Krusac v. Covenant Med. Ctr., Inc. – April 2015 (Summary)

PEER REVIEW PRIVILEGE

Krusac v. Covenant Med. Ctr., Inc., Docket No. 149270 (Mich. Apr. 21, 2015)

Overturning a lower court decision, the Supreme Court of Michigan held that the state’s peer review statute protected the objective facts described in an incident report.

In this case, a patient’s estate brought suit against the hospital where the patient died following a cardiac catheterization during which she fell off the operating table. A nurse who was present at the catheterization – and during the patient’s fall – filed an incident report shortly after the event, which she submitted to her supervisor. During discovery, the patient’s estate became aware of the existence of the incident report and sought the facts contained therein, alleging that those facts were necessary for cross-examination because it would be unethical for the hospital to offer a defense inconsistent with the facts contained in the report. The trial court examined the incident report and then ordered the hospital to disclose the first page (the objective facts) to the estate.

The hospital appealed to the Supreme Court of Michigan, arguing that the incident report was protected by the state’s peer review statute and that the appellate court precedent which was being followed by the trial court incorrectly interpreted that state statute.        The Supreme Court of Michigan agreed with the hospital and clarified that the state’s peer review statute does not include an exception for objective facts that are recorded in an incident report. Instead, such facts are protected by the statute, along with all “records, data, and knowledge” collected for or by a peer review committee.

Tri State Advanced Surgery Ctr., LLC v. Health Choice, LLC – April 2015 (Summary)

ANTITRUST

Tri State Advanced Surgery Ctr., LLC v. Health Choice, LLC, No. 3:14CV143-JM (E.D. Ark. Apr. 16, 2015)

The United States District Court for the Eastern District of Arkansas dismissed antitrust claims that had been brought against a physician-hospital organization and an insurer, finding that the complaint against them failed to satisfy the rule of reason analysis because it did not properly allege power over the relevant market.

In this case, an ambulatory surgery center and two surgeons who practice at that center (the plaintiffs) brought a lawsuit alleging that the physician-hospital organization and the insurer violated the Sherman Antitrust Act. The plaintiffs alleged that the insurer sent letters to the surgeons demanding that they attest that they would no longer refer patients to the out-of-network ambulatory surgery center and would instead refer patients to in-network facilities (such as the hospital that was part of the physician-hospital organization). When the doctors refused to comply, they were terminated from the insurer’s network.   They claimed these activities constituted an anticompetitive effort to dry up referrals to the ambulatory surgery center.

While the plaintiffs alleged that consumer choice had been limited since doctors were forced to stop referring patients to the ambulatory surgery center and patients were being precluded from using their out-of-network benefits for which they paid additional insurance premiums, the court held that these allegations were insufficient to show detrimental effect to competition since the services of the ambulatory surgery center were still available to the public. The court also held that the plaintiffs failed sufficiently to allege market power since they proposed to define the market impermissibly (by limiting it to patients who pay by private insurance bought from Cigna rather than by incorporating into the definition of “market” the alternative patients who were available to receive services at the ambulatory surgery center and surgeons). The court also found the “geographic market” proposed by the plaintiffs to be lacking since it referred generally to the Memphis metropolitan statistical area and “adjacent counties,” without delineating an area where patients may lack alternatives in the market should prices increase as a result of the defendants’ alleged activities.

Murphy v. Goss – April 2015 (Summary)

HCQIA IMMUNITY – NPDB REPORTING

Murphy v. Goss, No. 3:14-cv-01135-SI (D. Or. Apr. 16, 2015), aff’d, No. 15-35397 (9th Cir. July 11, 2017)

This case involves a cardiac anesthesiologist who consumed one to two glasses of wine while at a restaurant and while on call. The cardiac anesthesiologist was found by the state medical board to have engaged in unprofessional conduct. In turn, the state medical board reported the cardiac anesthesiologist to the National Practitioner Data Bank (“NPDB”). While the cardiac anesthesiologist did not challenge the validity of the state medical board’s determination, he alleged that it violated his due process rights when it answered “Yes” in response to the NPDB’s question: “Is the Adverse Action Specified in This Report Based on the Subject’s Professional Competence or Conduct, Which Adversely Affected, or Could Have Adversely Affected, the Health or Welfare of the Patient?”

In a prior opinion, Murphy v. Goss, No. 3:14-cv-01135-SI (D. Or. Jan. 26, 2015), the United States District Court for the District of Oregon dismissed (without prejudice) the cardiac anesthesiologist’s substantive due process claim against several members of a state medical board on the basis that those individuals were entitled to immunity under the Health Care Quality Improvement Act of 1986 (“HCQIA”) since the cardiac anesthesiologist did not allege that any of them had knowledge of the falsity of any report made to the NPDB.

In this more recent opinion in the same case, Murphy v. Goss, No. 3:14-cv-01135-SI (D. Or. Apr. 16, 2015), the court once again considered whether the cardiac anesthesiologist could pursue his claims against the state board and its members. In granting summary judgment to the state board and its members, again on the basis of HCQIA immunity, the court noted that there was no evidence that anyone at the state board had knowledge of the falsity of the NPDB report. The court rejected the cardiac anesthesiologist’s assertion that he should be permitted to proceed through discovery to trial, where a jury could decide whether to believe the state board employee (who declared that she had no actual knowledge that the report was false) or believe the cardiac anesthesiologist’s unsupported accusation that the employee did know that the report was false. According to the court, “[s]tanding alone, the mere assertion by Plaintiff that one of the Defendants had actual knowledge that the report was false is insufficient to survive a motion for summary judgment.”

McKee v. St. Paul Eye Clinic, P.A. – April 2015 (Summary)

DISRUPTIVE CONDUCT/AGE DISCRIMINATION

McKee v. St. Paul Eye Clinic, P.A., No. A14-0681 (Minn. Ct. App. Apr. 20, 2015)

The Court of Appeals of Minnesota affirmed a trial court’s grant of summary judgment in favor of an eye clinic that was sued by a physician after it terminated his employment based on his pattern of disruptive conduct, including angry outbursts at colleagues and two incidents of patient abuse (striking patients during the course of surgery).

This case arose when the physician, following his termination, brought suit alleging that the majority shareholders of the eye clinic breached a fiduciary duty to him, a minority shareholder, by terminating his employment without conducting a thorough investigation of the facts and by reporting information about him to the state’s physician health program (as part of the eye clinic’s request that the physician be evaluated for some physical or psychological cause of his disruptive conduct). Finding in favor of the eye clinic, the appellate court noted that the physician’s at-will employment agreement made it clear that the ophthalmologist could be terminated at any time and, in this case, uncontroverted evidence supported the fact that the shareholders of the eye clinic made the business decision to terminate the physician’s employment based on the honest belief that he had an anger management problem and constituted a liability to the clinic.

The court also rejected the physician’s argument that the peer review statute had been violated when information about a patient abuse incident was shared with the majority shareholders, holding that the incident report involving the event was filed in the general course of business by nurses present at the time of the patient abuse. That report was not filed at the request of a peer review body, nor as part of its activities, and therefore was not protected by the peer review statute. Finally, the court found no evidence in the record to suggest that the eye clinic’s proffered reason for terminating the physician (disruptive conduct) was a pretext for age discrimination.

Instead, the court noted that the record was “replete with testimony from several majority shareholders regarding Dr. McKee’s angry outbursts directed at his work colleagues.” The court pointed to several instances where Dr. McKee’s colleagues felt personally threatened and noted: “Fearful of potential confrontations with Dr. McKee, some St. Paul Eye Clinic physicians acquired conceal-and-carry permits for a firearm.”

Gallo v. Conemaugh Health Sys. – April 2015 (Summary)

CONFIDENTIALITY OF DRUG & ALCOHOL TREATMENT RECORDS

Gallo v. Conemaugh Health Sys., No. 1101 WDA 2014 (Pa. Super. Ct. Apr. 17, 2015)

The Superior Court of Pennsylvania reversed a lower court’s ruling that a physician must turn over his drug and alcohol treatment records, holding that those records were privileged under the federal Public Health Service Act and the state Drug and Alcohol Abuse Control Act.

This case arose after the estate of a patient who died following toe amputation surgery sued the anesthesiologist and the hospital where he worked. The estate alleged, among other things, that the anesthesiologist was impaired at the time he treated the patient. Notably, the 81-year-old patient’s pre-surgical anesthesia evaluation did not include a physical examination, cardiac evaluation, or a pulmonary assessment, even though the patient had a history of both cardiovascular and pulmonary conditions.

During discovery, the patient’s estate asked the court to compel the physician to release his personal drug and alcohol treatment records after it learned of the physician’s history of alcohol abuse. This history included eight DUIs, the last of which occurred just one month before the patient’s surgery. The physician objected to the estate’s discovery request, asserting federal and state privileges to protect his drug and alcohol treatment information.

The lower court ruled that the physician waived the privileges by stating in a court filing (the Answer) that he was not under the influence of alcohol when he treated the patient. Also, the court ruled that the anesthesiologist’s treatment records should be released because the plaintiffs had shown good cause justifying an exception to the privilege.

In this opinion, the appellate court reversed that lower court ruling, holding that the physician had not waived the privileges applicable to his treatment records and, further, that there is no “good cause” provision in the state statute which would allow disclosure of treatment records in a case such as this.

Hellwege v. Tampa Family Health Ctrs. – April 2015 (Summary)

RELIGIOUS DISCRIMINATION

Hellwege v. Tampa Family Health Ctrs., No. 8:14-cv-1576-T-33AEP (M.D. Fla. Apr. 10, 2015)

The U.S. District Court for the Middle District of Florida granted in part and denied in part a health center’s motion to dismiss a complaint filed by an advanced practice nurse alleging that she was denied employment as a nurse midwife based on her religious beliefs and associations in violation of state and federal law.

The health center advertised that it had openings for four nurse-midwife positions. The APN emailed the health center to inquire about the position and attached her resume. In her resume, the midwife listed that she was a member of the American Association of Pro–Life Obstetricians and Gynecologists (AAPLOG), a pro-life organization that does not believe in prescribing hormonal contraceptives in particular situations. An employee of the health center responded telling the midwife that, due to her membership with the AAPLOG, the health center could not move forward in the interviewing process.

The midwife then filed a complaint alleging that the health center had refused to allow her to apply due to her religious beliefs and membership in an organization, in violation of 42 U.S.C. §300a-7 (“Church Amendments”), Title VII, and state law. The health center then filed a motion to dismiss.

The court examined the Church Amendments which contain “conscience provisions” enacted to make it clear that “receipt of Federal funds did not require the recipients of such funds to perform abortions or sterilizations.” The Church Amendments contain clear language prohibiting discrimination and recognizing individual rights stemming from “religious beliefs or moral conviction.” In reviewing the Church Amendments, the court found that the law created a right but it did not create a right of action. Specifically, the court found that in passing the Church Amendments, Congress did not intend to create a private remedy. Rather, as set forth in the law, enforcement is left to the Office of Civil Rights. The court granted the health center’s motion to dismiss the claim involving the Church Amendments.

However, the court held that the midwife had alleged the essential elements of a claim for religious discrimination under Title VII of the Civil Rights Act and state law. Specifically, she alleged that she was a member of a protected class, that she applied for and was qualified for a position, that despite her qualification she was not hired, and that the position remained open. The court took note of the health center’s argument that the midwife was not qualified for the position, but could not rule on that argument at this stage of the proceedings. The court allowed the midwife’s failure-to-hire claim to go forward.

Sanchez v. Bumann – April 2015 (Summary)

DEFAMATION/STATE PRIVILEGE

Sanchez v. Bumann, Civil Action No. 2012-0072 (D. V.I. Apr. 9, 2015)

The U.S. District Court of the Virgin Islands found that the Chief of Anesthesiology did not have a legal duty to make allegedly defamatory statements to authorities at the hospital and, thus, he did not qualify for an absolute privilege under state law.

An employed anesthesiologist reported to the hospital improper professional practices and inappropriate conduct on the part of the Chief of Anesthesiology. According to the complaint, the Chief of Anesthesiology then began retaliating against the anesthesiologist by falsely reporting that he had a drug problem, was diverting narcotics, and was incompetent. The anesthesiologist filed a lawsuit asserting a claim for defamation and intentional infliction of emotional distress against the Chief of Anesthesiology.

The Chief of Anesthesiology filed a motion to dismiss the lawsuit claiming that his statements were absolutely privileged because he was legally obligated to report the anesthesiologist’s misconduct.

The court found that the Chief of Anesthesiology was not entitled to an absolute privilege because he was not legally compelled to make the statements that he did. The hospital bylaws, while applicable, were not codified laws or regulations, and thus did not create a legal duty on the part of the Chief of Anesthesiology. The court acknowledged that the Chief of Anesthesiology may be entitled to a conditional privilege, stemming from his employment, if his employment required him to make the statements. However, the court rejected the argument that an absolute privilege applies in this situation.

Odeluga v. PCC Cmty. Wellness Ctr. – April 2015 (Summary)

DISCRIMINATION

Odeluga v. PCC Cmty. Wellness Ctr., Case No. 12–cv–07388 (N.D. Ill. Apr. 1, 2015)

The United States District Court of the Northern District of Illinois granted a motion for summary judgment filed by a health center and several physicians. A former fellow brought a lawsuit against a federally-qualified community health center and several physicians who served as co-directors of the health center’s maternal child health fellowship program. The fellow claimed that she had been discriminated against based on her age, national origin, and race, and that she had been subjected to harassment and a hostile work environment.  In support of her claim for discrimination, the fellow alleged that one of the co-directors of the training program had said to her: “You Nigerians like to be overly ambitious. You people are greedy.” The court found that the stray comment, even if made, did not create a “total picture of discrimination” and thus could not be used as direct evidence of discrimination.

The fellow also tried to present indirect evidence of discrimination. However, the record supported that the health center had received complaints about the fellow’s performance from early in the training program. According to her evaluations, the fellow failed to recognize important tissue landmarks during surgery, including a failure to recognize the difference between the bladder and the uterus. The evaluations also supported that the fellow was slow to respond to patient emergencies, and often had trouble remembering basic obstetrical knowledge. One evaluation stated that the physician had left blood and other fluids on her shirt for hours after a delivery, even while seeing other patients. Yet another evaluation noted that the fellow fell asleep in the labor room while a resident delivered a baby without supervision.

In granting the health center’s motion for summary judgment on the discrimination claims, the court held that the fellow could not demonstrate that she was meeting the health center’s legitimate performance expectations and thus could not establish a case for discrimination. The fellow also could not show that she was treated less favorably than other similarly situated fellows in her class. Her age discrimination, harassment, and hostile work environment claims failed for the same reasons.

Goh v. Dep’t of the Air Force – April 2015 (Summary)

PEER REVIEW

Goh v. Dep’t of the Air Force, No. 1:14-cv-00315 LJO SKO (E.D. Cal. Apr. 8, 2015)

The United States District Court for the Eastern District of California affirmed the decision to restrict a physician’s clinical privileges to practice at an Air Force hospital holding that there was sufficient evidence to support the decision.

After the physician discharged a patient who was having a myocardial infarction from the emergency department without diagnosing the patient’s condition, the physician’s privileges were held in abeyance pending a review of his records. A review of 74 records confirmed that in 15 cases there were “significant discrepancies ranging from lack of adequate documentation to failure to meet standard of care.” Based on these findings, the Credentials Committee recommended supervision and medical record review for the next 360 patient interactions. The Credentials Committee then reviewed an additional 102 cases and found discrepancies in 22 cases and concluded that the physician failed to meet the standard of care in 13 of these cases.

The physician requested and was granted a hearing. The hearing committee found that the physician had failed to meet the standard of care in a number of cases. The review panel concluded that the physician failed to meet the standard of care in 22 out of 192 cases and that this was “egregious.” A final decision was made to restrict the physician’s privileges.

The physician sought review of the restriction arguing that the decision was arbitrary or capricious because there was no evidence of mismanagement or inappropriate care. Specifically, the physician asserted that it was unreasonable to find that his conduct fell below the standard of care because no patients suffered adverse outcomes. The physician also argued that the hospital’s documentation requirements were onerous given its paper records system.

The court affirmed the hospital’s decision to restrict the physician’s privileges finding that the decision was supported by sufficient evidence. The court explained that the physician’s argument – that there was no evidence that he failed to meet the standard of care because there were no injured patients – was contrary to common sense. According to the court, the physician’s argument “relies on the logical fallacy that simply because one never becomes aware of something necessarily means that the thing does not exist.” The court concluded that the hospital’s decision was supported by the evidence and reasonable because it based its decision on the review performed by four practicing physicians.

Furthermore, the court rejected the argument that the hospital’s documentation standard was onerous and required that the physician record “each of his impressions.” Rather, the hospital had been critical of the physician’s documentation because he failed to document that he had evaluated alternative etiologies and he failed to document his medical decision-making. Thus, there was substantial evidence to support the hospital’s decision to restrict the physician’s privileges.

Jablow v. Wagner – April 2015 (Summary)

STATE PATIENT SAFETY ACT

Jablow v. Wagner, No. A-4202-13T4 (N.J. Super. Ct. App. Div. Apr. 8, 2015)

The Superior Court of New Jersey, Appellate Division, affirmed a lower court’s ruling that an attorney representing a patient should be disqualified, holding that the attorney impermissibly reviewed information that was privileged pursuant to the state Patient Safety Act. A patient had suffered a complication while undergoing surgery at defendant hospital. The hospital performed a root cause analysis in accordance with the state’s Patient Safety Act. Before the patient filed a medical malpractice action, her attorney received an anonymous copy of the root cause analysis report and related documents in the mail.

First, the hospital filed a motion to compel the return of the documents stating that they were privileged pursuant to the Patient Safety Act. Finding no evidence that the person who disclosed the documents was authorized to do so, the district court agreed with the hospital and required that the documents be returned to the hospital.

Next, the hospital filed a motion to disqualify the patient’s attorney on the basis that the attorney had violated the rules of professional conduct by reviewing the privileged documents and that such review would prejudice the hospital. The district court granted the hospital’s motion and disqualified the attorney from representing the patient.

The appellate court affirmed the lower court’s ruling, holding that the attorney violated the rule of professional conduct and that he should be disqualified. The court explained that the circumstances, including that the report was mailed from an anonymous source and had a footer on every page which stated that the report was prepared exclusively in compliance with the Patient Safety Act, should have alerted the attorney that the documents were privileged. The attorney was thus obligated, under the rules of professional conduct, to stop reading the documents and return them to the hospital.