NEW YORK-New York's highest court upheld the 2002 for-profit conversion of Empire Blue Cross and Blue Shield, ending a three-year court battle over the insurer's charitable assets. The New York Court of Appeals in a 4-2 decision dismissed a lawsuit by Consumers Union challenging the conversion as unconstitutional. Empire completed its initial public offering and changed the name of its parent company to WellChoice in November 2002. Under a conversion plan approved by state lawmakers and regulators, 95% of the proceeds, or roughly $1 billion, would go to the state to supplement the salaries of healthcare workers. The remaining 5% would be used to create a healthcare foundation. Days later, Consumers Union won a restraining order barring state officials from spending any of the proceeds until a judge ruled on the legality of the conversion. The money has been held in escrow since then.
NORTH ADAMS, Mass.-The Massachusetts Nurses Association sued North Adams (Mass.) Regional Hospital alleging that the 120-bed hospital admitted too many patients for its nurse-staffing levels and staffed units without adequately trained nurses. A hospital spokesman said officials had not seen the lawsuit and could not comment on it. In a written statement, the spokesman said the hospital had increased staffing for its medical-surgical unit in the past two years and that the unit had sufficient staff "to provide safe patient care." The MNA said its lawsuit, filed in U.S. District Court in Springfield, Mass., accused the hospital of unsafe staffing conditions in violation of the nurses' labor contract in the emergency department, same-day surgery unit, radiology and medical-surgical unit. In February, an arbitrator ruled that the hospital in 2002 violated certain standards of nursing practices in the nurses' contract.