Radiology Group Sues Mary Washington Healthcare for $2.65 Million+
Alleges MWHC Engaged in ‘Blatant Attempt to Destroy Radiologists’ Business’; Warns Ongoing Conflict Could Cause ‘Elimination of Mammography Services within a 50-Mile Radius of Fredericksburg’
Hospital Officials Dismiss ‘financially motivated lawsuit that has nothing to do with patient care’
By Steve Watkins
ADVANCE EDITOR
Virginia Medical Imaging, which for the past 26 years has provided outpatient diagnostic services in the Fredericksburg area through a joint venture with Mary Washington Healthcare, is suing the hospital corporation for $2.65 million after failed attempts to negotiate a renewed service agreement.
That joint venture—the too-similarly-named Medical Imaging of Fredericksburg—is staffed by radiologists and technicians from Virginia Medical Imaging, which has a 49-percent controlling interest in the company. Mary Washington Healthcare, which owns most or all the buildings that house the imaging centers, holds a majority 51 percent interest.
According to the complaint, the breakdown in negotiations between the radiologist group and the hospital corporation was “the impetus for [a] retaliatory campaign” and “insider dealing by Mary Washington” against Virginia Medical Imaging.
The plaintiffs allege that as part of the hospital corporation’s “retaliatory campaign,” hospital officials refused to pay Virginia Medical Imaging money earned during the last three months of 2024. The plaintiffs also claim that Mary Washington Healthcare officials engaged in “bad-faith lease escalation”—specifically at the Imaging Center for Women in Fredericksburg, where after negotiations broke down the hospital corporation suddenly raised the rent nearly 50 percent, significantly above market value, which the plaintiffs say may force the center to close.
The Imaging Center for Women is one of eight Medical Imaging of Fredericksburg facilities in the area, most or all of which perform outpatient MRIs, CT Scans, X-rays, 3D mammography’s, and ultrasounds, along with other advanced diagnostic procedures.
The complaint further alleges that Mary Washington Healthcare officials attempted to hire away, or “poach,” radiologists from Radiologic Associates of Fredericksburg, the parent company of Virginia Medical Imaging, in “a blatant attempt to destroy [Radiologic Associates’], and by extension [Virginia Medical Imaging’s], business.”
Moreover, according to the complaint, “Mary Washington has an obligation to [Medical Imaging of Fredericksburg] to refrain from taking actions that would significantly devalue and jeopardize the Company’s business—such as poaching the very radiologists staffed at [Medical Imaging of Fredericksburg’s] locations. To make matters worse, Mary Washington’s actions were done during a nationwide shortage of qualified radiologists.”
Ian Gass, CEO of Radiologic Associates of Fredericksburg, sent The Advance a copy of the lawsuit shortly after it was filed in Fredericksburg Circuit Court earlier this month.
“While the complaint includes business and governance issues, the reason I am sharing it is the potential community impact related to local imaging access,” he wrote in an accompanying email. “The complaint addresses the expected closure of the Imaging Center for Women and Medical Imaging of King George.”
The “ongoing instability” of these expected shutdowns or relocations in the city and neighboring county “has already resulted in multiple technologist resignations, further worsening staffing challenges,” according to the complaint. If it continues, “The result would be the elimination of mammography services within a 50-mile radius of Fredericksburg beginning in February 2027, along with substantial and potentially irreparable financial harm to [Medical Imaging of Fredericksburg] due to patient outmigration, loss of downstream services, and continuing equipment lease obligations.”
Tamra Wheeler, public relations coordinator at Mary Washington Healthcare, was dismissive of the complaint.
“This is a financially motivated lawsuit that has nothing to do with patient care,” she wrote in an email response. “Our patients and community should be reassured that Mary Washington Healthcare is committed to providing high-quality radiology services now and for the long term. This is a core part of delivering healthcare services and any allegations to the contrary are simply false.”
Kendra Gerlach, vice president of marketing and corporate communications for MWHC, contacted The Advance a day after Wheeler and sent a follow-up statement:
“Mary Washington Healthcare is committed to providing high-quality radiology services now and for the long term. Despite rumors and false assumptions, there will be absolutely no disruption of any kind in our radiology services, including mammography, women’s health services and other vital outpatient radiology services.”
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Steve Watkins is editor of The Advance. You can contact him at swatkins000@gmail.com or 540-842-2066.