Health care provider settles lawsuit with Western

Joe Lord

The rubble from the collapse of Collegiate Health Care Inc. may have finally been cleared from the Hill.

Greenwich Insurance Company, who issued a $1 million performance bond purchased by Collegiate to ensure that the health care provider would fulfill a management agreement with the university, paid Western $250,000 this month after the two entities reached a settlement in mid-December.

The university filed a civil suit on Sept. 10, 2001 in U.S. District Court against Greenwich Insurance and Marsh USA, who helped Collegiate find the insurance company to draft the bond.

Representatives from Greenwich Insurance did not respond to numerous phone messages left by the Herald.

The university was seeking the money from Greenwich Insurance to cover damages caused by Collegiate’s fall.

The suit was Western’s last remnant of business involving Collegiate, General Counsel Deborah Wilkins said. The health insurance provider agreed to run the Student Health Center in September 1999 but went bankrupt a year-and-a-half later.

Collegiate was in shaky financial times during its relationship with Western. In March 2001, the health care provider laid off its 17 Western employees after it filed for bankruptcy, as the Herald previously reported. Western hired all 17 clinic employees the same month but laid off four at the end of the spring 2001 semester.

Collegiate remains in bankruptcy proceedings, but Wilkins said she doubts the university will receive any money.

“We’re not willing to let them off the hook,” she said.

Of the $250,000 awarded to Western by the settlement, $15,029.29 will go toward the legal expenses incurred by the suit, Wilkins said.

She said that she was satisfied with the settlement.

Gene Tice, vice president for Student Affairs and Campus Services, said that the remaining money will go into an account to pay for a new facility for Student Health Services. There are no concrete plans for the building at this time, but Tice hopes it will be erected in about four years.

A portion of the money could also be used for small improvements to the current site in the Academic Complex, Tice said.

When Collegiate inked the contract in 1999, it agreed to seek funding for a new $3 million facility between the Preston Center and Keen Hall, Tice said. Those plans died with the company, but they could be resurrected with the awarded money and additional funds generated by Student Health Services.

Tice said this new building would be comparable in price.

While Student Health Services at first struggled to stay afloat after Collegiate’s exit, it has managed to find calmer waters under Western’s leadership.

Libby Greaney, director of Student Health Services, said the clinic increased revenue last year when it became an in-network provider for employee health insurance.

It also increased the price of treatment from $15 to $30 after the university took over the operation.

Greaney said they now offer more services than before, including physical therapy.

Since the Collegiate era ended, Student Health Services has increased its average number of visits per day by about 15 patients during the school year, she said.

Tice said Greaney and her staff were responsible for the Student Health Services’ turnaround. He hopes it can continue expanding.

“We’re certainly running much better than when Collegiate was running it,” Tice said. “We’ve set a foundation to build this.”

Reach Joseph Lord at [email protected]