Judge clears path to trial against HCA
Mission Hospital is seen from downtown in Asheville on Aug. 15, 2024.
Most claims in North Carolina Attorney General Jeff Jackson's lawsuit against HCA Healthcare, alleging it violated its 2019 asset purchase agreement of Mission Health, can proceed to a trial, according to a July 27 North Carolina business court filing.
In a 55-page ruling, North Carolina Superior Court Judge Julianna Theall Earp found that most of the claims, including allegations that deteriorating emergency and trauma services violated its 2019 asset purchase agreement, can proceed and largely rejected HCA's efforts to end the lawsuit through summary judgment before trial. It puts the lawsuit, ongoing now for more than two and a half years, closer to trial, though no date has been set.
The lawsuit stems from alleged violations of the 2019 asset purchase agreement governing HCA's acquisition of Mission Health. In the agreement, the company made a set of promises — including that it would not discontinue specific services, including those in the emergency department and oncology services — until 2029.
In the years following HCA's purchase of the Mission Health system, an outpouring of frustration from nurses, community members and local leaders culminated when then-Attorney General and current Gov. Josh Stein decided to pursue legal action in late 2023. Since the lawsuit was filed, Mission Hospital has fallen into immediate jeopardy, one of the worst federal citations the Centers for Medicare and Medicaid Services can hand down, three times.
Earp suggested how the language of the asset purchase agreement will guide the rest of the lawsuit, where the attorney general and HCA's interpretations of the phrases "shall not discontinue" and "generally consistent" will likely clash. Given conflicting evidence, Earp concluded that summary judgment on the case's central issues, sought by both parties, was inappropriate.
The ruling comes just days after the independent monitor over the 2019 asset purchase agreement of the Mission Health system announced it had found HCA to be in "potential non-compliance" with the agreement in 2025. It was the third year in a row that the Boston-based Affiliated Monitors Inc. had indicated it believed HCA may have broken the agreement. AMI has continually pointed to the ongoing lawsuit as likely dictating its terms of enforcement within the context of the purchase agreement.
Earp noted that Jackson's claim regarding emergency and trauma services will likely hinge around defining and assessing the limits of language included in the asset purchase agreement.
Determining intent and meaning of the asset purchase agreement will be key in the case, Earp's ruling suggested.
"In sum, given its patient-tonurse staffing ratios, it appears that by 2023 Mission Hospital had difficulty always providing emergency and trauma services that were consistent with the Level II Trauma Program," Earp wrote. "However, the language of the APA does not require that such services always be provided. Instead, the contract requires that Mission Health provide emergency and trauma services generally consistent with the Level II Trauma Program, and what the contracting parties meant by 'generally consistent' is not clear."
The only allegation made by Jackson and dismissed by Earp was that HCA had breached the agreement by not offering surgical ear, nose and throat services "24 hours per day every day of the year." Earp found that Jackson had not identified sufficient evidence to support the claim.
In a statement to The Citizen Times, Mission Health spokesperson Nancy Lindell said the company is "confident in our compliance with the terms of the APA," but did not address the ruling.
"As always, our foremost focus is providing high-quality care to the Western North Carolina communities we are proud to serve, and we remain committed to meeting the healthcare needs of our region," Lindell said.
In a July 28 news release, Jackson described HCA as throwing "every argument against the wall to get this case thrown out, but they didn't stick."
"I'm grateful the judge saw through them. We're going to trial, and I will keep fighting to defend emergency and cancer care in western North Carolina," Jackson said.
In a statement provided to The Citizen Times on July 29, Stein also celebrated the ruling.
"When HCA failed to live up to its promises, I took it to court. Access to quality health care can be the difference between life and death. I'm pleased that the Department of Justice now has the chance to hold this for-profit hospital accountable," Stein said.
USA TODAY Network via Reuters Connect
