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Judge refuses to grant judgment without a trial in lawsuit arguing Central Health misused funds

Birch v. Travis County Healthcare District was filed originally filed in 2017.
Renee Dominguez
KUT News
Birch v. Travis County Healthcare District was originally filed in 2017.

A Travis County district judge has denied a request for judgment without a trial in a lawsuit accusing Central Health of improperly using taxpayer money.

Central Health, Travis County's public hospital district, is charged with providing medical care to low-income residents. It is funded by taxpayers.

Rebecca Birch, Richard Franklin III and Esther Govea sued Central Health in 2017, alleging it acted improperly by giving Dell Medical School money that was used for things like education, research and administrative costs. Their lawyers argued that under Texas’ rules for public hospital districts, Central Health's funding should be used only on medical costs for poor residents in Travis County.

Central Health makes an annual $35 million payment to Dell Medical School.

The plaintiffs asked Judge Amy Clark Meachum for judgment without a trial and an order preventing Central Health from spending money on anything not directly related to medical care for low-income patients.

Central Health’s attorneys argued the payments have been in line with the hospital district’s mission and are necessary to expand the services Central Health provides and "improve outcomes for the patients it serves.”

They asked the judge to dismiss the case, arguing taxpayers don't have standing to sue government entities like Central Health.

In her ruling Tuesday, Judge Meachum denied the request for judgment without a trial. She also ruled payments already made to Dell Medical School could not be recouped as an outcome of a possible trial.

“Judge Amy Clark Meachum’s decision denying the Plaintiffs’ motion for summary [judgment] is a positive outcome for Central Health,” a representative for the hospital district said in a statement. “We remain dedicated to our mission: delivering the highest quality, most equitable healthcare to low-income residents of Travis County.”

Fred Lewis, an attorney for the plaintiffs, said his clients had only ever been interested in seeking a halt to future spending — not recouping past payments. He said his team is evaluating whether to appeal the decision or pursue a trial.

“The core of the case remains: prospective relief against [Central Health’s] CEO,” Lewis said in a statement. “We never asked for retrospective relief; that was all defense malarkey. The case is alive and will continue.”

Ted Burton, a communications officer for Central Health, said the case has cost the district $244,022 in outside legal fees since 2017.

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Olivia Aldridge is KUT's health care reporter. Got a tip? Email her at Follow her on X @ojaldridge.
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