Iowa surgeons threaten to sue colleagues over proposed $17M ASC

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A week after Iowa City, Iowa-based Steindler Orthopedic Clinic requested to postpone its certificate of need hearing for a new $17.9 million ASC, an opposing surgical group looks primed to sue some of its own members who are associated with Steindler, according to an Oct. 19 report from The Gazette.

The opposing group, Johnson County Surgical Investors, along with Iowa City Ambulatory Surgical Center, sent a letter to the State Health Facilities Council urging it to deny Steindler's CON for the planned 35,880-square-foot ASC.

In the letter, Johnson County Surgical Investors and the ASC argued the Steindler project is unnecessary and unlawful, according to The Gazette's report. They wrote that because 13 of Steindler's physicians are also part owners of Johnson County Surgical Investors, agreements they signed prohibit them from owning, operating, managing, financing, leasing or investing in any other ASC or provide management services to a competitor.

Steindler President and CEO Patrick Magallanes said the opposing group's claims are "unsupported."

The opposition letter also said a new Steindler ASC would jeopardize Iowa City ASC's viability by "greatly and unnecessarily [reducing] our already low utilization and [making] the surgery center even less efficient," according to The Gazette.

Steindler's CON application, however, states that Iowa City ASC is no longer equipped to handle the increasingly complex orthopedic outpatient procedures that are becoming more common, and that a new ASC would keep costs down in the area.

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