Erlanger Rejects Walker County's $1.3 Million Settlement Offer In Hutcheson Hospital Case

Thursday, June 2, 2016

Erlanger Health System has declined a $1.3 million "global settlement: from Walker County, Ga., in relation to a $10 million commitment made by the county on $20 million that Erlanger supplied while it was managing Hutcheson Medical Center.

The Fort Oglethorpe hospital later went into bankruptcy.

Gregg Gentry, Erlanger chief administrative officer, said, “The amount owed to Erlanger by Walker County (after applying credit from the sale of both the nursing home and the hospital) is approximately $8.

7 million.  We are committed to pursuing what is rightfully owed to Erlanger on behalf of our community.

"If Walker County is serious about an outcome that best serves everyone, it should start by offering Erlanger more than 15 cents on the dollar.” 

Stuart James, special counsel for Walker County, said, "Late last week Walker County’s Special Counsel was authorized to offer a $1.3 million settlement to Erlanger.  The settlement would have allowed for global mediation of all issues between Walker County and Erlanger, as well as Catoosa, Dade their Tri County Hospital Authority, and brought a final outcome to the situation for all parties. 

"Within 26 hours of reaching out to Erlanger with the offer, attorneys for the hospital wrote, 'After conferring with our client, your offer of judgment is hereby rejected.  We also don’t see any value in mediating the case.'

”This means additional filings by attorneys on both sides of the issue with more taxpayer dollars being used for litigation instead of healthcare or service to the citizens of Walker County, as well as Hamilton County and Chattanooga Tn., as Erlanger is a publicly funded hospital.

“Clearly, we are disheartened that Erlanger has rejected offers to settle or for mediation not once, but twice. At the direction of Commissioner Bebe Heiskell, I’ve worked diligently to resolve this claim without litigation.  The only counter proposal Erlanger makes is a threat of suit that will result in additional attorneys’ fees and expenses. While Erlanger once again talks about settlement with Catoosa County in pleadings filed after the most recent settlement proposal it continues to choose to litigate with Walker County without making any proposal or counter proposal to resolve these claims.

”In addition, Erlanger has threatened individual members of the Hospital Authority with lawsuits to attach their personal assets for the improper transfer of property so that they can collect on the $36.5 million judgment. Erlanger continues to make these threats despite the fact that the volunteer and uncompensated Hospital Authority members are immune from suit under Georgia law. This threat of additional litigation with Walker County mirrors Erlanger’s threats with the individual members of the Hospital Authority.

"Our goal is an outcome that will best serve everyone involved in this matter.  We believe it’s time to put this dark chapter behind all of us and were prepared to do so through the offer of a settlement.  Unfortunately, this goal is not shared by Erlanger; therefore, we intend to take the necessary steps to protect the citizens of Walker County.”  



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