Tuomey: Feds 'demanded' executives resign - wistv.com - Columbia, South Carolina |

Tuomey: Feds 'demanded' executives resign

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Tuomey Healthcare System's attorney claims it was federal attorneys in its legal case that "demanded" the former CEO and vice president resign from the hospital last year.

Former CEO Jay Cox and former Vice President Gregg Martin resigned from Tuomey in September, after the hospital was found guilty of violating the so-called Stark Law and the False Claims Act. The court ordered the hospital to pay $237 million in damages. Toumey then filed an appeal.

Tuomey filed a motion for a protective order Jan. 15 requesting separation agreements between the hospital and Cox and Martin remain sealed in the court file. The hospital claims that releasing the documents to the public is a violation of contractual confidentiality, according to court documents.

Now, the hospital claims the agreements were a condition of the federal government during settlement discussions.

"After demanding that Tuomey end its relationship with these long-term executives as a condition of conducting settlement discussions, the government is now unfairly complaining about these separation agreements because Tuomey cannot satisfy the government's unrealistic financial demands," as written in Tuomey's Feb. 13 response.

The hospital's attorney added that the separation agreements have nothing to do with Tuomey's ability to pay and are not necessary to any analysis of the money the business has set aside for the pending appeal.

After Tuomey officials said it could be forced to close if it paid the total damages, federal officials asked for a $50-million bond and $20 million in escrow while the appeal process continues. The hospital then claimed that it would be forced to file bankruptcy if it paid the $70 million, but an analysis by the government claims that amount would not affect healthcare services at Tuomey.

The hospital claimed in a previous motion that the hospital agreed to keep the separation agreements sealed from public disclosure. However, federal prosecutors disagree.

Federal prosecutors said the hospital's argument for keeping the documents sealed has no merit in court.

Tuomey stands by its request for a protection order to keep the separation agreements confidential.

WIS previously found 990 forms filed by the hospital that showed Cox's salary as more than $1 million in 2011, with Martin's at more than $630,000. The hospital would not release the recent information on the former executives to WIS, citing personnel reasons.

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