“The lawsuit seeks to remove the illegal barriers erected by the defendants and return the playing field to level-set,” Alex Rintoul, the Medical Center’s CEO, said Friday.
Insurers listed in the complaint represent more than 70 percent of insured people in the Dayton area, the complaint states.
The complaint claims that Premier and other defendants — Catholic Health Initiatives, MedAmerica Health Systems Corporation, Atrium Health System, Samaritan Health Partners and UVMC — colluded by “coercing, compelling or co-opting commercial health insurers or managed care providers” to cut off access to the medical center for their networks.
Anthem, UnitedHealthcare, Private Healthcare Systems, Humana, Cigna and Medical Mutual of Ohio are listed in the complaint but are not defendants in the lawsuit.
In addition to pressuring insurers, the complaint states, the defendants threatened punitive financial consequences against physicians who affiliated with the hospital and offered payments to doctors who agreed not to work with the center.
“We strongly deny the allegations that were made in the lawsuit, and we’ll be defending against that,” said Diane Ewing, vice president of marketing and communications for Premier Health Partners. She said she was speaking on behalf of all of the defendants.
Antitrust lawsuits are not uncommon, and physician-owned hospitals have taken aim at larger hospitals in other markets, said Harry Gerla, a former U.S. Securities and Exchange attorney who teaches antitrust law at the University of Dayton School of Law. But private entities who file those lawsuits lose more than 97 percent of the time, he said.
“In general plaintiffs are heavy, heavy underdogs,” Gerla said. “They’ve got a tough task. I’m not saying they can’t do it.”
Premier is a nonprofit corporation formed in 1995 that exists because of a joint operating agreement involving the other defendants:
• Catholic Health Initiatives is a Colorado-based nonprofit corporation and the sole corporate member of Samaritan Health Partners, the parent company of Good Samaritan Hospital.
• MedAmerica, an Ohio nonprofit, operates Miami Valley Hospital and some subsidiaries.
• Atrium, an Ohio nonprofit, was previously known as Middletown Regional Health System and operates the Atrium Medical Center in Middletown.
• UVMC, an Ohio nonprofit, controls and operates Upper Valley Medical Center in Troy.
Spokespeople for some of the insurers stated that those companies don’t comment on pending litigation.
“We are unaware of the lawsuit between the Medical Center at Elizabeth Place and Premier and are unaware of the allegations in that lawsuit,” said Kim Ashley, public relations director for Anthem. “I can tell you the Medical Center at Elizabeth Place is currently contracted with Anthem and has been for several years.”
In 2010, Rintoul and Dr. John Fleishman, chairman of MCEP’s board, told the Dayton Daily News that less generous contracts with Anthem and UnitedHealthcare have hurt financial performance, revenue growth and profit margins.
The Medical Center at Elizabeth Place is a for-profit company and opened in 2006 inside the former St. Elizabeth’s Hospital with four operating suites. It has 26 beds and the space to expand to at least 50, the complaint states. The effects of Premier’s actions forced the center to sell an ownership interest to Kettering Health Network, the only other hospital system in the Dayton area, in 2009, the complaint states. Kettering Health Network is not a defendant in the lawsuit.
The complaint, filed Jan. 30, states that under the joint operating agreement, the defendants are owned, controlled and operated independently, and “Premier has stated that the JOA is not a merger of assets, but a consolidation of revenue streams.”
The complaint also quotes an unnamed Premier vice president as saying that specialty hospitals should be precluded in most cases, and physician-owned speciality hospitals are “particularly damaging” because they “attract away an important segment of an existing hospital’s specialists,” resulting in revenue declines.
The medical center claims that Dayton Heart Hospital was a victim of the conspiracy, and that “Premier brazenly acknowledged that the Hospital Defendants exerted their market power to convince managed care plan providers not to do business with Dayton Heart.”
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