A Lucas County judge tentatively granted Mercy Health’s motion for a temporary injunction against a joint venture between Nationwide Children’s Hospital and ProMedica involving Toledo’s two children’s hospitals after a daylong hearing Monday.
Judge Joe McNamara gave the three hospital systems two days, however, to submit drafts of such an injunction with their suggestions as to how to avoid harming patients who may have medical appointments or procedures scheduled that rely on terms of the Toledo For Kids venture.
“People in this community really hate the acrimony between the two hospitals systems” [Mercy and ProMedica] and how it diverts resources from providing patient care, the judge said in Lucas County Common Pleas Court before stating his intentions.
“But I guess that’s a criticism of the American health care system that we have this competition” between hospitals rather than a focus entirely on health care, Judge McNamara said.
He also solicited the parties’ briefs, with a one-week filing deadline, for how long the injunction should be in effect.
A motion to compel arbitration to resolve the dispute is among pending motions upon which Judge McNamara did not rule Monday, and he said at the hearing’s close that should the case go to arbitration, the conclusion of that proceeding would be a logical expiration time for an injunction.
Mercy Health in 2022 sold the Mercy Children’s Hospital facilities at its St. Vincent Medical Center in central Toledo to Nationwide Children’s Hospital, based in Columbus. But it retained a 25 percent stake in that operation as well as a right to participate as an equal shareholder in any agreement Nationwide might reach with a third party that affects use of those facilities.
Mercy filed a breach-of-contract lawsuit last month alleging that Nationwide and ProMedica made just that kind of agreement when they formally created Toledo For Kids on Oct. 28 and closed on the transaction Nov. 26.
Under Toledo For Kids, Nationwide and ProMedica may pool the resources of what is now Nationwide Children’s Hospital-Toledo and the Russell J. Ebeid Children’s Hospital on the campus of ProMedica Toledo Hospital. Certain pediatric health specialties previously provided at both hospitals would be subject to consolidation at one of them.
Mercy’s lawsuit alleges that the Toledo For Kids agreement threatens to exclude it from any involvement in pediatric medicine in Toledo. Nationwide contends that Mercy had opportunities to participate, but its leaders believed they couldn’t wait for it to make a firm decision.
Witnesses on behalf of Nationwide and ProMedica testified Monday that such consolidation promotes the recruitment to Toledo — no matter which organization employs them— of pediatric specialists who would otherwise stay away because of low case volumes in individual hospitals. Steady caseloads allow specialists to keep their skills practiced, they said, and employ enough doctors that they can consult with and learn from each other.
While Robert McFarland, Mercy’s lead lawyer, elicited admissions during cross examinations that Nationwide had successfully recruited numerous pediatric specialists to Toledo before the Toledo For Kids agreement was reached, the defense witnesses said much of that was accomplished because those recruits were told such a venture was in the works.
Richard Miller, Nationwide’s president and the final witness Monday, testified that Nationwide told Mercy during their talks about transferring Mercy Children’s that “we felt we needed to collaborate with ProMedica” because with two competing children’s hospitals in Toledo, “you can’t really get scale” and access to specialized care thus suffers.
When Mercy refused to participate in a three-way arrangement in which it and ProMedica would have 40 percent stakes and Nationwide would hold the remaining 20 percent, Mr. Miller said, Nationwide considered itself to have fulfilled its obligation to offer Mercy inclusion in the deal. But even after Nationwide and ProMedica reached their own deal, he said, Nationwide offered Mercy a 10-percent stake from its half because it really wanted Mercy to participate.
The covenant in the Mercy Children’s Hospital sale “is not a veto, but it is fairly close to one,” Judge McNamara said. And that, he said, struck him as having been included precisely to address a situation like the one at hand, in which its local rival would gain influence over Mercy’s former assets.
He set the two-day period for Mercy and Nationwide/ProMedica both to submit proposed injunction language with a goal of crafting something that “freezes” Toledo For Kids “so that it won’t disrupt any patient care that is already scheduled.”
Besides the deadlines for those briefs and suggestions for the injunction’s duration, Judge McNamara scheduled a pre-trial teleconference for the afternoon of Feb. 7.
First Published January 28, 2025, 2:14 a.m.
