Hospital operator Community Health Systems fired back against fraud allegations from rival Tenet Healthcare Monday, claiming a lawsuit levied by Tenet is "completely without merit."
Tenet earlier filed a suit in the U.S. District Court of Dallas that alleges Community Health overbilled government and private insurance companies for its own financial gain.
"Tenet's allegations are completely without merit and we intend to vigorously defend ourselves against these unfounded and irresponsible claims," a spokesperson for Community Health told CNBC.
The lawsuit from Tenet come on the heels of a thwarted attempt by Community Health last year to purchase Tenet, in a deal that valued the company at $3.3 billion and offered $6 a share. Tenet rejected that offer.
Shares of the two companies tumbled in Monday trade; shares of Tenet were last 12 percent lower, while shares of Community Health were down about 33 percent. Get real-time quotes for Tenet, Community Health here.