Graboff v. Colleran Firm (Summary)

Graboff v. Colleran Firm, No. 10-1710 (E.D. Pa. Mar. 28, 2013)

The United States District Court for the Eastern District of Pennsylvania (“district court”) denied an orthopedic surgeon membership organization’s request for a reversal of the verdict. A surgeon who was working with a law firm on a medical malpractice case sent the firm a draft report summarizing his medical conclusions. The surgeon later learned that the law firm had removed the “draft” label from the report and used it to settle their malpractice suit. As a result, the membership organization suspended the surgeon’s membership for two years for providing false testimony. The surgeon brought suit and was awarded damages.

The district court held that it was reasonable for the jury to conclude that the organization’s article created a false impression of the surgeon. State law entitles a grievant to damages in situations where a publication is susceptible to inferences that cast the subject in a false light. The court believed that the organization’s article did in fact give the false impression that the surgeon was a dishonest and inaccurate expert. The organization was aware of the fact that the law firm misrepresented the draft report as a final report, although this information was not communicated in the article. Since the organization’s publication of the article jeopardized the surgeon’s livelihood as an expert, surgeon was entitled to damages.

Tidwell v. State (Summary)

WHISTLEBLOWERS

Tidwell v. State, No. 08-11-00322-CR (Tex. Ct. App. Dec. 4, 2013)

The Court of Appeals of Texas affirmed a lower court’s finding that a county attorney was guilty of misuse of official information, retaliation, and official oppression, punishing him with ten years of imprisonment, probated for ten years, a $4,000 fine and a 120-day confinement.       This fiasco began after two nurses were charged with felony misuse of official information and fired from their jobs at a critical access hospital after it was learned that they had filed an anonymous complaint with the medical board about the care being provided by one of the hospital’s doctors.  The nurses’ concerns included the doctor performing untraditional surgeries (such as suturing the rubber tip of a pair of scissors to a patient’s thumb and hammering a needle into a patient’s foot) when surgeries were not to be performed at the hospital.  Further, the doctor was selling homeopathic remedies to patients in lieu of continuing their traditional treatments and was not conducting tests to follow up on the effect on the patients’ conditions.

The nurses (who served as quality and compliance officers for the critical access hospital) had made several appeals to the hospital’s CEO and Board, in an attempt to have their concerns about the physician addressed.  But their efforts were continually blocked and, in fact, the CEO and medical staff amended policies to prohibit the nurses from attending medical staff meetings, sending cases for external review, and reporting quality concerns.

After the nurses sent their letter of concern to the state medical board, the doctor was notified that an investigation had been commenced.  He promptly contacted the CEO of the hospital and the county sheriff, a personal friend.  Both took steps to vindicate the doctor and to identify who was responsible for filing the complaint about him.  The sheriff took the opportunity to contact the state medical board to request a copy of the complaint letter and made untrue representations to the state board in order to receive that information (which otherwise would have been confidential and unavailable to him).  Further, utilizing the services of the county attorney, the sheriff obtained a warrant, seized the nurses’ computers, and found the letter to the board.  After learning the complaining nurses’ identities, he confronted them individually, read them their Miranda rights, and accused them of misusing the hospital’s internal information.

Ultimately, the county attorney decided to prosecute the nurses for “misuse of official information” by virtue of their report to the state medical board.  The county attorney persisted with the case despite being warned by colleagues that he should dismiss the case and despite the written urging of the executive director of the state medical board, who indicated that such action was contrary to the law.  In the end, the charges against one nurse were dropped before the trial, and the other nurse was found not guilty by a jury after less than one hour of deliberations.

One month after the nurse’s acquittal, the Texas Department of State Health Services cited the hospital for a number of deficiencies related to the concerns raised by the nurses.  By the next spring, that agency had imposed administrative penalties against the hospital.  By that summer, the medical board filed a formal complaint against the doctor, including nine allegations involving patient care issues and unprofessional conduct, ultimately resulting in the suspension/probation of his license.  Subsequently, a grand jury indicted the hospital CEO, sheriff, and county attorney for their role in inappropriately obtaining the complaint letter from the state medical board and using it to prosecute the nurses.  The CEO pled guilty, while the sheriff and county attorney were convicted.

Considering the county attorney’s appeal, the court found that the evidence was sufficient to support the lower court’s findings.

Ryliskis v. Uniontown Area Hosp (Summary)

RACIAL DISCRIMINATION

Ryliskis v. Uniontown Area Hosp., Civil Action No. 11-1517 (W.D. Pa. Dec. 5, 2013)

The United States District Court for the Western District of Pennsylvania granted summary judgment in favor of a hospital, holding that there was not enough evidence for an operating room technician to sustain a race-based hostile work environment claim.

The technician alleged that over a period of seven years she was harassed by coworkers based on her race and, in support of her claim that her work environment was hostile, pointed to a number of incidents, including one where a surgeon sang along to the radio when Lady Marmalade was playing, while allegedly dancing like a gorilla.  At the time, the technician complained about that incident, which led the hospital to conduct an investigation and ask the surgeon to apologize (though he denied dancing like a gorilla and said he was not aware that the song was about black people).  The hospital did not receive further complaints from the technician about the surgeon.

The technician alleged discriminatory conduct by several hospital employees as well, but, in a number of those cases, she had never reported the conduct to the hospital and, in others, she failed to provide any evidence that the conduct was racially motivated (for example, a doctor who almost pushed her flat on her face while heading to the intensive care unit with a bunch of nursing students and an operating room team leader who used a tone of voice that was belittling).

The district court held that the incident with the surgeon singing and dancing, if true, would be sufficient to sustain a claim of hostile work environment.  However, because the surgeon was not employed by the hospital and his conduct did not involve a tangible employment action, the hospital could not be held strictly liable for his conduct.  Therefore, the only way for the hospital to be held liable for the surgeon’s (a non-employee’s) conduct is if the technician showed the hospital was negligent in its control of her working conditions.  In other words, the technician would need to show that the hospital failed to take remedial action that was reasonably calculated to prevent further harassment.

The court held that because the technician was not subjected to further harassment by the surgeon after reporting the singing/dancing incident, she could not establish that the hospital’s handling of the situation was negligent.  Further, the court spoke favorably about the fact that the hospital had a formal complaint procedure, which was known to the technician, conducted an investigation in response to the technician’s complaint, informed the surgeon that his conduct was considered offensive by the technician, and implemented a hospitalwide nondiscrimination, anti-harassment training program.

Chambi v. WMC-SA, Inc. (Summary)

PEER REVIEW

Chambi v. WMC-SA, Inc., G046922 (Cal. Ct. App. Dec. 3, 2013)

The California Court of Appeal for the Fourth District affirmed a lower court’s judgment in favor of a hospital, finding that a neurosurgeon failed to carry his burden of showing that the hospital’s failure to honor his request to have a fellow neurosurgeon on a peer review panel in accordance with California law was prejudicial. The neurosurgeon had privileges at the hospital when charges were brought against him for substandard medical care. He timely requested that a fellow neurosurgeon be on the peer review panel; however, the request was rejected because all the neurosurgeons on the staff would have been biased and getting an outside neurosurgeon would have been too expensive. The peer review panel recommended termination of the neurosurgeon’s privileges and the hospital’s governing board adopted the recommendation.

The court found that the hospital had a mandatory obligation under California law to have another neurosurgeon on the peer review panel, where feasible. The hospital, not the accused neurosurgeon, had the responsibility of showing that the presence of a fellow specialist was not feasible, as the hospital is responsible for paying for the specialist and the hospital has access to information regarding whether it has the financial means to pay.

However, the court found that the hospital did not show that finding a neurosurgeon for the panel was not feasible because it did not provide reasons why it would have been too expensive to hire an outside neurosurgeon other than taking its word for it. Nevertheless, the court further found that the neurosurgeon made no effort to show that having a fellow neurosurgeon on his panel affected the ultimate outcome; thus, the neurosurgeon failed to prove that the hospital had acted with prejudice.

Stratienko v. Chattanooga-Hamilton Cnty. Hosp. Auth. (Summary)

PEER REVIEW

Stratienko v. Chattanooga-Hamilton Cnty. Hosp. Auth., No. E2011-01699-COA-R3-CV (Tenn. Ct. App. Nov. 21, 2013)

In the ongoing saga that began when a physician filed suit against a hospital claiming antitrust, federal due process, and equal protection rights violations based on the summary suspension of his clinical privileges following a physical altercation with another physician in the medical staff lounge, the Court of Appeals of Tennessee affirmed a trial court’s finding that a physician failed to prove any of the elements of his claim of intentional interference with business relations and affirmed the trial court’s granting of summary judgment on the physician’s other claims.

The hospital and physician had been in litigation for over nine years and the case had been to both federal and state courts before returning to this court. The physician argued that the lower court erred in granting summary judgment, in not allowing another amendment to his complaint and additional discovery, by excluding claims regarding the administrative hearing and in holding that he failed to prove his intentional interference with business relations claim.

The appellate court affirmed the lower court’s grant of summary judgment, holding that there were no disputed issues of fact left to be determined. The court stated that both federal courts had made the same findings of fact, and to go against the already made findings would be inappropriate. The grant of summary judgment was appropriate because there were no disputed issues of fact.    The appellate court also affirmed the denial of an amended complaint and additional discovery. The court again noted that, based on the length of time the case had been in litigation, a third amendment and additional discovery were unlikely to provide any additional information. Any new claims that the physician sought to add should have been known by the time of the second amended complaint. The facts of the administrative hearing were also confirmed, meaning the physician was prohibited from arguing that issue as well.

The appellate court affirmed the trial court’s dismissal of the physician’s intentional interference with business relations claim because he failed to prove any of the necessary elements. The court stated that at trial the physician failed to identify a specific third party with which the hospital interfered. Further, even if the physician were able to prove that the hospital interfered with a business relation, there was no evidence that the physician suffered damage as a result.

Muzaffar v. Aurora Health Care S. Lakes, Inc. (Summary)

EMTALA

Muzaffar v. Aurora Health Care S. Lakes, Inc., No. 13-CV-744 (E.D. Wis. Nov. 27, 2013)

The United States District Court for the Eastern District of Wisconsin denied a hospital’s motion to dismiss, finding that a physician with privileges is an employee of a hospital for purposes of EMTALA’s whistleblower provision. The physician brought suit against the hospital claiming he was retaliated against because he reported patient transfers that he believed violated EMTALA. The court found that the purpose of EMTALA – to prevent “patient dumping” – would be frustrated if a physician who had staff privileges was not considered an employee for the purposes of the whistleblower provision. The court reasoned that enforcement of the EMTALA statute is dependent on those working in hospitals who are in the best position to observe violations and that a physician with privileges is in this ideal position to observe whether a hospital made an inappropriate transfer. Not deeming a physician with privileges an “employee” for the purposes of the whistleblower provision goes against the intent of the statute.

Pal v. Jersey City Med. Ctr. (Summary)

DENIAL OF APPLICATION FOR PRIVILEGES

Pal v. Jersey City Med. Ctr., No. 11-6911 (SRC) (D. N.J. Nov. 19, 2013)

The United States District Court for the District of New Jersey denied a motion for summary judgment filed by a hospital and others in a suit brought by a female, Indian, general surgeon, claiming that her application for privileges at the hospital was unlawfully denied.

The physician claimed that her application for privileges was denied based on negative information provided by two references from a cardiothoracic surgery residency which she did not complete.  She resigned from the residency after she was informed that her contract would not be renewed for a second year in the residency program.  The surgeon brought a separate suit against the residency program, claiming that the decision not to renew her contract was a retaliatory action for her complaints about staff members’ derogatory comments about her ethnicity and gender.  That case ended in a jury verdict for the surgeon.  However, the jury answered “no” to a question asking whether the surgeon proved that negative references were provided to other hospitals and, if so, if they were retaliatory in nature.  The hospital, in this case, argued that she was precluded from re-litigating this issue because it had already been decided in a separate case.  The court disagreed, holding that the jury’s answer in the earlier case did not clearly indicate that negative references were not provided.  According to the court, “[a]n equally plausible interpretation of the jury’s response is that even though [the surgeon] had proven that negative references were given, she did not demonstrate that they were given in retaliation for her complaints about discrimination.”

DeVore v. Heritage Provider Network, Inc. (Summary)

EXHAUSTION OF ADMINISTRATIVE REMEDIES

DeVore v. Heritage Provider Network, Inc., B244534 (Cal. Ct. App. Nov. 22, 2013)

The California Court of Appeal reversed a lower court’s dismissal of a medical corporation’s complaint in a suit brought against several insurers alleging that the medical corporation’s fee-for-service contracts with the insurers were improperly terminated because of economic credentialing.  The insurers terminated the contracts per the contracts’ without cause provision.  The medical corporation sued, asserting causes of action for, among other things, wrongful termination and violation of due process. The insurers sought dismissal of the complaint, arguing that the medical corporation failed to exhaust its administrative remedies.  The lower court dismissed the complaint.  The appellate court reversed the lower court’s dismissal, holding that “[t]here is no allegation within the complaint or the judicially noticed letter that any procedure existed at any time during the parties’ contractual relationship to contest the terminations.”

U.S. ex rel. Schubert v. All Children’s Health Sys., Inc. (Summary)

FALSE CLAIMS ACT – STARK LAW

U.S. ex rel. Schubert v. All Children’s Health Sys., Inc., No. 8:11-cv-01687-T-27EAJ (M.D. Fla. Nov. 15, 2013)

The United States District Court for the Middle District of Florida granted in part and denied in part a motion to dismiss filed by a number of related corporate entities in a health system in a False Claims Act suit brought by a former director of operations (“relator”) of the health system’s physician staffing entity.  The relator alleged that the health system aggressively recruited pediatric physicians and physician groups by paying them above fair market value (over the 75^th percentile salary range as determined by averaging a number of nationwide salary surveys). According to the relator, this violated the Stark Law and, in turn, violated the False Claims Act when the health system submitted claims to Medicare and Medicaid for services performed by the physicians.

The health system filed a motion to dismiss the relator’s third amended complaint, first arguing that the Stark Law does not apply to Medicaid claims.  The court disagreed, holding “[c]ertifying compliance with the Stark Amendment to ensure that CMS [makes Medicaid payments to the States] for Medicaid claims that violate the Stark amendment would be a violation of the False Claims Act in the same manner that certifying compliance for full reimbursement under Medicare would be.”  The court also concluded that the relator alleged with significant particularity that the physicians’ compensation was in excess of fair market value.  According to the court, “[r]elator endeavored to create a fair market value benchmark by drawing from the median of three nationwide salary surveys and creating a competitive salary range.  She then uses that information to allege a fair market value benchmark for all subspecialists identified in the complaint, and alleges that the salaries identified in the complaint exceed that benchmark.”  However, the court dismissed the relator’s claim against one of the individual physicians, noting that there were no allegations that supported the claim that his productivity bonus violated the Stark Law.  According to the court, “[t]here is…nothing inherently improper with volume based compensation arrangements, as long as they do not take into account the volume or value of referrals and the procedures are personally performed by the physician.”

Herrington v. Gaulden (Summary)

MEDICAL MALPRACTICE

Herrington v. Gaulden, No. S13G0577 (Ga. Nov. 25, 2013)

The Georgia Supreme Court reversed the judgment of the court of appeals denying a motion for summary judgment filed by the medical director of a hospital’s emergency department and held the medical director was not liable for the death of a patient whom he did not treat.  The patient suffered cardiac arrest and died while in the emergency department of the hospital.  Her daughter sued the medical director of the emergency department, alleging that he negligently failed to ensure that the patient’s treating physician and nurse were adequately trained in the implementation of the hospital’s chest pain protocol.   The Georgia Supreme Court instructed that summary judgment should have been granted to the medical director because he “had no responsibility or authority as medical director to control or direct ‘the manner and method’ of care rendered to [the patient] by her treating physician and nurse.”  Furthermore, there was no evidence that the medical director escalated the risk to the patient by his alleged failure to adequately supervise the training of the emergency department physicians and staff.