Sisters of Charity Accuse Palmetto Health of Stealing Ortho Services

Palmetto Health is being sued by the Sisters of Charity Providence Hospitals Legacy Corp. for $50 million.

The Sisters of Charity claim Palmetto is responsible for the demise of the orthopedic practice at Providence Hospitals in Columbia, South Carolina. The Sisters of Charity owned Providence at the time of the alleged actions.

The Cleveland-based Sisters of Charity were trying to sell Columbia-based Providence and had detailed discussions with Palmetto. During those discussions, claims the lawsuit, Palmetto realized that the orthopedic services offered at Moore Center for Orthopedics at Providence were the hospital’s most profitable service line. After learning this, the Sisters of Charity claim, Palmetto tried to secretly steal Providence’s orthopedic business.

In April 2015, the Moore Center and its 21 surgeons announced plans to join Palmetto. This action, claims the lawsuit, damaged negotiations with Brentwood, Tennessee-based LifePoint Health, which purchased Providence in February 2016.

Commenting on the lawsuit, Palmetto said, “We were extremely disappointed when we learned that the Sisters of Charity, who chose to stop providing healthcare services to the people in our community and sold Providence Hospitals to an out-of-state corporation, have decided to waste valuable resources on a meritless and unfounded legal matter.”

In addition to seeking $50 million in damages, the Sisters of Charity are seeking punitive and other damages that could cost Palmetto Health hundreds of millions in all were it to lose the lawsuit.

They claim in the lawsuit that several of Providence Hospital’s own top officials illegally conspired with surgeons at the Moore Clinic and Palmetto Health officials in 2014 and 2015 in enticing Moore Clinic staff to quit Providence and join Palmetto Health. Palmetto Health gained access to confidential Providence insider financial information and improperly used that information to get the Moore Clinic to leave.

The lawsuit also said that the acquisition of the Moore Clinic by Palmetto Health has resulted in near monopolistic power that hurts Midlands’ consumers and limits their choices.

Palmetto Health, which was created years ago by the merger of Baptist Hospital and Richland Memorial, is the largest and most comprehensive hospital system in the Midlands. It has more than $1 billion in annual revenues.

The lawsuit was made public on August 18, 2016 on a federal court records data base. The Sisters of Charity seek a jury trial; U.S. Judge Terry Wooten is hearing the case.