ATLANTA (June 22, 2023) | Senator Nan Grogan Orrock (D – Atlanta), Representative Kim Schofield (D – Atlanta) and Richard Rose, President of the Atlanta NAACP, announced they have filed comments urging Georgia Attorney General Chris Carr to address concerns about the Board of Regents’ plan to turn over control of Augusta University Health System (AUHS) to Wellstar Health Systems, Inc.

State law requires the Attorney General to review a proposed transfer of control of any non-profit hospital for the purpose of safeguarding its charitable assets and ensuring that the transaction proceeds are used for appropriate charitable health care purposes. Attorney General Carr’s office is currently conducting a review of Wellstar’s proposed acquisition of AUHS and will hold a public hearing in Augusta on June 27.

“All Georgians have a stake in what happens to AUHS because it is the primary teaching hospital for Medical College of Georgia,” said Sen. Orrock. “The hospital and clinics need to be operated by people whose organizational culture and practices demonstrate their trustworthiness for the mission of training professionals and providing high quality care rather than simply pursuing business opportunities.”

Atlanta NAACP President Richard Rose says, “Wellstar violated our trust when it chose in 2022 to abandon suddenly the largely minority communities formerly served by Atlanta Medical Center and Atlanta Medical Center South even as it was undertaking to acquire AUHS, and with it, the opportunity to build a new hospital and doctors office complex in mostly white Columbia County. Do we think Wellstar’s record here suggests the company is a dependable party to control an institution so important to the state?”

“Furthermore, Wellstar has not yet made amends for the damage it caused our communities when it closed the hospitals,” adds Representative Schofield.

Sen. Orrock and Rep. Schofield represent the districts where these hospitals were located. They say their constituents have suffered a severe reduction in their access to health care which has been documented in a new study completed by Ernst and Young for Fulton County and Morehouse Medical School.

Sen. Orrock emphasizes, “We are still working to ensure Wellstar compensates our communities so that they can restore services and improve access to quality care. Attorney General Carr should consider the potential for Wellstar to face financial obligations and limitations that could affect their plans and promises with regard to AUHS.”

Three federal complaints on the Wellstar closures are pending before the U.S. Department of Health and Human Services Office for Civil Rights (OCR), the U.S. Department of Justice (DOJ), and the Internal Revenue Service (IRS). The complaints to OCR and DOJ concern the fact that Wellstar’s closure of the two Atlanta hospitals, citing a disparate negative impact on patients who are Black or other people of color. The complainants ask that the agencies investigate Wellstar, a recipient of federal funds required to comply with Title VI of the Civil Rights Act of 1964, make findings on whether Wellstar’s actions violate the Act, and if so, require Wellstar to redress fully the harm to the community.

The complaint to the IRS is based on Internal Revenue Code requirements that nonprofit hospitals meet certain obligations in order to qualify for their tax-exempt status. Among those being that nonprofit hospitals must conduct a Community Health Needs Assessment and then adopt an implementation strategy to meet the identified needs.

The complaint states that Wellstar identified critical needs in the community served by the two hospitals, first among them, access to health services, but instead of planning to meet those needs, Wellstar closed down its hospital and physician’s office services, severely disrupting an existing ecosystem of care that had served the community for decades. The complaint asks the IRS to determine whether Wellstar continues to qualify for tax benefits.

Sen. Orrock stated, “IRS has revoked at least one hospital’s tax exemption for a failure like Wellstar’s to adopt an implementation strategy.” She continued, “Besides requiring Wellstar to pay federal, state and local taxes, a revocation of its charitable tax-exempt status would seem likely to disqualify Wellstar from taking over AUHS, given the Attorney General’s obligation to safeguard AUHS’s charitable assets.”

Rep. Schofield said, “We urge Attorney General Carr to ensure that Georgia’s interests with regard to the AUHS hospital and other facilities are rigorously protected.”

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Sen. Nan Orrock serves as the Democratic Caucus Secretary. She represents the 36th Senate District which includes portions of Fulton County. She may be reached at 404.463.8054 or by email at nan.orrock@senate.ga.gov.