The legal battle between East Texas Medical Center Healthcare System and Henderson County is over. The opposing parties each agreed to a settlement this week and expressed hopes that the citizens of the county will benifit with the best of health care in the future.

At a public meeting Thursday, The Henderson County Hospital Authority Board unanimously approved the proposed settlement which had been accepted by the Henderson County Commissioner’s Court on Tuesday.

The suit filed in 2006 by the East Texas Medical Center Regional Healthcare Center against Henderson County Judge David Holstein, County Attorney James Owen, Henderson County and the Hospital Authority, had its beginnings in two letters sent to ETMC. The letters, sent by Owen in 2004 and attorney Charles Clark in 2005, alleged ETMC was in default of its contract with the Hospital Authority. The dispute against ETMC asserted among other things, that the hospital did not provide adequate indigent health care, did not provide adequate insurance and that lands on which ETMC had placed facilities were property of the county.

Attorney Martin Bennett, representing the Hospital Authority, said Thursday, that all contested issues in the lawsuit had been settled in favor of ETMC and the Authority Board. Bennett said, according to the agreement, “all causes of action alleged in he lawsuit have been dismissed with prejudice.” Bennett said “with prejudice” means the claims can not be brought up again.

Concerning the Tobacco Settlement proceeds, ETMC acknowledges that distribution is solely at the disgression of the county. The system agrees to continue to provide the county with a report of its indigent healthcare costs that the county can be used in its annual application for the settlement proceeds. The county will be reimbursed 100 percent for its indigent healthcare costs. The remaining balance will go the ETMC Athens. Bennett said ETMC had never contested the county’s claim to the funds.

“No statute we can find indicates that ETMC is contractually or legally entitled to that money,” Bennett said.

In the agreement ETMC agrees to continue to provide hospital services at its facilities for all Henderson County indigent citizens. This includes those who are jail prisoners. Bennett said that is a continuation of the services already provided by ETMC. Bennett said that does not extend to prisoners from outside the county who are housed here.

As to the insurance issues raised in the litigation, the settlement states the healthcare system agrees to unconditionally indemnify and hold harmless the county from all classes arising from its operation. The indemnification includes the cost of litigation including attorney’s fees.

Concerning land, the parties agreed that “any all facilities that have been financed with Authority bonds heretofore issued are situated on land currently titled in the county’s name. The agreement states the only facility purchased approved or expanded with the authority bonds is ETMC Athens.” The document further states that lands and facilities not aquired wit funds from Athority bonds issued up to the present time are property of the healthcare system.

Following the board’s vote of approval, board member Bud Henry said he was thrilled to have an agreement. “I’m thrilled for the people of Henderson County,” Henry said. Henry took his seat on the board in 2005, after the first letter from Owen claiming default had been sent. “I expected to find default. I didn’t find default, just some procedural things,” Henry said. Henry said when the board was unable to meet with thecommissioners court, ETMC had no choice but to sue to stop the allegations that that they were in default. “We were attacked. Diplomacy was never tried,” Henry said.

Longtime board member Neil Hunter said the lawsuit delayed expansion and improvements that could have already begun. “We would have expansion, more employees and more income.” Hunter said ETMC had been good stewards of the Athens facility. Hunter said the hospital doesn’t look 20 years old.

Chairman David Monk regretted that the board had not had a chance to come to commissioner’s court and discuss the issues before the disagreements escalated to a lawsuit. “We’ve all lost, when we find the door closed to communication.” Monk commended the board and their work on the lawsuit. The group studied many pages of information and spent a lot of time on it, Monk said. “Every decision as a nine memer board has been unanamous,” Monk said.

Henderson County Judge David Holstein, who signed the agreement twice, both in his capacity as county judge and as an individual defendant, said he was pleased to have the suit resolved.

“I felt very strongly about our commitment to enforce the terms of an agreement that was written in 1982. I know James (Owen) felt the same way as did the commissioners. Everybody had an opinion, “

He said the agreement on the tobacco settlement money will benefit the people of the county. “They will have to actually pay for indigent health care costs that the taxpayers were previously paying. In 2003 that was over $300,000 in 2006 that was $165,000,” Holstein said.

“We’ve all agreed to compromise. I believe it’s important to put this issue behind us and move forward. Ultimately we’re all working for the best possible health care at the most reasonable cost for Henderson County,” Holstein said.

“I think the people of Henderson County are better off based on the agreement that was made,” Owen said Tuesday. Owen cited indigent health care costs that will be paid from the tobacco fund settlement through the life of the agreement. Holstein has placed the figure at an estimated $800 million. “ETMC is working on this bond issue and is looking to spend up to $25 million here and they’re going to feel comfortable doing that and that’s good for ETMC and good for the county. I think its a good deal.”







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