The effect of Akron, Ohio-based Summa Health's sale to a private equity firm on a physician's student loan forgiveness is the subject of a recent lawsuit filed by a former employee of the health system, Signal Akron reported Dec. 9.
The lawsuit, filed by Kristina Gulotta, MD, a surgeon with Summa, said that she had to seek new employment in order to protect her eligibility for a federal loan forgiveness program. Dr. Gulotta argued that the $485 million sale of Summa to PE-backed General Catalyst's Health Assurance Transformation recategorized Summa as a for-profit hospital, therefore jeopardizing her student loan repayment status.
According to the U.S. Department of Education's Federal Student Aid website, the Public Service Loan Forgiveness program may forgive student loans if a participant has made 120 payments under a qualifying payment plan while working full-time for an eligible employer, which includes non-profit organizations.
In addition, Dr. Gulotta, who has been with Summa since 2020, also asked that a noncompete clause in her employment contract be declared "invalid and unenforceable" and that the hospital be enjoined from "threatening or seeking enforcement of" the non-compete restriction.
The surgeon has sought other employment at a nearby hospital in Canton, Ohio, which would provide higher pay, more responsibilities and safeguard her student loan repayment status. But the noncompete clause in her current contract prevents her from practicing at a location within 22 miles of her current practice. The Canton hospital is 19.4 miles from Summa and is a 22.1-mile drive, according to the report.
Michael Bernstein, Summa's spokesperson said in a statement to Becker's that the health system wouldn’t comment on the litigation. He said that the PSLF program is "not a Summa Health benefit."
We have made counselors available with expertise in assisting healthcare workers navigate personal and private student loans," he added. "The services they provide are confidential, individual, voluntary and at no cost to employees."
Dr. Gulotta did not immediately respond to Becker's request for comment. This article will be updated if more information becomes available.