Lawsuit Says Doctors Will Be Indentured Servants If Merger Takes Place

A pending merger between two Newburgh, New York area healthcare providers is being threatened by a lawsuit. Seven doctors with partnerships in Crystal Run Healthcare are objecting to terms of a merger with Montefiore Medical Center, claiming that the deal would reduce them from business partners to “indentured servants.” The seven plaintiffs, are among 133 physicians with partnership roles at Crystal Run. They have refused to sign documents to complete the merger and become employees of the combined venture, set to take effect on Jan. 1.

The seven plaintiffs argue that the business merger effectively dissolves the Crystal Run partnership, thus entitling them to the remaining funds in their capital accounts, 85 percent of “residual collections” for their patients’ pending insurance payments, and shares of Crystal Run’s other assets. Among other objections, they say they could be moved to any facility of the new entity without consultation and would have to give three years’ notice if they want to quit.