Oregon hospitals end legal battle over joint imaging venture

The two hospitals serving Medford, Ore., have reached an agreement ending a legal dispute over their partnership in a regional imaging service.

According to the agreement, Providence Medford Medical Center will purchase Asante Health System’s share of Oregon Advanced Imaging, a joint venture the hospital--along with the Medford Radiological group--started in 2002.

As part of the agreement, Providence Medford will operate Oregon Advanced Imaging in partnership with the Medford Radiological Group, while Asante will purchase the MRI unit at the Rogue Valley Medical Center (of which Asante is the parent company) and operate that independently.

The agreement ends a three-year legal battle that began in 2007 when Providence Medford sued Asante after Asante stated its intention to end the joint venture.

The hospitals were unable to reach any kind of settlement, causing Judge Mark Schiveley of the Jackson County Circuit Court to send the case to arbitration. The judge originally gave the parties until Feb. 1 to reach a settlement, but later extended the date.

In his opinion, ordering the two hospitals to go to arbitration, Schiveley called the formation of the joint imaging venture “a noble enterprise.”

“One thing that all the parties agree on is that OAI has been a highly successful endeavor, both in terms of the services it has provided to the community, and in the revenue it has generated for its partners,” he wrote. “The spirit of collaboration that led Providence and Asante (along with the Medford Radiological Group) to create [Oregon Advanced Imaging] was impressive and, in light of the nature and caliber of the ongoing national dialogue regarding healthcare issues, rather inspiring. It thus pains me to see this otherwise productive venture come crumbling down. And it is a shame that this occurs, in part, because of the sometimes sophomoric behavior and attitudes of certain administrators at both institutions, which led to the substitution of the sense of cooperation between them with an atmosphere of mistrust.”

"We believe this agreement is in the best interests of the parties and the community," said Scott Kelly, chief strategy and business development officer at Asante Health System, in a statement announcing the settlement. "We are pleased to have reached this agreement, and we are excited about the future."