Shannon and Community Hospital’s Cancerous Relationship has Oncology Center on Life Support
SAN ANGELO, TX – San Angelo’s two major health care providers are on opposite sides in court this week and at stake is the future of the jointly owned and operated Regional Cancer Treatment Center.
Shannon Medical Center in October of 2015 sued the company that bought out the company that bought out Angelo Community Hospital for control of the RCTC. That company, Triad, disputes Shannon’s rights to vote to dissolve the partnership between the two hospitals.
According to the civil suit filed in 340th District Court, in 1988 two nonprofit hospitals, Shannon and Angelo Community Hospital formed a partnership operating a radiation oncology center so that patients from both entities wouldn’t have to travel for treatment.
Shannon provided $875,000 in funding for the initial equipment and to begin operations. In 1995, Columbia Hospital Corporation purchased Angelo Community and three years later created Triad, a for-profit entity to own San Angelo Community Medical Center.
This is where the partnership gets complex.
Dr. John Bolen became a voting limited partner in Triad in 2012 and Dr. Don W. Hughes became a voting partner in 2015. Dr. Bolen passed away in 2015 and his daughters are named in Shannon’s lawsuit as co-defendants with Triad. Shannon asserts they purchased Bolen’s voting rights. Triad disputes that.
The second amended petition from Shannon to the court shows that Shannon has 75 percent of voted units of ownership to Triad’s 25 percent.
The heart of the suit is that Shannon, the day-to-day operator of the partnership, “…may be forced to disclose its proprietary information and contacts to Triad, Shannon’s primary competitor.
Shannon and Triad recently competed directly for a contract with the City of San Angelo and Angelo State University to provide health care.
The suit maintains that, “Unless the partnership is dissolved, Shannon is forced to remain partners with an entity that wears two hats – one as Shannon’s partner and one as Shannon’s primary competitor.”
Shannon is asking the court to provide legal relief to be able to dissolve the partnership. “Because Shannon owns and/or has the right to vote 75 percent of the partnership’s units, Shannon has the right to dissolve the partnership.”
Shannon’s lawsuit asks the court to, “Appoint Shannon or a qualified person to carry out the winding up and to make any order, direction or inquiry that the circumstances require.”
LIVE! reached out to both health care providers for a statement about this legal action. Shannon provided the following statement:
“The Regional Cancer Treatment Center is a precious healthcare resource, and it is our responsibility to make sure it can operate in the most effective way possible to serve patients. We believe dissolving the partnership between Shannon Medical Center and San Angelo Community Medical Center in owning the Center is in the best interest of providing high-quality health care in our community.
Maintaining that effectiveness is extremely difficult because not only are we direct competitors in a small community, but there are also fundamental differences in orientation between Shannon and SACMC. Shannon is a local not-for-profit organization, and its mission is to provide the best possible health care for our community. SACMC is owned by a for-profit, publicly held company, Community Health Systems, whose primary focus is to provide strong financial returns for company shareholders.
By dissolving the partnership, Shannon will be able to focus the Regional Cancer Treatment Center squarely on its mission of providing high-quality care to patients in the Concho Valley. We are proud of the dedicated physicians and employees at the Regional Cancer Treatment Center. They provide excellent, compassionate care to patients facing a very difficult time in their lives.”
San Angelo Community Medical Center CEO Jeremy Riney issued this statement Monday:
"Nearly 30 years ago, San Angelo Community Medical Center and Shannon Medical Center collaborated to establish and build The Regional Cancer Treatment Center as an independent facility. This community-wide effort between the hospitals provided much needed radiation oncology services for our community and the Concho Valley. The partnership has given a local option for cancer treatment since 1988.
Shannon’s effort to dissolve the partnership contradicts the spirit of the original agreement, which established an independent radiation oncology facility for the good of the community.
Collaborating to provide certain services in a town our size makes good sense. Radiation oncology is one of those services.
This service is important to our hospital and patients and we will fight vigorously to preserve the independent nature and position of the Regional Cancer Treatment Center."