Dr. Corleen Thompson has filed suit against the Hospital Authority of Albany-Dougherty County, Phoebe Putney Memorial Hospital and Palmyra Medical Center in an effort to stop the proposed acquisition of PMC by Phoebe.
ALBANY — Local attorney Bo Dorough has filed suit on behalf of a local epidemiologist against the Hospital Authority of Albany-Dougherty County, Phoebe Putney Memorial Hospital, Phoebe Putney Health System and Palmyra Medical Center, contending, among other things, that authority members violated their responsibilities as public trustees by failing to question Phoebe’s attempted merger with Palmyra. The suit seeks a temporary restraining order against Phoebe.
Dorough filed the action Friday in Dougherty County Superior Court.
In the suit, Dorough, on behalf of Dr. Corleen Thompson, seeks to bar Phoebe from following through on its planned $195 million purchase of Palmyra until the matter can be put before a jury, after which he asks the court to permanently prevent the sale from going through.
Dorough also asks in the suit that, in the event the sale is consummated, the court set aside the pending lease agreement between the authority and Phoebe Putney Health System that would govern the use and operation of the new “Phoebe North”; that the court declare the authority’s current lease with Phoebe to be invalid, and that the court enter a judgment that Authority Chairman Ralph Rosenberg and Vice Chairman Dr. Charles Lingle have breached their fiduciary agreements and assess against them compensatory and punitive damages.
In response to a request for comment by The Albany Herald Friday, Jackie Ryan, Phoebe’s vice president for marketing, said that the lawsuit is baseless.
“Corleen Thompson’s lawsuit is absurd, baseless, frivolous and brought in bad faith. We are confident the matter will be summarily dismissed by the court. The consolidation with Palmyra Medical Center is a logical transaction between a willing seller and buyer and prepares this region for new health care reform regulations and laws that demand higher degrees of collaboration and consolidation among medical providers. The Hospital Authority has exercised prudent stewardship of the community’s medical resources, and there is simply no basis in law or fact for the litigation,” Ryan said.
In an exclusive interview Friday with The Herald, Thompson said that she has witnessed Phoebe’s corporate takeover of local health care both as an outsider and a contracted employee and believes that she and the other tax-paying residents of Dougherty County would suffer greatly if the hospitals were allowed to merge.
“It grieves me that I live in an area where health care expenses can bankrupt so many people,” Thompson said. “(The planned merger) will be a disaster. ... It will be a catastrophe for this community because there would be zero competition. Phoebe would be able to set all of the rules for insurance coverage and would dominate those negotiations as well.”
Thompson, who first came to Albany after the Flood of ’94 and was involved in flood recovery for both Phoebe and Palmyra, did studies for the Centers for Disease Control and Prevention examining the relationship between poverty and health care.
Thompson then went to work for the Southwest Georgia Community Health Institute and stayed there until the agency’s board agreed to sell the company to Phoebe. Thompson said that, after observing how callously hospital personnel treated certain types of individuals in the name of becoming the dominant health care provider in Dougherty County, she decided she didn’t want to work for Phoebe and resigned her position just prior to Phoebe taking over the company.
She left there and joined the staff at the Morehouse School of Medicine and again worked to examine the degree of care people in poverty-prevalent areas had access to before moving back to Albany, where she worked as a contract consultant with companies in the area, including Phoebe.
Thompson said part of that work included generating report cards for 14 Southwest Georgia counties that ranked the general health of the populous.
Thompson and Dorough believe that, over the course of the past 20 years, Phoebe has directly and indirectly influenced the work of the hospital authority by consorting with the Dougherty County Commission on who is appointed to the board and controlling what information makes it to their desks for approval.
“The people on the authority should be, and are required to be under the Georgia Constitution, trustees of the people and watchdogs for the community,” Dorough said. “Our investigation confirms that certain county commissioners have, over the years, consulted with hospital officials about possible appointees to the authority and have declined to appoint those the hospital administration doesn’t want on the board.”
Dorough said that influencing of board members has led to an entity the Federal Trade Commission called a “strawman” for the hospital, a rubber-stamp for policies and procedures that include the approval of the purchase of Palmyra, and has led to what the FTC contends are health care costs that are 45 percent higher than comparable cities outside of the metro Atlanta area.
“It comes back to economic development,” Dorough said. “There is no question that high health care costs played a role in the closure of Merk, Bobs Candies and Cooper Tire. Until health care costs are reduced, Albany and Dougherty County have very little chance of attracting any high-wage jobs.”
The suit comes as the 11th Circuit Court of Appeals weighs an appeal by the FTC for an emergency injunction against Phoebe and Palmyra’s parent company, HCA, that would keep the entities from consummating the sale.
The FTC is also awaiting results of an administrative hearing in Washington, during which the government argued its case that the merger violates anti-trust law and would significantly increase the cost of health care in Southwest Georgia if it were allowed to go through.
Phoebe officials have rebuffed the contentions of the FTC.
In the suit, Dorough contends that Phoebe and the authority conspired to shield the hospital and health system from anti-trust scrutiny so they could push the sale of Palmyra through and that Rosenberg and Lingle violated the public trust by refusing to question Phoebe on the deal or demand independent counsel or an independent study of the deal.
According to a purported letter between Rosenberg and Phoebe CEO Joel Wernick, which was included in the suit filed Friday, the one time a board member attempted to question Phoebe’s costs, he was told by Rosenberg to hush the matter up.
“We had to convince him that the authority really has no authority in running the hospital and meeting more often than quarterly really wasn’t necessary unless in a rare case of an emergency. He had read the lease and his opinion that, according to the lease, PPMH was to provide affordable health care and they were not doing so. ... I explained to him that when I was initially placed on the authority board, I basically kept my mouth shut and listened; that is how I learned (and hoped he would do the same) what the authority was all about. He stated he had no agenda, but I’m skeptical,” the letter reads.
Dorough contends that Phoebe’s current lease agreement with the authority was terminated under Georgia law when it was amended a day following the Dec. 21, 2010 board meeting in which Wernick pitched the purchase of Palmyra and that the proposed lease for the assets of Palmyra should also be voided.