Seven physicians sue Drexel College of Medicine alleging contract breach when Hahnemann closed

Seven Drexel University College of Medicine doctors filed a lawsuit alleging that Drexel breached their contracts by failing to give them enough notice that they were being terminated following the closure of Hahnemann University Hospital and the merger of Drexel’s clinical practices with Tower Health.

Drexel wants to end the doctors’ employment on Jan. 14, 2020. The doctors’ lawsuit says the university can’t do that until June 30 under their contracts and seeks full payment plus damages. It’s not clear how much it would cost Drexel to continue paying the doctors through June.

The lawsuit, filed Thursday in Philadelphia Common Pleas Court, also alleged that Drexel mismanaged the transition of patient care, making it more difficult for the doctors to take their patients to new practices.

“With the closure of Hahnemann, Drexel was at a crossroad — should it honor its longstanding contractual obligations to the doctors vis-à-vis an appropriate notice of termination or should it breach those contracts in an effort to save money? Drexel shamefully chose to save money,” according to the lawsuit, filed by William A. Harvey of Klehr Harrison Harvey Branzburg LLP.

Drexel said that it hadn’t reviewed the complaint and that the university’s policy is to not “comment on matters in litigation.”

Drexel’s medical school was the academic partner for Hahnemann, and the 245 physicians employed by Drexel provided much of the care at the Center City hospital, which closed in phases last summer. In June, Drexel unsuccessfully sought an injunction to block the closure, arguing that its academic affiliation agreement with Hahnemann prohibited the hospital’s closure without the university’s consent.

Even before the closure of Hahnemann was announced, Drexel was looking at combining its physicians group with that of Tower, which has been expanding in the Philadelphia region. The two nonprofits had already signed an academic affiliation agreement and were jointly building a four-year medical-school campus in West Reading, Pa., near Tower’s flagship Reading Hospital.

June’s announcement that Hahnemann would close, and the bankruptcy of Hahnemann and St. Christopher’s Hospital for Children a few days later, made the merger of the two physician groups even more important for Drexel, the university’s president, John Fry, said in July.

The catch was that Tower Health Medical Group wanted to hire only 60% of the 800 Drexel physicians and clinical staff, which meant that 320 would lose their jobs.

The seven doctors who sued Drexel are Sung-Hae Cho (cardiology), Kevin D’Mello (internal medicine), Paulina Gorodin Kiliddar (cardiology), Ibyonu Lawrence (internal medicine), Ricardo Morgenstern (gastroenterology and hepatology), Neilanjan Nandi (gastroenterology), and Sandra Wolf (gynecology).

On July 18, each received a letter saying that their employment with Drexel would end on Jan. 14, or 180 days later.

The crux of the doctors’ complaint is that their original contracts say Drexel cannot terminate them before the end of the academic year, which is June 30, according to the lawsuit. The doctors say that Drexel’s 2014 attempt to change the terms of the contract to allow termination in 180 days did not legally change the original terms.

In a separate matter, physicians formerly employed by Hahnemann and physicians at St. Christopher’s who have either lost their jobs or will lose them when Drexel and Tower take ownership of the hospital this month are facing the loss of medical malpractice insurance covering the period they worked at the hospitals.

The form of insurance at issue is called “tail” coverage because it stays in effect if lawsuits are filed in the future involving care provided at a past employer. Hundreds of residents and fellows who trained Hahnemann are facing the same problem.