In the latest fight against corporate medicine, an emergency medicine group in Oregon is claiming that the decision to replace it with an out-of-state staffing firm is violating one of the country’s newest laws to prevent corporate medicine from muscling into local markets.
Earlier this year, PeaceHealth announced that it was hiring ApolloMD to staff EDs at three hospitals in the Eugene area beginning this summer. The health system would not renew the contract of Eugene Emergency Physicians, a 41-member group that has worked for Peace Health for 35 years.
In March, the ED group sued, claiming that PeaceHealth’s decision to bring in ApolloMD violates a 2025 Oregon law that aims to keep corporations and private equity firms from controlling medical practices. State law requires that medical groups be owned and governed by physicians who are licensed in the state. Analysts say the changes give Oregon the toughest laws in the country to prevent national corporations and private-equity investors from taking over medical groups.
To get around this type of law in Oregon and other states, staffing groups often use what’s called a “physician-friendly model.” Groups name a local physician as the owner of a group and claim that the physician is running that group on its behalf.
According to reporting by Oregon Public Broadcasting, the local ED group is accusing ApolloMD of using this model.
ApolloMD has said a new group known as Lane Emergency Physicians is owned by Johne Philip Chapman, MD. In a letter to Oregon lawmakers, ApolloMD said the company will handle “nonclinical administrative support” like billing and HR, but Chapman will make all clinical decisions.
In its lawsuit, the ED group argued that the model being used by Apollo “is exactly the business model that Oregon’s corporate practice of medicine laws prohibit.” It maintains that ApolloMD is violating Oregon law by allowing the company to control the new group and control its clinical operations.
The ED group’s lawsuit added that Chapman, who has worked with Apollo in the past, is from Illinois and got his Oregon medical license on March 17. The new ED group was registered in Oregon in February.
The lawsuit is the first to be filed in the state since Oregon updated its laws regulating corporate influence in medicine. The local ED group is asking the courts to void the pending contract between PeaceHealth and ApolloMD and to allow the local group to continue working for PeaceHealth while the lawsuit proceeds.
