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Health care: Hospitals say settlement reached on suit over doctor contracts

By Charles Swenson
Coastal Observer

Doctors who work at the county’s two hospitals as employees of a Georgia company will be able to go to work for Tidelands Health once their third-party contracts expire, the hospital system announced this week. Georgetown Hospital System, the forerunner of Tidelands Health, filed suit in U.S. District Court last month to void contracts that prohibit the hospitals from hiring doctors who work for Eagle Hospital Physicians.

The hospital system said in a statement this week it had reached an “amicable legal settlement” with Eagle and will begin talks with the doctors who work at Waccamaw Community and Georgetown Memorial hospitals.

Eagle and a subsidiary have employed the doctors, known as hospitalists, since 2006. In January, the companies asked for a $600,000 annual increase in its management fee, according to court documents. The hospital system refused, and Eagle said it would end the management agreement in July. The company also said it would enforce non-compete and buyout clauses in the contracts of 18 hospitalists, which the hospital system said would cost $2.3 million. Paying the money, the hospitals said could put their tax-exempt status at risk.

“The quality of patient care will suffer significantly if there is any disruption of hospitalist services,” Gayle Resetar, the chief operating officer of Tidelands Health, said in an affidavit. It could take as long as a year to replace the doctors working for Eagle, she said.

Two doctors who have contracts with Eagle joined in the suit, saying the non-compete clause was an unreasonable restriction on their ability to find work.

The terms of the settlement were not released. “It reinforces our health system’s right to hire Eagle hospitalists as direct employees,” the statement from the hospitals said. “This process will be seamless for our patients, and we are pleased to reach a successful resolution that prioritizes patient care.”

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