YOUNGSTOWN Physician group plans to close

THE VINDICATOR, YOUNGSTOWN
The company's medical-billing business is to be sold.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
YOUNGSTOWN -- A downtown company that once had ambitious plans to expand its medical-practice management business to other cities is about to close after filing for bankruptcy protection.
Ron Fasano, president of Eastern Ohio Physicians Organization, said the company will close if a pending sale of part of the business goes through as planned April 1.
Much of EOPO's operations have been closed for months because Anthem Blue Cross and Blue Shield didn't renew a contract and EOPO lost the backing of a lender, Fasano said.
EOPO, which is in the Commerce Building, had about 25 employees last year but now has eight. Fasano said no employees will be left if the sale of EOPO's billing services goes through, although some employees will be picked up by the new company.
Fasano said a company he didn't want to identify is proposing to buy that part of the business.
He is set to become the executive director of development for the tri-state region. He is to be charged with developing business within a 150-mile radius.
Formation: The Mahoning County Medical Society formed EOPO in 1994 to help local doctors deal with the growth of managed-care organizations.
The number of doctors who could be shareholders was capped at 290 in 1998, but membership reached 500 last year.
EOPO negotiated contracts with insurance companies and also handled billing and other services. Doctors were able to select from a variety of services, including bulk purchasing and disease management consulting.
Fasano said last year that he expected to hire 10 employees this year as the company expanded. He wanted EOPO to be serving 400 new doctors in 15 other cities within three years.
Contract: The plan fell apart last September, however, when Anthem didn't renew its contract with EOPO, he said.
Fasano said Anthem's move was part of a corporate decision not to deal with organized physician groups.
However, Sharon Larrimer, an Anthem spokeswoman, said Anthem didn't want to contract with EOPO because of a dispute over the amount of money EOPO owed Anthem. The insurance company continues to contract with other physician groups, she said.
Larrimer said Anthem has individual contracts with most of the physicians that were in EOPO.
Anthem filed a lawsuit against EOPO in January in Mahoning County Common Pleas Court. The action was brought into U.S. Bankruptcy Court in Youngstown after EOPO filed for Chapter 11 bankruptcy protection last month. The lawsuit says EOPO owes Anthem about $1.4 million.
EOPO's bankruptcy filing lists assets of about $414,000 and liabilities of about $3.5 million.
Fasano said EOPO was trying to work through its loss of the Anthem contract, even though it provided EOPO's major source of revenue. But in December, Key Bank pulled its line of credit, which forced EOPO to curtail operations.