Question:

Our incoming Chief of Staff just signed an employment contract with our main competitor.  Some MEC members think there is no problem, that he can just step out of the room if the CEO ever wants to discuss something sensitive, but others are concerned that perceptions of a conflict of interest might lead the CEO to involve the MEC in fewer decisions.  What can or should we consider?

Answer:

Hospitals, systems and affiliates are employing more physicians today than ever before.  Some Medical Staff Bylaws include eligibility criteria for leadership positions such as officers and department chiefs that would disqualify a physician who is employed by a competing organization from serving as a leader.  In other hospitals, the Board has adopted mission-related eligibility criteria for appointment, not just leadership positions.  CEOs may be wary of disclosing too much competitively sensitive information to the MEC because it may be hard to anticipate all situations were a conflict might arise, so the CEO therefore might be less inclined to seek MEC input on some decisions.  That would be a loss to the interests of most physicians and potentially deprive the hospital management team of helpful, relevant advice.  Respected medical staff (and possibly Board) leaders could sit down with the physician who has the new employment relationship.  Such discussions can lead the individual to step aside voluntarily.  Employment contracts can legitimately require that referrals be directed to the employing entity, so there is a potential that the new employment relationship could present a conflict.  To avoid hard feelings and political fallout, some hospitals have used a task force process involving the Board, management and physician leaders to develop mission-related eligibility criteria, including those related to financial conflicts of interest, and solicit input before those criteria are adopted.

Join Susan Lapenta and Barbara Blackmond for an audio conference on these issues on August 21 to explore these and related issues and get some practical guidance.