Hospital takeover proposal advances

Suthers sees no reason for state to block sale to Sisters of Charity

By Myung Oak Kim, Rocky Mountain News (Contact)

Published December 28, 2007 at 12:30 a.m.

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Suthers wrote that he didn't see a "material change."

The pending Catholic takeover of two metro hospitals cleared a significant hurdle Thursday when Attorney General John Suthers said he did not find grounds to block the sale.

But the transaction, scheduled to be completed by Jan. 31, faces another obstacle - a state court challenge that could tie up matters for months.

Suthers said the sale of Exempla Lutheran Medical Center in Wheat Ridge and Exempla Good Samaritan Medical Center in Lafayette would not result in a "material change in charitable purpose" and therefore would not violate a state law governing the sale of nonprofit hospitals.

The decision was applauded by Sisters of Charity of Leavenworth Health System and Community First Foundation of Arvada, the two parties to the proposed sale. But it drew sharp criticism from opponents of the sale.

"It's terrible for the residents of Jefferson County, of Clear Creek County and Gilpin County" because it would restrict medical services at the only hospital close to those residents, said Michael Huttner, executive director of ProgressNow.

If the sale goes through, medical staff at both facilities would have to follow Catholic ethical and religious directives, which ban abortions, vasectomies, tubal ligations and other forms of birth control, unless deemed medically necessary. Doctors also would be restricted from removing feeding tubes from people in a persistent vegetative state.

Suthers said he could look only at a narrow aspect of the proposed sale.

"I recognize the strong emotional and political concerns surrounding this transfer, but per the statute, those concerns cannot alter the legal standard of review," Suthers said in a written statement.

He was not available for comment.

In the last three months, Suthers received hundreds of calls, letters and e-mails about the plan - mostly from opponents, said spokesman Nate Strauch.

"The bottom line is the law is the law, and in this case, the law doesn't always agree with public opinion," Strauch said.

Lutheran and Good Samaritan hospitals are jointly owned by Sisters of Charity, a Kansas Catholic nonprofit, and Community First Foundation, an Arvada nonprofit. Community First intends to sell its 50 percent share to Sisters of Charity for $311 million.

Opponents include the Lutheran medical staff; doctors at Good Samaritan and Kaiser Permanente, who practice at Good Samaritan; the board of Exempla Healthcare, which manages both hospitals; and an array of organizations, including the ACLU, the Colorado Center on Law & Policy and the Colorado Consumer Health Initiative.

Huttner said he is trying to get about 400 residents in Jefferson and Clear Creek counties who signed an opposition letter to join the lawsuit filed last week against the sale.

The suit was brought by Compassion & Choices, representing people who want to make their own end-of-life decisions, a Lutheran doctor and a former patient.

Ed Kahn, a lawyer for the Colorado Center on Law & Policy, said Suthers made the wrong decision because he didn't acknowledge that Lutheran's founding purpose was to provide nonsectarian services and that the Catholic directives change the scope of services.

"The opinion is wrong because the attorney general concludes that the restriction of reproductive choice and end- of-life choices is not material, when to the people of Jefferson County who have no alternative, it's very material," Kahn said.

But Sisters of Charity and Community First officials say medical care will not suffer because patients can get the prohibited procedures at nearby medical offices.

They also say the sale will result in a windfall of investment and improvement in medical services.

Bill Murray, president and CEO of Sisters of Charity, said the transaction "will strengthen local health care services by providing necessary resources for clinical excellence, new technology and service coordination."

Palmer Pekarek, spokesman for Community First, said the lawsuit "has no merit."

Jeff Selberg, president and CEO of Exempla, said he expected Suthers not to block the sale because of the narrow parameters of the law.

Suthers acknowledged in his six-page legal opinion that patients affected by the prohibited services believe that the sale amounts to a significant change.

Those services represent less than 1 percent of total admissions and do not cause the hospitals to experience any change in licensing and accreditation.

"A 'material change' must mean something more significant than 'any change,' " Suthers wrote.

kimm@RockyMountainNews.com or 303-954-2361

What's next

The parties involved in the proposed sale of Lutheran and Good Samaritan hospitals have until roughly Jan. 10 to respond to a lawsuit filed last week in Boulder District Court seeking to block the transaction, said lawyer Ed Kahn. The suit is being heard before Judge Morris Sandstead Jr.

A hearing will be scheduled after the responses are filed.

The Community First Foundation and Sisters of Charity of Leavenworth Health System said despite the lawsuit, they expect to complete the sale by Jan. 31.

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