Eugene Emergency Doctors Sue PeaceHealth Over ER Contract Awarded to Out of State Firm

EUGENE, Ore. — Eugene Emergency Physicians, a group of Lane County doctors, filed a lawsuit against PeaceHealth over a longstanding emergency room staffing supply contract to three local hospitals that was cancelled and awarded to the national firm ApolloMD.

Eugene Doctors File Lawsuit Against Peace Health After ER Staffing Contract Cancellation

Last month, PeaceHealth notified Eugene Emergency Physicians that its contract would be ended.

Atlanta-based ApolloMD would replace the local group for emergency services at Sacred Heart Medical Center at RiverBend in Springfield, Peace Harbor Medical Center in Florence, and Cottage Grove Community Medical Center.

ApolloMD would begin staffing the hospitals in Cottage Grove and Florence on June 1 and RiverBend on July 1. It does not have operations in Oregon, but staffs more than 100 emergency departments nationwide.

The lawsuit against PeaceHealth, filed in Lane County Circuit Court, seeks to stop the healthcare provider from hiring an out-of-state company to supply emergency room services and has been criticized by lawmakers, regulators, and medical groups across Oregon, particularly as Oregon law bans the corporate practice of medicine.

In a letter, Governor Tina Kotek also urged PeaceHealth to reconsider and asked that the transition be delayed by 6 months so regulators would have time to review whether the deal complies with Oregon law. The statute was strengthened last year to limit corporate ownership workarounds.

ApolloMD would not be staffing hospitals directly but through a new entity, Lane Emergency Physicians LLC, which would become the official provider.

In the lawsuit, the local doctors argue that the structure is a workaround, specifically designed to evade the Oregon law, which requires medical practices to be owned and controlled by licensed physicians.

Eugene Emergency Physicians asked the court to declare the arrangement illegal and prevent PeaceHealth from ending its current contract until the case is resolved.