One New York health system sues another over cardiology services—lawsuit prompts new legislation
Ellis Medicine, a not-for-profit New York health system with several locations in New York’s Capital Region, has sued St. Peter’s Health Partners (SPHP), a large physician group serving that same area, over the services of 27 cardiologists. Neither side appears to be backing down.
First, a bit of background. Ellis and SPHPM spent years considering a merger before ultimately deciding against such a move. In 2021, SPHP did acquire Cardiology Associates of Schenectady (CAS), a practice of 27 cardiologists. Ellis and CAS had a prior working relationship built around providing cardiology services to patients in and around Schenectady, New York.
Ellis Medicine’s allegations
According to the new lawsuit, filed in Schenectady County Supreme Court on Aug. 12, a professional services agreement (PSA) was in place stating that CAS cardiologists would be able to keep working with Ellis after CAS was acquired by SPHP. However, Ellis alleges there was a “clear and unjustified breach” of those contracts as SPHP terminated the PSA. CAS cardiologists then signed new contracts that included non-compete clauses, meaning they could no longer provide services to Ellis patients.
“Ellis brings this action reluctantly to prevent the irreparable harm SPHP seeks to inflict on Ellis, evidently in a desire to destroy Ellis as a competitor, gain a stranglehold on the hospital services business in the Capital Region, and, as an inevitable by-product, inflict grievous harm on the medically needy of Schenectady County, many of whom are among the most vulnerable in society,” according to the official complaint.
The lawsuit also claims that this situation has caused Ellis “severe damage” and threatens to cause “irreparable harm” to the health system by potentially putting an end to its cardiology practice. With this in mind, Ellis is seeking damages for what it has already gone through and what it will go through going forward.
Both parties share statements
“Ellis is taking its position because we believe preserving strong local access to cardiology care is important to the patients and communities we serve,” according to an official statement from Ellis. For decades, the physicians of CAS have cared for patients at Ellis Medicine and have played a significant role in building a leading cardiovascular program. Tens of thousands of patients rely on these services every year.”
The system added that this is “about more than a contractual disagreement.”
“It is about protecting access to healthcare services that are vital to this community,” according to the statement. “For many patients, receiving cardiology care close to home matters. Continuity of care matters. Maintaining a strong cardiovascular program for Schenectady County matters.”
Steven Hanks, MD, president and CEO of SPHP, has shared his own statement with the media about the ongoing situation.
“I believe we'll work through this,” he said. “And it is not our intent to disrupt care in any way or to harm Ellis Hospital.”
Lawsuit prompts new legislation
Angelo Santabarbara, a member of the New York State Assembly, announced new legislation intended to protect hospitals in Ellis Medicine’s current position. The Essential Health Care Access Protection Act, if passed, would help govern contracts between healthcare professionals in a way that protects essential healthcare services.
“Whatever disagreement exists between these health systems, our patients and our community cannot become collateral damage,” Santabarbara said in a statement. “No employment agreement should be allowed to put essential hospital services at risk.”
Santabarbara emphasized that he is not taking a side in this specific disagreement. Instead, he said the proposed legislation is about “drawing a line” when patient care is at risk due to contract disputes.
Michael has more than 19 years of experience as a professional writer and editor. He has written at length about cardiology, radiology, artificial intelligence and other key healthcare topics.