Surgeon sues to break up IU Health's 'monopoly' on primary care, vascular surgery

The only independent vascular surgeon in Southern Indiana alleged in a lawsuit that IU Health's monopoly on primary care physicians and vascular surgeons in Bloomington is anti-competitive and lowers care standards.

Ricardo Vasquez, MD, a Bloomington-based independent vascular surgeon, filed a lawsuit against Indianapolis-based IU Health June 11 after the health system acquired nearly all primary care physicians in Southern Indiana and allegedly restricted referral patterns to specialists within the IU Health network. The lawsuit also alleges IU Health employs 75 percent of vascular surgeons in Bloomington and can direct where surgeries are performed.

"IU Health's control over primary care services forces patients to see IU Health employed vascular surgeons to their detriment, and sacrifices patients' continuity of care," the lawsuit alleges. "IU Health charges more for patients to see these unfamiliar vascular surgeons — raising prices to consumers and payers — patients receive lower quality care, and patients cannot receive certain vascular surgery services all together from the IU Health vascular surgeons."

Dr. Vasquez previously had privileges at Bloomington Hospital, part of the IU Health network, but also took cases to a competing hospital and Indiana Specialty Surgery Center, which competes directly with an IU Health-affiliated ASC. He alleges Bloomington Hospital improperly revoked his privileges in April 2019 because he took cases outside of the IU Health network and opened an office-based laboratory instead of using IU Health's outpatient vascular services.

In January 2020, IU Health stopped credentialing Dr. Vasquez as a participating provider within the IU Health Plan. The health system then transferred or referred Dr. Vasquez's former patients to IU Health's Methodist Hospital in Indianapolis, a move Dr. Vasquez said increased the cost of care and reduced quality. Prices are higher at Methodist than Bloomington, the lawsuit alleges, and the additional time it takes to transfer patients from the local facility to Indianapolis could be life-threatening.

Dr. Vasquez also accused the health system and Daniel Handel, MD, chief medical officer of IU Health, of spreading false statements about him and filing "meritless complaints" with the Indiana Professional Licensing Agency and Indiana attorney general against him last year. Neither agency investigated the complaints.

Dr. Vasquez asked the court to prevent IU Health and IU Health Bloomington from enforcing an internal referral policy that prohibits its primary care physicians from referring to vascular surgeons outside of its network. The lawsuit also seeks to break up the health system's monopoly over primary care services, and Dr. Vasquez requested payments for compensatory damages and lost income after being excluded from the IU Health referral network.

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