by James C. Sherlock
I will comment on Sentara’s response to the suit when it is available.
The complaint alleges various instances of tortious interference by Sentara with CRMC’s business and conspiracy to do the same. I recommend you read the complaint as filed. It is quite a story.
Although I am familiar with only part of the evidence in this specific case, that being Sentara’s successful intervention against CRMC’s COPN application for open heart surgery, the other allegations match decades of Sentara business practices.
The complaint alleges that Sentara:
- while contesting a CRMC COPN application for open heart surgery services, secretly contacted the surgeons who provided cardiology services at CRMC;
- got non-disclosure agreements from them;
- got confidential CRMC business information from those surgeons; and
- then hired them away from not only their existing contracts with their physicians practice to provide services at CRMC but also, two of them, from parallel contracts as medical directors at CRMC, severely damaging existing interventional cardiology services at CRMC.
If the allegations that Sentara disregarded business ethics and the law (often alleged about this defendant), it is fair to ask how much is enough.
CRMC had only 12% of the regional cardiology market and Sentara 70% before it allegedly attempted to cripple the CRMC cardiology practice.
Having just buried Norfolk’s De Paul Hospital and recently been caught trying secretly to shift support of Eastern Virginia Medical School to the state while capturing its doctors’ practices, one would think Sentara would take a breather.
But not that crowd. They define relentless. And they have every reason to expect to get away with it.
Sentara has not once been penalized for business practices that violate both the ethics expected of a tax exempt charity and the letter of state and federal antitrust laws.
The Commonwealth not only has not stopped Sentara’s assaults on competitors, but has been an active accomplice. The Virginia Department of Health (VDH) for decades has wielded COPN as both a shield and a sword for Sentara, awarding and expanding its monopoly and blocking both competitors and federal antitrust enforcement.
The allegations, if true, are clear antitrust violations. although the CRMC attorneys di not cite antitrust law in the complaint. Indeed, the word “antitrust” never appears.
Doing what is alleged in this suit while its application for taking over Cone Health in North Carolina is still pending approval by the FTC and the North Carolina Attorney General, would seem self-destructive.
But Sentara management might not see it that way.
First, sharks gotta eat. Second, Sentara has neutered the Virginia Attorney General’s office. Third, the health system expects North Carolina and the FTC to roll over and accept the Cone merger.
We’ll see how this plays out, in court, at VDH, and in the pending Cone merger.
Perhaps Sentara can get Judge Hall back to sit on the bench on this case. It is, after all, filed in Chesapeake where she handled the COPN complaint by CRMC against Sentara. We are left to wonder what she or the Court of Appeals would have done had either found out about alleged secret negotiations by Sentara with CRMC’s cardiologists.
Win or lose, Sentara will see the CRMC suit as an acceptable cost of doing business the way it wants to do it and intends to keep doing it.
As for VDH, perhaps the agency will be cranky if Sentara is proven to have been poached CRMC cardiologists while CRMC’s COPN open heart surgery application was still being contested. On second thought, that’s probably crazy talk. They are partners after all.
If the Cone merger is denied, Sentara finally will have been held accountable. But Sentara expects the merger to be approved.
And it is are likely right.