Crow v. City of Colo. Springs Mem’l Health Sys. (Summary)

ADA/DUE PROCESS

Crow v. City of Colo. Springs Mem’l Health Sys., No. 13-cv-02842-RBJ (D. Colo. May 5, 2014)

In July 2011, the plaintiff physician was hired for a term of one year by Memorial Health System (“MHS,” described as an “enterprise of the City of Colorado Springs”) after it acquired his former group practice, to perform General Surgery and Trauma services.  Shortly thereafter, he was injured, unable to work and subsequently granted leave.  In April 2012, he sought a limited return to work and accommodations.  However, his request for accommodation was never forwarded to the Accommodation Evaluation Committee (“AEC”) due to “inconsistencies.” Despite numerous attempts to remedy his application, it never was given to AEC for review.  He was not permitted to return to work and his employment was not reinstated, resulting in termination.  He also sought employment as a breast surgeon from June 2012 until his termination.  He alleged that despite the fact that he was qualified for the position, MHS filled one or more positions with female physicians. The lawsuit alleged procedural and substantive due process and equal protection claims against individual representatives of MHS.

The U.S. District Court for the District of Colorado granted defendants’ motion to dismiss the constitutional claims.  The court held that the procedural due process claim was inappropriate because the crux of his complaint (failure to consider accommodation) was a claim more properly brought against MHS under the ADA rather than the defendants under the due process clause. The court also found that the substantive due process claims were not sufficiently egregious to substantiate a cause of action under the due process clause because the alleged arbitrary behavior did not shock the conscience and was at best motivated by indifference or ill-will.  Finally, the court held that plaintiff failed to plead specific allegations linking defendants to plaintiff’s denial of employment as a breast surgeon and as a result his equal protection claim against the defendants was improper.

Clark v. Evergreen Sw. Behavioral Health Servs., LLC (Summary)

SEXUAL HARASSMENT

Clark v. Evergreen Sw. Behavioral Health Servs., LLC, No. 1:12-cv-00218 (S.D. Ohio May 2, 2014)

The U.S. District Court for the Southern District of Ohio denied a hospital’s motion for summary judgment against a former employee’s claims of sex discrimination and retaliatory discharge.  Mr. Clark, a registered nurse, was allegedly forced to resign after breaking off a consensual sexual relationship with Dr. Cantor, the Acting Medical Director/Administrator of the hospital. According to the allegations in the case, Dr. Cantor pressured the Director of Nursing to fire Clark shortly after their break-up.  Ms. Charlier, the Director of Nursing, offered instead to move Clark to a separate shift so that he would no longer be working alongside Dr. Cantor.  When Clark asked Charlier about why he was being moved to another shift, she told him that it was because Dr. Cantor wanted him fired.  Clark informed her about his past affair with Dr. Cantor, which Charlier passed on to her supervisor and to a Managing Member of the Board.  A member of the hospital’s management team told Charlier that “Someone is going to have to fall on the sword.”  Clark volunteered to resign so that no one else would be punished. Clark’s lawsuit alleges that he was discriminated against on the basis of his sex and retaliated against for engaging in protected activity in violation of Ohio law.  The hospital counters that Clark was terminated for sexually harassing other employees and for creating a “disruptive and racially charged atmosphere” at the hospital.  The court denied the hospital’s claim for summary judgment, noting the suspicious timing of Clark’s termination (just one week after he broke off the affair).  The court found that Clark had established prima facie claims of discrimination and retaliation.

Babchuk v. Ind. Univ. Health, Inc. (Summary)

STATE ACTION/DUE PROCESS

Babchuk v. Ind. Univ. Health, Inc., No. 1:13-cv-01376-JMS-DML (S.D. Ind. Apr. 30, 2014)

The Southern District of Indiana denied defendants’ motion to dismiss plaintiff’s civil rights claim. Plaintiff, a doctor and former employee of defendants, alleged that defendants are state actors and that he was wrongfully terminated by them without due process. Defendants argued that they are not state actors and this claim should be dismissed because this is not a matter under federal court jurisdiction. The court held that the issue of whether they were state actors is an element of plaintiff’s civil rights claim over which the court has jurisdiction. Moreover, the defendants attempt to argue that plaintiff failed to state a claim, but because they did not assert it in their original motion to dismiss, they waived their right to this argument.

King v. Garfield County Pub. Hosp. (Summary)

DRUG TESTING OF EMPLOYEES

King v. Garfield County Pub. Hosp., No. 12-CV-0622-TOR (E.D. Wash. May 1, 2014)

The U.S. District Court for the Eastern District of Washington granted in part and denied in part a hospital’s motion for summary judgment after a nurse’s employment was terminated for alleged drug diversion.

The plaintiff, a registered nurse, was employed by the defendant hospital. After a painful dental procedure, the nurse was prescribed painkillers with codeine. In the days that followed, another nurse suspected that the hospital’s supply of morphine had been diverted and diluted by an employee, as a morphine sulfate bottle that was intended to contain only 15 milliliters actually contained 34 milliliters. The hospital subsequently administered a drug test to its employees. The nurse, who had been taking the prescribed painkillers with codeine, which metabolizes into morphine, was found to have high levels of morphine in his system, and was subsequently put on leave. Experts later opined that while there was a presence of the drug in the nurse’s system, the results were not consistent with the use of the morphine from the hospital. The nurse then sued the hospital, along with the company involved in administering the drug test, and the doctor responsible for interpreting the test’s results.

The court held that the doctor interpreting the drug test’s results may have been negligent in telling the hospital that the nurse had near-fatal levels of morphine in his system. The doctor was unable to evaluate the dosage levels from the simple urine analysis conducted, and he should have taken into account the fact that the nurse was on prescribed painkillers with codeine. Additionally, it was determined that an expert witness was not required to explain the causal relationship between the negligence and the resulting injury to the nurse.

The court ruled that the administration of the drug test was not an unreasonable search in violation of the Fourth Amendment, because a government hospital has so high an interest in protecting patients from employees under the influence of drugs. The court found potential merit in the nurse’s claims that his termination without a hearing was in violation of his right to due process. Even though the nurse was later able to find a job elsewhere, a name-clearing hearing was still deemed appropriate because the accuracy of the charges was contested, the charges had been made subject to public disclosure, and the accusations were connected to his termination.

Hospital officials were not entitled to qualified immunity because they placed stigmatizing information in the nurse’s personnel file without a name-clearing hearing. The court did grant the defendants’ summary judgment against claims of a breach of promises of specific treatment, finding that there was no evidence presented to establish the hospital’s pattern of practice that would contradict the language of the hospital’s employee handbook.

The hospital was not vicariously liable for the actions of the doctor interpreting the drug test’s results, as the nurse was unable to explain how this doctor presented himself as an agent for the hospital. The request for summary judgment to dismiss this claim was therefore granted.

Awaad v. Largo Med. Ctr., Inc. (Summary)

RACE DISCRIMINATION/MEDICAL STAFF APPOINTMENT

Awaad v. Largo Med. Ctr., Inc., No. 13-14275 (11th Cir. May 2, 2014)

The U.S. Court of Appeals for the Eleventh Circuit upheld a district court’s grant of summary judgment for a hospital on a physician’s race discrimination claim.  The plaintiff physician held medical staff appointment and clinical privileges at the defendant hospital.  Following the death of a patient, the physician was required, following peer review, to attend a Physician Recovery Network program and a post-graduate course in fluid and electrolyte management.  He failed to comply and his privileges were terminated.  The court held that the failure to satisfy the peer review directive was a legitimate reason for termination of privileges and thus the decision was not pretextual.  Because a reasonable employer would have terminated privileges after failure to complete the peer review mandate and the physician failed to rebut the authenticity of this reason, his claim could not proceed and the lower court decision was affirmed.

Dudark v. Sw. Med. Ctr. (Summary)

EMPLOYMENT DISCRIMINATION

Dudark v. Sw. Med. Ctr., No. CIV-13-401-M (W.D. Ok. May 1, 2014)

The U.S. District Court for the Western District of Oklahoma granted in part and denied in part a motion for summary judgment on a former employee’s breach of contract, discrimination, retaliation and whistleblower claims against a medical center and its parent corporation.

Plaintiff, a Caucasian, worked as a full-time therapist.  In October 2011, she complained about unfair pay and a month later was sent a warning letter.  In early 2012, she reported a HIPAA violation.   Her request to work part-time ultimately was allowed, but her pay was reduced and she was terminated when a replacement was found.  The lawsuit alleged that her pay was not commensurate with her experience, she was disciplined for conduct that failed to bring reprimand to her African-American colleagues, and she was not afforded a part-time opportunity while the same was allowed for African-American therapists.

In denying defendants’ motion in part, the court held that although defendants proffered legitimate explanations for plaintiff’s reduction in pay and termination (such as her move from full-time to part-time and the hiring of her replacement), there were inconsistencies and contradictions in defendants’ reasoning and thus there was a material dispute of fact as to the discrimination, retaliation and whistleblower claims.

In granting defendants’ motion in part, the court held that plaintiff was an at-will employee and thus her contract could be terminated at any time and defendants did not breach their employment agreement through termination.

Roberts v. Legacy Meridian Park Hosp. (Summary)

DISCRIMINATION – RACIAL

PEER REVIEW PRIVILEGE

Roberts v. Legacy Meridian Park Hosp., No. 3:13-CV-01136-SI (D. Or. Apr. 25, 2014)

The U.S. District Court for the District of Oregon granted a neurosurgeon’s motion to compel discovery of a hospital’s peer review in a racial discrimination case filed in federal court, denying the existence of a “peer review privilege,” but also granted the hospital’s request to protect the disclosure of certain information for non-party physicians.

The plaintiff, an African-American neurosurgeon, alleged that the defendant hospital had precautionarily suspended him because of his race and therefore sued the hospital in federal court alleging racial discrimination.  The neurosurgeon claimed that the surgery that resulted in the suspension had actually resulted in a positive patient outcome and that other non-African-American doctors on the medical staff who had received negative patient outcomes had not experienced any similar peer review consequences.  To support his claims through discovery, the neurosurgeon requested complete records of the peer review analyses and investigations for himself and other selected doctors appointed to the medical staff over the course of the previous 10 years.  However, the hospital argued that the documents were protected by a “peer review privilege.”  Additionally, the hospital stated that the neurosurgeon had agreed to be contractually bound by the state statute that exempts medical peer review records from disclosure.

The court found that a peer review privilege is not recognized in federal common law, and expressly declined to recognize or establish such a privilege.  As such, it was determined that any relevant peer review documentation should be produced for review.  The court also noted that even the state peer review statute which does include a privilege for peer review documents, included an express exception for documents sought by those challenging restriction of clinical privileges.  Due to policy considerations, however, the court ruled in favor of the hospital’s motion for protective order by allowing that the release of discovery documents be staggered.  The court directed the hospital to release the peer review information of the neurosurgeon and other doctors in his field, but was not required to release the information of other non-party, non-neurosurgeons unless a specific showing could be made regarding the discovery’s relevance.

Isaacs v. Pacer Serv. Ctr. (Summary)

DOCUMENT PRODUCTION

Isaacs v. Pacer Serv. Ctr., Nos. SA-14-MC-12-XR & 12-CV-40-JL (D.N.H.) (W.D. Tex. Apr. 22, 2014)

The U.S. District Court for the Western District of Texas granted a physician’s motion to enforce a subpoena to compel a court records producer to produce certain documents.  The physician is party to a pending litigation against the hospital where he completed his residency and sought certain court records in order to prove that he was abused by the faculty at that hospital which he claimed had taken an “obsessive interest” in a lawsuit that he had filed against his medical school alleging disability discrimination.  The physician obtained a third-party subpoena requesting the court records producer to produce records showing that the hospital had accessed court records pertinent to his lawsuit against his medical school; however, after the deadline for production had passed, the producer e-mailed the physician letting him know that his request had been denied because it failed to satisfy the federal judiciary’s disclosure regulations and the producer’s privacy and security policy.

The court found that the physician sufficiently complied with the regulations and ordered the records producer to provide the requested information.  Despite his initial subpoena request and accompanying letter which failed to demonstrate relevance and an inability to obtain the information from other sources, the physician had attempted to communicate with the producer after his initial subpoena request was denied.  The court reasoned that the physician demonstrated the relevance of the information and the need for it.  Furthermore, the records producer did not contend that responding to the subpoena would be burdensome.

ProMedica Health Sys., Inc. v. Federal Trade Commission (Summary)

ANTITRUST – HOSPITAL MERGERS

ProMedica Health Sys., Inc. v. Federal Trade Commission, No. 12-3583 (6th Cir. Apr. 22, 2014)

The U.S. Court of Appeals for the Sixth Circuit upheld an order by the Federal Trade Commission (“FTC”) ordering a health system to divest a smaller hospital recently acquired through a merger, which had determined that the merger would adversely affect competition in violation of the Clayton Act.

Two hospital systems, ProMedica and St. Luke’s, agreed to merge in 2010, giving ProMedica a majority of the market share in both primary and secondary services and obstetrical services.  The FTC challenged the merger, and an Administrative Law Judge and the Commission held in subsequent hearings that the merger would lessen competition in an already highly concentrated market, that it would permit ProMedica to unilaterally raise prices above a procompetitive level, and that the merger did not create any efficiencies sufficient to offset the anticompetitive effects.  As such, the FTC ordered ProMedica’s divestment of St. Luke’s.  ProMedica sought judicial review of that order.

The court confirmed the Commission’s determination, finding the market concentration data assessment resulted in substantial evidence that the merger well exceeded the threshold to be considered a highly concentrated market, thereby triggering the presumption of illegality.  The Commission therefore had every reason to conclude as it did that such dominance offered the plaintiff too much leverage to increase its rates.  The court found that the Commission was correct in determining the competitive effects of the merger by clustering both primary and secondary general acute care services for consideration.  The remedy of divestiture, which the FTC had found to be the best means to preserve competition in the relevant market, was deemed not to be an abuse of discretion.

U.S. ex rel. Rector v. Bon Secours Richmond Health Corp. (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Rector v. Bon Secours Richmond Health Corp., No. 3:11-CV-38 (E.D. Va. Apr. 14, 2014)

The United States District Court for the Eastern District of Virginia dismissed a False Claims Act (“FCA”) suit brought by a former employee (the relator) against a health system operating a concierge program to refer patients to physicians, holding that the relator failed to plead his complaint with sufficient particularity to support an FCA claim because, although he alleged a general scheme which perhaps could have resulted in false claims if it resulted in claims being submitted to the government for reimbursement, he did not allege any specific “claims” or bills that were actually submitted to the government.

After being terminated from his position as concierge for insubordination and falsifying a physician signature in violation of company policy, the relator filed a qui tam complaint against his former employer alleging that, as a concierge for the health system, his job was to provide concierge services (including processing orders for tests, obtaining pre-authorizations from the patients’ insurers, communicating with patients and testing facilities, and collecting copayments from patients) on behalf of physician practices that referred patients to the health system for diagnostic testing and other services.  He claimed that physicians routinely failed to complete the necessary order forms and that he, as a concierge, was instructed not to call the physicians’ offices for clarification but, instead, to use “cheat sheets” developed by the health system to select appropriate and reimbursable ICD codes and, if necessary, to call patients to obtain information about their diagnoses and the tests the doctors may have ordered.  Further, the relator alleged that if the physician’s signature was missing, he was instructed to copy and paste a signature from a prior order that was on file.  The relator complained that, as a result of these unlawful practices, the health system, though its concierge service and through its conspiracy with physician practices and other health care facilities, made false certifications to the government in order to cause claims to be paid, presented false claims to the government, violated the Anti-Kickback Statute, and violated Virginia’s Fraud Against Taxpayers Act.

The court dismissed the relator’s suit on the basis that it failed to plead the claims of fraud (such as the claims of violation of the FCA) with sufficient particularity.  Specifically, the court noted that fraud claims must be pled with greater particularity than other types of legal claims.  In the case of an FCA case, the relator must at least describe, for some of the alleged false claims, the time, place, and contents of the false representations, the identity of the person making the misrepresentation, and facts supporting the notion that an actual claim for reimbursement was submitted to the government.

In this case, the relator submitted, in support of his claims, a log of patients that he created while working as a concierge, which included patient names, procedures scheduled, dates of procedures, facilities in which procedures were completed, the names of the referring physicians, and the type of insurance held by the patient.  However, the relator failed to provide any evidence showing that bills for such services were generated and/or submitted to the government for reimbursement.  In the absence of any information indicating that actual claims were submitted (such as a copy of a bill, documents showing the amounts of charges, policies about billing), the court held that dismissal was appropriate.