Community Medical Centers is suing a physicians’ medical group over a contract-related work stoppage last year that jeopardized patient safety as well as Community Regional Medical Center’s Level 1 Trauma Center designation.
The lawsuit, filed Thursday in Fresno County Superior Court, seeks unspecific compensatory and punitive damages from the Community Regional Medical Staff Medical Group and Scott Wells for breach of contract and of good faith.
The suit’s filing comes a year after the medical group, which includes the Central California Faculty Medical Group, gave less than two days’ notice before it stopped providing physicians to the hospital. Community Regional Medical Staff Medical Group’s contract with Community Medical Centers expired on Aug. 31, 2020, and the physician walkout took effect at 5 p.m. on Sept. 2.
Community Medical Centers was forced to scramble to find neurosurgeons, and some patients had to be transferred for treatment at other hospitals. Community Medical Center came within one day of losing its status as a Level 1 Trauma Center, where the most seriously ill or injured patients are treated, because of the shortage of emergency room physicians, the lawsuit alleged.
The neurosurgeon walkout ended Sept. 15.
Goal Was Contract Leverage
The lawsuit accuses the Community Regional Medical Staff Medical Group and Scott Wells, chief executive officer of Sante Health Systems, of attempting to keep the medical center from providing lifesaving trauma care in an effort to obtain leverage over Community Medical Centers in contract negotiations.
Making physicians unavailable during the pandemic and while wildfires raged nearby was particularly egregious, the lawsuit said: “Plainly, defendants’ conduct was nothing short of despicable.”
The medical group had provided 28 physicians in 12 specialties, and included six UCSF faculty members who provided the 24-hour neurosurgical trauma coverage required for the Level 1 trauma designation.
The medical group and Wells could not be immediately reached for comment Monday.
According to the lawsuit, Wells did not have a position with the medical group but engaged in communications with Community Medical Centers on behalf of the medical group.
In a news release Monday, Community’s chief operating officer Craig Wagoner said the hospital system “has been working overtime for the Valley” during the COVID-19 crisis.
“We don’t have resources to waste, nor do we need the distraction that this unnecessary action created,” he said about the lawsuit sparked by the physician walkout.
Region’s Sole Level 1 Trauma Center
CRMC is the only Level 1 Trauma Center between Los Angeles and Sacramento and provides services to residents across 15,000 square miles in Central California.
Community Regional Medical Staff Medical Group has provided on-call trauma physicians to CRMC since the first contract was signed in 2005.
The lawsuit alleges that there was a conspiracy to deprive CRMC from the services of on-call neurosurgeons sometime before Joyce Fields-Keene, CEO of the Central California Faculty Medical Group, notified Wagoner on Sept. 1 that the neurosurgeons would cease providing call coverage the following day, giving the hospital less than 32 hours’ notice.
That same day, the Central California Faculty Medical Group issued a news release in which Fields-Keene was quoted as saying that a long-term funding agreement was necessary to provide patients specialized care such as neurosurgery and to provide physicians with “greater protections and certainty,” the lawsuit says.
The public relations firm that prepared the news release about the medical group’s walkout was likely hired well in advance of Sept. 1, the suit contends.
The lawsuit alleges some “suggestion” that Fields-Keene provided 30 days’ notice of the work stoppage through her fiance, Wells. When Wagoner spoke with Wells about the matter, his response was “I used to tell you those things when we were friends.”
Neither Fields-Keene nor the Central California Faculty Medical Group is named in the lawsuit as defendants.
The lawsuit also alleges that even as Community Medical Centers was scrambling to find and accredit neurosurgeons to provide on-call coverage, the defendants “directly or indirectly through their agents” repeatedly urged the agency that oversees trauma units in California to terminate CMC’s authority to operate the trauma center.
The lawsuit alleges that Community Medical Center was subjected to “considerable” damage and expense, including the costs of hiring substitute neurosurgeons, paying for the costs of stabilizing and transferring patients, and hiring a public relations firm to address the damage to CMC’s reputation, costs that are “well in excess of the jurisdictional minimum of this Court.”
Mary-Lisa Russell, a spokeswoman for Community Medical Centers, said Monday she was checking on the status of the Community Regional Medical Staff Medical Group contract negotiations.
Michelle Von Tersch, senior vice president for Community Medical Centers communications and legislative affairs, said Monday afternoon that the contract, which was revised in 2006, is still in place.
Responses from Sante
Late Monday, Sante Health Systems emailed a statement and a separate news release to GV Wire about the lawsuit.
The statement reads as follows:
“For the past 25 years, Santé and our physicians have worked tirelessly to advance health and wellbeing in the Central Valley. We value the nearly half a million local patients we serve and seek to ensure those in need have access to care.
“The allegations in Community Health System’s (CMC) lawsuit are not only without legal merit, but also run counter to our demonstrated, long-time commitment to this community. Santé is not a party to the contract in question, nor did we play any role in the temporary loss of neurosurgical trauma coverage at Community Regional Medical Center.
“While we are disappointed to see this baseless and unnecessary attack against Santé and our physicians, we are confident that we will prevail.”
The news release attached to the statement notes that Sante Health Systems provides services to Community Regional Medical Staff Medical Group and employs Scott Wells, and then said the following:
“The complaint alleges that CRMSMG breached its obligation to provide on call neurosurgery services to Community Regional Medical Center (CRMC) over a year ago. In addition to its curious timing, lurid prose and inaccuracies, the complaint completely misunderstands and misstates the business relationship between CMC and CRMSMG. Simply stated, CRMSMG never did have and does not currently have any obligation to provide medical coverage to CMC other than by compensating physicians who had agreed to provide call to CMC facilities.
“The pandemic-laced scripted complaint did contain one accurate statement:
‘The Restated On-Call Agreement required CRMSMG to assist CMC in administering and managing specialty physicians who would agree to be “on-call” in order to respond to trauma cases.’
“This is the issue. CRMSMG had no obligation to recruit, retain or provide physicians of any specialty to CMC. Its only obligation was to provide a payment mechanism to pass through compensation for taking call from the hospital to the various physicians who had agreed to be on-call.
“Why have a pass-through contract such as this? Federal law requires that contracts between hospitals and physicians meet a number of formal requirements which can result in lengthy delays between the time a service is needed and the completion of the contract allowing it. To assist CMC, CRMSMG was formed as a contracting service. It contracts with CMC through the formal process, but the contracts between CRMSMG and physician providers can be accomplished much more quickly than if they contracted with the hospital. CRMSMG has no employees and no assets other than contracts.
“The neurosurgery interruption of service was related to a well-documented disagreement between CMC and its neurosurgery provider. Once the neurosurgery provider was not agreeing to be on-call at CMC facilities, CRMSMG was contractually excused from providing those services under the 2006 Agreement. CRMSMG is a pass-through provider and it had no services to pass through because the neurosurgeons had not agreed to be on call.
“CRMSMG played no role in the neurosurgery service interruption experienced by CMC in September 2020. Scott Wells played no role in either the neurosurgery service interruption or in any CRMSMG action. These facts are well known to CMC, but appear to be immaterial and irrelevant to them.”
Response from Central California Faculty Medical Group
Tuesday morning, Lauren Nickerson, spokeswoman for the Central California Faculty Medical Group, issued the following statement:
“Central California Faculty Medical Group (CCFMG) works closely with our local, longstanding partners to deliver expert medical care for Central Valley patients. We value our continued partnership with Community Health System (Community) and were pleased to reach a mutually beneficial resolution to contract negotiations approximately one year ago last fall, allowing our physicians to continue providing quality care for Valley patients.
“We are committed to working collaboratively, as demonstrated through a comprehensive agreement for services reached with Community last Wednesday, which will ensure stability for patient care in the Central Valley for the next four years. Although we are not named in the recent lawsuit filed by the hospital system, we are deeply disappointed to learn about the accusations over a year after a resolution was reached. Strong forward-looking, local partnerships are vital to the effective delivery of patient care.
“CCFMG and our local health care partners continue to operate in good faith and look forward to a swift and amicable resolution and a continued solid relationship with the hospital system.”