Primedex Appoints Two New Top Executives to Run Health Firm
Two New Jersey executives were named Thursday to run Primedex Health Systems, a controversial health care firm that operates mainly in California.
The New York-based company said John J. Petillo, 46, will take over as chairman, president and chief executive in January, when he steps down as president and chief executive of Blue Cross and Blue Shield of New Jersey.
Joining Primedex as vice president and chief financial officer is Robert T. Caruso, 48, a former vice chairman of the nationwide Coopers & Lybrand accounting firm.
The executives they will replace, President and Chief Executive Andrew C. Alson and Chief Financial Officer Roger Barnett, will remain directors and they will be joined on the board by Petillo and Caruso.
Primedex is in the midst of a corporate overhaul. Until recently, its Culver City-based subsidiary, Primedex Corp., was one of the biggest health care operations in Southern California’s workers’ compensation industry. But the subsidiary, dismayed by recent state legislative reforms and the target of a fraud investigation, announced plans in July to pull out of the business of treating injured workers.
Meanwhile, the parent company has been expanding a separate California subsidiary, Radnet Management, which operates a chain of 17 diagnostic imaging centers in the state.
A Primedex spokesman said Thursday’s move reflects “an opportunity to get top-flight people on a full-time basis” to run the company. He said Alson, an attorney, and Barnett, an investment manager, have worked for the company only part time.
In an unusual arrangement, Petillo will gain the voting rights--but not the ownership--of the controlling stake in the company held by controversial financier Robert E. Brennan. Petillo will retain those voting rights for at least one year, and the arrangement can be renewed on an annual basis.
The company spokesman said the voting rights assignment was intended to attract Petillo to the company and it displays Brennan’s confidence in the incoming chairman.
Brennan, who gained control of Primedex in 1992, has battled the Securities and Exchange Commission for years over previous dealings. He has never held any official title with Primedex but will remain its major investor.
Overall, Primedex Health Systems and its subsidiaries employ about 350 people, and it posted revenue of $54.1 million in the nine-month period ended July 31.
In a news release, Petillo said: “Primedex is strongly positioned to become a national provider of a variety of managed care services. The environment for medical services is changing dramatically, and our focus will be on aggressively expanding the company in a manner that is compatible with the many opportunities we believe will be available to Primedex.”
