Rhodes v. Sutter Health (Summary)

CORPORATE PRACTICE OF MEDICINE

Rhodes v. Sutter Health, No. CIV 2:12-0013 WBS DAD (E.D. Cal. Feb. 1, 2013)

The United States District Court for the Eastern District of California granted in part and denied in part a non-profit clinic’s motion for summary judgment.  A physician brought suit against the clinic and a medical group practice for a number of claims after her termination.  She argued that the medical group and the clinic should be treated as either joint employers or as one singular, integrated employer.

The district court held that the clinic should not be considered liable as a joint employer.  The clinic had little control over the day-to-day activities of the physician.  She was operating under her own license and did not have a supervisor.  The staff members of the clinic provided evaluations but only at the request of the medical group.  The court stated that assistance and support of an employer is not sufficient to demonstrate the control necessary of a joint employer.

The district court also held that the clinic and the medical group should not be treated as an “integrated enterprise.”  The court stated that it would be a mistake for a corporate entity to face liability for another entity’s acts simply because the two have a contract to provide services.  The relationship between the medical group and the clinic was meant to satisfy a state law prohibiting corporations from practicing medicine.

Ne. Med. Servs., Inc. v. Cal. Dep’t of Healthcare Servs. (Summary)

MEDICAID ACT

Ne. Med. Servs., Inc. v. Cal. Dep’t of Healthcare Servs., No. C 12-2895 CW (N.D. Cal. Feb. 1, 2013)

The United States District Court for the Northern District of California granted one motion to dismiss and granted in part and denied in part a separate motion to dismiss.  A non-profit health center brought suit against the government and the state department of healthcare for violations of the Medicaid Act.  The non-profit claimed that the federal government mischaracterized its financial reporting requirement and that the state department of healthcare violated the Medicaid Act by not providing on-time reimbursements to the non-profit.

The district court dismissed the claims against the federal government for lack of jurisdiction.  The court stated the letter sent by the government was not an agency action that could be reviewed by the court.  The letter was a summary of the U.S. attorney’s investigative findings and clearly indicated that it was for the sole purpose of negotiating a settlement.  The court did not believe that the letter had any impact on the non-profit’s legal obligations.

The district court dismissed one of the non-profit’s claims against the department of healthcare because it did not allege a concrete injury.  The court held that claiming a compliance dilemma existed between the government’s letter and state law was too broad.  The state healthcare department did not play a role in the drafting of the letter.

The district court allowed the non-profit’s claim of timely payments to survive the motion to dismiss.  The court held that the non-profit was entitled to full compensatory payments every four months, as indicated by the Medicaid Act.  The department’s policy of providing interim prospective payments was not a satisfactory method of payment.

Johnson v. SSM Healthcare Sys. (Summary) UPDATED

HCQIA – IMMUNITY GRANTED

Johnson v. SSM Healthcare Sys., No. 4:11CV1235 HEA (E.D. Mo. Jan. 30, 2013) (see Update Below)

The United States District Court for the Eastern District of Missouri granted a hospital’s motion for summary judgment based on HCQIA immunity.  A physician brought suit against the hospital after an altercation with a patient’s mother led to the suspension and eventual revocation of his clinical privileges.  The hospital granted the physician all of the necessary hearings as required by the hospital bylaws before making the decision to revoke his privileges.

The district court held that the hospital was entitled to summary judgment because it acted within the scope of the HCQIA immunity provision.  The court stated that the precautionary suspension of the physician immediately following the confrontation with the mother constituted a professional review action.  The court stated the record was clear that the quality of health care was at the forefront throughout the peer review process.  The district court also believed that the hospital made an effort to obtain the relevant facts and that the physician received adequate hearing and notice procedures.  The hospital took statements from the physician, nurses and the patient’s mother before making any determination at the hearing.  The hospital also gave copies of the hearing transcript to the physician, and allowed him to cross-examine witnesses, use exhibits and make opening and closing statements.

**UPDATE**

Johnson v. SSM Healthcare Sys., No. 14-1397 (8^th Cir. Nov. 14, 2014)

The U.S. Court of Appeals for the Eighth Circuit affirmed the district court’s determination that the hospital was entitled to immunity under the Health Care Quality Improvement Act. According to the court, the physician did not produce sufficient evidence to suggest that a reasonable jury would find the hospital’s peer review process fell below legal standards.

U.S. ex rel. Armfield v. Gills (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Armfield v. Gills, No. 8:07-CV-2374-T-27TBM (M.D. Fla. Jan. 30, 2013)

In this FCA case, the United States District Court for the Middle District of Florida denied a physician’s motion for summary judgment.  The government brought suit against the physician for claims fraudulently billed to Medicare.  The government alleged, over the course of a patient’s cataract surgery, the physician upcoded procedures and examinations so that Medicare would pay for them.

The district court denied summary judgment on claims that false codes and medically unnecessary procedures were used to defraud the government.  The court stated that the correctional procedure performed after the first cataract surgery was coded properly, but a dispute existed over whether the procedure was medically necessary.  The correctional procedure met the regulatory requirements of a minor surgery: it was performed in a “minor procedural room” and required topical anesthesia.  There was, however, an issue of fact over whether the procedure was to be considered a correction or was meant to be an alternative to corrective lenses.  Due to this issue of material fact, the district court denied summary judgment.

The district court also denied summary judgment of the claim that the decision to perform the second cataract surgery was falsely billed to Medicare.  The court stated that the differing opinions of the experts needed to be heard by a reasonable jury.  The physician’s expert argued that the final decision on the second surgery was a regulatory requirement.  The government’s expert argued that the second pre-surgery examination (which occurred prior to the surgery on the patient’s second eye) was unnecessary and that the examination performed before the first cataract surgery would have been sufficient.

The court stated that the fact that the physician submitted the claims based on the advice of a consultant was not controlling.  The district court believed that a reasonable jury could determine that the physician acted with disregard when submitting his Medicare claims.

Gonsalves v. Sharp Healthcare (Summary)

NEGLIGENCE:  INFORMED CONSENT

Gonsalves v. Sharp Healthcare, No. D060514 (Cal. Ct. App. Jan. 30, 2013)

In this medical malpractice case, the California Court of Appeal reversed a trial court’s grant of summary judgment to a hospital.  A patient underwent open heart surgery at the hospital.  Days later, she developed fluid around her lungs.  Her pulmonologist ordered insertion of a tube to drain the fluid, but expected the practitioner who performed the procedure to discuss it with the patient.  Nurses from the hospital called the patient to obtain her consent to the procedure.  Since the patient had dementia, her daughter consented to the procedure for her, allegedly without being informed of the risks or benefits associated with it.  The physician who inserted the tube also did not discuss it with the patient before beginning.  During surgery, he punctured her aorta.  The patient died two years later, allegedly due in part to the physiological stress caused by the puncture and related injuries.  The family of the deceased patient then sued the hospital and doctors for malpractice, wrongful death, and battery.

As to the medical malpractice and wrongful death claims, the hospital challenged the causal connection between the puncture and the patient’s death two years later.  As to the battery claim, it argued that there was no evidence that anyone but the doctor who performed the procedure had touched the patient.  Finally, the hospital also argued that it was the doctor, not the nurses, who should have provided informed consent.  Therefore, it reasoned that it could not be liable, since it could only be liable for the acts of the nurses, as employees, not the acts of the doctor, an independent contractor.  The trial court accepted these arguments and granted summary judgment in favor of the hospital.

The appellate court reversed, finding that it was possible that the puncture and related injuries caused the patient’s death. Because touching a patient without informed consent constitutes medical negligence in California, rather than battery, and because wrongful death claims are essentially medical malpractice claims, where the alleged negligence results in the death of the patient, the appellate court analyzed all of the claims under the umbrella of medical malpractice. First, it reviewed the trial court’s decision to see if there was evidence of a causal connection between the puncture and the patient’s death. To show a causal connection, the patient’s family needed to provide evidence that a reasonable person would not have undergone the procedure, if aware of the risk of the puncture. Thereafter, the hospital had the chance to show that the particular patient still would have gone ahead with the procedure, even if informed of the risks. The patient’s family and the hospital presented conflicting evidence as to whether a reasonable person would have gone through with the procedure after being informed of the risk of puncture. Since an issue of fact remained with respect to causation, the appellate court reversed the grant of summary judgment in favor of the hospital and remanded the case for further proceedings.

Haley v. Cmty. Mercy Health Partners (Summary)

EMPLOYMENT TERMINATION:  AGE DISCRIMINATION, ADA AND FMLA

Haley v. Cmty. Mercy Health Partners, No. 3:11-cv-232 (S.D. Ohio Jan. 28, 2013)

In this FMLA case, the United States District Court for the Southern District of Ohio overruled a hospital’s motion for summary judgment. A nurse brought suit against the hospital after she received a number of disciplinary actions that resulted in her termination.  The nurse took leave due to sick parents, a hospitalized spouse and to undergo treatments for cancer. She claimed that the hospital discriminated against her based on age and disability.

The district court held that the age discrimination claims were not entitled to summary judgment. The court stated that the nurse had sufficiently demonstrated that she was terminated from a position that she was qualified for, and that she was replaced by someone younger than her.  The court also stated that a reasonable jury could conclude that two younger nurses were treated more favorably; one nurse accumulated more tardies but was not terminated.

The district court held that summary judgment was not appropriate for the disability discrimination claims or the FMLA claims.  The court stated that the nurse had met her burden of demonstrating that she was discriminated against based on her disability.  The court believed that a reasonable jury could conclude that her leave should not have been classified as unauthorized.

While the hospital did provide nondiscriminatory reasons for terminating the nurse’s employment, the court held that a reasonable jury could find these reasons to be pretextual. The court stated that there was a factual dispute over the attendance violations and the site marking violations that were provided as grounds for termination. There were contradicting testimonies from the nurse’s supervisor and the hospital itself over what did and did not qualify for disciplinary action.

Bell v. Methodist Healthcare Memphis Hosps. (Summary)

EMPLOYMENT TERMINATION:  ADA

Bell v. Methodist Healthcare Memphis Hosps., No. 2:11-cv-02755-JPM (W.D. Tenn. Jan. 28, 2013)

The United States District Court for the Western District of Tennessee granted summary judgment in favor of a healthcare company, doing business as a number of hospitals, on a nurse’s claim of employment discrimination on the basis of her fibromyalgia.  Years later, she was transferred to the same day surgery unit of one of the company’s hospitals. From 2002 to 2009, various incidents and performance evaluations indicated that the nurse was distracted, was making unprofessional personal phone calls, needed to focus on her work, and needed to improve her time management and timeliness.  In February 2010, the nurse received a final warning, after a case in which she seemed confused, was delayed, missed an abrasion on the operative site, and made inappropriate comments.  Her employment was terminated in September 2010, after another incident, in which she breached a sterilization technique by attempting to prepare a needle in the hallway, without gloves on.  After the termination, she sought only one other nursing job and applied for, and received, federal disability benefits.  In 2011, she sued the company under the Americans with Disabilities Act of 1990 (ADA) and the Tennessee Human Rights Act, alleging discrimination based on her fibromyalgia. (The state law claims, however, were dismissed by the court, since the nurse failed to pursue them.)

The ADA prohibits discrimination against qualified individuals on the basis of a disability. A qualified individual is a person who, with or without reasonable accommodation, can perform the essential functions of his or her job.

The court found that the nurse could not perform the essential functions of her job. First, it found that the essential functions of the nurse’s job were undisputed. They included the use of specialized skill and judgment to assess patients and the prompt retrieval and documentation of patient information. Second, it found that the nurse could not satisfy these essential functions, based on the repeated reprimands that she received, her own admission that she did not seek other nursing employment due to her disability, and the award letter of disability benefits by the federal government, which stated that she was unable to work due to her disability. Since the court found that the nurse had not shown any evidence that she was otherwise qualified for her position, it granted summary judgment to the company.

Ruday v. Shore Mem’l Hosp. (Summary)

NEGLIGENCE

Ruday v. Shore Mem’l Hosp., No. A-2586-11T1 (N.J. Super. Ct. App. Div. Jan. 30, 2013)

The New Jersey Superior Court reversed a trial court’s grant of summary judgment to a hospital, in a negligence case where a high-risk patient fell out of bed, while her bed alarm was not activated. The hospital assessed the patient, an 86-year old woman, to be at a high risk of falling.  Because of this, she was placed in a bed with a rail and a motion-detecting alarm to notify hospital personnel when she attempted to leave the bed. Because the alarm sounds when placing the person back in the bed, it is turned off during this process and must be turned back on by the staff member, before leaving the room. There was no evidence that the patient’s alarm malfunctioned.  The fact that the alarm is on is indicated by a light, which is visible from the hallway.  In addition, individuals who are assessed to be at a high risk of falling have their high-risk assessment indicated on the door to their room. Nevertheless, the patient climbed out of the bed, over the rail, when the alarm was turned off, and fell. She then sued the hospital for the injuries that she sustained in the fall. The trial court granted summary judgment in favor of the hospital on her claim.

The appellate court reversed. Negligence requires the breach of a duty. The appellate court found that a hospital can establish a duty for its employees through the implementation of a protocol. In this case, the appellate court found that the protocol for patients with a high risk of falling established a duty for hospital employees. If the staff failed to follow the precautions regarding the bed alarm, which were set forth in that protocol, then the staff would have breached its duty to the patient to prevent her from falling.

A breach of a duty can be established without direct knowledge of what the staff did or did not do, where the incident involved was the type of occurrence that would not normally occur in the absence of negligence on the part of hospital employees. The appellate court, applying this legal doctrine, found that it was not necessary that the patient point to any particular hospital employee to establish her case. Rather, a jury could infer from the fact that the patient fell, when her bed alarm was not on, and that the hospital was in control of the bed alarm at the time of the fall, that hospital staff had failed in ensuring that the alarm was on and in protecting the patient. Since the patient’s complaint tended to show that no one, other than hospital staff, could have turned off the patient’s bed alarm, the appellate court held that the hospital was not entitled to summary judgment and remanded the case back to the trial court for further proceedings.

Ex parte Moulton (Summary)

STATE ACTION IMMUNITY

Ex parte Moulton, No. 1111283 (Ala. Jan. 25, 2013)

The Supreme Court of Alabama granted a petition and entered an order of summary judgment in favor of a state university hospital based on state immunity and state agent immunity. A physician brought suit against the university after his position was eliminated from the hospital and he was terminated. The physician claimed that he was denied due process after his termination and that his supervisor deceived him when he took the position. Both the supervisor and the hospital argued that they were immune from the suit.

The supreme court held that the university was immune from liability because the physician could not demonstrate that he was entitled to any of the rights that would have granted an exception to state immunity. The physician was an at will employee who was not entitled to any due process rights and, even if he were, the employee handbook stated that layoffs were exempt from due process appeals. The court stated that there was no clear indication that the physician’s supervisor had any intention of employing him for life.

The court also held that claims brought against the physician’s supervisor were barred by immunity. The supreme court stated that the supervisor was acting within the functions of his job when making the decision to eliminate the physician’s post. Furthermore, there was a four-year gap between the physician’s employment and the elimination of his position, which the court stated clearly indicated that the supervisor had no intention of deceiving the physician by hiring him and then eliminating the job.

Kenyon v. Hosp. San Antonio (Summary)

EMTALA

Kenyon v. Hosp. San Antonio, Civil No. 11-1883(FAB) (D. P.R. Jan. 17, 2013)

The United States District Court for the District of Puerto Rico dismissed an Emergency Medical Treatment and Active Labor Act (“EMTALA”) and medical malpractice lawsuit brought against a physician and his practice group by a patient who alleged that, on two different occasions, she visited an ER and was not provided with appropriate or adequate stabilizing treatment.  The court held that since physicians cannot be held personally liable under EMTALA, it did not have jurisdiction over the suit against the physician by virtue of the suit raising a federal claim.  The court noted that it could exercise supplemental jurisdiction over the patient’s malpractice claims against the physician (which are based on state laws) if the patient could show that the malpractice claims shared a common nucleus of operative facts with the EMTALA claims being lodged against the Medical Center.  The court held, however, that in this case no such common nucleus of operative facts existed.  In support of its conclusion, the court observed that the physician alleged to have committed malpractice was not present in the ER on the second visit, when the alleged EMTALA violation occurred.  Further, the two visits were separated by 23 days and the patient received medical care on numerous other occasions, from a number of other providers, in the intervening period.