Doctors' Bruising Lawsuit against Hospitals Advances

Friday, October 26, 2007
by Roberts Staff Writer

According to the suit, the hospital defendants also engaged in frequent communications with one another and their managed-care partners to ensure that Heartland was shut out of all networks.

For instance, in 2004, after Cigna declined to include Heartland in Cigna's provider network, an HCA Midwest official wrote the following:

"Thanks for confirming what I thought was the case re (Heartland). I think they're desperate, hoping that they can convince an MCO that they're being added to everybody else's networks so that MCO will feel the pressure to also add. All he probably thinks he needs is one deer-in-the-headlights MCO to cave, and then the rest will fall like dominos."

United Healthcare Inc. became the first domino on March 1, allowing Heartland to become an in-network provider for about 350,000 members.

Before that, according to testimony from Laura Kozisek, United's former director of network management, there had been "kind of the understanding, unwritten but understood" among MCOs that none of them would extend contracts to physician-owned hospitals.

One of Heartland's founding physicians, Dr. Stanley Hoehn, testified that Shawnee Mission Medical Center's COO told him the medical center "was going to find a way to either put Heartland out of business or hurt Heartland's contracting so bad that Heartland would be crippled and unsuccessful."

David Ettinger, a lawyer with Honigman Miller Schwarts and Cohn LLP of Detroit who represents Shawnee Mission, said "that's not only untrue, it doesn't make any sense in light of Shawnee Mission's behavior."

Since Heartland opened in 2003, he said, Shawnee Mission has not entered into any contracts restricting managed-care payers' ability to contract with physician-owned hospitals.

In addition, two Heartland owners practice at the medical center, he said, "and Shawnee Mission not only doesn't retaliate against them, it promotes them heavily."


An April 1 federal jury trial date has been set in an antitrust lawsuit alleging that area hospitals and insurers conspired to drive Heartland Spine & Specialty Hospital out of the market.

The physicians who own the Overland Park specialty hospital allege that several acute-care hospital competitors pressured insurers to deny managed-care contracts to Heartland.

The trial date was set in an Oct. 1 order, which was sealed until Oct. 17 and also ruled against defendants' motions for summary judgment.

Hospital defendants include HCA Midwest Health System, Saint Luke's Health System, Shawnee Mission Medical Center and Carondelet Health. North Kansas City Hospital has settled, as have insurers Blue Cross and Blue Shield of Kansas City, United Healthcare Inc., Humana Health Plan Inc. and Cigna Healthcare of Ohio Inc. Insurers who remain are Coventry Health Care of Kansas Inc. and Aetna Inc.


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