Patients who have relied on the same Schenectady, N.Y., cardiology practice for years — some for decades — are watching a legal fight between Ellis Hospital and St. Peter’s Health Partners Medical Associates with growing concern over what it could mean for their care, local ABC affiliate News 10 reported Sept. 9.
Ellis Hospital, part of Schenectady-based Ellis Medicine, sued St. Peter’s Health Partners Medical Associates, or SPHMA, on Aug. 12, alleging the physician group is using noncompete agreements to block 27 cardiologists from joining Ellis once their contract with St. Peter’s ends. St. Peter’s acquired the practice in 2021 and became the physicians’ employer.
Paul Milton, president and CEO of Ellis Medicine, said the dispute traces back to the professional services agreement that governed the arrangement between the two health systems.
“Under an agreement between the two health systems, it said that if the contract was terminated, Ellis would be allowed to contact the physicians,” Mr. Milton said. “Unbeknownst to us, St. Peter’s put noncompete language in their employment agreements.”
St. Peter’s notified Ellis on June 15 that it was terminating the agreement effective Dec. 14. According to the lawsuit, new employment contracts issued to the physicians effective Jan. 1, 2026, include one-year noncompete provisions that Ellis argues violate the original arrangement between the two systems. Ellis is seeking damages, injunctive relief and a declaration that the noncompete provisions are unenforceable.
The hospital estimates about $75 million in annual cardiology revenue is tied to the physicians in question. Ellis reported $50 million in cash reserves and $70 million in debt as of June.
St. Peter’s Health Partners has denied wrongdoing. Steven Hanks, MD, president and CEO of St. Peter’s Health Partners, said in a statement that the system “emphatically denies the allegations in the lawsuit and will vigorously defend itself in court.”
“We remain deeply committed to the Schenectady community and to investing in its future,” Dr. Hanks said.
For patients, the dispute is less about corporate contracts than about continuity of care. Eugene Nachamkin told News 10 that he has gone to Cardiology Associates of Schenectady for about 25 years and does not want to switch doctors.
“He can tell just by looking at me if there’s an issue,” Mr. Nachamkin said of his longtime cardiologist.
Carol Phillips, a patient of the practice for about 12 years, has COPD, heart failure and coronary artery disease. She lives about 20 minutes from Ellis Hospital; a trip to St. Peter’s Hospital in Albany would take about double that, she said in the report.
“That’s wasting valuable time,” Ms. Phillips said of a potential transfer for cardiology care she currently gets close to home.
The professional services agreement between Ellis and St. Peter’s is set to terminate Dec. 14, according to the lawsuit.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.
