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Lawsuit filed to halt hospital acquisition

Suit claims authority members violated their status as public trustees by being rubber stamps for Phoebe

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.

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.

Comments

KaosinAlbany 2 years, 5 months ago

Man, this merger story just keep getting better and better. Good luck, Bo Dorough!

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Cartman 2 years, 5 months ago

Godspeed Bo! I guess now we will see the Phoebe PR Department increase its damage control efforts to drown out the truth. Expect a resumption of the weekly pro-Phoebe propoganda "news releases" in the newspaper and some more Phoebe campaign mail-outs in your mailbox. We saw what extremes they would visit to attempt to silence critics such as Bagnato and Rehberg. A truly independent Hospital Authority would have asked questions during that past management debacle. A truly "public" Hospital Authority would have had public hearings and solicited public input before making the largest decision of its existence. This was done under the table by Wernick, who then "briefed" the authority just prior to the news being released. The Hospital Authority might well use cardboard cutouts for its members. Independent public hospital authority. lol.

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Moe 2 years, 5 months ago

I wish Bo Dorough was back on the city commission instead of the filthy, Ken Hodges-supporting, Roger Marietta.

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VSU 2 years, 5 months ago

It's obvious that the majority of the voters doesn't agree with you.

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Moe 2 years, 5 months ago

VSU, the majority of the voters decided Phoebe-puppet Ken Hodges wasn't fit for state office. His supporter, Marietta, simply didnt have a strong opponent.

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supersquawker 2 years, 5 months ago

Phoebe, please quit filling my mail box with oversized slick glossy propoganda telling me how great you are.

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Margie 2 years, 5 months ago

All of this explains why Phoebe always were ready to make certain Palmyra never got a Certificate of Need for OB and other services that would have been competition for PPMH. Palmyra should have remembered all of the agony. Plus the doctors that don't practice at PPMH would be at a disadvantage. Palmyra should have considered selling to another hospital outside of PPMH. Almost in every corner in SW GA, PPMH has purchased. I think the most recent Tifton. I guess Archibold in Thomasville will be next. Lord help us. Medical insurance and care is high enough. No choice, will mean higher cost as with everything else. Praying for you and Dr. I am glad to hear that someone is at least speaking for the People.

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chinaberry25 2 years, 5 months ago

Go before a jury? OJ could be found innocent in Albany. The whole town is just a rubber stamp for Phoebe. Next to DCSS Phoebe is their Mecca. Without it where would they go for their free pills?

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sue 2 years, 5 months ago

Phoebe is the reason we have such huge health care and insurance expenses in swga - resulting in companies leaving. monopolies are bad for any place and phoebe is bad for swga. a non-profit that harrasses every person coming through the door and charges $70,000 for a two night stay in the hosp because you have insurance.

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43cop 2 years, 5 months ago

Bo, Give it all you have got to win this one. Some of us supported you when you were on the City Commission and when you ran for Mayor, so work every legal aspect in your libary. Phoebe needs to be stopped before it is to late, just as we saw in Augusta when the Fed's came in and had to take over a bankrupted city. Here, it will be taking over the city and the county. THANKS BO.

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ameek86 2 years, 5 months ago

Typical, they should just bulldoze this city to the ground, throw all the officials in jail and start over. This is a blatant disregard for the people of this community, and their laws, as per usual. I thought South Florida's politics were dirty, but they are squeaky clean compared to the greedy, spineless trash that is running this area.

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justme 2 years, 5 months ago

Is there anyone in southwest Georgia beside myself that thinks it is about time for WERNICK to be replaced ?

Wernick reminds me of Lee county's DUFFY, someone whose vision has become blurred by their own agenda.

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Trustbuster 2 years, 5 months ago

I am glad this lawsuit has been filed by a local attorney. I was beginning to think that no local lawyer would take on the corporate monarchy of Phoebe. Hopefully this suit will show how ruthless and aggressive Phoebe has been towards competitors. The hospital authority surrendered itself over to the undue influences of the Phoebe board. What happened to local control? Evidently it was lost 20 years ago.

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whattheheck 2 years, 5 months ago

Thanks for the filing--the more the merrier.

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Justice4Moma 2 years, 5 months ago

Go BO.a lawyer that is for the Good and People of Albany.Not the Good ole Boy System.About time.Some of the other lawyers here need to get a back bone.

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Tiger2 2 years, 5 months ago

I'm delighted there's a local attorney with the guts to take on the monolithic giant, Phoebe. So many people in this town are financially indebted to Wernick through his CEO position at PPMH. He has managed to get incredible numbers of influential people such as business leaders, entrepreneurs, and even media outlets using rich rewards, such as awarding projects, or using punishment, such as withholding business from them.

And those killer vacations he provides for the "voluntary" board members are to die for. They should have to report the value of those trips as taxable income. It would amount to thousands annually. Go get them, Bo! I hope anyone who needs a courageous attorney will consider you to take on the case. Kudos for Bo!

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QUIK 2 years, 5 months ago

Dr. Thompson realized the grave situation in this area after only a short period of time here and it's a wonder to me that most who have lived here for 40 or more years have turned a blinded eye to a monopoly taking place (I arrived in 1998). Sure the 'Bully' (Phoebe) calls the sale a part of consolidation for health reforms that are needed for Albany (Americus, Sylvester and so on). Have you seen the reforms after your hospital stay? For the average woman in this area that won't have any choice for infant delivery, there is only a sickening dead silence from them! Lastly, for those that think for a moment that this city can lure large businesses to settle here knowing there is a health care monopoly in the region, keep dreaming. I suspect this take over will go thru based on the amount of heavy money that can be persuasive. Albany, should change their nickname to the NO LIFE CITY after this sale.

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ObjectiveEyes 2 years, 5 months ago

Well, this explains why I've been getting glossy Phoebe propaganda in the mail and why there are links on just about every internet site I visit. You can always count on anti-Phoebe news coming out just after this type of announcements are made. It's like they know what's coming and try to preempt any negative (truthful) publicity.

The fact is, the ALL of the Phoebe boards are puppets. I've sat in dozens of board meetings and NEVER have I heard a prying question from one of the board members.

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ittybittyme 2 years, 5 months ago

Phoebe HAS NOT BOUGHT Tift Regional Medical Center. TRMC is a strong financial institution and does not need anything from PPMH. Do your homework before you post erroneous information about another faclity.

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ObjectiveEyes 2 years, 5 months ago

I just reviewed Phoebe's 2010 Form 990. I saw that Wernick's compensation is now up to $1,336,572 per year! Folks should be outraged. No one in an administrative capacity is worth that much in Albany GA! I also find in interesting that Phoebe donated $300,000 to Darton College, $24,000 to the GA Alliance of Community Hospitals, $6,000 to The Albany Symphony Association and $400,000 to Albany Tech! Again, folks, this is OUR hospital, OUR money. If they have this much money to give away and $195 MILLION to purchase Palymra, it looks like they could lower their prices. Wishful thinking, huh?

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