30 Doctors Sue St. Joseph Medical Corp.

SANTA ANA — About 30 doctors in St. Joseph Medical Corp. filed a lawsuit this week, claiming that the large medical group is trying to strip them of their livelihood by blocking them from notifying patients when they leave the group.

An Orange County Superior Court judge refused the doctors’ request Wednesday for an order temporarily restraining the medical group from terminating physicians who haven’t signed a new group contract.

Afterward, Kevin B. Connolly, the plaintiffs’ lawyer, said he would file an amended complaint by Friday.

The plaintiffs seek general damages of more than $2 million and punitive damages.

Charles Madden, chief executive of Orange Coast Managed Care Services, which manages the medical group, said “there is no basis in fact or merit” to the plaintiffs’ allegations.

The physician-owned medical group, with nearly 600 physicians, serves 125,000 members of health plans. It is independent of St. Joseph Health System, which owns the hospital. However, the health system holds a small, 8% stake in Orange Coast Managed Care.

Connolly said the medical group recently sought to change terms of the contract involving physicians leaving the organization. He said the company violated state law by adding a provision that prohibits doctors from telling patients they are terminating their contract with St. Joseph.

Madden said the group recently amended terms of its contract with the physicians in an effort to meet their requests, but they filed suit anyway. He noted that health plans require that doctors switching plans be prohibited from telling patients to follow them.

Mike Scarano, a lawyer representing the medical group, added that health plans have recently become stricter in enforcing that requirement.

He noted, however, that patients of physicians terminated by the St. Joseph group will receive a letter regarding the change, either from the medical group or the health plan.