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Bellin Hospital Files Suit Against BAMC

Issue Date: March 19, 2014

In a complaint filed Monday, March 17 in Marinette County Circuit Court, Bellin Memorial Hospital, Inc., alleges that Bay Area Medical Center (BAMC) has violated portions of the agreement reached in 2000 when they joined to form NorthReach Healthcare, LLC by pursuing an arrangement by which Aurora Health Care would invest in the hospital. The complaint charges that by doing so, BAMC failed to honor commitments made to Bellin and NorthReach in the Operating Agreement established when NorthReach was formed as a 50/50 partnership between Bellin and BAMC.

Bellin also is seeking a temporary injunction that would maintain the status quo for 60 days or until the litigation has been resolved.

At the heart of the issue is a pending decision by BAMC to partner with Aurora rather than Bellin for operation of the BAMC hospital facility that began as the county-owned Marinette General Hospital.

One of the major issues is a 2-year non-compete clause that could cause some physicians currently working for NorthReach to either suspend their practices or leave the area. BAMC is trying to negate that clause.

Bellin filed suit Monday, March 17 claiming that BAMC’s selection of Aurora Health Care as a possible partner violates terms of their joint ownership of NorthReach Healthcare. Bellin is asking for full ownership of NorthReach with no compensation to Bay Area Medical Center.

In the lawsuit Bellin is asking the court to freeze a 60-day period where one or the other would be required to buy the other’s interest in NorthReach.

NorthReach Healthcare is a 100-clinic network of primary care physicians, nurse practitioners and physician assistants practicing in Marinette and Menominee Counties. It is a joint venture of Bay Area Medical Center of Marinette and Bellin Health System of Green Bay.

NorthReach has a fully functional network laboratory and a central administrative office in Marinette that houses the billing, transcription, customer service and administrative departments.

Twenty-six board certified or board eligible health care providers offer services in family medicine, internal medicine, geriatrics, pediatric and adolescent medicine, and women’s health at various clinic locations stretching from Peshtigo to the south of Daggett, Mich. to the north. Select advanced services are offered at many clinics including on-site laboratory services, on-site x-ray services, mammography and bone densitometry.

Many NorthReach physicians are also on staff at Bay Area Medical Center providing services such as obstetrics and delivery, surgical procedures and hospital inpatient care. Other physicians coordinate the inpatient care for their patients with the BAMC Hospitalists program.

That could all change if the non-compete clause is enforced and the Bellin suit prevails.

Bellin’s injunction request states that under the guise of an offer to transfer membership units in NothReach in accord with the operating agreement, BAMC was in fact improperly seeking to evade provisions of the Operating Agreement.

In a letter to Bellin President George Kerwin dated Tuesday, March 4, BAMC President and CEO Edward Harding had offered to sell its interest in NorthReach to Bellin for $11.7 million, with the stipulation that title would be transferred free and clear and that NorthReach and Bellin would release BAMC from its agreement to not compete, not try to attract the buyer’s employees and not attempt to enforce those provisions. NorthReach has 187 employees in the service area, including many nurses, practitioners and physicians.

Bellin had previously offered to buy BAMC’s NorthReach shares for $3.2 million, which they said was fair market value.


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