Opinion: Whistleblower lawsuit comes at bad time for Erlanger in its effort to secure private, nonprofit status

Staff Photo By Matt Hamilton / The Baroness campus of Erlanger Health System is pictured on Dec. 15, 2020.
Staff Photo By Matt Hamilton / The Baroness campus of Erlanger Health System is pictured on Dec. 15, 2020.

For a hospital that basically said "Trust us" on beginning the move from a public, governmental entity to a private, nonprofit organization in 2022, a federal whistleblower lawsuit alleging illegal billing practices and allowing doctors-in-training to operate on patients without physician supervision is not a good look for Erlanger Health System.

The whistleblowers, who filed their complaint in April 2021 in U.S. District Court under the federal False Claims Act and Tennessee Medicaid False Claims Act, are three former Erlanger doctors who say the concerns they raised cost them their jobs.

They allege their ouster was part of a "malicious and unlawful campaign of retaliation" by former Erlanger CEO Dr. Will Jackson, whose leadership at the hospital was described as chaotic in a 2020 online column. Hired as CEO in late 2019, he and Erlanger parted ways in June 2022, before his contract expired and with no reason given for his exit.

False Claims Act suits must be filed under seal to give the government an opportunity to investigate the allegations and decide whether to take the case forward, which happens in about 20% of cases. If the government declines to intervene, which an Erlanger spokeswoman said the state of Tennessee did, the whistleblowers have the option to proceed themselves, which is what they are doing.

The spokeswoman said Erlanger "disputes the merit of the allegation" and said "no instances of patient harm relating to these allegations have been identified."

An attorney for the plaintiffs, Dr. Stephen Adams, Dr. Julie Adams and her husband, Dr. Scott Steinmann, said the three "look forward to a full airing of their concerns in court" and hope that "whatever comes out of the litigation will ultimately lead to better medical care for the vulnerable and the voiceless."

Although the whistleblower lawsuit was filed before Erlanger announced plans to seek a private, nonprofit status, we question if under its new governance structure the public would be kept from knowing about internal problems within the hospital, and if the hospital will be more likely to make business-centered rather than patient-centered decisions. And, once again, we are left wondering about the hospital trustees' oversight of operations.

We were troubled a year ago when Erlanger officials said they would give the public opportunities to discuss their move to private, nonproft status -- which is not yet finalized -- but never did. And now these allegations -- though yet to be proven -- make us wonder how fraught is the hospital's ship of state.

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