare billing practices outlined in studies by the Department of Health and Human Services' Office of Inspector General and the Service Employees International Union. Noting that in the SEIU report, ManorCare topped the list of care providers who billed Medicare for $259 million in potentially "excess" fees in 2009, CtW called for a board review of the acquisition and greater disclosure to shareholders regarding whether the potential unsustainability of the possibly excess fees could jeopardize ManorCare's ability to meet its lease obligations.