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Taxpayers Sue Central Health Over Money Spent On New Medical School

Martin do Nascimento
The lawsuit accuses Central Health of violating the law by spending money on a new medical school.

Three Travis County residents filed a lawsuit Wednesday asking a Texas court to tell Central Health it can’t spend taxpayer money on anything other than health care for low-income people.

Central Health is the local hospital-taxing district in Travis County.

The lawsuit follows a ballot measure that was before Travis County taxpayers in 2012. That year, voters were asked to pay more on their property tax bill to fund, among other things, a new medical school.

Proposition 1 said the money would be used for:

“[I]improved healthcare in Travis County, including support for a new medical school consistent with the mission of Central Health, a site for a new teaching hospital, trauma services, specialty medicine such as cancer care, community-wide health clinics, training for physicians, nurses and other healthcare professionals, primary care, behavioral and mental healthcare, prevention and wellness programs, and/or to obtain federal matching funds for healthcare services.”

Fred Lewis, an attorney representing the plaintiffs, said under state law, hospital-taxing districts can only provide care to the poor.

“The voters had the right – and did – raise taxes for health care for the poor,” he said. “They do not have a right to expand Central Health’s mission beyond what the Texas Constitution and statutes allow.”

Lewis said some of that money, which amounts to an extra $35 million a year, has been spent on non-health-care-related activities, including business operations in the new medical school, among other things.

“We have asked repeatedly for Central Health to spend its tax dollars according to the law on health care for our county’s most poor,” Rebecca Birch, one of the plaintiffs, said in a statement. “Neither Central Health’s Board nor the Travis County Commissioners, who are its financial overseers, have listened. This lawsuit was our last option.”

But Mike Geeslin, CEO and president of Central Health, said the organization is providing care to the poor in Travis County.

He said the medical school that was created by that tax referendum – the Dell Medical School at The University of Texas at Austin – has been working to improve care for low-income people. That's what was promised to taxpayers, he said.

“And that’s where our focus remains at this point – is making sure that we are putting together all the pieces so that low-income and the uninsured have the best possible care,” he said.

Geeslin said Central Health is also serving more people than in years past. He said last year it funded care for more that 143,000 low-income people in Travis County, which represents a 6 percent increase compared to 2015.

Dell Medical School officials said in a statement that they have been providing care as part of their mission.

“Just yesterday, we opened the first UT Health Austin clinics, focused on providing patient-centered and outcome-focused specialty care to all Travis County residents,” Dr. Clay Johnston, dean of the medical school, said in a statement. “This builds on Dell Medical School’s existing clinical efforts, including faculty physicians and medical residents serving all patient populations in clinic and hospital settings.”

In a statement, Central Health officials also took issue with the legal issues raised by the lawsuit.

“As we’ve stated previously, we are confident Central Health’s investment in Dell Medical School at The University of Texas is legal and appropriate,” the statement said.

Ashley Lopez covers politics and health care. Got a tip? Email her at Follow her on Twitter @AshLopezRadio.
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