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Photo by Jim Craven Dr. John Forsyth, a longtime cardiologist at the Medford Clinic, says doctors are trying to ensure a smooth transition for their patients. Negotiations about the future of the clinic are under way with Physician Partners Inc., a management group the clinic joined in 1997. Clinic: Change is inevitable Doctors negotiate for Medford Clinic's future By SUSAN JAY Amid all the rumors and speculation, only one thing is certain -- Medford Clinic will not look the same in the future as it does today. Clinic doctors and a management group are in intense negotiations over the future of Southern Oregon's largest medical clinic. Negotiations could wrap up by the end of the month, and the results will help doctors decide if they will leave or stay, how long the clinic will operate in its present form and if and when it will cease to exist. A quarter of the clinic's physicians have resigned this year, and rumors have been swirling since spring that the clinic was on the verge of closing. Some doctors are still thinking of staying with the clinic, some want to leave, but practice in the same building, and some have left for independent practices. In the past chaotic months, Medford Clinic doctors have concentrated on the continuity of patient care. Most are making sure that if they leave the clinic, their patients can go with them. Since January, 22 of 86 doctors have left. Three doctors have joined it in that time: a nephrologist, a podiatrist and a family practice physician. Of the 22 who left, 15 clinic physicians have joined PrimeCare, an independent physician association that will represent them in health insurance contracts. Because PrimeCare has contracts with the same HMOs and health plans as Medford Clinic, "there is a very high probability that the patients can continue their physician relationship without having to change insurance," said Mike Bond, PrimeCare CEO. The doctors who remain, which include those still seriously thinking of leaving, have discussed dissolving the clinic but haven't taken a vote because they are in sensitive negotiations with the management group that owns the clinic's assets. That group, Physician Partners Inc., formed in 1997 when Medford Clinic merged with the Corvallis Clinic and HealthFirst in Portland. It ran into trouble last year when the biggest of the three clinics, HealthFirst, experienced financial problems and half of its doctors resigned. The group borrowed $8 million from U.S. Bank, and received an investment of $15 million from First Union Capital Partners of North Carolina. PPI was touted as a management group that would raise capital for expansion and technology as well as trim administrative costs and add information systems. It was supposed to help the network of clinics grow. But the harsh reality now is that Medford Clinic doctors do not own any of the clinic's assets and are shareholders in an entity -- PPI -- that appears to be unraveling. The clinic is negotiating to end the management agreement, said Jerry Livaudais, clinic medical director and acting chief executive officer. "I would expect over the next couple of weeks it will become clear if we can close the gap or whether or not it's possible to reach an agreement," Livaudais said. "I think we'll end up with a settlement," he said. "There's a lot at stake for everyone." If Medford Clinic does get out of the agreement, that would clear the way legally for the clinic to dissolve or for doctors to keep using the clinic name. If it doesn't, the entanglement would limit doctors' options. A key question is how much it will cost the clinic to end its agreement with PPI. Part of that cost, potentially, could be to doctors who are bound by contracts that require them to pay part of their income to the clinic if they leave soon after joining. For some, that could amount to thousands of dollars. Livaudais and Dr. John Forsyth, a longtime Medford Clinic cardiologist, say the negotiations are key to a smooth transition for the clinic's patients and doctors. "I think all of the members of the staff, the physicians and the employees, are working incredibly hard right now to do two things at once," Forsyth said -- continuing to provide quality care while trying to ensure an orderly transition to what happens next. Mail Tribune Copyright � The Mail Tribune 1999, Medford, Oregon USA