George Washington University (GWU) filed a complaint last Friday against its hospital partner Universal Health Services (UHS) for $100 million in District of Columbia Superior Court, claiming that UHS embezzled profits that are meant for the university’s medical school and the doctors, The Washington Post reported.
UHS is the university’s partner at the Foggy Bottom hospital campus. It owns 80 percent of D.C.’s George Washington University Hospital via a 22-year-old agreement with the university.
“Instead of investing sufficient Hospital revenue in the University’s research and teaching missions … UHS has paid itself these funds in the form of outsized dividends from artificially inflated, excess profits,” the complaint says.
According to the lawsuit, the medical school and physician network linked to the hospital are struggling financially, while the hospital’s average operating margin has been over 13 percent over the past four years. The median figure at teaching hospitals is 2.4 percent, the hospital states.
Through a statement to The Washington Post, UHS denied the allegations.
“This lawsuit is nothing more than an attempt by the new leadership of the university to renegotiate — via litigation — agreements it entered into over 20 years ago,” the UHS statement said. “UHS regrets that GWU’s new leadership has elected to file an unfounded lawsuit, to the substantial expense and distraction of all involved, rather than attempt to resolve its business concerns through good faith discussions.”