The board of trustees of 440-bed Christ Hospital in Cincinnati is learning that breaking up is hard to do.
In January, the 117-year-old hospital's board informed its parent corporation, the not-for-profit Health Alliance of Greater Cincinnati, that it intended to leave the 11-year-old system, citing contractual defaults by the alliance, as well as a history of alleged underinvestment in the hospital and fears that the alliance planned to close the facility.
But the Health Alliance struck back, filing a civil lawsuit March 1 in Hamilton County Court of Common Pleas, seeking to prevent Christ Hospital from leaving the alliance, which was formed in 1995. The 11-page lawsuit seeks a state judge's order declaring that the hospital has no legal grounds for leaving the system and seeks reimbursement for legal costs.
Ria Davidson, a spokeswoman for Christ Hospital's 15-member board of trustees, said the original joint operating agreement defined the events that could trigger default, one of which could include a failure by the system to appropriately fund medical education through the University of Cincinnati. She said the alliance's lawsuit also constitutes a condition of default. Davidson said the hospital has no plans for mergers or other system affiliations.
She also said that in 2005, Christ Hospital accounted for 42% of Health Alliance's operating income but received only about 20% of the alliance's capital allocations, or $18 million. In 2006, the hospital again projects that it will account for more than 40% of the alliance's operating profit, but is slated to receive only 12%, or about $11 million back from the capital budget, Davidson said.
Christ Hospital lost $5.8 million on operations in the fiscal year ended June 30, 2004, according to the American Hospital Directory. But it turned a $33.1 million overall profit on net patient revenue of $344.9 million that year.
In a statement, the alliance said: "Since Jan. 12, when Christ Hospital's board originally stated its intention to withdraw, the Health Alliance has continually sought dialogue to identify and discuss the underlying issues and concerns.
"Since the Christ Hospital board has refused to do so, the Health Alliance has no choice but to seek a speedy resolution in the court system," the alliance said.
