A hospital merger-dissolution trial began in Cincinnati today much like a divorce hearing, with the airing of dirty laundry and petty jealousies, and with a lifetime of assets on the table. At stake is whether three hospital members of the six-hospital Health Alliance of Greater Cincinnati can withdraw from the 12-year-old joint-operating agreement that formed the system.
Legal teams from Health Alliance, Christ Hospital in Cincinnati and two-hospital St. Luke Hospitals based in Fort Thomas, Ky., delivered opening arguments in the civil trial for 2½ hours.
Health Alliance lead attorney Earle Maiman reiterated the system's contention that Christ Hospital and St. Luke's had no legally permissible reasons under the JOA or Ohio law to withdraw. Maiman said the boards of the rebel hospitals breached their fiduciary duties by acting so quickly in terminating their participation. "The counterclaimants' (Christ Hospital and St. Luke's) game plan escalated from not just withdrawing from the Health Alliance to destroying the Health Alliance," Maiman said.
Christ Hospital attorney Mark Ruehlmann said Christ Hospitals board acted carefully and followed its fiduciary duties when it terminated its participation in the JOA. Ruehlmann said the board believed the alliance was underfunding the hospital, and planned to eventually close or sell the urban Christ Hospital and build a replacement hospital in the suburbs. He said Christ Hospitals board acted to preserve its charitable mission. The trial is expected to last well into March. (For more on hospital trends, see the cover story from the Feb. 19 edition of Modern Healthcare magazine. Registration required.) -- by Mark Taylor