A lawsuit involving dozens of Kansas City-area doctors has spilled into the Republican primary for the U.S. Senate seat in Kansas.
Mark Idstrom — a physician and a former employee of Kansas City-area company Alliance Radiology — is suing the firm. His lawsuit accuses Alliance of an illegal “price-fixing scheme” designed to prevent competition and drive up costs for health care services such as X-ray and MRI diagnoses.
One of Alliance Radiology’s partners is Milton Wolf, who is running against incumbentSen. Pat Roberts in the GOP primary.
The Roberts campaign says Wolf’s partnership in Alliance Radiology and the lawsuit suggest that the physician may be motivated by profits instead of patients.
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Wolf denies that claim, instead accusing Roberts of promoting the lawsuit story to divert attention from his own record.
Wolf is not a named defendant in the case, which was filed in 2012 and is now before a Johnson County judge. But Idstrom’s attorney, Brandon Boulware, alleged that Wolf, as a partner, was part of an attempt by Alliance Radiology to limit competition for radiological services.
“Absolutely,” he said, suggesting all of the firm’s partners were participants in the company’s business strategy.
When asked whether that included Wolf, Boulware said yes.
Lawyers for Alliance Radiology and a spokesman for Wolf’s campaignstrongly denied the accusations in the lawsuit and Boulware’s conclusions.
In court papers and interviews, they described Idstrom as a “disgruntled” former employee and director who raised concerns about competition and price only after he was dismissed from the company in 2012.
“It’s just nonsense,” said Mike Saunders, a lawyer representing Alliance.
Lawyers for the company also say Alliance Radiology, first formed in the late 1990s, is a legitimate professional organization, not an improper “scheme” to drive out other doctors and competitors.
Wolf issued a statement Monday saying the accusations were irrelevant to his candidacy.
“Attempts to link this frivolous case to public policy propositions I have made while running for U.S. Senate show either a failure, or a refusal, to follow the facts,” the statement said.
Wolf’s employment and participation in Alliance Radiology is not in question. He is one of 48 physicians listed on the company’s website.
Wolf’s financial disclosure statement, filed as a candidate, shows he earned $916,033 in salary from Alliance over a two-year period. He also earned $157,379 as a partner in the Johnson County Imaging Center, a health care facility owned by a division of Alliance Radiology, during those two years.
Leroy Towns, a spokesman for the Roberts campaign, said the lawsuit suggests Wolf’s lack of concern about patient expenses.
“What has Dr. Wolf done in his own practice to hold down health care costs?” Towns said in a statement.
But Wolf said the issue has been driven by politics. He said he was taking criticism related to the lawsuit because he attacked Roberts’ living arrangements.
A recent New York Times story revealed that Roberts leases his Dodge City home and rents a different space as is his legal residence.
“Planting this (lawsuit) story in the media, and desperately trying to connect it to my policy propositions, is par for the course for a 47-year Washington insider,” Wolf’s statement said.
The exchange comes after The Topeka Capital-Journal reported Sunday on Wolf’s use of Facebook several years ago to post grisly images of some patients. Wolf apologized for the posts, but he said they, too, were a diversion from the issues in the campaign.
The testiness of the newest exchange reflects an unusual bitterness in the underlying legal case between Alliance and Idstrom.
The Johnson County judge hearing the case has refused to dismiss the allegations of illegal restraint of trade lodged against the firm. Further hearings are scheduled. A jury could hear the case later this year.
In hundreds of pages in the court file, though, Alliance and Idstrom accuse each other of bad faith in relation to the provision of diagnostic radiology services. In one filing, Alliance said Idstrom missed meetings and failed to answer mail in time, leading to performance concerns.
But Idstrom said he was fired because he tried to open the market for radiology services in the Kansas City area, potentially reducing costs for patients and insurers. Idstrom “brought this lawsuit to correct wrongs,” according to one filing.
In the initial complaint, Idstrom alleged Alliance controls more than half of Kansas City’s market for radiological services.
Idstrom said he has been unable to find work in the Kansas City area since the dismissal, in part because of his lawsuit. He claims potential damages in excess of $7.8 million.
Alliance was formed in Missouri in 1998 to unite radiologists from four practices under one umbrella. Wolf began working for Alliance in 2006, and now works in the Shawnee Mission division. According to his financial disclosure, he became a partner in July 2008.
Alliance argues Idstrom’s restraint-of-trade claim will fail because the company’s divisions cannot be compelled to compete with one another. But Idstrom’s lawyer says the four divisions are more like separate firms and should be required to compete on price and quality of service.
Wolf’s earnings and role in the company may become more important as the campaign unfolds because of his sharp criticism of the Affordable Care Act. Both Wolf and Roberts oppose the law.
In a statement issued Sunday, Wolf’s campaign said Roberts was engaged in a “war on doctors” and “character assassination.” Roberts’ campaign, in turn, accused Wolf of a “lack of judgment.”