Two Texas home healthcare agencies have filed a class-action lawsuit accusing Columbia/HCA Healthcare Corp. of trying to monopolize home-care services in two markets.
The suit, filed in U.S. District Court in El Paso, Texas, accuses the nation's largest for-profit healthcare provider of channeling patients from its hospitals to its affiliated home healthcare agencies. Such actions amount to restraint of trade, the plaintiffs contend. The amount of damages being sought is not specified in the lawsuit.
Plaintiffs are Columbia Health Services of El Paso-which has no connection with Nashville, Tenn.-based Columbia-and Shepard's Cross Nursing Agency, Pampa, Texas. Columbia Health competes with four Columbia hospitals that have a 33% market share in El Paso. Shepard's competes with Columbia Coronado Hospital, the only hospital in Pampa, which is owned by Columbia.
Columbia officials declined to comment on the pending legal action.
However, such actions could become more widespread as the investor-owned chain widens its healthcare network. Although Columbia is most often described as a hospital company, its home-care operations have grown to make it the nation's third largest in revenue volume.
The Columbia Homecare Group, which is based in Dallas, has revenues of $861 million and delivers 12.3 million home healthcare visits annually. That would rank it behind Olsten Kimberly QualityCare, Melville, N.Y., and Costa Mesa, Calif.-based Apria Healthcare Group in revenues.
In addition to Columbia, the home-care agencies have named two El Paso physicians as defendants.
The plaintiffs accuse Columbia of directing its discharge planners to refer patients to agencies that are affiliated with the hospital system. It also accuses the hospital chain of pressuring physicians to direct patients to its affiliated home-care agencies and of paying for patient referrals.
The lawsuit illustrates the problems of hospital-based health systems in consolidating markets, experts say. "If a court rules to inhibit a hospital's ability to redirect its clinical and technological assets beyond its four walls to compete in a managed-care world, many hospitals will be forced to close their doors altogether," said Kevin O'Donnell, a home-care consultant based in Lewisville, Texas.