Sounds like a real mess. Glad that I am not a part of it.
Something very similar to this happened in my last group as we tried to pull out of a Hosp. system that was working us all night and paying us nothing. The surgeons wanted out along with us, so we stated we would only cover emergencies begining on a certain date, until they fixed the problems. Well they fixed it alright. They got another group to cover them for alot more money than we were getting and took away another site of ours that was owned by the hosp. It all worked out in the end, except for the surgeons who still had to go there and now with new anesthesia (and rumored to be less skilled ).