AUSTIN (KXAN) — Central Health announced Tuesday it is suing healthcare company Ascension Texas, alleging Ascension is “failing to meet its contractual obligations” in providing healthcare services to residents from lower-income backgrounds in Travis County. In response, Ascension announced later Tuesday afternoon its own suit against Central Health.

According to Central Health’s release, Central Health began its contractual relationship with Ascension in 2004. In 2013, Ascension committed to continue providing at minimum “the current levels of healthcare services,” which included both hospital and specialty care. The contract renewal applied to patients enrolled through Central Health’s Medical Access (MAP) program, or healthcare coverage for uninsured Travis County residents from lower income backgrounds.

Central Health officials cited a 21% decline in patients between 2013 and 2022, down 8,000 patients, the release stated. Those numbers, officials said Tuesday, came from Ascension’s own data collection. In its response Tuesday afternoon, Ascension disputed the use of those figures in Central Health’s lawsuit.

“We are out of options,” said Mike Geeslin, President & CEO of Central Health, in the release. “Ascension’s persistent failures to honor its contractual commitments left Central Health with no choice but to file a lawsuit to hold Ascension accountable for not providing adequate, equitable healthcare services for people with low income in Travis County. Their practices have caused real harm to the people we serve.”

In a statement from Ascension Tuesday, officials said Ascension has filed its own lawsuit against Central Health, adding it “seeks to address Central Health’s over-enrollment and underfunding of the Medical Access Program (MAP), the county indigent healthcare program and the public-private partnership designed to provide equitable access to care for Tavis County’s economically vulnerable residents.”

Ascension Seton had been seeking a good faith resolution to Central Health’s continued refusal to support increased demand for MAP services but was forced to seek legal remedy after Central Health refused to engage in further good faith discussions and negotiations. Central Health’s taxpayer-funded lawsuit is focusing on the wrong numbers. The data clearly demonstrates the success of the MAP program — through improved clinical outcomes and a better continuum of care. Central Health repeatedly cites a 10-year-old agreement in their lawsuit, but completely ignores 23 agreements they have ratified since then that detail baseline numbers for appointments in specialty care.

Ascension Seton lawsuit filed against Central Health

Ascension’s suit against Central Health

In its lawsuit filed Tuesday, Ascension alleged Central Health has both “misrepresented its agreement with Ascension Seton and used distorted numbers to inaccurately represent growth of the MPA program.” Ascension’s lawsuit claimed Central Health has overenrolled patients in the healthcare program “while refusing to provide funding to support the care for additional patients.”

“Despite Central Health’s ongoing refusal to support increasing demand for MAP services and disregard of the existing contract regarding MAP membership, Ascension Seton has worked in good faith to continue providing critical healthcare services to Travis County residents,” said Andy Davis, President and CEO, Ascension Texas, in the release. “Even with today’s developments, we will continue to focus first on caring for patients, aligned with our mission to provide quality care to all. It is unfortunate that Central Health through its inappropriate actions has forced us to take this legal action to ensure that Central Health meets its commitments to the community it was created to serve.”

In a press release issued Tuesday, Ascension alleged Central Health’s reserves have grown substantially over a five-year period despite “unmet needs” in its patient populations. Ascension cited Central Health’s “significant new administrative expenses” in its release, including Central Health’s new headquarters, with a reported cost of $63 million.

Ascension officials added it will continue to support MAP patients throughout the legal proceedings.

Central Health’s claims against Ascension

Central Health’s lawsuit alleges reduced levels of healthcare services provided in both general and specialty areas. The lawsuit claims Ascension breached its contract with Central Health in the following ways:

  • Failure to provide “agreed-upon healthcare services to low-income Travis County residents,” including both general and specialty care
  • Failure to provide healthcare services to MAP patients, Charity Care patients on “a nondiscriminatory basis”
  • “Improperly billing” Charity Care patients for healthcare services
  • Failure to provide mandatory reports that Central Health needs to “monitor, on behalf of Travis County residents, Ascension’s compliance with performance standards”

During a press release Tuesday afternoon, Geeslin said federal funds are used to compensate Ascension as part of its contractual agreement. Central Health’s budget includes more than $300 million annually to cover specialty and general care services provided through Central Health’s partnerships with various entities, including Ascension, he added.

When asked on whether Ascension has requested more funding from Central Health, Casey Dobson — an attorney with Scott Douglass & McConnico representing Central Health — declined to answer that question, citing active litigation.

As part of the lawsuit, Central Health is looking for a termination of its contractual agreements with Ascension, as well as the option to purchase Dell Seton Medical Center. Per the release, Ascension was “permitted to affiliate with the Central Health-supported Dell Medical School at The University of Texas at Austin,” as part of the creation of Dell Seton Medical Center.

As for the option to purchase Dell Seton Medical Center, Dobson said Tuesday that option was built into the 2013 contractual agreement between the two entities.

“It was created specifically as a last resort safety valve for this situation, where Central Health would have the ability to purchase the hospital if Ascension was not living up to their bargain,” Dobson said. “And Ascension, we’ve alleged, is not living up to their bargain.”

Officials said Tuesday litigation can move slowly, but added the frontline workers interacting with patients on a day-to-day basis have provided great care, and they believe they’ll continue to do so amid the legal process.