Valentin-Lugo v. Hosp. Matilde Brenes Inc. (Summary)

EMTALA

Valentin-Lugo v. Hosp. Matilde Brenes Inc., Civil No. 12-1757 (PAD) (D.P.R. Dec. 18, 2014)

Memorandum and Order

The Magistrate Judge’s Report and Recommendation

The U.S. District Court for the District of Puerto Rico granted a hospital’s motion for summary judgment against an EMTALA lawsuit. The EMTALA lawsuit was filed by an employee of the hospital, who became a patient there after she developed sudden abdominal pain during her lunch break.

At issue in the case was whether the hospital conducted an adequate screening of the patient before transferring her to see her personal obstetrician. When the patient developed a sudden onset of abdominal and pelvic pain, she was taken to the hospital’s “Labor Room” for an examination by its resident obstetrician. However, she refused to consent to this examination, instead requesting that the hospital transfer her to see her personal obstetrician at another location. Prior to the transfer, the hospital conducted a “Non-Stress Test” and determined that the fetal heart rate was normal and that she was not undergoing contractions. The hospital also conducted several other tests, including a pelvic examination, blood test, urinalysis, and renal sonogram. All of these indicated that it was safe for the patient to be transferred. The parties in the lawsuit differed over whether the patient displayed any indications of trouble during transit. The hospital argued that her vital signs were normal, but the patient claimed that the paramedic record showed premature contractions and the possibility of hypovolemic shock and class II hemorrhage. Tragically, when the patient arrived at the destination hospital, the receiving nurse found no fetal heart rate. A subsequent examination revealed a ruptured uterus and intrauterine death of the fetus.

In her lawsuit, the patient alleged that the hospital failed to perform a complete medical examination before transferring her. The hospital countered by arguing that it had complied with EMTALA, and that it had treated her as it would any patient with similar symptoms. In addition, the hospital argued that although the patient claimed the Non-Stress Test did not last long enough, she had failed to submit any other evidence demonstrating that her screening was inadequate or that the hospital had failed to comply with EMTALA.

A magistrate judge initially heard the case and found that the hospital had complied with EMTALA. The judge noted that the hospital had ordered tests to identify the source of her pains and had transferred her to a hospital in her hometown after it deemed her stable. Consequently, the judge recommended that the hospital’s motion for summary judgment be granted. The U.S. District Court concluded that the magistrate judge had made the proper ruling and affirmed. It dismissed the case with prejudice.

 

Morman v. Campbell Cnty. Mem’l Hosp. (Summary)

GENDER DISCRIMINATION

Morman v. Campbell Cnty. Mem’l Hosp., No. 13-CV-243-ABJ (D. Wyo. Dec. 5, 2014)

A federal court in Wyoming dismissed an orthopedic surgeon’s motion alleging that gender discrimination from a county hospital resulted in damage to her compensation and conditions of employment by that hospital. Soon after becoming employed by the hospital, the surgeon began noting several issues with the hospital’s management of the clinic in which she practiced. She objected to the name change of the clinic and complained that the clinic did not have effective advertising, managerial staff, office space, or billing personnel, all of which combined, she claimed, put her at a competitive disadvantage with other orthopedic surgeons and affected the productivity bonus payments she would have received under her contract. Shortly after the surgeon renegotiated her employment contract, the terms of which were highly publicized in the area, the hospital entered into agreements with three male orthopedic surgeons from the area surgery center where the plaintiff surgeon had previously practiced. Under these agreements, which were not highly publicized, the hospital paid for the surgery center’s advertising campaign, radiology services and billing and allowed the surgeons to remain in their modern office space. She then sued the hospital and individually named board members for discrimination, alleging disparate treatment on the basis of gender.

The court determined that while the board members were not entitled to absolute legislative immunity, they were entitled to qualified immunity, because the surgeon failed to show that their conduct in approving the contracts of the three male surgeons was a violation of a clearly established constitutional right. Furthermore, the court dismissed the surgeon’s discrimination claim, finding that she had not alleged a plausible claim that she was treated differently than other similarly situated employees. Rather, the court found, the male surgeons from the surgery center brought more to the bargaining table than the plaintiff surgeon. This meant that they were not similarly situated, and thus could not be compared.

Baptist Mem’l Hosp.-Miss. Cnty., Inc. v. Kalyan (Summary)

CONTRACT DISPUTES

Baptist Mem’l Hosp.-Miss. Cnty., Inc. v. Kalyan, No. CV-14-450 (Ark. Ct. App. Dec. 10, 2014)

An appellate court in Arkansas reversed and remanded a trial jury’s award of damages, finding insufficient evidence to support the amount of damages that had been awarded in a case in which a pulmonologist breached his physician agreement with a hospital.

The pulmonologist was recruited to work full time for a hospital. The pulmonologist and the hospital signed a physician agreement stipulating that the hospital would pay the pulmonologist guaranteed draws for income assistance and practice expenses. Under the terms of the physician agreement, the pulmonologist was supposed to repay the amount of the advancement, unless he worked at the hospital long enough for his debt to be forgiven. During his practice at the hospital, the pulmonologist received $228,350.74. The pulmonologist left before the terms of his contract were up and did not repay the amount he received from the hospital. A jury trial determined that the pulmonologist had breached his contract, but had awarded the hospital only $46,478.38 in damages. The hospital appealed this amount.

The appellate court found that the pulmonologist presented no evidence at trial to suggest that the pulmonologist’s amount owed should be set off. Additionally, though the pulmonologist argued that he was entitled to damages for the hospital’s negligent recruitment, claiming that the hospital knew there was not enough need to support a full-time pulmonologist, he had failed to present any damages at trial. Because he received $228,350.74 and was found to have breached his contract with the hospital, the court found no substantial evidence to support the jury’s award of $46,478.38.

Wheeless v. Maria Parham Med. Ctr. (Summary)

MEDICAL STAFF PRIVILEGE ACTIONS

Wheeless v. Maria Parham Med. Ctr., No. COA14-612 (N.C. Ct. App. Dec. 2, 2014)

The Court of Appeals of North Carolina affirmed a trial court’s decision to grant a hospital’s motion to dismiss claims filed by an orthopedic surgeon alleging, among other things, unfair and deceptive trade practices and medical malpractice. The hospital and surgeon had been embroiled in a long-standing dispute about the physician’s conduct and potential violations of the hospital’s “disruptive physician policy.”

Although there were several different episodes of conflict between this physician and the hospital, the most salient one for purposes of this court opinion involved an anonymous complaint submitted to the North Carolina Medical Board. This anonymous complaint alleged that the physician engaged in inappropriate and disruptive behavior. According to the physician, the anonymous complaint referenced instances that were subject to a strict confidentiality agreement. Consequently, the physician believed that the anonymous complaint was an attempt by certain individuals to discredit him before the North Carolina Medical Board.

In this appeal, the physician challenged three adverse rulings by the trial court. First, the physician argued that the trial court erred by dismissing his claim for unfair and deceptive trade practices. The appellate court disagreed, finding that health care professionals who make complaints to a medical board are not subject to suit for unfair and deceptive trade practices, because they are performing an integral part of their role in ensuring the provision of adequate medical services. Second, the physician argued that the trial court erred by dismissing his claims for medical malpractice and negligence. The appellate court again disagreed, holding that a physician-patient relationship is necessary in order to bring a medical malpractice claim, and cannot simply be brought by a physician against his colleagues. The court also found that the trial court had acted properly in dismissing the physician’s negligence claims under the doctrine of abatement, finding that if a plaintiff files multiple lawsuits that present significant overlap between the parties, subject matter, issues, and relief requested, then the duplicate claims may be “abated” by the initial lawsuit. Because the negligence claims dealt with many of the same issues as the physician’s first complaint, the appellate court held that the trial court acted properly in dismissing these duplicate negligence claims under the doctrine of abatement.

U.S. ex rel. Schaengold v. Mem’l Health, Inc. (Summary)

FRAUD AND ABUSE – QUI TAM ACTIONS

U.S. ex rel. Schaengold v. Mem’l Health, Inc., No. 4:11-cv-58 (S.D. Ga. Dec. 18, 2014)

The U.S. District Court for the Southern District of Georgia granted in part and denied in part a hospital’s motion to dismiss a qui tam lawsuit filed by its former CEO and President. The lawsuit alleged claims for breach of contract, retaliatory discharge, and violation of the False Claims Act.

According to the CEO, his problems with the hospital began when he advised the Board that the hospital was paying excessive amounts of compensation to certain physicians. Although the Board initially cooperated with his attempts to implement a new compensation model, it ultimately continued to pay certain physicians at levels above fair market value. The CEO claimed that the Board had terminated his employment in direct retaliation for his efforts to report these compliance issues to the Department of Health and Human Services. The hospital had also withheld his severance pay unless he agreed to sign a release of his legal claims.

In its motion to dismiss, the hospital countered by arguing that the CEO’s complaint did not state an actionable legal claim and was not detailed enough in its allegations of fraud. Also, the hospital challenged the CEO’s ability to assert a breach of contract claim on behalf of the government, and argued that any retaliatory discharge claim would have to be pursued in an arbitration hearing.

The court granted certain parts of the hospital’s motion to dismiss. It dismissed some of the Stark violations that were tied to so-called “Bonus Pool” payments made to specific physicians, since the CEO’s complaint had failed to set an adequate benchmark for fair market value. Without any evidence of fair market value, the court explained that it was unable to determine whether the bonus payments were genuinely excessive.

It also granted the hospital’s motion to dismiss the False Claims Act violations. It reasoned that the CEO had not given enough evidence to show that the government actually made payments for services derived from illegal referrals. Without this evidence, the court held that the CEO had failed to plead a sufficient cause of action under the False Claims Act.

However, the court denied the hospital’s attempt to compel arbitration for the retaliatory discharge claim. It discovered that the CEO had attempted to pursue his retaliatory discharge claim in an earlier arbitration proceeding, but that the hospital had challenged the arbitrator’s jurisdiction over the claim. The court concluded that the hospital’s inconsistent courses of action were prejudicial to the CEO and that the hospital therefore had waived its right to compel arbitration at this point in the litigation.

It also denied the hospital’s attempt to dismiss other Stark claims relating to physician compensation, as the CEO had provided evidence of fair market value for these claims. Further, it denied the hospital’s attempt to dismiss the Anti-Kickback Statute violations, finding that the CEO had given “sufficient indicia” that the hospital intended its compensation arrangements to induce referrals from certain physicians. Lastly, the court granted the relator’s request to amend certain counts of his complaint.

Holmes Reg’l Med. Ctr. v. Dumigan (Summary)

PRODUCTS LIABILITY – NEGLIGENCE STANDARDS

Holmes Reg’l Med. Ctr. v. Dumigan, No. 5D14-505 (Fla. Dist. Ct. App. Dec. 12, 2014)

The Fifth District Court of Appeal of Florida denied a petition for writ of certiorari filed by a hospital seeking review of an adverse decision in a negligence lawsuit. At issue on appeal was whether a patient’s negligence lawsuit should be characterized as a medical malpractice claim or as a products liability claim.

The lawsuit was filed by a patient who had been admitted to the hospital for cardiac bypass surgery. During the course of the surgery, he had received contaminated heparin, which caused him to develop a severe bacterial infection. This infection was so extensive that it eventually led to the amputation of his left leg and his right foot. In his complaint, the patient explained that the heparin supplier had issued a notice of recall prior to the surgery, but that the hospital had failed to implement adequate procedures to respond to the recall.

At trial, the hospital argued that this was a medical malpractice case subject to the Florida Medical Malpractice Act (“FMMA”). The FMMA requires plaintiffs to address a higher, medical negligence standard of care in their lawsuits. Because the patient had not done this, the hospital argued that his claim should be dismissed. The trial court disagreed with the hospital’s argument, concluding that the patient was actually alleging a product liability suit, rather than medical malpractice, which carried a lesser, ordinary negligence standard.

The appellate court agreed, holding that the allegedly wrongful act was the hospital’s failure to remove contaminated heparin from its supplies, not the medical decision to administer a blood thinner. Because this involved an administrative policy rather than a medical judgment, it was properly classified as a products liability case and was not subject to the heightened medical negligence standard. Consequently, the trial court had acted properly in denying the hospital’s motion to dismiss.

Prairie Rheumatology Assocs. v. Francis (Summary)

RESTRICTIVE COVENANTS

Prairie Rheumatology Assocs. v. Francis, No. 3-14-0338 (Ill. App. Ct. Dec. 11, 2014)

The Third District Appellate Court of Illinois affirmed in part and reversed in part a trial court’s orders regarding a physician group’s request for a preliminary injunction. The physician group sought the injunction after one of its former employees, a rheumatologist, failed to abide by a restrictive covenant in her employment agreement. This restrictive covenant prevented the rheumatologist from entering into a competitive practice within a 14-mile radius of the physician group’s offices.

In the trial court, the physician group succeeded in obtaining a limited preliminary injunction that prevented the rheumatologist from treating the current patients of the physician group. However, the trial court refused to enforce the non-competition agreement with respect to the general public. The physician group appealed this decision, arguing that the trial court had abused its discretion by declining to enforce the restrictive covenant in full. The rheumatologist countered by arguing that the restrictive covenant was unenforceable altogether, as it lacked adequate consideration.

The appellate court agreed, explaining that under state law, two years or more of continued employment constitutes adequate consideration for a restrictive covenant. This rule is maintained even if the employee resigns on her own instead of being terminated. In this instance, because the rheumatologist resigned after 19 months, her employment with the physician group had not constituted sufficient consideration to support the restrictive covenant.

In addition, the court noted that the rheumatologist received “little or no additional benefit” from the physician group in exchange for her agreement not to compete, noting that the physician group had not assisted her with obtaining hospital privileges nor had the group introduced her to any referral sources. Consequently, it concluded that the restrictive covenant was not enforceable altogether. It reversed the trial court’s decision to enforce the restrictive covenant for the group’s current patients and remanded the case for further proceedings.

Gaskill v. VHS San Antonio Partners (Summary)

MEDICAL STAFF PRIVILEGE ACTIONS

Gaskill v. VHS San Antonio Partners, No. 04-14-00153-CV (Tex. App. Dec. 17, 2014)

The Court of Appeals of Texas reversed a trial court’s dismissal of a physician’s lawsuit challenging the suspension of his privileges. The physician sued the hospital after the hospital issued a formal “Notice of Involuntary Reduction of Medical Staff Privileges” against him, which left him unable to work at any hospital. The physician requested a hearing, but the parties ultimately decided to mediate the dispute by sending several of the physician’s cases to external review. After the external review concluded that there had been no deviation from the standard of care, the physician’s privileges were fully restored; however, he then sued the hospital for breach of contract, defamation, business disparagement, and intentional infliction of emotional distress, alleging that the suspension had damaged his business and his reputation.

In the trial court, the hospital system filed a motion to dismiss, arguing that the physician’s claims had no basis in law. The trial court agreed, granting the motion and awarding the hospital $8,320.50 in attorney’s fees. The physician appealed, arguing that this dismissal had been improper because he was not given adequate notice of the upcoming motion to dismiss.

The appellate court agreed. It explained that under the Texas Rules of Civil Procedure, the physician was entitled to at least 14 days’ notice of the hearing on the motion to dismiss. In this instance, the hearing was held without giving any formal prior notice of the date and time of the hearing to the physician. Consequently, the physician was deprived of his due process rights to respond to the motion to dismiss. The appellate court reversed the trial court’s dismissal and remanded for further proceedings.

Abrahamson v. Ill. Dep’t of Fin. and Prof’l Regulation — Dec. 2014 (Summary)

DUE PROCESS – MEDICAL LICENSURE ACTIONS

Abrahamson v. Ill. Dep’t of Fin. and Prof’l Regulation
No. 13-1921 (7th Cir. Dec. 11, 2014)

The U.S. Court of Appeals for the Seventh Circuit affirmed a trial court’s decision to dismiss a due process claim against the Illinois Department of Financial and Professional Regulation (“department”) filed by a physician after the department rejected his application for a medical license for the second time in nearly 20 years.

The physician had first applied for a medical license in 1986 after graduating from medical school, completing three years of surgical residency, and passing his boards. The department denied this initial application after discovering that he had fabricated his medical school transcript and had lied about his academic credentials and his applications for other state licenses. When the physician applied again in 1998, the department denied his application and explained that, at that time, he had insufficient current professional experience upon which it could grant the license. The physician sued and, after protracted litigation, obtained an order from a circuit court instructing the department to assess his capacity to practice medicine and to determine what sort of additional training he would need to obtain a license. Following that review, the department informed the physician that he needed to pass the current medical boards and complete another two years of residency. After unsuccessfully appealing this in the state court system, the physician then filed a due process claim in federal court. The trial court dismissed the claim, reasoning that the physician was really just conducting a “collateral attack” on the state court judicial decisions, concluding that only the Supreme Court of the United States could overturn the state court rulings.

The Seventh Circuit affirmed the trial court holding on appeal. It explained that the physician was asking for relief that it could not give, because he was essentially trying to use the federal courts to upset a judgment by the state courts. Consequently, it refused to overturn the lower court’s decision.

Knapik v. Mary Hitchcock Mem’l Hosp. (Summary)

PEER REVIEW PRIVILEGE

Knapik v. Mary Hitchcock Mem’l Hosp., No. 5:12-CV-175 (D. Vt. Dec. 12, 2014)

The United States District Court for the District of Vermont denied a former resident’s motion for contempt and sanctions against a hospital for withholding documents. Plaintiff, who had been in a residency program at defendant hospital, alleged that she was wrongfully terminated by the hospital for whistleblowing activity which involved her sending a letter the hospital had sent to a different resident that was critical about that resident’s performance to the fellowship program that the resident had applied to as the plaintiff resident was aware that the information had not been disclosed to the fellowship program. During discovery, the former resident requested, and a court ordered, the hospital to disclose internal e-mails regarding certain medical residents’ employment records and feedback about their performances. The hospital provided some, but not all, requested documentation, arguing and that the information that was not provided was privileged under the state’s quality assurance and peer review privileges. The former resident then sought sanctions against the hospital for failing to produce the documents. Ultimately, the missing documentation was submitted to the court for in camera review to determine whether they were privileged.

Following in camera inspection of the e-mails, the court held that the e-mails were covered by the quality assurance privilege because they related to performance feedback and evaluations of medical residents by peers and advisors. The court stated that the privilege protects both formal and informal feedback and evaluations, such as e-mails, from disclosure. The former resident argued that one particular e-mail should be disclosed because a physician discussed it with her and thereby waived the privilege. The court rejected this argument because the privilege is held by the hospital, not its employees, hence only the hospital is able to waive it. In addition, due to the privileged nature of the documents, the court also declined to impose sanctions against the hospital.