Missouri Attorney General Jay Nixon asked a state court to dissolve Health Midwest, Kansas City, Mo., and fire the 21 members of the not-for-profit's board of directors. Nixon and Kansas Attorney General Carla Stovall have been reviewing Health Midwest's agreement to sell its assets to for-profit HCA, Nashville, for $1.1 billion. "Health Midwest existed for the purpose of running hospitals in the Kansas City area," Nixon said in his 27-page motion. "The board of directors has made a decision to abandon the very thing for which the corporation exists, so Health Midwest must be dissolved and its directors replaced." Nixon accused Health Midwest directors of breaching their fiduciary duties and of "gross abuse of authority or discretion with respect to the corporation." A Health Midwest spokeswoman said attorneys for the system are reviewing the lawsuit.
Late last month, 13-hospital Health Midwest, which operates in both Missouri and Kansas, petitioned a court to define its responsibilities to the attorneys general. "We're hoping to bring clarity to this," spokeswoman Laurie Roberts said. "We need a court to step in and say who has jurisdiction and who we should be listening to." Roberts said the system has received conflicting guidance from the attorneys general. Responding to Health Midwest's petition, Nixon and Stovall said laws of their respective states give them the authority to review the sale of not-for-profit assets to for-profit companies. Health Midwest and HCA have said they hope to close their deal by Dec. 31. -- by Mark Taylor