Dive Brief:
- For-profit hospital operator Tenet Healthcare is asking a federal court to force The Leapfrog Group, a nonprofit that posts widely read hospital grades, to pay $10.5 million in attorney’s fees and other legal costs after a judge ruled earlier this year that Leapfrog unfairly deflated the ratings of five Tenet-owned hospitals in Florida.
- In legal documents Friday, Tenet argued Leapfrog should be responsible for the costs of the litigation, arguing the fees are necessary for deterring deceptive practices and amount to a fraction of the financial harm done to its facilities as a result of Leapfrog’s ratings.
- But Tenet’s requested sum is “grotesquely inflated” and would “cast a specter of financial ruin” over Leapfrog, the nonprofit’s attorneys said in a counter filing. Requiring Leapfrog to pay Tenet would also be premature given the company hasn’t exhausted its option to appeal, they said.
Dive Insight:
Twice a year, Leapfrog publishes a set of hospital safety grades that customers can use to assess facilities. The company says its ratings, which include detailed information on infection statistics, safety problems, staffing and more, keep hospitals accountable to the public and are an important tool for healthcare transparency.
One metric that informs Leapfrog’s safety grades is a survey issued to hospitals. Leapfrog says the survey is voluntary. But starting in 2024, five Tenet-owned facilities in Florida — Good Samaritan, Delray Medical Center, Palm Beach Gardens Medical Center, St. Mary’s and West Boca Medical Center — started receiving poor grades after opting not to participate.
Tenet sued Leapfrog last year over the falling scores, arguing its facilities were being penalized for not filling out the survey.
In March, Judge Donald Middlebrooks of Florida’s southern district court agreed, ruling Leapfrog must remove the Tenet facilities’ safety grades. Middlebrooks also required Leapfrog to send corrective disclosures to companies that paid to license the 2024 and 2025 grades, and to correct future contracts and advertising materials.
Now, Tenet is seeking approximately $2 million in attorney’s fees and legal costs for each plaintiff hospital, totalling just shy of $10.5 million.
Leapfrog “should consider itself lucky” that Tenet didn’t ask to recoup more money, said Maggie Gill, the eastern group president of Palm Beach Health Network, a subsidiary of Tenet that includes the plaintiff hospitals. The financial burden on Tenet as a result of Leapfrog’s “punitive, made-up grades” and “targeted bullying campaign” was multiples of what the hospitals are now seeking, she said.
Meanwhile, Leapfrog alleges Tenet’s request is a strategy to tax the nonprofit’s limited resources before Leapfrog is allowed to complete an appeal. The $10.5 million sum is more than Leapfrog’s revenue of $8 million in 2024, according to documents filed in the case.
“Something’s gone awry when hospital corporations owned by Tenet convince a court to muzzle a nonprofit watchdog like Leapfrog, which reports on hospital safety,” Leapfrog’s lead attorney Derek Shaffer said in a statement.
“Now Tenet and its army of 25 lawyers are trying to stick Leapfrog with their $10.5-million legal tab. If they succeed, they’ll be doing so at the expense of not only Leapfrog and its freedoms but millions of patients whose interests Leapfrog protects,” he said.
Tenet’s bid to recoup fees is the latest development in a case in which both parties claim the other side isn’t playing fair.
Since Middlebrooks’ ruling, Tenet has claimed that Leapfrog isn’t respecting the rules of the judge’s injunction.
For example, Leapfrog’s website now places a red hazard symbol with a warning and exclamation mark of facilities within a 50-mile radius of Palm Beach, Florida that have opted not to participate in Leapfrog’s survey, Tenet says.
“There are 61 facilities in your search that declined to respond to Leapfrog’s request for patient safety and quality data,” reads Leapfrog’s ratings website, according to a screenshot included in a legal notice filed by the Tenet hospitals. “Patients like you have no other source to get this critical, life-saving information. Do you want to show these facilities?”
Leapfrog’s website “is clearly designed to leave consumers with the net impression” that hospitals that don’t complete the survey are “less safe” than those that do, Tenet said.
In response, Leapfrog said those claims were “worse than meritless” and are an attempt by Tenet to censor Leapfrog.
“The injunction did not, and could not, prohibit Leapfrog from truthfully informing the public that certain hospitals, like Plaintiffs, declined to respond to its voluntary survey, or from opining that such nonparticipation endangers patient safety,” attorneys for Leapfrog said in a letter to Tenet.
