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Clinic loses suit naming Wal-Mart.

A U.S. District Court judge recently ruled that Wal-Mart Stores Inc. didn't do anything wrong when it terminated its lease agreement with a Little Rock walk-in health clinic.

On Nov. 30, U.S. District Court Judge Robert Dawson tossed the lawsuit filed against Wal-Mart by Maumelle Medical Clinics Inc.

In 2010, Maumelle Medical Clinics accused the Bentonville retailer of racial discrimination for canceling its lease agreement for the 30 Minute Clinic in Wal-Mart's Supercenter on Baseline Road.

"The Court finds [Maumelle Medical Clinics] failed to meet its burden of showing discriminatory intent" by Wal-Mart, Dawson said in his 17-page ruling.

Jerry Poole, who also has a health clinic in Maumelle, hired Dr. Charles Schock and opened the Wal-Mart clinic in November 2009. The business quickly grew, treating 30 to 40 patients a day, according to the clinic's lawsuit filed in U.S. District Court.

But nearly all the patients were black or Hispanic and were in poor health, the lawsuit said. "Wal-Mart employees and managers began to complain to [Maumelle Medical Clinics] concerning the 'type of people' the clinic was attracting," the lawsuit said. Wal-Mart then terminated its lease agreement with Poole.

Wal-Mart told a very different story. The company said its pharmacy started receiving a large number of prescriptions from the 30 Minute Clinic for Phenergan with codeine, which can be addictive and used to make the street drug called Sizzurp or Purple Drank. (Schock, according to his own deposition, used preprinted prescription slips for Phenergan with codeine to save time.)

Wal-Mart officials said, "The number of prescriptions for [a] controlled substance by the Clinic was unlike any pattern [Wal-Mart] had ever seen" Wal-Mart officials also said it observed suspicious activity that appeared to be drug deals between people who visited the clinic and then the pharmacy.

Poole and his attorneys didn't see it that way.

"I have rarely seen the equal of such overt racial discrimination against African Americans and Hispanics since before the Civil Rights Act of 1964," Mark Lane of Charlotteville, Va., an attorney for Maumelle Medical, said in a Nov. 21 news release. The news release was issued before Dawson's ruling. The case was scheduled to go to trial on Dec. 12 in Hot Springs, but Dawson issued a summary judgment in Wal-Mart's favor.

Poole said he planned to appeal, and his lawyer, David Bowden of Little Rock, is attempting to get the case filed in a state circuit court.

"We stated [the lawsuit with] both state and federal claims, and the judge dismissed the state claims with prejudice as well."

When a case is dismissed with prejudice, it can't be refiled.

He asked Dawson to revise his order so the state claims are dismissed "without prejudice" so it can be refiled.

That motion is pending.

Arkansas Mutual Cuts Rates by 12.5 Percent

Arkansas Mutual Insurance Co. of Little Rock recently announced that premiums for its medical liability insurance would drop 12.5 percent.

The rates, which have been flat for the past couple of years, dropped because Arkansas Mutual is "very selective" about what doctors it underwrites and has controlled its losses, said its CEO, Corey Little.

Its premium revenue has been rising, too. In 2009, it wrote $467,913, and in 2010 it was $980,339, according to the Arkansas Insurance Department.

Arkansas Mutual had $22,500 in direct losses incurred--that is, claims submitted--in 2010 and $2,251 in 2009, the Insurance Department showed.

Little said the insurance carrier rejected about 150 doctors who wanted into the plan. It currently writes insurance for about 300 doctors.

"As the CEO of the company, I don't have anybody telling me to bring in more doctors," Little said. "Our policyholders are more excited that we've brought in the right doctors."

Medical malpractice premiums vary depending on the specialty, but the average is about $10,000 annually, he said.

Founded in 2008, the nonprofit organization is owned and governed by its physician policyholders.

"Arkansas Mutual was founded in order to stop the needless outflow of millions of premium dollars that were leaving Arkansas and going to other states in the form of profits or dividends," Little said in a Dec. 8 news release.
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Title Annotation:Health Care
Author:Friedman, Mark
Publication:Arkansas Business
Geographic Code:1U7AR
Date:Dec 19, 2011
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