Craig Sessions M.D., P.A. v. TH Healthcare, Ltd. (Summary)

RECRUITMENT AGREEMENT

Craig Sessions M.D., P.A. v. TH Healthcare, Ltd., No. 06-13-00010-CV (Tex. Ct. App. Aug. 28, 2013)

A hospital entered into a collections income guarantee recruitment agreement with a new recruit.  The agreement required the recruit to pay the hospital any collections in excess of the agreed upon amount.  The recruit’s collections were $267,418.10 in excess of the agreed upon amount.  When the recruit refused to pay this excess to the hospital, the hospital sued the recruit for the amount of this excess.  The trial court denied the recruit’s motion for summary judgment and granted the hospital’s motion for summary judgment in the amount of $419,504.63 in damages, interest, and attorney’s fees.

The Court of Appeals of Texas affirmed the lower court’s denial of the recruit’s motion for summary judgment but reversed and remanded the lower court’s grant of summary judgment in favor of the hospital.

The appellate court held that the recruitment agreement was unambiguous and could not be reinterpreted based on the recruit’s oral understanding of the terms of the contract.  However, the appellate court also held that there were issues of material fact that must be decided by a jury as to:  whether the recruit’s membership and ownership interest in a surgery center was an “existing practice” as defined in the contract which would have automatically changed the guarantee from a collections guarantee to a net income guarantee; and whether the hospital established that the recruit breached his obligation to provide a written notice of dispute as to the amount owed and when the breach occurred.

Farrow v. Saint Francis Med. Ctr. (Summary)

WRONGFUL TERMINATION (NURSE)

Farrow v. Saint Francis Med. Ctr., No. SC 92793 (Mo. Aug. 27, 2013)

The Supreme Court of Missouri affirmed in part and reversed in part a lower court’s grant of summary judgment to a hospital and a physician in a suit brought by a formerly employed  nurse, alleging violations of the Missouri Human Rights Act (“MHRA”) and other common law claims.

During her employment at the hospital, the nurse complained that the physician defendant sexually harassed her and made defamatory remarks about her work when she rebuffed his sexual propositions.  The hospital ultimately terminated the nurse, ostensibly for her “failure to meet customer service expectations.”  She sued.  The lower court granted summary judgment on all of the nurse’s claims.

On appeal, the Supreme Court of Missouri affirmed in part and reversed in part the lower court’s grant of summary judgment.  The court held that the nurse’s complaint filed with the Missouri Commission on Human Rights was timely.  The court also concluded that the hospital was not exempted from the scope of the MHRA as a corporation owned and operated by a religious or sectarian group because, as a non-profit corporation, the hospital was not “owned” by a religious group.  As such, the lower court erred in dismissing the nurse’s claims under the MHRA.

The nurse also asserted several common law claims, including a claim for wrongful discharge, against the hospital.  The court, in holding that the lower court erred in dismissing this claim, concluded that the nurse’s conduct fell within the public policy exception to the at-will employment doctrine.  That is, her allegation that her termination was because of her complaints that the hospital used non-nurses to insert catheter lines in violation of the state Nursing Practice Act constituted a wrongful termination based on a clear mandate of public policy as contained in a statute.

Marion Healthcare LLC v. S. Ill. Healthcare (Summary)

ANTITRUST

Marion Healthcare LLC v. S. Ill. Healthcare, No. 12-CV-00871-DRH-PMF (S.D. Ill. Aug. 26, 2013)

The United States District Court for the Southern District of Illinois dismissed an outpatient surgery center’s federal and state antitrust claims against a hospital and health insurer.  The surgery center asserted claims under the Clayton Act, Sherman Act, and Illinois Antitrust Act, alleging that the hospital, through its exclusive contracts with the insurer, prohibited the insurer from contracting with the surgery center and other providers of outpatient surgery services.

The hospital and insurer filed a motion to dismiss.  The court granted the motion with prejudice, for the Clayton Act claims, since the Clayton Act only applies to goods, as opposed to services.  According to the court, any goods provided by the defendants were “incidental” to the surgery center’s defined relevant markets of inpatient hospital services and outpatient surgical services.  With respect to the surgery center’s Sherman Act claims of exclusive dealing and illegal tying, the court, applying a rule of reason analysis, determined that the surgery center failed to define a plausible relevant market because it failed to include all potential buyers of inpatient and outpatient services, notably the federal government.

The court dismissed these Sherman Act claims against the hospital without prejudice, thus allowing the surgery center to amend its complaint.  The tying claim against the insurer was dismissed with prejudice because the surgery center was incapable of alleging that the insurer had market power in the tying and/or tied product (hospital services), considering the insurer was not a seller of these services.  The Sherman Act monopolization claim against the hospital was dismissed without prejudice because, once again, the surgery center failed to define a plausible relevant market.  The court’s ruling on the surgery center’s Illinois Antitrust Act claims mirrored those for the federal antitrust claims since federal courts use federal law to construe provisions of the Illinois Antitrust Law that are substantially similar to federal law.

Whipple v. Chattanooga-Hamilton County Hosp. Auth. (Summary)

FALSE CLAIMS ACT

Whipple v. Chattanooga-Hamilton County Hosp. Auth., No. 3-11-0206 (M.D. Tenn. Aug. 26, 2013)

The United States District Court for the Middle District of Tennessee granted a hospital’s motion for summary judgment in a False Claims Act suit brought by a consultant who was performing auditing services for the hospital.  The consultant claimed that the hospital improperly (1) billed patients for inpatient care when they should have been billed as outpatient or observation, (2) added observation charges to claims for outpatient surgeries, and (3) billed certain dialysis procedures as inpatient claims when they should have been billed as outpatient or observation.

In granting the hospital’s motion for summary judgment, the court held that the public disclosure provisions of the False Claims Act barred the consultant’s claims.  The court found that the consultant’s allegations were based on prior investigations and information compiled by, among others, the Office of Inspector General.  Moreover, the consultant was not an original source of the information underlying his claims because the information he collected during his engagement with the hospital was from other sources and included spreadsheets and medical records from past submissions.

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

RACE DISCRIMINATION

Awwad v. Largo Med. Ctr., Inc., No. 8:11-cv-1638-T-24 TBM (M.D. Fla. Aug. 21, 2013)

The United States District Court for the Middle District of Florida granted a hospital’s motion for summary judgment in a suit brought by a disruptive Palestinian physician, alleging, among other things, race discrimination under 42 U.S.C. §1981.

After an investigation performed by an ad hoc committee of the Medical Executive Committee and a focused peer review, the physician was required, within 30 days, to obtain counseling for anger management and professionalism and continuing education in the area of fluid and electrolyte management.  The physician failed to do this.  Following a medical staff hearing and appeal, the physician’s privileges were revoked.  Subsequently, he sued, asserting various claims, including race discrimination under §1981.

In ruling on the hospital’s motion to dismiss, the court concluded that the physician failed to show that the hospital treated similarly situated, non-Palestinian doctors more favorably.  Specifically, the court found that the physician failed to offer evidence of any physicians who were disruptive and refused to comply with the hospital’s counseling and education requirements, but did not have their privileges revoked.  The court also observed that a disparaging statement by a member of the Medical Executive Committee that the physician was “practicing medicine the Palestinian way” was not enough to infer discrimination by a decision-maker.

Finally, the court held that the hospital offered a legitimate, non-discriminatory reason for revoking the physician’s privileges:  his failure to enroll in anger management counseling and continuing education courses.  Because the physician failed to show that this reason was a pretext for discrimination, his §1981 claim was dismissed by the court.

Molina v. Pocono Med. Ctr. (Summary)

ADA

Molina v. Pocono Med. Ctr., No. 3:11-2276 (M.D. Pa. Aug. 26, 2013)

The United States District Court for the Middle District of Pennsylvania denied a medical center’s motion for summary judgment, concluding that there were unresolved factual issues concerning an employed nurse’s claims under the Americans with Disabilities Act (“ADA”).

The nurse was diagnosed with an autoimmune deficiency which caused her to frequently fall ill, including contracting pneumonia 16 times in a three-year period.  Because of this, the nurse took either vacation or medical leave a number of times throughout her employment.  During a period of Family Medical Leave Act leave after the nurse contracted MRSA pneumonia, the nurse’s treating physician wrote a note that she could return to work with certain accommodations, such as not being exposed to infected patients.  The nurse’s immediate supervisor refused to allow her to return to work as a nurse.  The nurse sued, claiming violations of the ADA and the Pennsylvania Human Relations Act.

The medical center filed a motion for summary judgment, arguing that the nurse was precluded from pursuing claims because in her application for Social Security Disability Insurance (“SSDI”), she indicated that she was “unable to work.”  The medical center also argued that it had a legitimate non-discriminatory reason for not allowing the nurse to return to work.  The court disagreed, holding that the nurse’s SSDI claim did not preclude her ADA claim because the SSDI claim, as opposed to the ADA claim, did not take into account the possibility of a reasonable accommodation.

Further, the medical center’s unsupported assertions that it “clearly was not safe for [the nurse] to return to work” did not qualify as a legitimate non-discriminatory reason for its action in the face of the nurse’s “ample evidence that she can perform the essential functions of her job with reasonable accommodations.”

U.S. ex rel. Singh v. Bradford Regional Med. Ctr. –Aug. 2013 (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Singh v. Bradford Regional Med. Ctr.
No. 04-186 Erie (W.D. Pa. Aug. 22, 2013)

The United States District Court for the Western District of Pennsylvania dismissed the United States’ claims of payment by mistake and unjust enrichment against a physician group which was involved in an equipment sublease with a hospital.  The government based its claims on allegations that the sublease violated the Stark Law and Anti-Kickback Statute.

The court granted the physician group’s motion to dismiss, “because the United States has failed to allege or show that the [physician group] received any direct or [in]direct mistaken payments from the government.”  Since this alone was grounds for dismissal, the court did not reach the physician group’s contention that the government’s claims were barred by the statute of limitations.  However, the court did give the government an opportunity to amend its complaint.

Gronemeyer v. Crossroads Cmty. Hosp. (Summary)

FALSE CLAIMS ACT – RETALIATION

Gronemeyer v. Crossroads Cmty. Hosp., No. 3:10-cv-00571-WDS-DGW (S.D. Ill. Aug. 26, 2013)

The United States District Court for the Southern District of Illinois granted a hospital’s motion to dismiss a previously employed pathologist’s claim of retaliation in violation of the False Claims Act.

As a part of her employment, the pathologist served on the hospital’s Utilization Management Committee, Infection Control Committee, Medical Executive Committee, and Quality Improvement Committee.  Her responsibilities included reviewing records, approving transfusions, and conducting assessments of the medical necessity for transfusions.  While performing these duties, the pathologist allegedly discovered that the hospital was billing for unnecessary transfusions.  She claimed that the hospital terminated her in violation of the False Claims Act anti-retaliation provisions for reporting this to her superiors.

In ruling on the hospital’s motion to dismiss, the court found that the pathologist, as a “fraud-alert” employee, or one whose position involved investigating fraud, was held to a heightened notice standard.  Specifically, for the hospital to be on notice that the pathologist was engaged in protected conduct under the False Claims Act, the pathologist had to use words such as “illegal” or “unlawful” when reporting the allegations to her superiors.  This she did not do.  Accordingly, the court dismissed the pathologist’s retaliation claim.

Godbey v. Iredell Mem’l Hosp., Inc. (Summary)

ADA/REHABILITATION ACT

Godbey v. Iredell Mem’l Hosp., Inc., No. 5:12-cv-00004-RLV-DSC (W.D. N.C. Aug. 19, 2013)

The United States District Court for the Western District of North Carolina granted a hospital’s motion for summary judgment in a disability discrimination action brought by a hearing-impaired patient claiming that the hospital violated the Americans with Disabilities Act (“ADA”) and the Rehabilitation Act.  The patient sought care at the hospital several times, informed the staff that he was deaf, and on at least one occasion requested an interpreter.  The patient never indicated that communicative attempts by the hospital staff, including written notes and engaging interpreters, were insufficient.  Nonetheless, he sued, claiming that the hospital’s “denial of interpretive services constituted intentional discrimination…in violation of the [Rehabilitation Act] and the ADA.”

The hospital filed a motion for summary judgment, which the court granted.  The court held that monetary damages under the Rehabilitation Act were not warranted.  The hospital’s failure to provide an American Sign Language-fluent interpreter did not by itself suffice to maintain the patient’s claim of intentional discrimination under the Rehabilitation Act in the absence of evidence that the other accommodations the hospital made fell short of providing effective communication with the patient.  Injunctive relief under the ADA was, similarly, inappropriate, since the hospital subsequently amended its policy to have qualified interpreters more readily available to prevent a reoccurrence of the alleged violation of the ADA.

Eiland v. San Jacinto Methodist Hosp. (Summary)

ADEA

Eiland v. San Jacinto Methodist Hosp., No. 4:12-CV-00192 (S.D. Tex. Aug. 20, 2013)

The United States District Court for the Southern District of Texas granted a hospital’s motion for summary judgment in a suit brought by a formerly employed nurse, asserting a claim under the Age Discrimination in Employment Act (“ADEA”).

The hospital terminated the nurse’s employment because of a “lengthy disciplinary record…for poor performance and being rude to patients.”  The hospital disciplined the nurse during her employment for, among other things, failing to remove an IV before a patient left the emergency room and failing to administer a medication prescribed by a physician for a life-threatening condition.  The hospital filed a motion to dismiss the nurse’s ADEA claim.  The court granted the motion.  In doing so, the court determined that the hospital had offered a legitimate, non-discriminatory reason for terminating the nurse (the nurse’s lengthy disciplinary record) and the hospital’s proffered reason for termination was not a pretext for age discrimination.