Lawsuits follow hospital exec through career

LEESBURG — According to information obtained by The Albany Herald, the president and CEO of LCMC OPCO LLC, the group that would build and manage the proposed Lee County Medical Center, has been involved in a number of such projects that have either failed or been the subject of lawsuits for such charges as breach of contract, misappropriation of trade secrets and fraud.

G. Edward Alexander, who also serves as president/CEO of Franklin, Tenn.-based Surgical Development Partners LLC, began his career as vice president of Medaphis Corp. in 1988 and over the years has served as either CFO (Team Health Inc. and Ortholink Physicians Corp.) or founder/CEO (Surgical Alliance Corp. and Surgical Development Partners) of medical industry-based companies that have found themselves embroiled in legal issues.

Starting with a shareholder class action suit for alleged violations of the Securities Exchange Act brought against Medaphis in 1996, which occurred after Alexander had left the company but involved some transactions that were alleged to have taken place while he was there, and continuing through a 2017 lawsuit for fraud, statutory fraud, breach of fiduciary duty, negligent misrepresentation and other charges brought by Texas physician Dr. Tony Das, Alexander’s career has seen a number of court actions and non-actionable charges.

Among other court actions taken or charges made against Alexander or companies with which he was a principle:

— Ortholink Physicians Corp. is among a group of medical companies and physician groups sued by the United States in a false claims whistleblower case (2001);

— Columbus, Ohio-area health system administrators accuse Surgical Alliance Corp. of “skimming the most profitable patients and medical procedures away from other hospitals” (2002);

— Surgical Development Partners and others (including attorney Frank T. Sossi, who is reportedly representing LCMC OPCO in its quest to open in Lee County) are sued by Lake Travis Specialty Hospital LLC, a planned rival hospital, for breach of contract, misappropriation of trade secrets and negligent misrepresentation (2012);

— Lakeway Regional Medical Center in Austin, Texas, developed by Surgical Development Partners and other groups, defaults on a $167 million HUD-insured loan after filling only 40 to 50 beds in a 106-bed facility (2013);

— State and federal inspectors find patient care issues at Lakeway Regional Medical Center, including inadequate qualifications by one in four nurses at the center, improper nursing care, procedures carried out based on inadequate lab results and ill-trained lab staff (2015);

— Aetna Life Insurance Co. sues the North Cypress Medical Center in Houston, developed in part by Surgical Development Partners in 2007, alleging that the hospital engaged in a $225 million fraudulent kickback scheme (2016);

— Walnut Hill Medical Center files for Chapter 7 bankruptcy three years after opening, primarily because of a default on the loan secured by HUD. The hospital’s assets are sold at auction (2017).

Lee County Commissioner Rick Muggridge, asked Sunday about these incidents, said he remains confident that the Lee Medical Center will be a benefit to the community.

“First of all, I want to make it clear that we are not in anyone else’s hands when it comes to the hospital,” Muggridge said. “This is a hospital being developed by entrepreneurs, and entrepreneurs put together projects like our hospital for one reason and one reason only: to make a profit. I’m certainly not offering a defense for anything you might have discovered because I’m sure I’m not aware of all of it, but I do know that when businesses go out and aggressively pursue business opportunities, people sue them.

“I’m a relationship kind of guy, but that doesn’t mean my instincts are always right. Am I able to read everyone correctly that I encounter? Of course not. Have I been fooled by people before? Yes, I have. But I genuinely like Eddie Alexander. He seems like a straight shooter.”

Muggridge said he is personally motivated to advocate for the LCMC by three primary factors.

“Since this is a medical project, my first concern is that we do no harm,” the veteran commissioner and insurance agent said. “My No. 1 concern in this three-question box I have is whether the taxpayers of Lee County will be hurt. I suppose if things fell through, we could lose some attorney fees. But I truly believe our taxpayers are protected in this.

“No. 2 on my list is whether this project will improve the health care conditions of Lee County, Southwest Georgia and, yes, the city of Albany. Unfortunately, the sole provider of health care in this region (Phoebe Putney Health System and, primarily, Phoebe Putney Memorial Hospital) is seeking to hold onto that, well, monopoly, at any cost. And anyone who knows anything about health care, anyone who’s done even a little searching, knows that the costs here are higher than most other areas of the country.”

The third item on Muggridge’s list is job creation.

“Once we get past the do no harm, I think you have to look at economic development in our region,” he said. “Even if the hospital didn’t come here, I believe Lee County, the city of Albany and other entities in this region have got to develop that property on our county lines to create an environment that will bring jobs to our community.”

Muggridge said that he doesn’t feel he’s in a position to have to trust outsiders for the success or failure of the proposed Lee hospital.

“We’ve done what we need to do, and I feel good about that,” he said. “There have been a lot of lawyers involved, but I’m not really concerned about trusting anyone else in this deal. I trust (Lee County Attorney) Jimmy Skipper. And so far, Skipper’s OK with it.”

Attempts to reach Alexander Sunday were unsuccessful.

The Department of Community Health is expected to rule on LCMC OPCO’s application for a certificate of need, which is required to operate a medical facility in the state, by Nov. 15.