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IU Health fights Franciscan over family doc

August 15, 2011

In a sign of the times, Indiana University Health is fighting Franciscan St. Francis Health in court over a single primary care physician in Martinsville.

IU Health Morgan Hospital sued Dr. Dianna Boyer on Aug. 3 in Morgan Superior Court to stop her from moving her practice to a facility Franciscan is building in Martinsville, according to an Aug. 11 article in the Martinsville Reporter-Times.

On Tuesday, a judge will consider IU Health’s request for a preliminary injunction.

IU Health contends Boyer signed a non-compete agreement with Morgan Hospital back in 2002—long before its acquisition by IU Health this year. The agreement says that if she leaves Morgan Hospital, she cannot set up a competing practice within 30 miles of Martinsville for two years.

Furthermore, IU Health contends, Boyer has been asking her patients to consider transferring their records to her new location.

Boyer is supposed to end her job with IU Health on Aug. 29 and start with Franciscan on Sept. 1. Boyer declined to comment to the Reporter-Times, as did Franciscan spokesman Joe Stuteville.

Franciscan is not a party in the lawsuit. But there has been bad blood between Franciscan and IU Health for months.

Franciscan St. Francis CEO Bob Brody said in May that his hospital had made offers to hire “a number of” family physicians in Martinsville, which sparked an angry response from IU Health Morgan CEO Tom Laux.

“For a faith-based system to ‘raid’ the medical staff of our community-sponsored [hospital] also appears to violate basic principles of fairness, respect and professional ethics, with absolutely no added community benefit or tax-exempt, charitable purpose,” Laux wrote in a May 5 letter to employees obtained by the Reporter-Times. “We are exploring legal remedies that may be available to us.”

But Brody defended Franciscan’s moves, saying his hospital had worked for years with physicians practicing in Martinsville. He also noted that it’s common for physicians to work with multiple hospitals.

But that last statement is anachronistic. Every hospital system in Indianapolis is madly trying to lock up physicians—especially family doctors—because health plans now want to pay them for how well they keep a specific population of patients healthy over time.

Hospitals know family doctors and other primary care providers are critical to getting patients into their hospital systems and generating referrals to the rest of their operations.

The average primary care physician gets paid about $170,000 per year, according to the latest survey by Texas-based recruitment firm Merritt Hawkins. But a primary care doctor generates 10 times as much money for a hospital by referring patients for high-dollar surgeries and other services.

Franciscan is feeling particularly threatened right now as IU Health and Indianapolis-based Community Health Network have expanded in Franciscan’s territory in the southern suburbs of Indianapolis.

Community expanded its hospital on County Line Road near Greenwood and formed a partnership with Johnson Memorial Hospital in Franklin. IU Health acquired Morgan Hospital and still has land near Bargersville on which it could build a facility.

Franciscan has countered with the facility in Martinsville and a new $20 million emergency room and medical office complex near Greenwood. Also, Franciscan acquired a medical office building in Carmel—its first foray into the northern suburbs.

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