Nonprofit Claims Louisiana Backed Off Promises

By ERIK DE LA GARZA

BATON ROUGE (CN) – A state-mandated health care corporation developed in response to Hurricane Katrina claims in court that the Louisiana Department of Health and its secretary reneged on a $12 million funding agreement and defamed it in the healthcare community.

In a complaint filed Dec. 12 in the state’s East  Baton Rouge District Court, the  Louisiana Health Care Quality Forum says it relied on the promised funds and may now have to stop providing some health care services that could pose “a significant public health threat.”

The Louisiana Legislature created the non-profit private corporation in the aftermath of Hurricane Katrina to assist the state in delivering healthcare services and improving the overall care it provides to its citizens. Since then, the complaint says, the Quality Forum claims it has helped to expand Louisiana’s health care infrastructure, including in medically under-served areas.

In the lawsuit, the Quality Forum claims it cannot survive if the state’s Department of Health and Secretary Rebekah Gee refuse to continue funding it as promised.

The corporation also claims that department officials made defamatory statements about the Quality Forum’s efforts and services in the healthcare community.

According to the lawsuit, Gee instructed the department soon after taking over in January 2016 to withdraw the Quality Forum’s 2016-2017 request for funding “instead of moving forward as agreed and anticipated.”

“The Quality Forum was not told of this action,” the lawsuit says. “Secretary Gee and other LDH officials are well-aware that the Quality Forum’s ability to function without the promised funding will be severely impeded, if not prevented.”

Department spokeswoman Kelly Zimmerman said that the department has undergone a review of “Jindal-era programs” in an effort to be responsible stewards of public funds, and that the lawsuit came as a surprise.

“We’ve had a productive relationship with the Louisiana Quality Forum over the past few months,” Zimmerman told Courthouse News. “We have fulfilled our obligations and continue to work with the Louisiana Quality Forum on a path forward that is mutually beneficial.”

“We dispute the characterizations offered in the suit, however we are committed to resolving this matter amicably in the best interests of the state,” she said.

But in the lawsuit, the Quality Forum said the department encouraged others not to do business with it, made disparaging statements to others in the healthcare industry, and attempted to use the power of the state to put it out of business.

The Quality Forum seeks damages for detrimental reliance, unfair trade practices, and defamation.

“Indeed, the Quality Forum will suffer extreme harm for its reliance if LDH does not provide the promised funding, including but not limited to loss of substantial business and damage to its reputation if it is not able to provide the services that it has promised to its participants and subscribers.”

The Quality Forum is represented by Ellie Schilling of tSchoneakas, Evans, McGoey & McEachin in New Orleans.