Court proceedings are underway in the first lawsuit involving Oregon’s new healthcare consolidation law. The case is related to a staffing contract switch involving Vancouver, Wash.-based PeaceHealth, Eugene (Ore.) Emergency Physicians and Atlanta-based ApolloMD, Lookout Eugene-Springfield reported April 27.
Eugene Emergency Physicians, an emergency medicine group with about 41 providers in Lane County, is suing to block PeaceHealth from partnering with ApolloMd, a national physician staffing company. The lawsuit, filed March 20 in an Oregon state circuit court, claims the partnership violates the state’s corporate practice of medicine laws, including restrictions on management services organizations.
PeaceHealth said in February it would not renew its 35-year contract with Eugene Emergency Physicians, instead opting to partner with ApolloMD to staff emergency departments at PeaceHealth Cottage Grove (Ore.) Community Medical Center, PeaceHealth Peace Harbor Medical Center and PeaceHealth Sacred Heart Medical Center at RiverBend.
According to the complaint, the arrangement involves a newly formed Oregon entity, Lane Emergency Physicians, which would hold the staffing contract while ApolloMD provides administrative support. The plaintiffs allege ApolloMD would retain significant control over staffing, hiring and other operations.
Here are updates from the case’s first day of court proceedings, according to Lookout:
1. Nearly 50 people sat in the courtroom gallery, including members of the Oregon Nurses Association, for the first of at least two anticipated days of oral arguments and evidentiary hearings scheduled for this week. A judge told attorneys more time may be scheduled if needed.
2. Eight witnesses were called to testify by the plaintiffs, including physicians, a nurse and a parent. They spoke of “significant risks” that came with a rapid transfer of care, according to the report, but it remains unclear whether those concerns fall under what the judge may consider under the corporate practice of medicine law.
“There are many lenses, which in this case, this relationship can and appropriately looked at, look through,” Judge Mustafa Kasubhai said. “There’s some community concern, interest. There’s the concern of business entities to be able to really engage in relationships with one another. All of that is certainly bearing and intense and weighty within our community.”
3. The plaintiffs attorney highlighted that PeaceHealth still does not have a final contract with ApolloMD that “clarifies rates, terms or commitments” from new physicians, including whether they are permanent or locums.
4. In response, PeaceHealth’s attorneys argued that a lack of contract in and of itself does not constitute evidence as a violation of the consolidation law.
ApolloMD declined to provide comments related to ongoing litigation. PeaceHealth
In a statement shared with Becker’s a spokesperson from PeaceHealth said the claims in this case lack merit.
“As outlined in filings with the court, PeaceHealth conducted a structured and objective [request for proposal] process to evaluate a number of emergency department physician services partners, given the pending conclusion of the existing contract,” reads the statement. “Our focus was on identifying the partner best positioned to uphold safe patient care, recruit and retain quality staff, provide quality improvement programs and transition readiness. The incumbent provider participated in that process, along with other organizations. At the conclusion of this process, PeaceHealth selected a new partner to deliver safe, reliable, continuous emergency care.”
The system also noted that it is actively planning for the transition in a way that will ensure no disruptions to patient care.
In an email shared with Becker’s, a spokesperson for EEP said that the “court process has made even more clear the violations of Oregon law and the degradation to patient care that [PeaceHealth]and Apollo are ushering in.”
“EEP will continue doing everything it can to prevent this,” the statement continued. “It trusts the court’s judgment and appreciates the community’s support.”
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