APRIL 5 UPDATE:
In a briefing Tuesday, Renown Health weighed in on camera, for the first time, about its anesthesiology staffing issue.
After terminating the contract to staff anesthesiologists with North American Partners in Anesthesia (NAPA) effective April 1, Renown has been hiring the doctors independently. So far, Renown has hired 41 of the 54 doctors involved in the original lawsuit, with hopes to hire another 12 by the end of the month.
Because this could be deemed a breach of contract, Renown and the doctors could face lawsuits from NAPA seeking damages. Renown Interim CEO Dr. Thomas Graf said they'll handle the lawsuits as they come.
"Our priority was less worrying about the legal ramifications and more worrying about the patients and the people of Northern Nevada," Graf said. "We have to, as the leading health system, put their interests first. If at the end of the day it costs us some money, it is what it is."
Those lawsuits could target the doctors individually, due to non-compete clauses in their NAPA contracts. Graf said he does not believe that would result in any of the doctors leaving the area.
"Absent the judge ruling that they had to leave the area, that's not going to happen," Graf said. "It may involve some financial penalties on our part, or shared with the anesthesiologists, but it would be, I think, unthinkable that the legal system would put patients in jeopardy by taking an action like that."
As they work to increase their anesthesiology staffing, Graf said there may be some impacts to surgery scheduling, but said he doesn't anticipate significant disruptions. Along with hiring the doctors who leave NAPA, Renown is recruiting anesthesiologists from southern Nevada, as well as nurse anesthetists, to keep up with demand.
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APRIL 1 UPDATE:
As of Friday, Renown Health has terminated its contract with the company that employs its anesthesiologists, and is hiring them separately. This decision could put both Renown, and the doctors, at risk of legal trouble.
The three groups-- Renown, the doctors, and the doctors' former managing company, North American Partners in Anesthesia, or NAPA/Pickert, have been embroiled in a lawsuit since fall 2021.
Now that Renown is hiring the doctors, a judge is weighing in. Washoe District Court Judge David Hardy decided that the situation has changed, so it no longer merits emergency judicial intervention. He said in court documents obtained by 2 News, that now that the community isn't at risk of losing its surgical capability, the issue becomes whether NAPA/Pickert will seek damages for breach of contract.
From the court documents:
"Renown's unequivocal termination of the PSA and the physicians' unequivocal resignation from Pickert remove the risk of irreparable harm to public health and make compensatory damages, if any, an adequate remedy."
NAPA/Pickert representatives say, while they're still assessing their options, further lawsuits are still on the table.
"There is a lot of money at stake," NAPA Senior Vice President of Client Services Justin Crain said, "and anytime a group like ours invests so heavily in a group, and then it's sort of dissolved overnight, there certainly could be some significant financial damages."
Renown, and the doctors, say the decision to move forward without NAPA involved is for community benefit, and that surgical capability at Northern Nevada's largest hospital will not be impacted.
The anesthesiologists sent this statement on April 1:
"The anesthesiologists filed this lawsuit because they saw an imminent health crisis: the loss of anesthesia at the region's only Level 2 trauma center. The doctors sought a ruling that would allow them to continue serving the community without putting themselves at risk of being accused of breaching their non-compete agreements.
At present, the court has not given a definitive ruling on the substance of the litigation. The litigation will continue, and in the meantime, the anesthesiologists cannot sit idly by. For that reason, anesthesiologists have partnered with Renown to ensure that surgeries and other critical care can continue. While they do so under continued threat by their former employer, the community comes first.”
Renown's full statement from March 31, 2022:
“In order to ensure safe, high quality and effective anesthesia coverage for our patients and community, Renown Health leaders and medical staff members are taking all actions necessary, including continuing legal proceedings, to make certain the availability of anesthesia care, avoid any disruption in surgical care and preserve Renown’s role as the primary source of inpatient care and surgeries in northern Nevada.
Renown’s anesthesia contract with North American Partners in Anesthesia (NAPA) ends today, March 31. Although legal proceedings with NAPA have not been resolved, Renown has made the decision to hire those who have resigned from NAPA, which assures continuous patient care services coverage.
In addition to the former NAPA anesthesiologists who will continue to serve the community by providing anesthesia services at Renown locations, Renown is making arrangements with other anesthesia service providers to ensure there is no disruption to care in the communities we serve.
Accordingly, Renown is confident that we will be able to minimize disruption in surgical care and service to this community effective April 1, 2022 and in to the future with a quality of care that is exceptional.”
Injunction Denial from Washoe County District Court Judge David Hardy:
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MARCH 30 UPDATE:
Renown has terminated its contract with the company that staffs its anesthesiologists as of March 31, 2022.
The contract dispute between Renown, its anesthesiologists and the company that manages the doctors has been working its way through the court system since November 2021.
Renown's decision would leave more than two-thirds of our region's working anesthesiologists unable to work due to non-compete clauses in their contracts. But according to their lawyer, those doctors are planning to show up for work anyway.
Renown released a statement Wednesday, saying it plans to hire the anesthesiologists starting April 1, to avoid any disruption in surgeries.
"Although legal proceedings with NAPA have not been resolved, in an effort to assure coverage for our patients, Renown has made the decision to hire, effective April 1, anesthesiologists who have resigned from NAPA." -Renown Health
That creates a potential contract violation with the doctors' managing company, North American Partners in Anesthesia (NAPA).
"As an organization, we're very disappointed that things have worked out like this," NAPA Vice President of Client Services Justin Crain said in a phone interview Wednesday. "We fully intended to work with Renown and work with our local physicians for the foreseeable future."
When asked if NAPA is planning to sue for breach of contract, Crain said "all options are on the table."
"We are still in the process of exploring remedies to this, and it's an ongoing evaluation at this point," Crain said.
All three parties have been waiting on action from the court, which could grant the doctors a release from their non-competes, or could stop Renown from terminating its contract with NAPA. If the court sides with NAPA and upholds the non-competes, that would leave the doctors and Renown open to legal consequences.
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UPDATE:
Renown has released the following statement regarding the end of a contract with their anesthesiologists:
“Renown has provided an extension while the parties work to resolve the matter. Local physicians continue to provide anesthesia care to patients. There have been no interruptions in service, nor do we anticipate any, due to this issue. We continue to negotiate in good faith with NAPA and will provide an update once this issue is resolved.” -Renown Spokesperson
The managing company of the anesthesiologists, North American Partners in Anesthesia (NAPA) had an exclusive contract to staff Renown's surgeries with anesthesiologists, but in October, Renown gave notice that it was terminating that contract, effective January 27th.
Without a new contract (or extension) in place, or intervention by the courts, that would leave 54 NAPA anesthesiologists unable to practice in the Reno area, due to non-compete clauses in their contracts.
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ORIGINAL STORY:
In two days, the Northern Nevada community could lose approximately two thirds of its working anesthesiologists.
There's a complicated legal battle going on between a group of doctors, their managing company, and Renown. And if it's not resolved-- or at least delayed-- by January 27th, we could be facing a massive shortage in doctors needed for life-saving surgeries.
There are three players at the center of the issue:
The doctors-- 54 anesthesiologists, or roughly two thirds of the total number in that specialty-- in the Reno area.
Then there's their managing company, North American Partners in Anesthesia-- or NAPA, which manages the local doctors under a subsidiary called Pickert.
Finally, there's Renown Regional Medical Center.
All three are part of an ongoing lawsuit that was filed at the end of November.
Napa/Pickert has an exclusive contract to staff Renown's surgeries with anesthesiologists, but in October, Renown gave notice that it was terminating that contract, saying that NAPA/Pickert had failed to staff enough doctors, in violation of their agreement. That termination would take effect in 90 days, on January 27th, 2022.
That left the doctors in an impossible position: unable to work for Renown, but due to non-compete clauses in their contracts, not allowed to work anywhere else in this area either.
So, in November, those doctors filed a lawsuit against their employer, NAPA/Pickert, and asked for the courts to release them from their non-competes, to allow them to work elsewhere locally.
A month later, NAPA/Pickert filed their own request-- asking the courts to stop Renown from terminating the contract.
So far, the courts have not decided on either request. And if nothing changes by Thursday, and Renown's contract with NAPA/Pickert is allowed to end, those doctors will not legally be allowed to work within 25 to 30 miles of any Renown hospital, meaning any hospital in the Reno/Sparks/Carson City area.
The doctors say in their court filings that NAPA's management practices have driven away many of their employees, causing the shortage in surgical staffing at Renown. NAPA denies it, saying they have staffed every surgery that Renown requested. The hospital claims that in the last six months, Renown's operating rooms have run at historic lows due to NAPA/Pickert's inability to provide necessary anesthesiologists.
The hospital says it is within its rights to terminate the contract. NAPA/Pickert says the termination is legally invalid, and denies the claims, saying Renown never gave them a chance to correct any issue. NAPA/Pickert also accuses the doctors of colluding with the hospital to cut NAPA/Pickert out of the market.
It's a legal mess that's now up to the courts to untangle. Unfortunately, the courts aren't planning to weigh in before the clock runs out. That opens the community up to what could be a major health crisis.
Dr. Jay Morgan, past president of the Washoe County Medical Society, agreed to give his perspective.
"If we can't take care of people who are having strokes or head bleeds or heart attacks or need a bypass because we don't have anesthesiology, that just can't happen," he said.
Morgan added that with so few anesthesiologists left to staff operating rooms, more people would have to be transferred out of the area.
"Sometimes time is critical," Morgan said, "and if we don't take care of people in that critical period of time, then they could die, or they could have a bad result."
That's amid a pandemic, when hospital staffs are already stretched thin, and there's more of a premium on healthcare than ever.
The next court hearing isn't scheduled until February 28th, a full month past when Renown's contract is set to terminate. If the contract ends and the non-compete clauses are allowed to stand, those doctors wouldn't be legally allowed to practice in our area for two years. There is the possibility that Renown will choose not to terminate, or will grant an extension before the courts weigh in, but so far the hospital has not confirmed any move to do that.
All three parties in the lawsuit declined an interview, but did provide written statements:
Joint statement from Renown and NAPA/Pickert:
“Renown Health and NAPA are working to improve healthcare in Nevada and will continue to put the needs of patients first, ensuring seamless and uninterrupted surgical care for our community, including trauma and other surgeries, which naturally require anesthesia. Renown and NAPA continue to negotiate in good faith for ongoing coverage by local physicians and to ensure the consistent availability of anesthesia care supporting Renown’s role as the primary provider of inpatient care, including surgeries, for those living in northern Nevada and the broader region.
Renown does not anticipate having to cancel, reschedule or delay any surgeries due to this issue. Our goal, in continued discussions and collaboration with our NAPA colleagues, is to ensure seamless and uninterrupted surgical care for our community, including trauma and other surgeries, which naturally require anesthesia.”
Renown and NAPA Spokespeople
Statement from anesthesiologists:
The anesthesiologists who filed this lawsuit cannot thank the public enough for its interest in this important issue. We filed this lawsuit after Renown issued a notice to our employer (North American Partners in Anesthesia, operating in Nevada as Pickert Medical Group) stating that the contract between Renown and NAPA/Pickert would be ending as of January 27, 2022. Since NAPA/Pickert is the exclusive anesthesiology provider at Renown, the end of this contract could have devastating consequences to our local community.
Renown is the region’s only trauma center, and it is the hospital that many go to when other options are exhausted. When the Renown/Pickert relationship comes to an end, the more than 50 of us cannot simply continue providing anesthesia services at Renown (as our practice has done since 1949). That is because our employment agreements include non-competes that, if enforced, would keep us all from continuing to provide services across Northern Nevada (not just at Renown). As physicians who have dedicated our lives to helping others, we could not sit idly by and risk the shutdown of anesthesia – and therefore patient access to surgical and other critical services – at such an important facility like Renown. We also could not envision an outcome where the more than 50 doctors (which represent approximately two-thirds of Northern Nevada’s resident anesthesiologists) would be forced to step out of Northern Nevada operating rooms for the next two years (the duration of our non-competes). Therefore, we asked the Court to rule that our non-competes are unenforceable.
When we filed this lawsuit back in November, we hoped for a quick resolution. Over the last two months, we have fought tirelessly to maintain Renown’s surgical capabilities. That fight has taken many forms, not just in the context of this lawsuit. Outside of this lawsuit, we have personally sacrificed to ensure that critical surgical cases receive timely treatment. When our vacant anesthesiology positions approached 25% (2.5 times the national average), we sacrificed by working around the clock, all while enduring the utter exhaustion that COVID-19 has brought to the entire medical community. We did this because we knew that even before Renown announced the termination of its relationship with NAPA/Pickert, our local community faced a critical shortage of anesthesiologists. To us, turning away patients with acute medical needs – when we had the power to avoid that – simply was not an option. So, we worked around the clock – far beyond what our contracts require – to put the interests of the community above our own. We are now fatigued, but remain committed to serving our patients who require surgical care.
We hope that the community understands what the lawsuit is about, and what it is not about. We have not asked the court for money. We simply asked that the Court rule that the community’s need for continued anesthesia services outweighs any reason that Pickert might have to enforce the very broadly worded and highly restrictive non-competes. In larger communities, there are large pools of physicians who can fill in the vacancies, but in Northern Nevada, enforcing more than 50 non-competes eliminates the majority of the anesthesia workforce. In turn, this could severely limit access to surgical and procedural care.
Renown has unequivocally stated that its relationship with NAPA/Pickert will end. Once it does, two-thirds of this community’s anesthesiologists (i.e., us) must either obtain relief from the Court or leave this community without the community having another 50 anesthesiologists to take our place. If we are forced to leave, our non-competes prevent us from returning for two years. We continue to search for solutions, both in and outside of this lawsuit, to prevent this from occurring.
We love this community and call it our home. The majority of our doctors have never practiced anywhere else. Our friends and families are here. Most importantly, we have dedicated our entire professional lives to caring for the people in Northern Nevada. We again thank for the community for its interest and support.
