Capitalism or price gouging? Vt. man accused of overcharging hospital

Published: Apr. 15, 2020 at 5:48 PM EDT
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A Williston man accused of price gouging during a pandemic is defending himself, saying he turned a profit and did not commit a crime. Our Ike Bendavid spoke to Shelley Palmer about the accusations.

The attorney general says the Central Vermont Medical Center in Berlin was duped by Palmer, paying him more than $100,000 for masks that normally cost just a fraction of that. Palmer tells WCAX News he did nothing wrong.

Palmer normally operates a nonemergency transportation service, giving him connections in the medical field.

"Surgical masks are the ones that we are selling," Palmer said.

Court documents say Palmer bought the masks for just 10 cents overseas and then sold them to the Central Vermont Medical Center for $2.50 each. The attorney general's office says Palmer sold 42,500 masks in March to the hospital for a total of $106,250.

We asked CVMC about the masks they bought from Palmer. In a statement, they didn't address the price gouging accusation, but they did say: "We recognized the need to bolster our supply of all personal protective equipment (PPE), including masks, to ensure the safety of our patients and staff. Like many other health care providers dealing with this pandemic, we are in some cases paying higher rates than usual when needed to build our supply."

According to the court paperwork, Palmer also tried to sell the masks to Champlain Medical Urgent Care in South Burlington.

"It certainly alarmed my staff," said Beth Schiller of Champlain Medical Urgent Care.

They say the prices caught them off guard and Palmer advertised them as N95 masks. Champlain Medical Urgent Care contacted the attorney general's office.

"In this time frame when everybody is so urgently needing PPE, it's an abuse," Schiller said.

"This may be an outlier but it was so egregious in my opinion that it warranted us filing this complaint," said T.J. Donovan, D-Vt. Attorney General.

Vermont's top prosecutor says his office filed the case, calling the mark up unethical and price gouging during a state of emergency affecting medical workers.

"The bottom line is they shouldn't get ripped off and they should get the benefit of the bargain," Donovan said.

For now, Palmer says he hasn't done anything wrong.

"They said that I misrepresented to a hospital professional what the product was. I didn't and couldn't. And I charged an exorbitant amount? No, I turned a profit," Palmer said.

Palmer says he has donated masks with some of the profit he has made.

A judge will decide next week whether to grant a temporary injunction that would prevent Palmer from selling more.

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