In re Wyatt v. Vanguard Health Sys., Inc. (Summary)

HOSPITAL LIABILITY/ADULT PROTECTIVE SERVICES

In re Wyatt v. Vanguard Health Sys., Inc., No. CV-13-0272-PR (Ariz. June 30, 2014)

The Supreme Court of Arizona vacated the opinion of a lower court, holding that Arizona’s Adult Protective Services Act applies to acute care hospitals in their treatment of patients and subjects them to potential liability.

Separate wrongful death lawsuits were brought against two hospitals, and then were consolidated. The hospitals argued that they should not be held liable under a state statute that holds providers of care liable for harm or neglect to a vulnerable adult. The hospitals argued further that they provide “treatment” rather than “care,” meaning they don’t fall under the text of the statute. The court disagreed, ruling that the language of the statute applies to acute care hospitals, as well as any other facility that neglects, abuses, or exploits vulnerable adults.

Hamdan v. Ind. Univ. Health N. (Summary)

ATTORNEY-CLIENT PRIVILEGED DOCUMENTS

Hamdan v. Ind. Univ. Health N., No. 1:13-cv-00195-WTL-MJD (S.D. Ind. June 24, 2014)

The U.S. District Court for the Southern District of Indiana granted in part and denied in part a surgeon’s motion to compel production of documents. The surgeon alleged that a hospital had discriminated against him on the basis of his race and ethnicity. The surgeon accused the hospital of entertaining false charges of professional misconduct against him, of harming his reputation through disciplinary actions, and of forcing his resignation.

The surgeon sought to obtain e-mails exchanged among the hospital’s supervisory, medical, nursing, and human resources personnel. The defendants refused to produce these e-mails for the plaintiff on the grounds that the e-mails were guarded by the attorney-client privilege and by the attorney work product rule. Attorney-client privilege is a legal doctrine that permits clients to refuse to disclose confidential communications with an attorney. The work product rule provides a limited degree of protection during discovery proceedings for the work product of an attorney.

The court permitted the surgeon to view certain e-mails that were “HR focused” and which documented “at-the-moment analysis” by the hospital’s chief medical officer and chief nursing officer, among others. The court ruled that simply copying attorneys on an e-mail chain in order to keep them abreast of business-related occurrences is not sufficient to guarantee the protection of attorney-client privilege or the work product rule. The court denied the surgeon’s request for the remaining e-mails, deciding that those e-mails qualified for protection.

Haight v. NYU Langone Med. Ctr. Inc. (Summary)

SEXUAL HARASSMENT/HOSTILE WORK ENVIRONMENT

Haight v. NYU Langone Med. Ctr. Inc., No. 13 Civ. 04993 (LGS)(S.D. N.Y. June 27, 2014)

The U.S. District Court for the Southern District of New York granted in part and denied in part a hospital’s motion to dismiss an action brought by a former nurse accusing the hospital, under state law, of negligent supervision, quid pro quo sexual harassment, hostile work environment sexual harassment, disability discrimination and failure to provide a reasonable accommodation, and religious discrimination. The nurse, a 41-year-old woman with gynecological problems and a strict follower of the Catholic faith, was harassed by a co-worker over a six-year period. The co-worker impermissibly accessed the nurse’s personal medical charts numerous times and used this information to call the nurse late at night, inappropriately touched her, and negatively discussed the nurse’s medical problems and religious practices with other employees. The co-worker was also suspected of leaving a used pregnancy test on the nurse’s desk. Additionally, a doctor who worked with the nurse gave her a religious book when the physician heard about her health problems. He advised her that it had a section “on women who were cursed by God because they have no children[.]” The nurse repeatedly made complaints to the hospital’s human resources department and HIPAA compliance officer.

The co-worker was fired from the hospital, but an outside vender hired her the next month as a nurse educator and vendor fill-in. The nurse saw the co-worker at the hospital seven times within the next four months, with each meeting resulting in the nurse feeling physically ill and almost fainting. Some of these meetings were facilitated by the “gifting” doctor mentioned above who purposely scheduled them on the same shift. After another encounter with the co-worker, the nurse complained to human resources. She was removed from work after an independent third party concluded that she was a victim of abuse as a result of a hostile work environment. The nurse began collecting worker’s compensation as a result of post-traumatic stress disorder and was terminated a year later.

The court held that a jury could reasonably determine that the hospital was negligent of supervising its workers; the nurse was a victim of sexual harassment based on a hostile work environment; and the nurse was a victim of disability discrimination and failure to provide a reasonable accommodation. The court reasoned that the hospital had knowledge of the co-worker’s propensity of wrongdoing due to the nurse’s repeated complaints and it breached its duty of providing a safe work environment to the nurse by allowing her and the co-worker to continuously work together. The court stated that a hostile work environment for sexual harassment existed because the essence of the harassment, the nurse’s medical condition and records, was based on her gender. Lastly, the court stated that the hospital was aware of the nurse’s post-traumatic stress disorder but never attempted to accommodate her before the hospital terminated her employment.

Hyshaw v. Saint Francis Med. Ctr. Med. Exec. Comm. (Summary)

MEDICAL STAFF DUE PROCESS

Hyshaw v. Saint Francis Med. Ctr. Med. Exec. Comm., B249424 (Cal. Ct. App. June 30, 2014)

A California Court of Appeal upheld a lower court’s decision dismissing a neurosurgeon’s request to overturn a hospital’s determination that he did not qualify for reinstatement following a leave of absence, holding that a court will not review a hospital’s determination unless the aggrieved physician has properly exhausted his administrative remedies. The hospital’s medical executive committee found certain issues regarding the neurosurgeon’s professional performance. The Chief of Staff offered the physician two options: take a temporary leave of absence or be suspended. The neurosurgeon chose to take a temporary leave of absence.

He eventually sought reinstatement, but the hospital’s medical executive committee denied his request. As per the medical staff bylaws, the neurosurgeon sought review of this decision by a “judicial review committee,” and the review committee ultimately upheld the medical executive committee’s decision. The neurosurgeon again sought appellate review of this decision by the hospital’s Board of Directors, pursuant to the medical staff bylaws. However, after the neurosurgeon received confirmation that his appeal would be heard by the Board, the neurosurgeon failed to file his brief in a timely manner. The Board affirmed the medical executive committee’s decision and the neurosurgeon brought this action requesting the court to overturn the hospital’s decision not to reinstatement him.

The court of appeal affirmed the lower court’s holding that proper exhaustion of administrative remedies is a prerequisite to judicial relief and, because the neurosurgeon did not properly file a brief with the Board of Directors, pursuant to the medical staff bylaws, his claim was barred.

Green v. Springfield Med. Care Sys., Inc. (Summary)

WHISTLEBLOWER RETALIATION

Green v. Springfield Med. Care Sys., Inc., No. 5:13-cv-168 (D. Vt. June 24, 2014)

The U.S. District Court for the District of Vermont denied a nurse anesthetist’s motion for summary judgment, and denied in part and granted in part a hospital’s motions for summary judgment, holding that the question of whether the hospital terminated the nurse anesthetist in retaliation for reporting concerns about improper patient care practices was a question for a jury. Plaintiff, the nurse anesthetist, was an employee of defendant, the hospital. Over a two-year period, the nurse anesthetist reported three different co-workers to the hospital regarding what he perceived to be improper patient care. Additionally, the nurse anesthetist threatened to report these individuals to the Vermont Medical Board.

During this two-year period, the hospital experienced a decline in its surgical volume. Accordingly, as a result of cost-saving measures, the hospital terminated the nurse anesthetist’s employment. The nurse anesthetist brought suit claiming he was terminated in retaliation for reporting and threatening to report the alleged improper patient care. The court held that summary judgment for the hospital was inappropriate because even though the hospital had offered a legitimate business reason, a decline in surgical volume, for the nurse anesthetist’s termination, a jury could reasonably find that this reason was a pretext for his whistleblowing.

Goldenberg v. Woodard (Summary)

NEGLIGENCE

Goldenberg v. Woodard, Nos. 57232, 58151 (Nev. June 20, 2014)

The Supreme Court of Nevada affirmed in part and reversed in part a physician’s appeals from a judgment finding him negligent and fraudulent. The physician-defendant decided to expand his practice by offering colonoscopies after he attended a continuing medical education course. After being granted privileges at a surgery center with the condition that he was to be supervised by an experienced physician, the physician scheduled a colonoscopy with patient-plaintiff. The supervising physician did not show up at the scheduled time, but the physician proceeded nonetheless. The physician experienced difficulty during the procedure and left an instrument induced half-dollar-size hole in the patient’s colon. The jury found against the physician and the surgery center for claims of professional negligence and fraud.

The physician argued that the fraud and professional negligence claims fell under a statutory damages cap which limited the patient’s entire noneconomic damages to $350,000. The district court held that the statutory damages cap was only for professional negligence and it was to be applied separately to each defendant. The physician appealed, claiming the district court erred by upholding the jury’s finding of fraud against him, applying the damages cap separately to each defendant, and refusing to reduce the damages awarded against him.

The Nevada Supreme Court upheld the jury’s finding of fraud because there was substantial evidence that the physician materially misled the patient about his ability to perform the procedure. The court held that this specific claim for fraud was “qualitatively different” than a claim for professional negligence, so that the statutory cap did not apply to the fraud damages. Lastly, the court held that the statutory damages cap for professional negligence applied to the patient’s entire award for noneconomic damages, not to each separate defendant.

Kane v. Healthfirst, Inc. (Summary)

QUI TAM

Kane v. Healthfirst, Inc., Civil Action No. 11-2325 (ER) (S.D. N.Y. June 27, 2014)

The U.S. Attorney for the Southern District of New York filed a qui tam complaint-in-intervention alleging that a not-for-profit healthcare corporation erroneously submitted 900 claims to Medicaid and failed to timely reimburse the U.S. government.

The healthcare corporation discovered that a software compatibility error had caused its billing programs to automatically generate incorrect bills to secondary payers, including Medicaid. An individual, who became the relator, was asked by the corporation to examine the bills to determine which had been improperly submitted to the Department of Health. The relator discovered that more than 900 incorrect claims had been submitted, totaling over $1 million, as a result of this software error. Four days after the relator e-mailed his analysis to the corporation’s management, he was fired. The corporation did not move forward in addressing these erroneous claims. After two years and a Civil Investigative Demand seeking information, the corporation only reimbursed the federal government for 300 incorrect claims.

The qui tam complaint alleges that the corporation intentionally or recklessly failed to rectify the mistaken claims caused by the software error, and failed to timely reimburse the Department of Health for the money paid by Medicaid to cover these false claims.

Sidibe v. Sutter Health (Summary)

ANTITRUST

Sidibe v. Sutter Health, No. C 12-04854 LB (N.D. Cal. June 20, 2014)
The U.S. District Court for the Northern District of California dismissed a complaint from a class action lawsuit alleging that a healthcare system was involved in anticompetitive conduct in violation of antitrust law.

The company that owns and operates the largest network of hospitals in the area was alleged to be involved in anticompetitive behavior by initiating the use of “tying arrangements,” in which the company required hospitals to include high-priced plans in their health plan networks.

The court found that the complaint did not plead sufficient facts to support the proposed inquiry into the adequacy of the relevant geographic markets in question. Also, the complaint suggested that geographic markets be examined by the location where health plan members actually go. The court found, however, that the Sixth Circuit mandates analyzing geographic markets by examining the availability of substitute products.

Additionally, the complaint failed to properly define the geographic markets by stating that they were roughly congruent with the Dartmouth Atlas of Health Care’s definition of “hospital service area.” The court was unconvinced by this definition, and held that the Dartmouth Atlas was not sufficient to define relevant terms for antitrust purposes. Because the relevant geographic markets were not properly identified or supported in the complaint, the factual allegations stemming from the faulty definitions were dismissed entirely.

In re Colo. Med. Bd. v. Office of Admin. Courts (Summary)

PEER REVIEW LICENSURE

In re Colo. Med. Bd. v. Office of Admin. Courts, No. 13SA209 (Colo. June 23, 2014)
The Colorado Supreme Court reversed the lower court’s order compelling the production of peer review documents, holding that the Colorado Medical Board review committee’s records are protected from all forms of subpoena and discovery, including one as a result of an administrative hearing. After a medical license applicant was denied licensure by the Colorado Medical Board (“Board”) she sought review of the Board’s decision through an administrative hearing. The applicant requested the Board’s “Letters of Concern” that it had produced for similarly situated applicants because she believed the letters contained relevant information to her licensure denial. The Board objected to this request by raising the statutorily provided peer review privilege. The administrative judge ordered, and the district court agreed, that the Board was to produce the letters, reasoning that the peer review privilege only applies to civil suits and not administrative hearings. The Colorado Supreme Court held that the peer review statute protects the records of a professional review committee, the Board, from all forms of subpoena and discovery. Furthermore, an administrative hearing of an adjudicatory nature is considered a civil suit under the peer review statute.

Taylor v. Jewish Hosp. & St. Mary’s Healthcare, Inc. (Summary)

VICARIOUS LIABILITY

Taylor v. Jewish Hosp. & St. Mary’s Healthcare, Inc., Civil Action No. 3:13-CV-00361-CRS (W.D. Ky. June 11, 2014)

A federal district court in Kentucky reached different conclusions with respect to the liability of two hospitals for the acts of their emergency physicians. The court ruled that one hospital could be liable for the acts of an emergency physician because he had an agency relationship with the hospital. However, the court found that an emergency physician at the second hospital was not its agent, so the second hospital could not be liable for his actions. The court also ruled that neither hospital violated the Emergency Medical Treatment and Active Labor Act (“EMTALA”).

A patient presented to the emergency department of the first hospital with severe abdominal pain and was diagnosed with pneumonia. After being tested and prescribed an antibiotic, the patient was discharged. He returned a few days later, complaining of shortness of breath and a sharp pain in his chest. He received an x-ray and a new prescription, and was once again sent home. When the patient still didn’t feel better, he went to a second hospital complaining of the same symptoms. After ordering a chest x-ray, a second-year resident diagnosed the patient with atypical pneumonia, prescribed another antibiotic, and sent him home. A few days later, the patient was found collapsed on the floor, and he was rushed to the hospital, where he was pronounced dead. An autopsy showed that he died of a pulmonary thromboembolism.

The patient’s mother alleged, in separate claims, that both hospitals were negligent in providing her son medical care. The first hospital sought summary judgment on this claim, arguing that the independently contracted physicians were not employees, and therefore not agents. The court found that a genuine issue of fact existed regarding whether the hospital exercised a high level of control over the physicians in a way that might implicate them as agents. Among other things, the court found that the first hospital’s ability to prohibit an emergency physician from providing services, and its incentive compensation plan with the group that employed the emergency physician, suggested a high level of control. This led to the court’s denial of the hospital’s request for summary judgment so that further determination could be made by a jury.

The court did grant summary judgment to the second hospital on the same claim, however, holding that the patient’s signed consent form stating his awareness that the physicians are not hospital employees is sufficient to show that the resident was not an agent of the hospital.

The plaintiff alleged that both hospitals violated EMTALA by failing to provide sufficient testing or care to the patient. However, the court granted summary judgments to dismiss both claims, ruling that, while additional testing may have been advisable, the health care facilities could not be deemed to have had actual knowledge of the emergency medical condition other than pneumonia. Because there was no actual knowledge of the emergency medical condition, the necessary elements for an EMTALA claim could not be established.