During a brief phone interview Monday, David McCormack, CEO of RMC, said he had not heard of the 2010 Alabama Supreme Court case, Tennessee Valley Printing Company, Inc. v. Health Care Authority of Lauderdale County and the city of Florence. In that decision, the court ruled public hospitals were not exempt from open records law. RMC is a nonprofit hospital controlled by a board appointed by local governments. RMC officials have so far declined to release the price of the recently purchased Jacksonville hospital, saying a confidentiality agreement between RMC and the seller, Tennessee-based private company Capella Healthcare, prevents them from revealing contract details.
“No I was not aware of it,” McCormack said of the court case.
McCormack said he would talk with RMC’s attorney about the case. Attempts to reach McCormack later on Monday were unsuccessful.
McCormack said during the phone interview that Capella wanted the confidentiality agreement due to the competitive nature of the health care industry.
“It’s usually strategic in business,” McCormack said.
The Health Care Authority of Lauderdale County made a similar argument in the Supreme Court case. Unlike the RMC purchase, this case involved details about bidding prices for two hospitals controlled by a governmental entity, namely the Coffee Health Group. RegionalCare, a Tennessee-based private hospital management company, purchased the hospitals in question.
In the lawsuit, the defendants argued that, “… if bidders are not protected by confidentiality, they might not submit a bid because sensitive corporate information would be released to other corporations.”
However, the Alabama Supreme Court threw out that argument, stating that, “a general suggestion by a governmental entity that disclosure would likely result in competitive harm to the person submitting the information is not sufficient.”
Furthermore, the court stated a private party could not render public records exempt from disclosure just by designating information it furnishes a governmental agency confidential.
“The right to examine these records is a right belonging to the public; it cannot be bargained away by a representative of the government,” the court stated.
Dennis Bailey, an attorney for the Alabama Press Association, said the Supreme Court decision applied to RMC as well, even though it is the purchaser and not the seller.
“The same principles hold true for this situation,” Bailey said. “A private company cannot compel a public entity to hide the terms of a sale of public property.”
In any case, the Supreme Court decision did not impact RegionalCare or its acquisition, said Jeff Atwood, spokesman for RegionalCare. Atwood said the Coffee Group was involved with the confidentiality agreement decision and lawsuit, not RegionalCare.
“The freedom of information stuff didn’t really impact us at all,” Atwood said.
Atwood said RegionalCare has since benefitted from the purchase of the two hospitals, Eliza Coffee Memorial Hospital in Florence and Shoals Hospital in Muscle Shoals.
“It’s been a tremendous success in the Florence and Muscle Shoals markets,” he said.
Atwood added that RegionalCare is in the planning stages of replacing the Florence hospital with a new one.
Tom Whetstone, spokesman for the Coffee Health Group, said the release of the purchase prices of the two hospitals after the deal was not a problem.
“It didn’t hurt anything because the issue wasn’t releasing the amount of the purchase price … they were seeking bids to the purchase,” Whetstone said. “At that time, there were four different groups looking to purchase and releasing that would have put us at a competitive disadvantage.”
Whetstone said that by the time the case was settled, the deal was already done.
“So there was no fallout for us,” he said.
Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star.