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.

Jones-McNamara v. Holzer Health Sys., Inc. (Summary)

Jones-McNamara v. Holzer Health Sys., Inc., No. 2:13-cv-616 (S.D. Ohio Apr. 28, 2014)

The U.S. District Court for the Southern District of Ohio denied defendant hospital’s motion for judgment on a former employee’s False Claims Act (“FCA”) retaliatory discharge claim.

In May 2010, plaintiff, a former compliance officer, began investigating conduct that she believed resulted in improper and fraudulent claims being submitted in violation of the FCA.  She sent a memorandum complaining of such conduct and advised that reimbursement checks be sent to the government.  In response, the compliance officer allegedly was instructed not to talk to her informant again, not to reduce her findings and analyses to writing, and not to work with anyone in her investigations except for outside counsel in order to create the appearance that the attorney-client privilege covered any materials involved in the work.  In June 2010, the compliance officer was terminated from her position and she sued, claiming retaliatory discharge.

In denying the hospital’s motion for judgment, the court held that a plaintiff is not required to bring or further a qui tam FCA case against a defendant in order to gain protection under the FCA’s retaliation provision.  Instead, the current retaliation provision affords broad coverage to employees by protecting them from being fired for (1) conduct that is in furtherance of an FCA action, as well as (2) other efforts to stop violations of the FCA (including internal reporting of FCA violations).  As a result, the court found it inappropriate to dismiss the former compliance officer’s claim because her investigation and disclosure of conduct in potential violation of the FCA satisfied the second prong and, as a result, was protected.

Riley v. St. Mary Med. Ctr. (Summary)

DISCRIMINATION – AGE

Riley v. St. Mary Med. Ctr., No. 13-cv-7205 (E.D. Pa. Apr. 23, 2014)

The U.S. District Court for the Eastern District of Pennsylvania granted in part and denied in part a hospital’s motion to dismiss a former nurse’s claim that she was the victim of age discrimination.

The plaintiff, a 62-year-old nurse, worked in the defendant hospital over ten years with generally positive work reviews.  She had a history of anxiety, colitis, insomnia, and some cognitive disabilities.  In 2009, she complained to her supervisor that she was experiencing harassment at the hands of another nurse.  In 2011, the nurse received a poor annual evaluation that contained a significant amount of inaccurate information.  The nurse expressed her concern that she was being selectively discriminated against because of her age.  Shortly thereafter, the hospital began scheduling her for fewer shifts as the Charge Nurse, instead giving the position to a younger employee.  One week after the hospital hired a new, younger nurse in early 2013, the hospital terminated her for allegedly poor performance.  The nurse then filed a Charge of Discrimination with the Equal Employment Opportunity Commission.

The court found that the nurse could only bring claims based on her termination itself.  Claims for the other alleged previous acts of discrimination were held to be untimely since they occurred more than 300 days before the filing of the suit.  This time-bar prevented the nurse’s claims of a hostile work environment prior her termination.  The court held that the termination itself was to be considered a “discrete act” which could not be aggregated with the other acts that had allegedly occurred in the past to constitute proof of a hostile work environment.  The court did not dismiss the nurse’s discrimination and retaliation claims, finding that the facts suggested a plausible claim for relief.  However, the court held that the nurse had not provided adequate factual support to substantiate her claims that she suffered from a disability.  Because of this, she could not also claim that any discrimination against her was based on a disability.

Doe v. Bd. of Regents of the Univ. of Neb. (Summary)

DISCRIMINATION – DISABILITY

Doe v. Bd. of Regents of the Univ. of Neb., No. S-12-1136 (Neb. Apr. 24, 2014)

The Supreme Court of Nebraska upheld the dismissal of a medical school student’s Americans with Disabilities Act (“ADA”) and Rehabilitation Act claims against a university medical school, its affiliated hospital, and several faculty members in their official and individual capacities.  The student was placed on academic probation his first year, asked to have his exams rescheduled twice, and was granted a leave of absence to deal with personal issues related to a death in the family and the break-up of a relationship.  Later, he was granted the unprecedented ability to take specially arranged summer core classes to stay on pace with his class.  During his third year, he failed two clerkships and received a marginal rating in another.  These results were based on a mixture of professional concerns, such as playing internet poker on duty, leaving clinic hours early, and unexcused absences, as well as academic concerns such as difficulty presenting patients, below-average knowledge base, and failing national exams.  The student agreed to an academic contract which included a professionalism clause in order to maintain enrollment in medical school.  During his next rotation, the student received a poor rating and negative comments in regard to his professionalism.  On that basis, the medical school determined that he was in violation of his academic contract and terminated his enrollment.  In challenging the termination, the student claimed that he was suffering from a disability – depression – and that his termination was in violation of the ADA and Rehabilitation Act.  It was undisputed that the student had never formally informed the medical school that he was suffering from a disability through the designated process or ever requested an accommodation.

Due to their similarities, the court analyzed both claims together.  The court held government officials cannot be sued in their individual capacities under the ADA or the Rehabilitation Act.  Next, the court held that the medical school never had knowledge of the student’s disability and, therefore, it could not be held liable under the Acts.  The mere fact that plaintiff told some faculty members he was “depressed” or “stressed” was insufficient to prove that the medical school had knowledge of a disability or a request for an accommodation.  The court also concluded that the academic contract that the student signed didn’t have materially adverse effects on the student, but instead, merely clarified the expectations of the program applicable to all students.  Moreover, given the record full of professionalism and clinical knowledge issues, the student had failed to show that there were any adverse actions taken “because of his disability” by defendants.

Miller v. Huron Reg’l Med. Ctr., Inc. (Summary)

NPDB REPORTING

Miller v. Huron Reg’l Med. Ctr., Inc., No. 12-4138-KES (D. S.D. Apr. 22, 2014)

The U.S. District Court for the District of South Dakota dismissed a claim for tortious interference with business relationships and expectations that was brought by a general surgeon against the professional liability carrier of the hospital where she worked, in which the surgeon alleged that the professional liability carrier’s delay of almost four months in submitting the results of an external review regarding one of her cases resulted in the hospital reporting her to the National Practitioner Data Bank.

The court noted that, to survive dismissal, the surgeon was required to allege an intentional and unjustifiable act of interference by the professional liability carrier with respect to the contract between the surgeon and the hospital.  She failed to do this, instead claiming that the carrier had a duty to facilitate the external review in a reasonable and prudent manner (i.e., without negligence).