McIntire v. Mich. Inst. of Urology (Summary)

EMPLOYMENT – RACE DISCRIMINATION

McIntire v. Mich. Inst. of Urology, No. 311599 (Mich. Ct. App. Jan. 23, 2014)

The Court of Appeals of Michigan affirmed a lower court’s granting of summary disposition in favor of a urology practice, finding that an African-American urologist had not proven that the termination of her employment violated the state’s civil rights act, the state’s whistleblower’s protection act, or public policy.

After numerous complaints from doctors, medical assistants, and patients regarding the urologist’s behavior, the employer’s practice manager and executive committee president met with the urologist to discuss the problems and to explain that the unprofessional behavior in question was unacceptable.  When the complaints continued, the members of the employer’s executive committee voted in favor of terminating the urologist’s employment, giving her one last chance to rectify her behavior.  After the urologist yelled at a medical assistant, her employment was terminated.

As the urologist was unable to establish a prima facie case of racial discrimination, the court found that there was no genuine issue of material fact that she was terminated from her employment for nondiscriminatory reasons.  The urologist failed to show intentional discrimination because she could not show that the individual who discharged her was predisposed to discriminate against African-Americans, or that this predisposition was being acted upon when her employment was terminated.  The urologist also failed to prove disparate treatment by being unable to show that she was a member of a protected class and that she was treated differently than members of a different class for the same or similar conduct.  Furthermore, the medical center had a legitimate, nondiscriminatory reason for the urologist’s termination, as the medical center’s staff and patients complained about her behavior and demeanor.

With regard to the urologist’s public policy claims, the court similarly found that the urologist could not prove that she was terminated due to her refusal to violate a law because the violation of the physician’s standard of care is not a violation of objective law.

Sanders v. Christus Santa Rosa PASC (Summary)

HOSTILE WORK ENVIRONMENT

Sanders v. Christus Santa Rosa PASC, No. SA-13-CV-250-XR (W.D. Tex. Jan. 17, 2014)

The United States District Court for the Western District of Texas denied an ambulatory surgical center’s (“ASC”) motion for summary judgment, finding that a genuine issue of material fact existed as to whether a registered nurse’s hostile work environment claim could be established. The surgical pre-op nurse claimed that after complaining that a surgeon sexually harassed her, she was given the choice of remaining at the facility on a different floor or transferring to a different facility.  The nurse then filed a lawsuit claiming she suffered a loss of hours after transferring to the other facility.

The court found that the nurse adequately exhausted her administrative remedies before the state’s Workforce Commission by notifying it that the surgeon was sexually harassing her and that she complained to her supervisor of the alleged conduct. The court further found that the nurse timely filed her charge of discrimination with the Workforce Commission. With regard to the nurse’s hostile work environment claim, the court found that there existed a genuine issue of material fact as to whether the alleged acts were severe or pervasive and whether the ASC exercised reasonable care to prevent and promptly correct any sexually-harassing behavior. Lastly, the court found that while the nurse may not be entitled to any lost wages because she voluntarily quit her job at the ASC, she may still be entitled to a jury question on whether she should be awarded compensatory damages for emotional pain or mental anguish.

Woodruff v. Hawai’i Pac. Health (Summary)

PHYSICIAN EMPLOYMENT; CORPORATE INTEGRITY AGREEMENT

Woodruff v. Hawai’i Pac. Health, No. 29447 (Haw. Ct. App. Jan. 14, 2014)

The Intermediate Court of Appeals of Hawai’i affirmed a lower court’s judgment in favor of a medical group parent company, finding that a physician had not shown that the lower court erred in granting summary judgment for the parent company.

The physician’s employment at two medical groups was terminated after the medical groups’ parent company voluntarily reported to the government, per an integrity agreement with the OIG, that the physician had submitted invalid claims for payment by third party payors. The physician subsequently formed a new medical group and brought suit against the parent company’s successor and others, alleging defamation, breach of the physician’s employment contract, and anticompetitive and unfair practices, among others.

With regard to the physician’s defamation claims, the court found that the lower court did not err when ruling that the parent company had a qualified privilege with respect to the alleged defamatory statements and that they had not abused this qualified privilege.  The court reasoned that the parent company complied with the integrity agreement and retained an independent review organization to audit its billing practices and verify compliance with applicable standards. The parent company self-disclosed after reviewing the results of the audit in order to ensure compliance with the integrity agreement.  Further, the medical group had a duty to discuss the results of the investigation with others in ensuring compliance with billing requirements and the integrity agreement.  All of the actions performed in order to ensure compliance with the integrity agreement were protected by a qualified privilege.

The court further found that the lower court did not err in granting the parent company summary judgment with regard to the physician’s breach of employment contract claim because the physician was an at-will employee. The medical groups and parent company provided the physician with many documents, which the physician signed, specifically stating that her employment was at will.

The court also held that the lower court did not err in granting summary judgment on the physician’s employment claims, finding that the physician was not entitled to a hearing on the decision to terminate her employment, as the bylaws and any due process hearing requirement apply only to clinical and membership privileges, not employment termination.

Tavilla v. HealthSouth Valley of the Sun Rehab. Hosp. (Summary)

AGENCY

Tavilla v. HealthSouth Valley of the Sun Rehab. Hosp., No. 1 CA-CV 12-0768 (Ariz. Ct. App. Jan. 14, 2014)

The Court of Appeals of Arizona found that a genuine issue of material fact as to the alleged agency relationship between a hospital and a physician precluded the hospital from obtaining summary judgment.  The court analyzed the two different kinds of potential agency relationships that could have existed between the hospital and the physician, finding that one, ostensible agency, needed further review.

The hospital employed the physician as a program director or as an associate medical director.  The physician also independently treated patients in his own pain management practice; he practiced in office space leased from the hospital.  A pain management patient filed a medical malpractice claim against the physician, and also named the hospital, asserting that the hospital was vicariously liable for the physician’s conduct because he was either an actual agent or an ostensible agent of the hospital.

The court found that the hospital could not be held liable for the physician’s allegedly negligent treatment, as there was no evidence of an actual agency between the hospital and the physician with regard to the physician’s pain management patients. For example, the hospital’s lease agreement stated that the space was to be used only as an office for the physician’s outpatient patients, further requiring the physician to maintain a distinction between his private practice and his hospital duties.

The court further found that a reasonable jury could find that the hospital’s actions or inactions induced the patient into believing that the physician was the hospital’s agent with regard to the patient’s pain management treatment. The hospital did not make clear (through signs or otherwise) that the physician was not acting on behalf of the hospital.  Nor did the hospital require the physician to notify his patients that there was no agency relationship between him and the hospital. The hospital also allowed the physician to use the hospital facilities and personnel in a manner that could lead a patient to believe the physician was an agent of the hospital.

Collison v. Iowa Bd. of Med. (Summary)

STATE MEDICAL BOARD ACTION

Collison v. Iowa Bd. of Med., No. 13-0477 (Iowa Ct. App. Jan. 9, 2014)

The Court of Appeals of Iowa affirmed a lower court’s ruling upholding the state Medical Board’s decision that a physician violated state law by knowingly making misleading, deceptive, untrue, or fraudulent representations to the Board, finding that the physician’s right to due process was not violated.

After being diagnosed with abdominal cancer, a long-term patient of the physician’s brought a malpractice suit against him, alleging failure to order diagnostic testing, and late detection of the cancerous mass. The physician’s insurance company then filed notice with the Medical Board regarding the malpractice action, and the Board subsequently sent the physician an investigative inquiry. The physician claimed that the patient saw his assistant, and that he had not been involved in the patient’s care, either directly or indirectly, in several years. The Board held that the physician had knowingly made misleading, deceptive, untrue, or fraudulent representations to the Board and, among other things, was ordered to pay a $3,000 civil penalty.

The physician asserted that while the record shows his response to the Board’s investigation as untrue, there was no substantial evidence that he intended to deceive the Board.  The court found, however, that the Board’s statutory and administrative code provisions do not require an intent to deceive or that someone was actually misled; a statement that is made knowingly and is untrue or misleading is sufficient.  As such, the court found that there was substantial evidence that the physician made a misleading and untrue representation to the Board.

The physician also claimed that his right to due process was violated by the Board due to the participation of three people in both the investigative and adjudicative process. The court found that while the Board’s actions were not ideal, they were not “unreasonable, arbitrary, or capricious,” and thus, the Board did not abuse its discretion.

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

DISCOVERY/QUI TAM

U.S. ex rel. Rector v. Bon Secours Richmond Health Corp., No. 3:11-CV-38 (E.D. Va. Jan. 6, 2014)

The United States District Court for the Eastern District of Virginia granted in part and denied in part a health system’s motion for relief against a relator’s qui tam complaint. The health system had implemented a program to provide concierge services to one of its hospitals. The concierge service was to provide a wide array of services to doctors who referred their patients to the health system for diagnostic tests. The hospital had retained a temporary employment agency, which was co-owned by one of the health system’s managers, to provide personnel for the concierge service. The relator was employed at the employment agency and later hired by the hospital to be a concierge. Subsequently, the manager was fired by the hospital and he abandoned his employment agency, including computers containing sensitive information from past dealings with the hospital, and the hospital took no steps to secure the information from the agency, despite knowing that the business had closed. Later, the health system moved the court to order the relator to return all of the hospital’s data that he possesses.

The court found that the health system is likely to be prejudiced by the relator’s possession of the agency’s computers containing sensitive information shared by the health system and the agency. The information may not be reachable through the discovery process and it is difficult to determine whether the data is pertinent to the matter at hand because the court is unaware of the exact content of the data.

Sheikh v. Grant Reg’l Health Ctr. (Summary)

NPDB

Sheikh v. Grant Reg’l Health Ctr., No. 11-cv-1-wmc (W.D. Wis. Jan. 2, 2014)

The United States District Court for the Western District of Wisconsin ruled that a hospital was immune from liability for reporting a physician to the National Practitioner Data Bank (“NPDB”) because the report filed by the hospital accurately reflected why the hospital revoked the physician’s privileges.  The court also ruled that the hospital appropriately terminated the physician’s employment agreement following the suspension of his clinical privileges, and found that the physician was obligated to repay a $50,000 loan he had received from the hospital.

The physician brought suit against the hospital after it reported him to the NPDB, claiming that the hospital reported inaccurate information and acted with the intent to cause emotional distress. The physician also claimed that the hospital terminated him without cause.

The hospital asserted that it was entitled to immunity under the Health Care Quality Improvement Act (“HCQIA”) for the tort claims arising out of filing the report with the NPDB. The court granted summary judgment for the hospital on these claims, finding the hospital immune from claims seeking damages because the report filed by the hospital was not “false.”  The court observed that the hospital’s immunity did not depend on the merits of its underlying decision to revoke the physician’s privileges.  Instead, the question is whether the NPDB report accurately reflected the action taken.  Further, the court dismissed the physician’s claim for injunctive relief against the NPDB, finding that the physician failed to sufficiently assert a claim for such relief.

With regard to the physician’s breach of contract claim, his employment contract specifically stated that it could be terminated if his clinical privileges were suspended.  The physician failed to provide admissible evidence in response to the hospital’s motion for summary judgment showing that the contract should not be enforced.

The hospital also requested summary judgment on its counter-claim for breach of contract, which was premised on a loan agreement signed by the physician and then the hospital.  Among other things, the loan agreement provided that the hospital would advance the physician $50,000, which the hospital executed.  After the physician’s employment was terminated, the hospital demanded that the physician perform his obligation under the loan agreement and repay the principal and interest, which the physician has failed to do.  The court found that the physician knew, or should have known, that his employment could be terminated by the hospital as he executed an employment agreement with express provisions for termination of his employment on the same day he signed the loan agreement.  As such, no reasonable jury could find that the physician’s inability to pay back the loan was because he did not know or could not foresee the situation.  Thus, the court found that the physician breached the loan agreement.

Sheikh v. Grant Reg’l Health Ctr., No. 14-1449 (7th Cir. Oct. 14, 2014)

On October 14, 2014, the United States Court of Appeals, Seventh Circuit affirmed the decision of the district court.

Lopez-Aguirre v. Bd. of Cnty. Comm’rs – Summary

PEER REVIEW

Lopez-Aguirre v. Bd. of Cnty. Comm’rs, No. 12-2752-JWL-KGG (D. Kan. Dec. 20, 2013)

The United States District Court for the District of Kansas held that evidence relating solely to federal law claims would not be protected by the state peer review privilege, evidence relating solely to state law claims would be protected by the state peer review privilege, and evidence that related to both federal and state law claims would not be protected by the state peer review privilege.

Chudnovsky v. Chapman Med. Ctr – Summary

CONTRACT

Chudnovsky v. Chapman Med. Ctr., G047990 (Cal. Ct. App. Dec. 23, 2013)

A California Court of Appeal found that an arbitrator did not exceed his authority by finding that a no-cause termination provision in an agreement between plaintiff-physician and a defendant medical center was “null, void and ineffective” in light of a medical staff bylaws provision that allowed termination of membership and privileges solely for specific “for cause” reasons.

Miller v. Huron Reg’l Med. Ctr – Summary

PEER REVIEW

Miller v. Huron Reg’l Med. Ctr., No. CIV. 12-4138 (D. S.D. Dec. 20, 2013)

The United States District Court for the District of South Dakota held that a defendant hospital’s medical malpractice insurance carrier, which hired a physician-reviewer to conduct an external review of a plaintiff-physician, was required to produce the physician-reviewer’s report to the plaintiff-physician.

The plaintiff-physician wanted the hospital to produce the report, as well as the physician-reviewer’s time line notes and notes the claims representative made when discussing the review with the physician-reviewer.  The insurance carrier argued that the notes are protected by the state peer review privilege.

The court held that under the state peer review law, peer review proceedings are not subject to discovery, but that prohibition does not apply “to deny a physician access to or use of information upon which a decision regarding the person’s staff privileges or employment was based.”  The court also found that a privilege can be waived if the party that asserts the privilege puts in issue information protected by the privilege, which the hospital did in this case.  Finally, the court found that the privilege may be waived when invoked in an unfair way, such as using it as a shield and dagger, which the hospital did here.