QuickTake:

State Rep. Lisa Fragala, D-Eugene, said the state law intended to prevent corporations and private equity firms from interfering between doctors and patients needs an enforcement mechanism. 

State Rep. Lisa Fragala remains concerned about PeaceHealth’s looming plans to transition to Atlanta-based contractor ApolloMD for emergency department staffing.

In a presentation to the League of Women Voters of Lane County, Fragala, D-Eugene, said PeaceHealth’s decision to exit its contract with Eugene Emergency Physicians and switch to an out-of-state corporate management services organization is “a disaster for our community.”  

Eugene Emergency Physicians had contracted with PeaceHealth for 35 years. The pending change has alarmed elected officials, from local representatives and state legislators to Gov. Tina Kotek, who recently asked PeaceHealth to delay its scheduled July 1 transition until the community has assurances that the process is fully vetted and sound. 

PeaceHealth officials have rejected that request, calling its processes and planned management structure sound in a letter responding to Kotek last week. PeaceHealth will contract with Lane Emergency Physicians, a new practice that an Illinois-certified physician currently seeking Oregon credentials will own. That new company will staff PeaceHealth’s three emergency departments in Springfield, Cottage Grove and Florence, with ApolloMD providing administrative and operational support. 

Fragala spoke to a gathering of nearly 80 people in Eugene, Tuesday, March 24. 

“I’m committed to continue to work with the governor’s office to address our community crisis with accessing emergency health care,” Fragala told the group, adding she’s also committed to planning legislation to better enforce the current law restricting corporate ownership of medical practices in Oregon.

Fragala and other lawmakers have pressed for more information to ensure that PeaceHealth’s transition to ApolloMD is compliant with Senate Bill 951, a state law passed in 2025 to prevent private equity firms from running health care. The company insists it has no relationship with private equity and that the transaction is not subject to the law. 

SB 951 sets some of the nation’s strongest regulations on private and corporate control of medical practices. The bill closes a loophole that has allowed private equity firms and corporations to appear compliant by naming physicians — sometimes with limited authority — as clinic owners on paper. 

Fragala, one of the chief sponsors of SB 951, said she wants to see a stronger enforcement mechanism put in place for the legislation. When the bill was drafted in 2025, legislators didn’t put a mechanism in place that delegated enforcement to the Oregon Department of Justice. Doing so would have put added a cost to the bill, making it more likely to get held up in the state budget-setting process. 

“We felt like it was important to strengthen the law and then to come back and make those tweaks,” Fragala said, adding that other changes will also be necessary. “We have the strength in law and statute, and now we need to build on that statute.”

Fragala said the governor’s office and the Oregon Health Authority are looking closely at the situation. Potential options for the state could include invoking an emergency rule to delay the transition. Or, the state could step in if officials can demonstrate that care was interrupted, which would require the state to prove an interruption in emergency health care — especially if there are diversions, which is when patients are sent to other hospitals for care without a plan in place for them.

“If OHA proves they don’t have a plan in place for those diversions, then that is one place that the governor could implement some type of executive decision, or OHA can implement an emergency rule,” Fragala said. “OHA does have rulemaking authority in some of these areas, but it’s very narrow.”

But nothing is determined yet, and at this point lawmakers “still don’t have the full picture” or all the details they have sought. PeaceHealth has declined to delay its implementation timeline with ApolloMD, but previously offered to provide publicly posted data on diversion and mortality at emergency departments in its response to Kotek’s office.

Without an enforcement mechanism, the only option for slowing or stopping the transition is through the courts, and the Eugene Emergency Physicians group has filed a lawsuit against PeaceHealth and ApolloMD, alleging the deal violated Senate Bill 951.

But the court process takes time, Fragala said, meaning that physicians in Eugene could leave before the case is resolved.

Have something to say?

Send us a Letter to the Editor. Read our guidelines for Letters to the Editor here.

Ben Botkin covers politics and policy in Lane County. He has worked as a journalist since 2003, most recently at the Oregon Capital Chronicle, where he covered justice, health and human services and documented regional efforts to combat fentanyl addiction. Botkin has worked in statehouses in Idaho, Nevada, Oklahoma and, of course, Oregon. When he's not working, you'll find him road tripping across the West, hiking or surfing along the Oregon Coast.