Exhibits; Motion; Order; Press Release; Settlement Agreement; Notice of Proposed Settlement and Hearing; Joint Motion; Response; Consent Decree
Public Court Documents
April 11, 1978 - July 28, 1978
65 pages
-
Case Files, Hatcher v. Methodist Hospital - Hardbacks. Exhibits; Motion; Order; Press Release; Settlement Agreement; Notice of Proposed Settlement and Hearing; Joint Motion; Response; Consent Decree, 1978. 1e60c71b-5484-f111-ab0f-7c1e527d528a. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/a59a6df6-32e9-42d6-8079-0c563cf433de/exhibits-motion-order-press-release-settlement-agreement-notice-of-proposed-settlement-and-hearing-joint-motion-response-consent-decree. Accessed October 10, 2026.
Copied!
[||03b6dad9-8c44-410c-b13b-34a2beeba0d8||] Mechanical Violatiors in 1957 Building (continued)
Corridor door louver to Ultra-Sound Room 113
must be removed.
All laboratory sinks require vacuum breakers.
The shut-off valve on the sprinkler system serving
the Laundry Clean Linen Rooms requires a supervised
lock, and the existing flow alarm shall be connected
to the fire alarm system.
The Nursery Rooms on the third floor have no exhaust/
return air outlets. Corridor door louvers must be
removed and an exhaust/return system with outlets near
the floor and arranged for positive pressures must be
provided.
Linen Chute System -
Sprinklers at alternate floor levels.
To be extended full-size through the roof.
The floor separations are not fire sealed to prevent the
passage of smoke.
There are no fire dampers in ducts penetrating two hour
fire rated walls and floors.
The building exceeds 150 feet in length, and therefore
requires smoke barriers, and it is not smoke separated
from the adjoining buildings.
All ducts which may distribute smoke from the
fire zone shall be equipped with smoke dampers and
actuated by smoke detectors in the duct system.
Provide smoke detectors in the supply systems to
prevent the distribution of smoke.
Mechanical Violations in 1961 Building
Mechanical Equipment Room B27
All supply ducts are covered with combustible canvas.
Insulation must meet maximum flame spread rating of
25 and smoke developed rating of 50. The equipment
room is a plenum.
Remove relief opening in corridor wall.
Provide electric griddle shut-off with the ex
system of the Coffee Shop hood and connect to
alarm system.
The floor separations are not fire sealed to prevent the
passage of smoke
4/11/78 ff Exhibit A
Me
Mechanical Violations in 1961 Building (continued)
There are no fire dampers in ducts penetrating two hour ,
fire rated walls and floors.
The building is not smoke separated from the adjoining
buildings.
All ducts which may distribute smoke from the fire
zone shall be equipped with smoke dampers and actuat-
ed by smoke detectors in the duct system.
Provide smoke detectors in the supply system to
prevent the distribution of smoke.
Mechanical Violations in 1965 Building
The laboratory hood in Room B33 requires a vacuum breaker.
There are no fire dampers in ducts penetrating two hour fire
rated floors and walls.
Provide smoke detectors in the supply system to prevent the
distribution of smoke.
Mechanical Violation in 1972 Building
Seal all penetrations of smoke barriers.
Mechanical Violations in Dietary Building
The hood extinguishing systems are not connected to the
fire alarm system and does not shut-off the gas fuel.
Electrical Violations - General (Applies to all Buildings)
Fire Detection and Alarm System -
Smoke compartmentation has not been provided. Doors in
smoke partitions are required to be either kept closed
or held open electrically. Smoke dampers in ducts are
to be controlled by a smoke detector located in the
ventilating system. Supply and exhaust fans are to be
controlled by smoke detectors at the respective fan
locations.
All smoke detectors shall also activate the fire alarm
system,
Automatic fire extinguishing sprinkler heads scattered
throughout the facility. Flow alarms are required to
be connected into the fire alarm system.
4/11/78 Exhibit A
: ¢ »
Electrical Violations in 1923 Building
Operating rooms, located on the fifth floor.
Receptacles above the five foot level are
standard parallel-blade duplex type.
No signs are posted within the room for
non-flammable anesthesia.
Electrical Violations in 1943 Building
Alcohol storage room contains no lighting. Room
will be relocated.
Delivery rooms no '"'equipotential grounding' is
provided.
Delivery rooms standard parallel-blade duplex receptacles
are being utilized.
Electrical Violations in 1957 Building
Operating room, fifth floor.
Receptacles above the five foot level are
standard parallel-blade duplex type.
No signs are posted within the room regarding
non-flammable anesthesia.
General (This is in addition to ROFEC list)
Fire-proofing of ceiling and exposed steel - boiler
house.
Excessive size borrowed lights in doors and corridors.
TOTAL ESTIMATED COST $1,500,000.00
4-5-78
Revised 4-11-78
4/11/78 i a Exhibit A
: # »
Health Services Building =- Broadway
Program/Services Description
Program and Services:
First Floor
1) Out-Patient Department
Registration Ambulatory Services
Billing
2) Admitting
In-Patient
3) Coffee Shop
Staff/Visitors
4) Lobby area expanded
Visitors
In-Patient Admitting
5) Ambulatory Care Services
Cancer Program/Regional for 5 counties
Executive Physical Service
Cast Removal Service
Pulmonary Screening
E.E.G./E.M.G. (in-patient and out-patient)
Pre-admission Service
Blood Drawing/Pathology
6) Nuclear Medicine Department (relocated)
1) Computerized Isotopic Scanning Camera
2) Large-field of View Scanning Camera
Basement
1}. Auditorium
Medical Education
Employee Education
Patient Education
Storage
Affiliating Education Programs
2) Classrooms (2)
3) Mechanical Area
4=11~78 FXHIBIT B
* [
Building #2 (Cancer Program/Radiology)
Pirst Floor
Physicist Work Area/Office
Oncology Office
Exam/Recovery Therapy Area
Therapy Waiting Area
Special Procedures and Control
Lymphangiography
Angiography (no cardiac specials)
Scrub Area
Xeriography
Viewing Area/Films
Staff Lounge/Employees
Ultra Sound Room
X-Ray #5 Diagnostic with Simulator
Control Area
Storage (Emergency Room/Sterile Supplies)
Basement
Storage:
Medical Records
In-Patient
Out-Patient
General Storage
Laboratory
Radiology
Dietary
Housekeeping
Plant Operations
Pharmacy
Respiratory Therapy
E.K.G.
Miscellaneous
4/11/78 EXHIBIT B
OF He
Tit
ASS ue
CIVIL RIGHTS ASSURANCES
«An order to alleviate the concerns of the Department
2alth, Education, and Velfare regarding our compliance with
H
le vi of the Civil Rights Act of 1964 and the Regulations
d pursuant thereto (45 C.F.R. Part 80), The Methodist
Hospital of Gees Inc,, gives the following specific am Sur ances
in connection Vit h its application for a loan guarantee to
fox Pd
subsidy:
” d
W
the period the Federal Government 1s paving an interest
‘operate as a general acute care hospital, =z
sist financing the construction of Broadway Methodist Hospital
‘1. Gary Methodist Hospital will continue to
ch
its
present or comparable site in Gary, providing no
less than its present level of comprehensive
health services.
2. If the Gary Methodist Hospital should
Sind ones any financial difficulties that would | :
preclude the operation of Gary Ye tnaging Hospita 11
as set forth in assurance 1, surpluses, loans,
and other financial resources generated by the
Broadway Methodist Hospital operations will be
immediately and directly used to provide the
NLENLP ICIS YY Pale Tl a ad a iD By AoC Ie : ~ A TY . J 4 ’ REecCessaAry assistance +0 Gary Methodist Hospl tal,
[4]
Ser Priorito approval of any additions to
Or cxpansion of Broadway Methodist Hospital, it
nust be demonstrated to and approved by the
Aven Comprehensive Health Planning Agency, the
EXHIBIT C
! NO
{
Regional Civil Rights Director of the Department
of Health, Education, and Welfare, and the
Regional Heuallh Director of the Department of
Health, Education, and Welfare that adequate
capital expenditures have been made at Gary
Methodist Hospital,
4. Prior to any reduction of services at
Gary Methodist Hospital such phonoied reduction
must be submitted to and approved by the Regional
Civil Rights Director of the Department of Health,
Education, and Welfare in a manner consistent with
Title VI of The Civil Rights Act of 1864 and the
regulations issued pursuant thereto. -
8. Any. .znd 211i plans to duplicate’ at
Broadway Methodist Hospital services now present
at Gary Methodist Hospital or the implementation
of new programs, in. accordance with Public Law
92-603, at either hospital must be SubniEteq to and
approved by the Pegional Civil Rights Director of
the Department of Health, Education, and Welfare
in a manner Sonate with Title VI of The Civil
.
Rights Act of 1964 and the regulations issued pur-—
“suant thereto.
6. All staff physicians shall have equal
privileges and practice at both hospitals.
7. All patients are to be assigned to
Gary Methodist Hospital and Broadway Methodist
Hospital on the basis of availability of beds
.
-—
Lit LILALTOD UD LAA lAwiiTc ITAL Lid UL Vite’ ’
valid reason exists; however, no .patient shall
be denied equal access to either facility on
the basis
his place
e2
]
considerat
of the distance from the hospital to
of residence.
t
. in implementing the above assurances,
ion shall be given to the operation
of Gary Methodist Hospital and Broadway Methodist
Hospital as an integrated and interlocking unit.
9. Consistent with the requirements of
Section 80.6(b) of the aforementioned regulations,
The Methodist Hospital of Gary, Inc., will keep
ju
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herein,
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understood that the violation of any assurance
may be ground, in itself, for termination of all Federal
assistance subject, however, to all applicable Federal laws;
iy os 3
1
also understood that the affirmative action
plan submitted August 14, 1972 by The Methodist Hospital of
Gary, Inc., rem
inconsistencies
ains applicable; however, in the event of any
between those provisions and these specific
assurances, the specific assurances contained herein shall
prevail,
It is
assurances cont
c
N
KS i
further understood that while the specific
ained herein are limited to the period the
Federal Government is paying an interest subsidy, Title VI
of the Civil Rights Act of 1964, the regulations issued pur-
suant thereto, and any other relevant statutory ox regulacory
i
4
provisions. in effect or subsequently enacted, will remain
applicable until otherwise changed, amended,or repealed,
. (/ 0
274 G2) ol)
at) 2 aE An Nae ran 4
; EvereftT A. “Hohuson, ) Ph. B,
- Administrator J
The Methodist Hospital of
Cox Y, Ine,
Approved by the United States
Department of Health, Education,
and Welfare
oil 2 / 7 NL pips yi ag Ar LAT Re? = ES off ve
AERA T friedman
Regional Director
Region VV.
i aD ;
Wn 2x, “ar sii -
Bo Frank BlLrs, Me
Regional Health Director
Region V
Date: ALL 4.
“By: 4 Lane Ef A. frre Gy
- Kenneth sl Sf
tegional Civil Rights Director
/\ - is ‘
By: : [ | Sisley, Y., Cs
Marvan LL. Gavin
Reg an Attorney
patie V
Date: Sul, al 19 = : : :
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5 » ®
IN THE
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET AL.,
Plaintiffs
VS. Cause No. H 76-373
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO,
as United States Secretary of
Health, Education and Welfare,
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Defendants
RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO CORPS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
VS. Cause No. H 77-154
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not-For-Profit
Corporation and DENIS E. RIBORDY,
as President of the Board of
Directors,
JOSEPH CALIFANO, as United States
Secretary of Health, Education
and Welfare,
WILLIAM T. PAYNTER, M.D., as
State Health Commissioner for the
Indiana State Board of Health,
JAMES WHITE, as Director of the
Division of Hospital and
Institutional Services of the
Indiana State Board of Health,
DAVID J. EDWARDS, M.D., as
Director of the Health Facilities,
Services and Review Development
Bureau of the Indiana State Board
of Health,
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Defendants
MOTION
NOW COMES Methodist Hospital of Gary, Inc., through its
attorneys and moves this Court for the entry of the proposed
-
-
;
Order attached hereto and in support thereof states the
following:
l. That the attorneys for the parties hereto have
agreed upon a settlement with the exception of certain national
and statewide issues and subject to certain contingencies
which, if such contingencies are not satisfied or do not
occur by June 30, 1979, shall regult in a further resetting
for trial in this cause;
2. That a Settlement Agreement is to be executed which
contains a proposed Consent Decree, Joint Motion for Approval
of Settlement and Consent Decree, and Notice of Proposed
Settlement, Consent Decree and Hearing, all of which would
be submitted to the Court and sealed, not to be opened,
implemented or acted upon by this Court unless and until
the aforementioned contingencies are fulfilled;
3. That the disclosure of the terms of or the proposed
settlement documents prior to the fulfillment of the aforesaid
conditions would be inappropriate at this time in the event
further proceedings and trial are necessitated;
4. That the attorneys for parties have agreed upon
a press release adequately describing the present status
of this cause.
WHEREFORE, Methodist Hospital of Gary, Inc., prays
that this Court enter the proposed Order attached hereto
providing for a continuance of the trial setting in this
cause and prohibiting disclosure of the proposed documents
and terms thereof,
except as set forth in said Order.
Respectfully submitted,
ATTORNEYS FOR METHODIST HOSPITAL OF
GARY, INC. and DENIS E. RIBORDY, AS
PRESIDENT OF THE BOARD” OF DIRECTORS
{> FZ Ee yy
[2 NR ( (Lf C%
BRUCE E. SAYERS /
HODGES, DAVIS, GRUENBERG, COMPTON & SAYERS
5525 Broadway
Gary, Indiana 46410
RAYMOND J. KELLY
SEYFARTH, SHAW, FAIRWEATHER & GERALDSON
55 East Monroe Street
Chicago, Illinois 60603
Co 8p es, |» Sil M hi
IN THE
UNITED STATES DISTRICT COURT ; | =) | LL E D
FOR THE NORTHERN DISTRICT OF INDIANA IN OPEN COURT
HAMMOND DIVISION JUL 281978
RICHARD E. TIMMONS, CLERK
U.S. DISTRICT COURT BERNICE TERRY, ET AL., NORTHERN DISTRICT OF INDIANA
Plaintiffs
VS. Cause No. H 76-373
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO,
as United States Secretary of
Health, Education and Welfare,
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Defendants
RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO CORPS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
Vs. Cause No. H 77-154
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not-For-Profit
Corporation and DENIS E. RIBORDY,
as President of the Board of
Directors,
JOSEPH CALIFANO, as United States
Secretary of Health, Education
and Welfare,
WILLIAM T. PAYNTER, M.D., as
State Health Commissioner for the
Indiana State Board of Health,
JAMES WHITE, as Director of the
Division of Hospital and
Institutional Services of the
Indiana State Board of Health,
DAVID J. EDWARDS, M.D., as
Director of the Health Facilities,
Services and Review Development
Bureau of the Indiana State Board
of Health,
Defendants
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ORDER
This cause coming on to be heard on the Motion of Methodist
Hospital of Gary, Inc., due notice having been given and
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the parties being represented by counsel, and the Court
being fully advised in the premises;
IT IS HEREBY ORDERED:
1. That the trial date in this cause is continued
indefinitely;
2. That certain proposed settlement documents are
hereby filed with the Court and sealed, not to be viewed,
implemented or acted upon unless and until the Court is
advised by all of the parties herein that certain contingencies
referred to therein have occurred or have been fulfilled;
3. That the parties, their attorneys, other associates
or representatives thereof or any other person or entity
privy to or obtaining the information are prohibited from
distributing copies or the terms of the settlement documents
referred to above whether in draft or final form including
but not limited to any correspondence or memoranda concerning
settlement proposals, negotiations and/or interim measures,
or in any way publicizing or disclosing the provisions of
the proposed settlement, except as provided in the press
release attached hereto;
4. In the event this Order is subsequently modified,
reversed or otherwise varied, the sealed documents referred
to above shall be withdrawn from the Court and this matter
reset for trial.
Dated this 25 HK day of (ry i 1878.
Sf ’ /
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i Pa I He ¢ — : . / we Zn gi — / A CCA 7 x
JUDGE, UNITED STATES DISTRICT COURT
PRESS RELEASE
The terms of a settlement have been agreed to by the
parties. The implementation of the settlement and the entry
of a Consent Decree are contingent upon securing certain
financing. When that financing is secured a public hearing
will be held to approve the terms of the settlement and
the entry of the Consent Decree. If the financing is not
achieved, this matter will be reset for trial and settlement
negotiations will be resumed.
IN THE
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET AlL.,
Plaintiffs
ys. Cause No. H 76-373
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO,
as United States Secretary of
Health, Education and Welfare,
Defendants
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RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO CORPS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
VS. Cause No. H 77-154
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not-For-Profit
Corporation and DENIS E. RIBORDY,
as President of the Board of
Directors,
JOSEPH CALIFANO, as United States
Secretary of Health, Education
and Welfare,
WILLIAM T. PAYNTER, M.D., as
State Health Commissioner for the
Indiana State Board of Health,
JAMES WHITE, as Director of the
Division of Hospital and
Institutional Services of the
Indiana State Board of Health,
DAVID J. EDWARDS, M.D., as
Director of the Health Facilities,
Services and Review Development
Bureau of the Indiana State Board
of Health,
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Defendants
SETTLEMENT AGREEMENT
1. The attorneys for all parties in these cases have
agreed upon a settlement thereof with the exception of plaintiffs’
allegations with respect to the "national causes of action"
limited only to defendant, Joseph Califano, United States
Secretary of Health, Education and Welfare which were severed
by this Court's Order of January 13, 1978, and plaintiffs’
allegations of "statewide causes of action" limited to the
State of Indiana defendants. Further, Counsel for plaintiffs
reserve the right to apply to this Court for an Order for
the entry of attorney's fees and costs against the defendants
and Counsel for the defendants deny the right of Counsel
for the plaintiffs to apply to this Court for attorney's
fees and costs and specifically reserve any and all rights
they have to dispute or deny such claims of the Counsel
for plaintiffs, except that defendants shall not claim that
counsel for plaintiffs have waived their alleged right to
apply for attorney's fees and costs by entering into the
Consent Decree.
2. The attorneys for the parties have reduced the
terms of the agreed upon settlement to a proposed Consent
Decree, a copy of which proposed Decree with exhibits is
attached hereto as Exhibit A. Said Consent Decree embodies
all terms and conditions of the settlement and supercedes
any previous verbal and/or written proposals, positions
Or agreements.
3. The attorneys for the parties have also agreed
upon the form of a Joint Motion for Approval of Settlement
and Consent Decree and Hearing on Objections to be submitted
to the Court, a copy of which motion is attached hereto
as Exhibit B.
4. The attorneys for the parties have also agreed
upon the form of a Notice of Proposed Settlement, Consent
Decree and Hearing to be given all members of the class
certified by this Court in its Order of December 7, Jo77,
a copy of which is attached hereto as Exhibit C. Said Notice Y
—_2
is to be given by publication in the following fashion:
(To be agreed upon, i.e. Gary Post-Tribune, dates of
publication).
5. The hospital intends to submit a proposed Order
to the Court, a copy of which has been attached hereto as
Exhibit D, for entry upon the execution of this Settlement
Agreement and its attached Exhibits A and B. It is understood
and agreed that in the event such Order is not entered or
is modified or varied in any fashion in the future without
the express agreement of the hospital, that the hospital
will be released from its obligations as set forth in this
Settlement Agreement and, further, that the documents submitted
to the Court under seal as requested by the hospital shall
be withdrawn and the Settlement Agreement shall be null
and void, and all the parties will resume negotiations on
settlement and this matter will be reset for trial.
6. The attorneys for the parties further agree that
this Settlement Agreement and the documents to effectuate
the provisions thereof, Exhibits A, B and C, are contingent
upon the hospital securing certain financing and to that
end it is understood and agreed that the Consent Decree,
Joint Motion and Notice, Exhibits A, B and C above, will
be opened, implemented and acted upon by the Court only
in the event that the hospital has secured financing at
an interest rate of no more than one and one-half points
over the prime rate listed at the Continental Illinois
National Bank for a period of not less than twenty-five
(25) years to carry out the building projects described
in paragraphs B-1 and B-2 of the Consent Decree, Exhibit
A. It is understood that the hospital will secure such
financing or determine that such financing is not available
as soon as practicable but not later than June 30, 197%.
In the event Methodist Hospital is unable to secure financing
according to the terms outlined above, all the parties will
resume negotiations on settlement and this matter will be
reset for trial.
Respectfully submitted,
ATTORNEYS FOR PLAINTIFFS
JACK GREENBERG
BETH J. LIEF
N.A.A.C.P. Legal Defense Fund
BY: oo bhead Lo Sed
BETH J. LIEF U
N.A.A.C.P. Legal Defense Fund
10 Columbus Circle, Suite 2030
New York, New York 10019
po Br —p Po ’
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JULIAN TE ALLEN i
2009 Broadway
Gary, Indiana
ATTORNEYS FOR METHODIST HOSPITAL OF GARY, INC.
and DENIS E. RIBORDY, AS PRESIDENT OF THE
BOARD OF DIRECTORS /
/ : / <5 / i
AL
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BRUCE E. SAYERS
HODGES,” DAVIS, GRUENBERG,/ COMPTON & SAYERS
5525 Broadway
Indiana 46410
RAYMQND J. KELLY 3
EYFARTH, SHAW, IRWEATHER & GERALDSON
55 East Monroe Street
Chicago, Illinois 60603
ATTORNEYS FOR JOSEPH CALIFANO, UNITED
STATES Chis OF HEALTH, EDUCATION AND WELFARE
REBECCA L. Chbecsn 2. ( Joss Eo
Department of Justice
INn+1 = nD TTR Ti Ir Ts, Sey TA ati - ~ 10th and Pennsylvania Avenue, N.W.
Washington, D.C. 20201
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ALBERT HAMLIN
Assistant General Counsel
Civil Rights Division
Office of General Counsel
Department of Health, Education and Welfare
330 Independence Avenue, S. W.
Washington, D. C. 20201
ATTORNEYS FOR WILLIAM T. PAYNTER, M.D.,
AS STATE HEALTH COMMISSIONER FOR THE
INDIANA STATE BOARD OF HEALTH, JAMES
WHITE, AS DIRECTOR OF THE DIVISION OF
HOSPITAL AND INSTITUTIONAL SERVICES
OF THE INDIANA STATE BOARD OF HEALTH
and DAVID J. EDWARDS, M.D., AS DIRECTOR
OF THE HEALTH FACILITIES, SERVICES AND
REVIEW DEVELOPMENT BUREAU OF THE INDIANA
STATE BOARD OF HEALTH
THEODORE L. SENDAK
ATTORNEY GENERAL OF THE STATE OF INDIANA
BY: : /3
ERIC B. SERVAAS
Deputy Attorney General
219 State House
Indianapolis, Indiana 46204
OD 4
IN THE
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET AL.,
Plaintiffs
VS. Cause No. H 76-373
METHODIST HOSPITAL OF CARY, INC.,
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO,
as United States Secretary of
Health, Education and Welfare,
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Defendants
RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO CORPS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
VS. Cause No. H 77-154
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not-For-Profit
Corporation and DENIS E. RIBORDY,
as President of the Board of
Directors,
)
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JOSEPH CALIFANO, as United States )
Secretary of Health, Education )
and Welfare, )
)
WILLIAM T. PAYNTER, M.D., as )
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State Health Commissioner for the
Indiana State Board of Health,
JAMES WHITE, as Director of the
Division of Hospital and
Institutional Services of the
Indiana State Board of Health,
DAVID J. EDWARDS, M.D., as
Director of the Health Facilities,
Services and Review Development
Bureau of the Indiana State Board
of Health,
Defendants
NOTICE OF PROPOSED SETTLEMENT
CONSENT DECREE AND HEARING
TO: ALL BLACK RESIDENTS OF GARY, INDIANA
PLEASE READ THIS NOTICE CAREFULLY
A proposed settlement has been reached in the above-
captioned actions with respect to Methodist Hospital of
Gary, Inc. and incorporated in a proposed Consent Decree
which has been submitted to this Court for its consideration
and approval. The proposed Consent Decree has been approved
by all of the attorneys of record for the plaintiffs and
defendants named herein.
The purpose of this Notice is to announce the proposed
entry of the Consent Decree to all Black residents of Gary,
Indiana as members of the affected class defined in the
Decree and to other persons who may be affected by entry
of the Decree. This Notice is not intended to vary any
of the terms of the proposed Consent Decree. A copy of
the proposed Consent Decree is on file with this Court and
is available for examination in the office of the Clerk
of the Court on the lst Floor of the Federal Office Buiding,
507 State Street, Hammond, Indiana 46320, and in the Clerk's
Office of City Hall, 401 Broadway, Gary, Indiana.
Civil Action No. H 76-373 was commenced in December
of 1976, by Bernice Terry, Rosa Keeton, Barbara Leek Wesson
and Eddie Gray against Methodist Hospital of Gary, Inc.
and David Mathews as Secretary of the Department of Health,
Education and Welfare as a class action. Civil Action No.
H 77-154 was commenced in May of 1977, by Richard Gordon
Hatcher, Metro Corps of Gary, Inc. and Willie Lee Page against
Methodist Hospital of Gary, Inc., Denis E. Ribordy, as President
of the Board of Directors of Methodist Hospital of Gary,
Inc. (hereinafter collectively referred to as the Hospital),
Joseph Califano, as Secretary of the Department of Health,
Education and Welfare (hereinafter referred to as HEW),
William T. Paynter, M.D., as Indiana State Health Commissioner,
James White, as Director of the Division of Hospital and
Institutional Services of the Indiana State Board of Health,
and David J. Edwards, M.D., as Director of the Health Facilities,
Services and Review Development Bureau of the Indiana State
Board of Health (hereinafter collectively referred to as
the "State of Indiana") as a class action.
These actions subsequently were consolidated by the
Court, and are class actions alleging racial discrimination
in the provision of health care and health facilities at
Gary Methodist Hospital and Broadway Methodist Hospital
by the defendants in violation of Title VI of the Civil
Rights Act of 1964, as amended, the Fifth and Fourteenth
Amendments to the United States Constitution and various
other civil rights statutes, regulations, rules and assurances.
BY Order dated December 7, 1977, this Court determined
that the cases be maintained as a class action on behalf
of a class of all Black residents of the City of Gary, Indiana.
The affected class is so defined in the proposed Consent
Decree.
The plaintiffs and defendants, by their attorneys,
have made a thorough and detailed investigation of the facts
and circumstances involved in these actions and have conducted
extensive discovery by various means, including oral examinations
by deposition, written interrogatories, and examination
of voluminous documents and records concerning the parties
and issues involved in these actions. After taking into
account the likelihood that this litigation, if not settled
now, will be protracted and extensive, involving many questions
of law and fact and potential time-consuming and expensive
appeals, counsel for all parties concluded that it would
be in the best interests of the plaintiffs, the affected
class and each member thereof, and the defendants to settle
these actions on the terms of the proposed settlement which
are incorporated in the proposed Consent Decree.
Neither Methodist Hospital nor HEW nor State of Indiana
have admitted, nor has this Court determined, that there
has been any violation by any of the defendants of any of
the above-named statutes or any other law, rule, assurance
or regulation, or that any of the defendants admit liability
for any alleged injuries suffered by any plaintiff.
PLEASE TAKE NOTICE THAT pursuant to an Order of the
United States District Court for the Northern District of
Indiana dated 7.19 a ‘hearing will
be held in the above-captioned cases in the Court of the
Hon. Phil McNagny, Jr., United States District Court for
the Northern District of Indiana, Hammond Division, Federal
Building, 507 State Street, Hammond, Indiana, at
HM. On ’ ’
19 , (hereinafter referred to as "Hearing"), to determine
(1) the fairness, reasonableness and adequacy of the proposed
Consent Decree; (2) whether the affected class as defined
in—the proposed Consent Decree is properly defined and determined;
(3) the effects of the settlement and proposed Consent Decree
upon persons who are not members of the affected class;
and (4) whether the proposed Consent Decree should be approved
finally by the Court. The Hearing may be adjourned from
time to time by the Court at the Hearing or at any adjourned
session thereof without further notice.
This Notice is given to you in the belief that you
are, were, or may be a member of the affected class, or
that your rights may be affected by these actions or the
proceedings described in this Notice.
This Notice is not an expression of any opinion by
this Court as to the merits of or the defenses in these
actions, but is solely to inform you of the pendency of
these actions and of the proposed settlement and proposed
Consent Decree so that you may decide what steps you wish
to take in relation to these lawsuits and the proposed Consent
Decree.
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The Consent Decree entered shall include and bind all
members of the affected class, whether or not they join
or intervene in these actions.
If you are satisfied with the proposed Consent Decree
or if you have no objection to it, you need not appear at
the Hearing referred to in this Notice.
Any person who is dissatisfied with the proposed settlement
or proposed Consent Decree may appear at the Hearing in
person or with counsel and show cause, if there be any,
why the proposed affected class should not be defined as
above described, or why the proposed settlement and the
proposed Consent Decree should not be approved. Such objections
also may be made in writing by mailing or delivering a written
statement of the objections to the Clerk of the United States
District Court for the Northern District of Indiana, lst
Floor, Federal Office Building, 507 State Street, Hammond,
Indiana 46320, by 5:00 p.m., On ’
ry 19 + If such written objections are made,
the! persons making such objections should appear at the
Hearing. Any class member and any person who is or may
be affected by the proposed settlement, the proposed Consent
Decree and the prior orders of this Court, who do not make
objections in the manner provided herein shall be deemed
to have waived such objections and shall be foreclosed forever
from making any such objections, by appeal or otherwise,
to the proposed settlement, the proposed Consent Decree
and the prior orders of this Court.
This Court's approval of the proposed Consent Decree
shall be final, and upon the entry of the Consent Decree
and expiration of the time limit for appeal therefrom, all
defendants shall be released, without further act by any
person, agency or entity from any and all liability, claims,
and causes of action, joint or several, arising (1) from
alleged acts and practices of discrimination by the defendant
Methodist Hospital which properly are within the scope of
the complaints herein, and to which the Consent Decree is
directed to the date of the entry of the Decree, and (2)
from alleged past), present or future effects of any such
acts and practices, and (3) from the present or future effects
of any acts and practices required or authorized by or defined
in the proposed Consent Decree. This release does not affect
future actions or inactions by Methodist Hospital of Gary,
Inc., the United States Department of Health, Education
and Welfare, or the Indiana State Board of Health, except
for acts in satisfaction or performance of the Consent Decree.
The issuance of this Notice shall not affect any issue
in these actions, until and unless the Court approves the
proposed Consent Decree, and then only in accordance with
the Consent Decree. In the event this Court approves the
proposed Consent Decree, the Decree will be entered immediately.
For a more detailed statement of the matters involved
in these actions and the proposed Consent Decree, you are
referred to the pleadings, the proposed Consent Decree,
and to the other papers on file in these actions, all of
which may be inspected at the office of the Clerk of the
United States District Court for the Northern District of
Indiana, lst Floor, 507 State Street, Hammond, Indiana,
during the business hours of the Court.
THE PROPOSED SETTLEMENT
The following is a summary of the main provisions of
the proposed Consent Decree:
1. The following building programs will be undertaken
at Gary Methodist Hospital: Medical Services Building (on
the west side of the hospital) to contain a new Surgical
Suite, Intensive and Coronary Care Unit, Central Supply,
and Emergency Room. This building will be constructed so
as not to preclude horizontal expansion. A twenty-four
(24) hour pharmacy will be available.
Remodeling, including an area to house a Family Practice
Residency Program (said area to be approved by the American
Academy of Family Practice), provision of an adequate power
plant, refurbishing Labor and Obstetrical Department: remodeling
the Nuclear Medicine Department; remodeling to provide an
Auditorium; provide secure parking areas; remodeling areas
for ambulatory care clinics; establishment of an Intermediate
Cardiac Care Unit, Stress Testing and Cardiac Rehabilitation
Laboratory, and steps to bring the hospital into compliance
with the Life Safety Code of 1973. In addition, a laundry
facility for both the Gary and Broadway sites of Methodist
Hospital will be constructed in or near the hospital. A
site will be provided by the City of Gary, if necessary.
This building program is to be financed by a federally
guaranteed loan and interest subsidy, and by other private
financing.
2. The following building programs will be undertaken
at Broadway Methodist Hospital: A Health Services Building,
and a 105 bed addition. This building program will be financed
by private financing.
3. The building programs will be commenced on a substantially
identical chronological basis. Progress of the programs
will be jointly monitored by the parties.
4. The occupancy rate at the Gary facility will be
maintained at an efficient level including urging patients
applying at the Broadway facility to go to the Gary facility
rather than be placed on a waiting list. Efforts will be
made to Further integrate the staffs and patient census
at both facilities. Furthermore, the Hospital shall provide
adequate and comparable doctors' coverage in the Emergency
Room including the availability of staff specialists for
consultation at both sites. Additionally the Hospital will
wo 2 oy Wh, SE 3% 11 n wv ye § £3 om. ry rn wry vy dpm 3 3. ensure that all nursing shifts are adequately covered at
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both facilities. Comparable medical education of staff
and patients will be provided at both facilities.
5. Ambulatory care services will be expanded at the
Gary facility with the development of an outreach program
to foster utilization of the ambulatory care services as
well as the Family Practice Residency program. Methodist
Hospital will continue to serve patients who appear at the
Emergency Room of Gary Methodist Hospital. Any new services
provided by the Hospital will be placed at the Gary facility
unless such placement would be inconsistent with good hospital
management principles. Furthermore, prior to placing any
new clinics at the Broadway facility, it must be demonstrated
to HEW's Office for Civil Rights of Region V that there
is a need for such a clinic at the Broadway facility and
that there are adequate hours and staffing at the clinics
at the Gary facility.
6. Future purchases of equipment shall be made on
an equitable basis between facilities and any purchase of
equipment costing over $100,000.00 shall be approved for
civil rights purposes by HEW's Office for Civil Rights of
Region V.
7. Daily transportation services at no charge will
be developed by a consultant between the Gary facility and
the Broadway facility for ambulatory patients and hospital
staff going to and from work. In addition, the parties
agree to work to obtain public transportation between the
facilities.
8. The Board of Directors of Methodist Hospital will
be restructured to ensure representation on the Board and
on all committees of the Board of members of minority groups
in Gary and the handicapped and minority groups in the patient
population at both facilities by 1981. At least one-third
of the members of the Board of Directors shall be members
of minority groups.
9. Methodist Hospital will make reasonable efforts
to obtain residencies at Gary Methodist in Internal Medicine,
and Obstetrics and Gynecology.
10. The orthovoltage x-ray machine at Gary Methodist
will be operated at least two (2) afternoons per week and
such service will continue unless it is unfeasible.
ll. The Hospital will report in a coded system on a
semi-annual basis to HEW concerning coded patient days at
each Facility by race, diagnosis, zip code, and race and
coded number of physician; concerning staff, overtime, equipment
purchases over $10,000.00 and new services; efforts at recruitment
of staff and utilization of the transportation system will
be provided to HEW. This information is to be used solely
to assist in monitoring the Consent Decree.
12. The Hospital will develop a Long Range Plan for
both Hospitals by December, 1978, to be approved for civil
rights purposes by HEW and attorneys for the plaintiffs.
The long range plan will include but not be limited to:
improving and modernizing the Laboratory, Radiology, and
Pediatrics Departments at Gary Methodist, ventilation of
the Obstetrics Department at Gary Methodist and central
air conditioning in portions of Gary Methodist. HEW is
not precluded from requiring additional commitments and
resources from Methodist Hospital that it requires of all
other Hospitals in Lake County nor from requiring any joint
planning it requires of any other Hospitals in Lake County,
Indiana.
13. The Civil Rights Assurances signed by Methodist
Hospital on July 27, 1973, are incorporated into the settle-
ment agreement.
14. The State of Indiana will take steps to facilitate
the financing of the Gary facility construction; will not
oppose any of the building programs; and, will decline to
review the building projects except for the 105 bed addition,
under §1122 of the Social Security Act.
15. HEW will revise Assurance Number 3 of certain Civil
Rights Assurances signed by the Hospital and HEW on July
27, 1973, expeditiously complete its county wide hospital
civil rights Review; take steps to facilitate the financing
of the Gary facility building project; and, agree that the
building programs outlined herein do not constitute a violation
of Title VI of the Civil Rights Act ov the July 27, 1973
Civil Rights Assurances. HEW further agreed not to take
or support any other action, administrative or otherwise,
based upon alleged civil rights violations which have been
alleged or are within the scope of the Complaints filed
in the suits. :
16. The plaintiffs will not oppose any of the building
programs. Mayor Richard Gordon Hatcher will make good faith
efforts to supply additional lighting and security forces
at the Gary facility; participate in efforts to secure public
transportation between the Gary and Merrillville facilities;
make available the City's powers of eminent domain to facilitate
the building programs; and, provide the Hospital with a
2 to 3 acre site on which to construct the laundry, 1f necessary.
If you have any questions concerning this Notice, any
of the matters discussed in this Notice, or the proposed
settlement or proposed Consent Decree, you may contact:
ATTORNEYS FOR PLAINTIFFS
Beth J. Lief
N.A.A.C.P. Legal Defense Fund
10 Columbus Circle, Suite 2030
New York, New York 10019
Telephone number 212/586-8397
and
Julian Allen
2009 Broadway
Gary, Indiana 46402
Telephone number 219/886-3666
Attorneys for plaintiffs and
the class of all Black residents
of Gary, Indiana. If any
Black residents of Gary have
ol
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any questions concerning this
Notice, he or she should contact
the attorneys for plaintiffs
(persons may contact Beth
Jd, Lief by calling collect).
Any other individuals having
inquiries concerning this
notice may contact attorneys
for the plaintiffs or the
attorneys of record listed
below.
ATTORNEYS FOR METHODIST HOSPITAL OF GARY, INC.
AND DENIS E. RIBORDY, AS PRESIDENT OF THE BOARD OF DIRECTORS
Bruce E. Sayers and Edward J. Hussey
Hodges, Davis, Gruenberg, Compton & Sayers
5525 Broadway
Gary, Indiana 46410
Telephone number 219/981-2557
Raymond J. Kelly
Seyfarth, Shaw, Fairweather & Geraldson
55 East Monroe Street
Chicago, Illinois 60603
Telephone number 312/346-8000
Attorneys for defendants, Methodist
Hospital of Gary, Inc. and Denis
E. Ribordy, as President of the
Board of Directors
ATTORNEYS FOR H.E.W.
Rebecca L. Ross
Department of Justice
10th and Pennsylvania Avenue, N. W.
Washington, D.C. 20201
Telephone number 202/739-2230
Albert Hamlin
Assistant General Counsel
Civil Rights Division
Office of General Counsel
Department of Health, Education and Welfare
330 Independence Avenue, S. W.
Washington, D. C.
Telephone number 202/245-7737
Jeffrey Champagne
Attorney, Office of General Counsel
Civil Rights Division
Department of Health, Education and Welfare
330 Independence Avenue, S. W.
Washington, D. C. 20201
Telephone number 202/245-7737
Attorneys for Joseph Califano,
United States Secretary of Health,
Education and Welfare
ATTORNEYS FOR THE STATE OF INDIANA
Theodore L. Sendak
Attorney General of the State of Indiana
Eric B. Servaas
Deputy Attorney General
219 State House
Indianapolis, Indiana 46204
Telephone number 317/633-5512
Attorneys for the State of Indiana
Dated this day of
JUDGE, UNITED STATES DISTRICT COURT
1 #
IN THE
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET Ale,
Plaintiffs
VS. Cause No. H 76-373
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO,
as United States Secretary of
Health, Education and Welfare,
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Defendants
RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO CORPS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
VS. Cause No. H 77-154
METHODIST HOSPITAL OF GARY, INC.,
An Indiana Not-For-Profit
Corporation and DENIS E. RIBORDY,
as President of the Board of
Directors,
JOSEPH CALIFANO, as United States
Secretary of Health, Education
and Welfare,
WILLIAM T. PAYNTER, M.D., as
State Health Commissioner for the
Indiana State Board of Health,
JAMES WHITE, as Director of the
Division of Hospital and
Institutional Services of the
Indiana State Board of Health,
DAVID J. EDWARDS, M.D., as
Director of the Health Facilities,
Services and Review Development
Bureau of the Indiana State Board
of Health,
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Defendants
JOINT MOTION FOR APPROVAL OF SETTLEMENT AND
CONSENT DECREE, AND FOR SETTING OF HEARING ON OBJECTIONS
Counsel for plaintiffs and defendants in the above-
captioned cases represent to the Court as follows:
: § #
l. Counsel for all of the parties in the above-captioned
cases have agreed upon a settlement thereof with the exception
of plaintiffs' allegations with respect to the "national
causes of action" limited only to defendant, Joseph Califano,
United States Secretary of Health, Education and Welfare,
which were severed by this Court's Order of January 13,.
1978, and plaintiffs' allegations of "statewide causes of
action" limited to the State of Indiana defendants. A proposed
Consent Decree incorporating that settlement and its exhibits
is attached hereto as Exhibit A. Further, Counsel for plaintiffs
reserve the right to apply to this Court for an Order for
the entry of attorney's fees and costs against the defendants
and Counsel for the defendants deny the right of Counsel
for the plaintiffs to apply to this Court for attorney's
fees and costs and specifically reserve any and all rights
they have to dispute or deny such claims of the Counsel
for the plaintiffs, except that defendants shall not claim
that counsel for plaintiffs have waived their alleged right
to apply for attorney's fees and costs by entering into
this Consent Decree.
2. Counsel for all of the parties also have agreed
upon the form of a "Notice of Proposed Settlement, Consent
Decree and Hearing" to be given to all Black residents of
Gary, Indiana, a copy of which is attached hereto as Exhibit
B. |
WHEREFORE, counsel for all plaintiffs and defendants
move the Court as follows:
l. To approve the Notice of Proposed Settlement, Consent
Decree and Hearing, and order that said Notice be published ...
(To be agreed upon, i.e. Gary Post-Tribune, dates of publication).
2. To set a date certain by which any written objections
to the proposed Consent Decree must be filed with the Clerk
» »
of the United States District Court for the Northern District
of Indiana, Hammond Division, and to set a subsequent date
certain for a hearing on any objections which may be filed
to the proposed Consent Decree and on the pavisabliitty of
the settlement of these cases in accordance with the terms
of the proposed Consent Decree.
3. To approve the proposed Consent Decree in the form
presented to this Court, subject to the consideration of
any objections which may be made thereto, and to enter said
Consent Decree and Judgment thereon thereby finally disposing
of all but plaintiffs' "national" and "statewide causes of
action" and attorney's fees issues referred to in paragraph
1 above.
4. To make such other directions and orders with respect
to these cases and the proposed Consent Decree as the Court
may deem just and proper.
Respectfully submitted,
1 ZC FOR DY A TANIMMITIDOO ATTORNEYS FOR PLAINTIFFS
JACK GREENBERG
BETH J. LIEF
N.A.A.C.P. Legal Defense Fund
/ [|
PA Ni] J
BY: ) { {y 1 5 2 A /
1
BETH J. LIEF
N.A.A.C.p, Legal Defense Fund
10 Columbus Circle, Suite 2030
_New York, 3 710019
Nell IE
RE
——
JULIAN B. ALLEN
2009 Broadway
Gary, Indiana
ATTORNEYS FOR METHODIST HOSPITAL OF GARY, INC.
and DENIS E. RIBORDY, AS PRESIDENT OF THE
Ty OF DIRECTORS
v- cil
— 7 AA. all.
EDWARD (5
HODGES, it terry COMPTON
5525 Broadway
Gary,, Indigna 46410
SAYERS
LJ
RAYMOND J. KELLY
BYFARTH, SHAW "AIRWEATHER & GERALDSON
55 East Monroe Street
Chicago, Illinois 60603
ATTORNEYS FOR JOSEPH CALIFANO, UNITED
STATES SECRETARY OF HEALTH, EDUCATION AND WELFARE
3 (Koss
REBECCA L. ROSS
Department of Justice
10th and Pennsylvania Avenue, N.W.
Washington, D. C. 20201
(lad Ce is Cl
ALBERT HAMLIN
Assistant General Counsel
Civil Rights Division
Office of General Counsel
Department of Health, Education and Welfare
330 Independence Avenue, S. W.
Washington, D. C. 20201
ATTORNEYS FOR WILLIAM T. PAYNTER, M.D.,
AS STATE HEALTH COMMISSIONER FOR THE
INDIANA STATE BOARD OF HEALTH, JAMES
WHITE, AS DIRECTOR OF THE DIVISION OF
HOSPITAL AND INSTITUTIONAL SERVICES
OF THE INDIANA STATE BOARD OF HEALTH
and DAVID J. EDWARDS, M.D., AS DIRECTOR
OF THE HEALTH FACILITIES, SERVICES AND
REVIEW DEVELOPMENT BUREAU OF THE INDIANA
STATE BOARD OF HEALTH
THEODORE L. SENDAK
WE OF THE STATE OF INDIANA
ity BY:
ERIC B. SERVAAS
Deputy Attorney General
219 State House
Indianapolis, Indiana 46204
UNITED-STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET AL.,
Plaintiffs,
Vv. Civil No. H 76-373
METHODIST HOSPITAL OF
GARY, INC., ET AlL.,
Defendants.
RICHARD GORDON HATCHER,
ET AL.,
Plaintiffs,
Vv. Civil No. H 77-154
METHODIST HOSPITAL OF
GARY, INC.,- ET BY..,
Defendants.
RESPONSE TO MOTION TO
- PROHIBIT DISCLOSURE OF DOCUMENTS
Defendant, Methodist Hospital of Gary, Inc., has moved
for an order prohibiting disclosure of the settlement docu-
ments until certain contingencies are met. If this motion
is granted, the terms of the settlement will remain secret
for almost a year while the hospital obtains financing. The
Secretary of the Department of Health, Education, and Welfare
does not believe that such an order would be in the public
interest.
The Secretary has a policy of encouraging access by the
public to his final decisions. He does not believe that
interested parties should be prevented from learning of and
commenting on his decisions, even for a period of less than
*
a year, He feels that Congress has set forth a policy of
openness in government as evidenced by the Freedom of Infor-
mation Act, 5'0.8.C, $552, hich lehonta be upheld. 4n order
such as She one now sought by Methodist Hospital would run
contrary to the policies behind the Freedom of Information Act.
The purpose behind sealing the settlement papers in the
instant chad is not for national security reasons or to pro-
tect the privacy of individuals. It is designed to prevent
a omdeonine of the hospital's litigation position. The Secre~
tary. strongly believes that when the hospital's interest in
Baving ities docinents sealed is weighed against the public's
right to understand its government's decisions, the balance of
equities weighs heavily in favor of the public. Consequently
an order och na that proposed by the hospital would not be in
the public interest
Conclusion
For these reasons, the government opposes the hive of
the order sought by plaintiff.
Respectfully submitted,
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Rarbina, Allen =
BARBARA ALLEN BABCOCK
Assistant Attorney General
FRED W. GRADY
OF COUNSEL: Assistant United States Attorney
Albert T. Hamlin 2 : 2
Jeffrey Champagne ) EN . i :
MALLEY
oP 5 Lo
Edward Koven BARBARA B. O°
Department of Health,
Education, and Wel fare QR.0
REBECCA L. ROSS
Attorneys for Defendant Califano
Attorneys, Department of Justice
Washington, D, C. 20530
Telephone: (202)739-2230
CERTIFICATE OF SERVICE
I hereby certify that a copy of the foregoing Response
to Motion .to Prohibit Disclosure of Documents was served
this 11th day of July by mailing a copy thereof, express
mail, postage prepaid to:
Beth Lief, Esq.
NAACP Legal Defense Fund |
10 Columbus Circle
Suite 2030
New York, New York 10019
Julian B. Allen, Esq.
2009 Broadway
Gary, Indiana 46402
Bruce Sayers, Esq.
Hodges, Davis, Gruenberg, Compton
& Sayers
5525 Broadway
Gary, Indiana 46140
Raymond Kelley :
Seyfarth, Shaw, Fanweather & Geraldson
55 East Monroe Street
Chicago, Illinois 60603
Eric B. Seyvaas
Deputy Attorney General
State House
Indianapolis, Indiana 46204
Grea J Qoss
REBECCA L. ROSS
. ¢
IN THE
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
BERNICE TERRY, ET AL.,
Plaintiffs
VS. Cause No. H 76-373
METHODIST HOSPITAL OF GARY, INC.
An Indiana Not For Profit
Corporation, and JOSEPH CALIFANO
as United States Secretary of
Health, Education and Welfare,
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Defendants
RICHARD GORDON HATCHER,
WILLIE LEE PAGE,
METRO COPRS OF GARY, INC.,
A Not-For-Profit Corporation
and others similarly situated,
Plaintiffs
VS. Cause No. H 77-154
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METHODIST HOSPITAL OF GARY, INC.)
An Indiana Not-For-Profit )
Corporation and DENIS E. RIBORDY)
as President of the Board of )
Directors, )
)
JOSEPH CALIFANO, as United States
Secretary of Health, Education )
and Welfare, )
)
WILLIAM T. PAYNTER, M.D., as )
State Health Commissioner for the:
Indiana State Board of Health, )
)
JAMES WHITE, as Director of the )
Division of Hospital and )
Institutional Services of the )
Indiana State Board of Health, )
)
) DAVID J. EDWARDS, M.D,, as
Director of the Health Facilities
Services and Review Development )
Bureau of the Indiana State Bo@rd
of Health,
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Defendants
CONSENT DECREE
BETWEEN PLAINTIFFS AND DEFENDANTS
WILLIAM T. PAYNTER, JAMES WHITE, AND DAVID EDWARDS
HISTORY OF THE LITIGATION
On approximately May 6, 1977, Richard Gordon Hatcher,
Willie Lee Page and Metro Corps of Gary, Inc. on behalf of them-
selves and others similarly situated filed a complaint, against
Methodist Hospital of Gary, Inc., and Denis E. Ribordy, as
President of the Board of Directors of Methodist Hospital of
Gary, Inc., (hereinafter collectively referred to as "Methodist
Hospital”), Joseph Califano, as United States Secretary of Health,
Education and Welfare, (hereinafter referred to as "HEW"), William
T. Paynter, M.D., as State Health Commissioner for the Indiana
State Board of Health, James White, as Director of the Division
of Hospital and Institutional Services of the Indiana State
Board of Health, David J. Edwards, M.D., as Director of the
Health Facilities Services and Review Development Bureau of
the Indiana State Board of Health, (hereinafter collectively
referreéd to as the "State"), and Kipton Kaplan, Executive
Director of the Northern Indiana Health Systems Agency, Inc.
This cause was docketed as H 77-154 in the United States District
Court for the Northern District of Indiana, Hammond Division.
In this action plaintiffs, who are black residents
of Gary, Indiana, and a non-profit corporation alleged the
existence, perpetuation and expansion of racially segregated
and discriminatory hospital facilities operated by Methodist
Hospital of Gary, Inc., and the illegal approval and granting
of federal financial assistance to Methodist Hospital for said
facilities by defendant federal and state officials. Plaintiffs
also charged the State of Indiana and HEW with a failure to
ry VE
include civil rights considerations in federally funded health
planning review and approval programs. Plaintiffs sought
declaratory and injunctive relief against defendants, alleging
default of obligations under the following statutes and their
implementing regulations: the Fifth and Fourteenth Amendments
to the United States Constitution; the Civil Rights Act of
1871, specifically 42 U.S.C. §1983; Title VI of the Civil Rights
Act of 1964, 42 U.S.C. §2000d et seq.; Title VI of the Public
Health Services Act, 42 U.S.C. §291; Title XVI of the Public
Health Services Act, 42 U.S.C. §3000 et seqg.; §314 of the public
Health Services Act, 42 U.S.C. §246; Title XV of the National
Health Planning and Resources Development Act of 1974, Public
Law 93-641, codified at 42 U.S.C. §300k et seg.; §1122 of the
Social Security Act, as amended, 1972, 42 U.S.C. §1302a-1; and,
§504 of the Rehabilitation Act, as amended, 1973, 29 U.S.C.
§794. Jurisdiction was alleged under 28 U.S.C. §1331, 1343
and 1361 and 28 U.S.C. §2201 and 2202.
On the 6th day of July, 1977, the action in Hatcher,
et al. v. Methodist Hospital of Gary, Inc., et al. was consoli-
dated with the action in Terry, et al. v. Methodist Hospital of
Gary, Inc., et al. (Cause No. H 76-373) by Order of Court and
on the 7th day of December, 1977, the District Court by its
order conditionally certified said actions as class actions on
behalf of all of the Black residents of the City of Gary, Indiana,
pursuant to Federal Rule of Civil Procedure 23 (b) (2).
The Court's Order of December 7, 1977, additionally
granted the Motion to Dismiss of defendant Kipton Kaplan.
On the 13th day of January, 1978, the Court severed:
the plaintiffs' allegations with respect to the "national cause
of action" limited only to defendant HEW. The remaining provisions
® °
of this Consent Decree accordingly do not involve nor apply
to the aforesaid "national causes of action" in these matters.
A Pre-Trial Conference was held on the 21st day of
February, 1978, at which time the plaintiffs voluntarily dis-
missed the allegations of their Complaint with respect to
§504 of the Rehabilitations Act as amended in 1973, 29 U.S.C.
§794. A Pre-Trial Order has been prepared and forwarded to
the Court by the attorneys for the parties which has not been
formally signed by all the attorneys for the parties or
entered by the Court.
The parties to these actions and their respective
counsel have met and discussed the settlement of those causes
of action which relate to the operation maintenance and
perpetration of the hospital facilities of defendant Methodist
Hospital of Gary, Inc. (hereinafter referred to as the "local
issues"). The plaintiffs, Methodist Hospital, HEW and the State
of Indiana have agreed upon the terms of a settlement as to
these local issues. Said settlement is contingent upon
Methodist Hospital's securing financing for certain construction
projects. The settlement agreement on the local issue was
filed with the Court on July 13, 1978. Accordingly, the
provisions of this Decree do not involve or apply to the
provisions and/or issues raised in the settlement agreement
on the local issues.
ENTRY OF THE CONSENT DECREE
The plaintiffs and the State have consented to the
entry of this Consent Decree to resolve, without the additional
time and expense of contested litigation, the issues raised in
the consolidated complaints relating to the "statewide causes of
action": the claims that the State of Indiana has failed to
consider civil rights issues and Title VI of the Civil Right
Act of 1964 in federally funded health planning review and
approval functions administered by the Indiana State Board of
Health. These issues only involve or relate to the plaintiffs
and the State and accordingly only these two parties are signatories
to this Consent Decree.
It is the intent of the plaintiffs and the State to
resolve by this Decree all allegations which are the basis for
the aforesaid "Statewide causes of action". The parties and
their respective counsel have met and discussed this:
settlement and the terms and provisions of this Decree and
each and all of them do &onsent to the entry of this Decree as
a binding order as if entered into after a trial on the merits.
The Court has examined carefully the terms and
provisions of this Decree and finds that they are fair, reason-
able and just, that the rights of the affected class and each
member thereof are protected adequately by this Decree, that
the Decree provides the relief requested in the complaints
as to Statewide causes of action, that this Decree is in
comformity with the Fifth and Fourteenth Amendments to the
United States Constitution; the Civil Rights Act of 1871,
specifically 42 U.S.C. §1983; Title VI of the Civil Rights
Act of 1964, 42 U.S.C. §2000d et seg.;Title VI of the Public
Health Services Act, 42 U.S.C. §291; Title XVI of the Public
Health Services Act, 42 U.S.C. §3000 et seg.; §314 of the
Public Health Services Act, 42 U.S.C. §246; Title XV of the
National Health Planning and Resources Development Act of
1974, Public Law 93-641, codified at 42 U.S.C. §300K et seq.:
§1122 of the Social Security Act, as amended, 1972, 42 U.S.C.
§1302a~-1; §504 of the Rehabilitation Act, as amended, 1973,
29 U.S.C. §794; and, the Federal Rules of Civil Procedure,
and that this Decree is not in deprivation of rights and
privilege of any person in violation of said Rules, Amendments
and statutes.
It likewise appears to the Court that entry of this
Decree will further the objectives of Title VI of the Civil
Rights Act of 1964, and the aforesaid Rules, Amendments
and statutes, that this Decree protects adequately the rights
of the affected class and is in the interest of the plaintiffs,
the class members, and the general public.
NOw, THEREFORE, IT IS ORDERED, ADJUDGED AND DECREED
as follows:
I
General Obligations
The Indiana State Board of Health shall hereinafter be
referred to as the "State". Such designation shall
encompass, where appropriate, the functions of the State
as the State Agency for purposes of §1122 of the Social
Security Act, and the State Agency, and the State health
planning and development agency, for purposes of Title
XV and XVI of the National Health Resources and Development
Act of 1974.
The State recognizes the applicability of Title VI of the
Civil Rights Act of 1964 to the continuing programs of
federal financial assistance which it administers, including
but not limited to Title VI of the Public Health Service
Act; §1122 of the Social Security Act; and Titles XV and
XVI of the National Health Resources and Development Act of
1974. Pursuant to this recognition, and 28 C.F.R.§42.410,
the State shall establish a Title VI compliance program
for itself and hospital facility recipients which obtain
federal financial assistance through it, provide for the
assignment of Title VI responsibilities to designated
state personnel, and comply with the standards and procedures
set forth below.
1G
Health Plans and Data
The State Health Plan and the State Medical Facilities
Plan shall consider and include facts, findings and recommenda-
tions relating to the health care needs of minorities.
py
B. The State shall compile or have compiled and maintain
data necessary to determine the health care needs of
minorities and other data, as needed, to determine whether
recipients of federal funds which it administers are in
compliance with Title VI of the Civil Rights Act of 1964.
It is understood that the State shall have flexibility in
determining what data is needed, but that, as a minimum,
the State shall gather, or have gathered, the following
information:
(1) the minority population - broken down by "blacks"
and "Hispanics" for
(a) each HSA service area
(b) each HSA sub-service area
(c) each metropolitan area of greater than 100,000
x person;
(2) the number of black and Hispanic doctors for
(a) each HSA service area
(b) each HSA sub-service area
(c) each metropolitan area of greater than 100,000
persons;
I11
Procedure for Review of
Applications Pursuant to §1122 of
the Social Security Act
A. The State shall require each hospital facility applicant who
submits a proposal for review under §1122 of the Social
Security Act to include the following data in each application:
(1) The actual location of the applicant's facility
and the racial composition of the city, or, where
applicable, the SMSA of the facility's location.
» »
(2) The applicant's actual service area, broken down into
inpatient, and outpatient and emergency room categories. Such
data shall be determined by the residence or zip code of
residence of all patients for the past six months, and shall
be computed according to patient days for the inpatient category
and number of visits for the out patient and emergency room
category. (e.g., 30% inpatient days, Gary; 40% inpatient days,
Merrillville-Hobart-Crown Point; 30% other)
(3) The racial composition of the applicant's actual
service area, determined by either the most recent national
census, Or where available, more recent local census information;
(4) The following information as to the actual patient
population of the applicant for the past six months, broken
Jown separately into inpatient (by the number of patient days),
outpatient and emergency room categories:
(a) race - white, black, Hispanic and other
(b) in each racial category the method of payment:
private insurance, medicare, medicaid, self-pay, free service
and other charity;
(5) The number of doctors, registered nurses and
licensed practical nurses on staff by race;
(6) In the case of applicants which have more than one
facility at different sites such applicants shall, in addition,
supply (a) the information listed III A (1)- (5), above,
separately for each facility; and (b) a separate list of
capital expenditures over $150,000 at each facility for the
past three years:
The state shall not deem any application complete for purposes
of review under §1122 of the Social Security Act until all the
information listed in III A above is submitted. However, if
oe See
an applicant has submitted the information listed in III A
within the past year of the date of the applicant's current
application, the requirement to resubmit the data listed in
III A may be waived if the applicant certifies that the
patient characteristics have not substantially changed within
the past year. Furthermore, if the applicant informs the
State that it is experiencing difficulty in supplying the
necessary data, the State shall to the best of its ability
render technical assistance or request the HSA in whose
area the applicant is located, to render technical assistance
to the applicant.
The State shall analyze the data submitted by each applicant
and shall immediately forward the data to the Office for
Civil Rights, Region V United States Department of Health,
Education and Welfare in the followings instances:
(1) Where there is a 10% or greater discrepancy
between the racial composition of the area in which the
applicant is located and the racial composition of the
actual service area of the applicant; or where the racial
composition of either the actual location or actual service
area is 10% or less black and Hispanic, where the discrepancy
between the racial composition of the actual location and
the actual service area is half or greater than of the
percentage of blacks, and Hispanics in either the applicants
actual location or the actual service area (e.g., if the
racial composition of actual service area is 40% minority,
if the racial composition of the applicant's actual location
is greater than 50% or less than 30% minority; or if the
racial composition of the applicant's actual service area
is 8%, if the racial composltion of the location is 4% or less,
or 12% or greater.).
(2) Where there is a 10% or greater discrepancy between
either the racial composition of the applicant's location or
actual service area, and the racial composition of the
applicant's patient population in any of the three categories
(inpatient, by patient days, outpatient or emergency room);
or where the racial composition of the applicant's patient
population is 10% or less minority, where the discrepancy
between either location or actual service area and actual
patient population in any category is half or greater than
half of the percentage of blacks and Hispanics in the applicant's
patient population.
(3) Where there is a significant difference between the
number of black and Hispanic doctors in the HSA sub-service
area in which the applicant is located and the number with staff
privileges;
(4) In the case of applicants with dual site or more
than dual site facilities, in addition to III C(l), (2) and (3),
(a) if there is a significant difference in the capital
expenditures at each facility; or
(b) if there is a greater than 10% difference in
the racial composition of the patient population of the applicant's
different facilities; or
(c) if there is a greater than 10% difference in
the racial composition of the nursing staff and/or doctors at
the applicant's different facilities.
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D. If the State submits an applicant's application to HEW in
conformance with the standards set forth in III C, it shall
consider such discrepancies in determining whether the
applicant satisfies the review criteria of §l1122, particularly
the criteria at 42 C.F.R. §100.107 (a): "whether the proposed
project is needed or projected as necessary to meet the needs
of the community in terms of health services required."
E. If the applicant's proposal is not for a project or service
that is listed as necessary in the State health plan or State
medical facilities plan, the applicant shall in its application
explicitly state why sueh project or service is needed despite
the fact it is not within the State health plan or State
medical facilities plan.
F. If an application is forwarded to HEW in conformance with the
provisions in III C above, the State shall include in such
transmittal the State's deadline for review of the application
and shall request HEW to forward to the State the findings of
any civil rights review HEW conducts as a result of the infor-
mation and/or the reasons for not conducting a civil rights
review as soon as possible, but not later than five (5) days
prior to the State's deadline for review of an application.
The State's deadline for review of an application shall be
90 days, or the maximum length of time permitted by regulations,
unless the application states that the applicant wishes to or
will secure a binding obligation on the project which is the
subject of the application sixty (60) to ninety (90) days
from the date of the application, in which case the State's
deadline shall be three days prior to the date the applicant
wishes to or will secure the binding obligation.
G. If within the time period for review of an appliation,
HEW issues a Letter of Findings pursuant to 45 C.F.R. Part
80 finding probable cause to believe an applicant has violated
Title VI of the Civil Rights Act:
(1) The State shall consider such letter in its
§1122 review; and
(2) if the State determines to approve the application,
shall include in its letter of notification of approval to the
applicant the following statement "The applicant is under
notice that the Office of Civil Rights, United States Department
of Health, Education and Welfare has issued the applicant a
Letter of Findings of probable violation of Title VI of the
Civil Rights Act of 1964. In the event that voluntary
compliance is not achieved, the applicant may be subject to
termination of federal financial assistance."
H. (L) If during the ninety day period that an application
is pending, voluntary compliance is achieved which results in the
applicant's providing a new service or an increase in 10%
of the cost of the proposal or $500,000 whichever is less, the
applicant shall supplement its proposal-to state! why the proposal
is still financially feasible.,
(2) If after a proposal has been approved, voluntary
compliance is achieved which results in the applicant's
providing a new service or an increase in 10% of the cost of the
proposal or $500,000 whichever is less, the State shall deem the
proposal to be a new capital expenditure pursuant to 42 C.F.R.
§100.103, and the prior approval shall be rescinded.
(3) For the purpose of computing the increase in cost
pursuant to sub-paragraph III H(l) and (2) above, inflation
alone shall not be considered.
17
Iv
Further Civil Rights Components for
Review of Applications Under §1122
of the Social Security Act
A. The State in its review of applications by hospital facilities
under §1122 of the Social Security Act shall consider whether
the applicant is in compliance with Title VI and the regulations
issued pursuant to Title VI at 45 C.F.R. Part 80, particularly
45 C.F.R. 80.3 and 80.4.
B. Where an application involves or includes a proposal for the
relocation in whole or part of a hospital facility or any
health service of a hospital facility, the State shall consider
and apply in its review of such application the regulations at
45 C.F.R. 80.3b(3) and the following guidelines which reflect the
regulation at 45 C.F.R. 80.3b (3):
1. (a) The site selection of a hospital facility
or a health care service within a hospital facility violates
Title VI if the site of such facility or service is chosen for
the purpose of creating, fostering, facilitating or aggravating
racial or ethnic segregation; or of excluding racial and/or
ethnic groups from participation in, or of denying them the
benefits of the hospital and health care services.
(b) The site selection of a hospital facility or a
health care service within a hospital facility violates Title
VI if the site of such facility or service will have or has the
effect of creating, fostering, facilitating or aggravating
segregation, or of excluding racial and/or ethnic groups from
participation in, or of denying them the benefits of the health
care services within a facility or facilities in a geographic
area unless the hospital demonstrates:
1. The particulat site and service meets documented,
specific health planning needs of the population in the facility's
service area; and
oo there are no alternative sites or arrangements which
would permit the substantial accomplishment of these goals
without segregative effect; and
Se if (1) and (2) are established, that methods of
administration and operation minimize wherever feasible the
segregative effect of the site selection.
Ce In construing IV Bl (b) above, "documented, specific health
planning needs" encompass economic considerations only if
the hospital demonstrates that:
1. the new facility or service will generate sufficient
income to maintain the former. facility; and
2 that the income from the new facility or service will
go directly toward supporting a facility which serves the
larger racial or ethnic patient population; and
3. without the income generated from the new facility
or service, the facility which serves the larger racial or
ethnic patient population will not be financially able to
serve the health care needs of its patients; and
4. this derivative financial support for the racially
identifiable facility can only be generated by revenue from the
new site or service.
2e In addition to the standards set forth in IV Bl. above,
a hospital which presently serves a patient population which
includes members of racial or ethnic groups, which desires to
relocate in whole or in part, or which proposes to construct a
=F 4m
facility or deliver a health care service in another location
where the patient population does not include as many members
of racial or ethnic groups, has a continuing obligation to
recognize and serve health care needs of its present patient
population including the following factors:
(a) Expenditures
i. A sufficient level of expenditures and capital
construction essential to a continual and necessary upgrading
of its present facility;
2% Revenues from the present facility cannot be
used to finance the new site or service unless it is
demonstrated that all necessary health services, modernization
and expenditures have been provided to the present facility.
(b) Staffing
The numbers and ratios of professional and
nonprofessional staff, as well as doctors, must be maintained
at levels to serve the patient population adequately and, in
no event, less than levels maintained prior to the opening
of the new site or service.
(c) Physical Plant
The physical plant of all facilities at a dual
or multi-site hospital must be maintained and upgraded on an
equitable basis.
(d) Access of present population group to all
services being provided by ‘hospital.
To the extent services are not duplicated and
the location of a service 1s not at the present facility,
transportation must be provided or available to the present
patient population.
(e) Method of Operation
The hospital must operate its two facilities
in a unitary and interlocking manner, but records must be
-152
maintained to indicate separately the staffing, expenditures
and services at each facility.
(f) Governing Board
The governing board and any planning or
advisory body which is an integral part of the hospital
shall be representative of and responsive to the needs of members
of the racial and ethnic group it serves.
3. Reduction or Duplication of Services
(a) A hospital may reduce a service, staffing or facility
at the site which serves members of racial or ethnic groups
only ifs
1. such reduction is justified by specific health
2 the service, staffing or facility is economically
feasible; and
3. the same service, or level of services 1s equally
accessible to the members of racial ethnic groups or the
hospital has demonstrated methods to insure such
accessibility; and
4. the reduction does not violate any other regulation
set forth in IV Bl and IV B2 above.
(b) A hospital may duplicate a service or facility that is
at its old location only if:
1. such duplication is justified by specific health
reasons and needs; and
2. such duplication will not reduce staffing or the
level of service at the old facility; and
3. such duplication will not jeopardize the economic
viability of the service or facility at its old location;
and
“1 6=
4. such duplication does not violate any other
regulation set forth in IV Bl and IV B2 above.
V
Applicability of Review Procedures
In the event the State becomes a full participant in
any federal health planning programs for which it shall have
review functions of health proposals it shall apply the procedure
set forth in III and IV. above to hospital facilities.
VI
Annual Civil Rights Reviews
The State shall conduct annual civil rights reviews of all
hospital facilities which receive or have received federal
financial assistance pursuant to the Hill-Burton program,
Title VI of the Public Health Services Act. Said review shall
include the data listed in III A above and in addition:
(1) The list of services at the facility, or, in
the case of multi-site recipients, separately for each facility;
(2) the list of the governing board of the
facility by race;
(3) the amount of free services and community
services provided at the facility, by race. (N.B. - a form
for gathering this information will be forwarded to you.)
-17=-
VII
General Provisions
A. This Court has jurisdiction of the parties hereto.
B. Should the implementation of any specific provi-
sion of this Decree thereafter be determined by a federal
court or a federal agency to be illegal under federal
law or inconsistent with federal regulations, the parties
may apply to this Court upon appropriate application and
notice to all attorneys of record for plaintiffs and the
State to suspend or modify the specific provision at issue
to conform to the subsequent Court determination, or to
resolve any legal inconsistency between such federal agency's
determination and the provisions of this Decree. In the
event any such suspension or modification is determined by
this Court to be necessary, to the greatest feasible extent
the initial purpose of the porvisions shall be maintained
and any such suspension or modification shall not affect the
legalaity of all other provisions in this Decree.
C. The plaintiffs, by their counsel, shall have the
opportunity upon reasonable notice, to determine the com-
pliance by the State with the provisions of this Decree.
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