QUESTION:
It feels like every person in our hospital is using AI at this point, whether it be ambient AI tools, clinical decision support systems, or even sending their AI agents to attend Teams meetings on their behalf. What should hospitals be doing to tame this wild west?

ANSWER FROM HORTYSPRINGER ATTORNEY IAN DONALDSON:
Used thoughtfully, AI can help hospitals improve patient care, reduce administrative burdens, strengthen clinical and operational decision-making, and allow physicians, nurses, and staff to spend more time on work that requires human judgment. Ambient documentation tools may ease clinicians’ documentation workload; clinical decision support tools may help identify relevant information and potential risks; and other applications may streamline scheduling, communications, and other routine administrative tasks.

But these benefits do not eliminate the need for guardrails or independent judgment. AI tools can affect everything from patient care to credentialing and peer review. Hospitals therefore should establish a centralized process for reviewing and approving AI tools before they are adopted or used. That process should assess, as appropriate, the tool’s accuracy, reliability, and data practices and security, as well as other legal and regulatory risks. It should also help the hospital establish clear expectations for appropriate use, monitor performance, and periodically reevaluate approved tools.

If you haven’t already, your hospital should consider creating an AI steering committee or similar body.  The group should include representatives from information technology, privacy, compliance, legal, and risk management, among others. Because many AI tools influence clinical workflows and professional judgment, meaningful physician and other clinical input is also essential.

At the end of the day, the goal of such steps is not to discourage innovation, but to ensure that AI is used responsibly and in a manner consistent with the hospital’s patient-safety obligations.

If you have a quick question about this, e-mail us at info@hortyspringer.com.

QUESTION:
One of our employed physicians is interested in attending a fellowship program in a much-needed specialty.  He has asked us not only to allow him to attend the Fellowship Program but to provide him with financial assistance while he attends that fellowship program.  Is this something that we are legally permitted to do and, if so, are there issues we should consider?

ANSWER FROM HORTYSPRINGER ATTORNEY HENRY CASALE:
Yes, this type of arrangement is not uncommon.  It is lawful to grant the physician a furlough from their employment arrangement so they may attend the fellowship program.  But you need to make sure that you have the coverage for this physician during the year or so that the physician will be away attending the fellowship program.  There are also a number of practical concerns you need to consider before granting the physician’s request.

We have found that often the physician does not appreciate how much more valuable they have become to other employers because they have received the fellowship training until they begin to receive job offers from recruiters and others while they are attending the fellowship training program.  As a result, this type of agreement has the highest default rate of any of the agreements that we prepare.  So you need to be aware of this possibility and protect yourself to the extent that you can.

You will need a written agreement with the physician that will describe how long they are to be away, that they must return and resume employment with you once the fellowship training has been completed (often permitting 30 days or so as a grace period) and to the extent possible you should lock down, in advance, the amount that you will pay the newly trained physician upon their return − taking the advanced training into account.

While they are in the Fellowship training program, in order to protect yourself from the old saying “out of sight, out of mind” you should require the physician to contact you every couple of months during the training program and require them to provide evidence that they are in good standing in the training program.  Then 30-60 days prior to the end of the training program, the physician should be required to contact you to make arrangements for their return.

A fellowship training program will typically employ the physician, providing a salary and malpractice coverage.  Your agreement with the physician should recognize that employment arrangement, make it clear that the malpractice insurance provided by the training program (and not your insurance coverage) will apply to any act or omission that may occur during the training program, and require the physician to provide you with notice of any incidents or claims that may arise during the training program.

It is also not unusual for your hospital to supplement the fellowship program’s salary with some form of financial assistance.  How much you may pay the physician during the fellowship program is subject to the agreement of the parties − but it should be commercially reasonable and consider the amount being paid by the fellowship program and the physician’s reasonable living expenses.

Unless you are in a state like California which limits an employer’s right to have a “Stay or Pay” term in an employment agreement that began on or after January 1, 2026 (see AB 692), in consideration of the expenses that the employer has incurred to assist the physician to obtain the fellowship training and the additional amount the employer has incurred for coverage while the fellowship is in effect, the employer should have some recourse if the physician does not return and work for the employer for an agreed upon period of time.

So, to the extent permitted by your state’s laws, the agreement should make it clear that if the physician does not complete the fellowship program, fails to resume their employment with you upon the completion of the program, or does not work for you for at least a specified period of time (excepting death or disability), then some or all of the amount that you have paid to the physician during the fellowship program must be repaid.

Some employers require immediate repayment of the full amount that has been paid to the physician during the fellowship training.  However, in our experience, most employers permit that amount to be pro-rated and decreased for each month that the physician is employed following the end of the fellowship program.  We have even seen some employers add liquidated damages in addition to that amount as a deterrent to another employer poaching your newly trained employee during the period of time the newly fellowship-trained physician has agreed to remain your employee.  But check your state law before adding liquidated damages to make sure they are permitted in your state.

But recognize that there may be an employer who is willing to pay this amount, no matter how much, on behalf of the physician to recruit the newly fellowship-trained physician away from you.  If any type of repayment term is permitted by state law to be included in the agreement with the physician to obtain the fellowship training, it is wise to obtain the physician’s agreement that you are authorized to offset the amount so owed from any amount the employer may owe to the physician upon the termination of employment.  A promissory note is also helpful if repayment is required.

But hopefully these terms won’t be necessary and you will be able to achieve the intent of the fellowship training agreement − which is to assist one of your employed physicians to obtain, and then to provide, a needed, fellowship-trained, specialty for many years following the end of the fellowship training.

If you have a quick question about this issue, email us at info@hortyspringer.com.

QUESTION:
We are in the process of developing a policy to address practitioners’ self-treatment and treatment of family members.  What are some resources we should consider when drafting our policy?

ANSWER FROM HORTYSPRINGER ATTORNEY MOISES A. TONOC BONILLA:
Circumstances in which a practitioner treats oneself or their family member poses ethical and legal challenges, such as the practitioner’s ability to provide care and the patient’s ability to provide informed consent.

In developing such a policy, it is important to consider ethical guidelines issued by medical associations, state laws and regulations prohibiting or outlining circumstances in which a practitioner may self-treat or treat a family member, and policy or position statements from your state’s practice boards interpreting relevant rules and regulations (if the Board has taken a position on the issue).

The American Medical Association’s (“AMA”) Council on Ethical and Judicial Affairs Opinion 8.19.  “Self-Treatment or Treatment of Immediate Family Members” (May 2012) provides that “Professional objectivity may be compromised when an immediate family member or the physician is the patient; the physician’s personal feelings may unduly influence his or her professional medical judgment, thereby interfering with the care being delivered.”  Additionally, “patients may feel uncomfortable disclosing sensitive information or undergoing an intimate examination when the physician is an immediate family member.”  However, Opinion 8.19 notes that “in emergency settings or isolated settings where there is no other qualified physician available, physicians should not hesitate to treat themselves or family members until another physician becomes available.”  Opinion 8.19 can be found here.

Although your state’s practice statutes or regulations may not explicitly address a prohibition on self-treatment or the treatment of a family member, state law may prohibit certain types of practitioners from prescribing controlled substances to oneself or to the practitioner’s immediate family members.  State Medical Boards and Nursing Boards may issue policy statements outlining the circumstances in which a physician, physician assistant, or other medical practitioners may treat or assist in treating oneself or a family member.

If you have a quick question about this, e-mail us at info@hortyspringer.com.

QUESTION:
Does our Utilization Review Committee have to be a Medical Staff committee, or can it be a Hospital committee?

ANSWER FROM HORTYSPRINGER ATTORNEY CHARLES CHULACK:
In our experience, some hospitals do have a utilization review committee set up as a Medical Staff committee, but many do not.  There is no explicit regulatory requirement or accreditation standard obligating a hospital to have a Medical Staff utilization review committee.  For example, the Centers for Medicare & Medicaid Services (“CMS”) Conditions of Participation for Hospitals require hospitals to have a utilization review plan and a utilization review committee.  The committee, per the Conditions of Participation, has to be a “staff committee of the institution” with at least two physicians as members.  The requirement can be satisfied by “a group outside the institution” such as one established by local medical societies.  CMS includes the utilization review requirements in the Conditions of Participation in a separate section from the medical staff requirements.  The Medical Staff sections of the Conditions of Participation do not even mention utilization review.  Even though the Conditions of Participation note that a utilization review committee has to be a “staff committee,” this is different from a “medical staff committee.” CMS knows how to signify when something falls under the purview of the medical staff and the fact that CMS left out “medical staff” when describing the requirements for the utilization review committee is significant.  Furthermore, the Conditions of Participation state that the committee has to be a committee of the “institution,” which signifies “hospital” as opposed to Medical Staff.  The fact that the utilization review committee requirement can be satisfied by a “group outside the institution” (that would not be a medical staff committee) also demonstrates that it does not need a medical staff committee.  Keep in mind that if you decide to have the utilization review committee as a hospital committee, we recommend that you confirm that your state does not require that the committee be a medical staff committee.

That being said, we are aware of at least one client who received feedback from the CMS Survey & Certification Group, Division of Acute Care Services that the utilization review committee “must be a committee or subcommittee of the medical staff.”  Nonetheless, this feedback, as noted above, is not consistent with the Conditions of Participation and we are not aware of CMS citing any hospital for having a hospital utilization review committee.  It is also not consistent with current practice of many hospitals whose utilization review committees are multi-disciplinary hospital committees with membership comprised of both practitioners and administrative personnel such as directors of coordinated care, billing staff, and internal audit staff.

If you have a quick question about this, e-mail us at info@hortyspringer.com.