August 15, 2007 Recent Legal News


Peer Review










Patients v Putnam Hosp.
WV Court

There are 122 med mal cases filed against Dr. John King.  The hospital was named as a co-defendant for negligent credentialing.  The jury agreed that the hospital should be held liable and that the patients can seek punitive damages.  The doctor was suspended in 2003 and then gave up his West Virginia license.    

Carraway v Beverly Enterprises
ALA Supreme Ct.

The high court stated that the arbitration agreement signed by the brother of the deceased was valid as to settling claims by arbitration.  The court said that the form could be voided within 30 days and that by signing, the brother signified he was the authorized representative of the deceased.  

Kindred Hosp  v Luttrell
Ky Ct. App.

Here, as above, the daughter signed an arbitration agreement.  In both cases the signature was not a requirement for admission.  The daughter had little education and told the admissions clerk she had the power to sign.  The admissions lerk testified she knew there was no power except for the familial arrangement.  The court ruled that the daughter was not authorized to sign for her mother.  

Frigo v Silver Cross Hosp.
Ill. App Ct

 As in the first case above, the podiatrist was sued for med mal and the hospital for negligent credentialing.  The podiatrist was given privileges even though he had not completed the foot residency and was not board certified as required by the hospital bylaws.  The plaintiff settled with the podiatrist for $900,000 prior to trial for the amputation of his foot.  The trial proceeded and the plaintiff was awarded damages of $7.7 million. The hospital was on the hook for the $6.8 million not already paid.  There was a dissent regarding a statute of limitations rule which may be the reason for a Supreme Court challenge.  YOU HAVE TO FOLLOW YOUR BYLAWS.  

Chosak v Alameda Med Ctr.
CA App Ct

The plaintiff was injured by an optometry unlicensed intern during an eye exam.  The patient went to the ED several weeks later and was seen and told it was a sprain.  The pain continued and she was ultimately diagnosed by MRI to have a bone spur causing the pain.  She sued but the suit was two years post trauma.  The statute of limitations is one year.  The plaintiff stated that MICRA, the California malpractice statute, did not apply to unlicensed individual.  The court disagreed and stated that the med mal statute meant that health care providers are those who lawfully practice under an exemption to the California medical licensing and certification requirements.  This include interns.

Phuoc v Englewood Hosp
NJ Superior Ct.

The plaintiff died and the estate sued the physician's former hospital.  They noted that the physician agreed to resign his employment in the NY hospital in lieu of being terminated.  The hospital did not report this to the National Data Bank.  The report would have alerted the present hospital not to hire the physician.  The Court stated that the report to the National Data Bank is for clinical privileges and not employment.  The question for the lower court is if the hospital should have told the NY medical board and then they would have routinely reported to the National Data Bank.  

Patient v Rhode Island Hospital
To Be Filed

A neurosurgeon operated on the wrong side of a patient's head for a subdural hematoma.  This is the second time this year the same thing has happened at this hospital.  The state is investigating the hospital and the physician.  The Joint Commission is also involved.  An outside consultant has been ordered by the state since there was another incident in 2001.  The hospital has the proper steps on paper but is obviously not following their own procedures.   Top 

Peer Review

Belbachir v County of McHenry
ND Ill

The US Customs people detained the plaintiff at O'Hare airport.  She was taken to a hospital with acute anxiety and committed suicide in her cell.  The estate sued for failure to provide medical care.  The plaintiff wanted records that the state said were privileged.  There is no privilege under federal law. Give the records.

Austin v Becton Dickinson
ED Texas

Several patients at a hospital developed infections and after an investigation the cause was noted to be eye drops manufactured by the defendant.  The patients were told this by a member of a peer review committee.  The defendant wanted the peer review records as they believed the telling waived the peer review privilege.  The court stated that in order to waive the privilege, the breech would need to be in writing.    

Jablonsky v Sierra Kings 
ED Ca.

Dr. Jablonsky sued the hospital due to failure of due process and won the hospital's  summary judgment motion.  He had sued for damages and wrongful termination of his privileges.  The hospital wanted under summary judgment to get the suit dropped since the physician could have but did not present his due process claims to the medical staff or the hospital.  The court ruled that the hospital nor the medical staff can rule on the constitutionality of the due process and therefore the physician had no requirement to present his complaints to the hospital. The physician demanded a hearing on his suspension on November 14, 1997.  The hearing did not start until June 15, 2004.  The adjudication was not until May 23, 2006.  The hearing record made no mention as to the reasons for the extreme delay.   

Klein v Kushins
NJ Super. Ct.

Dr. Klein received a negative recommendation from his department chair and had his privileges restricted.  He sued due to the malice and animosity between the two individuals.  The court stated that the hearings over a two year period were fair and that under HCQIA animosity played no role. The plaintiff presented no evidence that the chair came forward with erroneous facts and there were no false statements. They went on to state that under New Jersey law the department chair was protected under the Tort Clam Act.    Top


Crum v Vincent
8th Circ

The physician did not pay back taxes.  A Missouri statute states that if after a period of time post notification the taxes are not paid, the licensed professional will have their license suspended until the back taxes are paid.  The physician had the license suspended and then reported to the National Data Bank.  The physician sued and of course lost.  He had received notice and an opportunity for a hearing so there was no due process claim.  There was also no equal protection claim.  The physician should have paid the tax and not the attorney. 

Rupp v Fla. Dept of Health
Fla App Ct.

The Florida Appellate Court blasted the Florida Medical Board for fining a physician for not reporting a disciplinary action in another state within the required 30 days.  The reason for not reporting within the time frame is the physician did not know about it for about two months.  The physician was working for a locum tenens company who was supposed to notify all boards and insure the license remained current.  The company failed and the physician lost her license in Virginia.  She was not notified of this for several months by the company.  An ALJ recommended discipline and the Board held a hearing without allowing the physician or her attorney to be heard.  The dumb board fined her $500 and an additional $10,000 in administrative costs plus a letter of concern.  She appealed and the court said the board was deficient in not holding a de novo hearing therefore depriving the physician of her rights.  The court went even farther and ordered the Board to repeal all charges so another hearing would not be needed.    

Physicians v Midwives
Mo Ct.

A Missouri law that would allow midwives to practice without facing criminal charges was deemed unconstitutional by the court.  The judge stated the manner it was passed by the legislature secretly attached to a bill that had nothing to do with midwifery was wrong.  The decision does not mention the actual practice of midwifery, just the technical way it was secreted through the legislature.   Top


US v Physicians

US agents arrested 88 potential quasi physicians accused of obtaining their medical licenses via fraud in Puerto Rico.  The "physicians" paid medical board members bribes to get their licenses.  Most of the people failed their licensing exams an had their grades raised to pass after the bribes.  The arrested included members of the current and past medical boards.

US v Physicians, etal.

The US indicted and arrested multiple physicians and others for selling prescription drugs over the internet.  The were charged with federal racketeering.  The physicians briefly scanned an online questionnaire and okayed the prescriptions.  The online store is AffPower, a Costa Rica based company.  The owners had previously pled guilty of money laundering and conspiring to sell prescription drugs without valid prescriptions.  The physicians were paid about $3 per prescription and okayed hundreds or thousands per day.  

US v Urciuoli

 The former executives of Roger Williams Hospital in Providence, Rhode Island that were convicted of fraud for having a state senator back bills they were for and go against bills they were against.  The appeal was for the jury instructions.  

US v Stoddard
10th Circ

Dr. Larry Stoddard of Utah pled guilty of healthcare fraud over the non supervision of hyperbaric oxygen chambers.  The physician was sentenced to one year in jail.  The Circuit Court agreed with the sentence.  

Minnesota v St. Paul Radiol.

The Minnesota attorney general is looking into the business practices of St. Paul Radiology, a group of 90 radiologists for fraud.  A former employee and customers both tell of the group not billing insurances and then much later billing the patient for the full and not the insurance discounted bill. They allegedly lie and tell the patient they never supplied their insurance information.  

US v Capener

Dr. Mark Capener of Idaho Falls, Idaho was accused by the government of billing for endoscopic sinus surgeries that were either unnecessary or never performed.  The judge found the case lacked merit and the government made claims that it knew were false.  The government has appealed to the 9th Circuit.  The Court awarded the physician $104,000 in attorney fees and another $175,000 for expert witnesses.  Dr. Capener has now sued the fed investigators for legal fees for pursuing a frivolous case.         Top


US v Evanston Hosp.

The FTC has said the ALJ who ruled seven years ago that the takeover by Evanston Hospital (Northwestern University) of Highland Park Hospital was illegal under the antitrust rules was correct.  The Northwestern people are happy since they do not have to unwind but just negotiate separately with insurers.  There must be a "firewall", hopefully will separate attorneys and negotiators.

The day after the above, a patient filed a class law suit against the hospitals for having to pay inflated charges.  This of course was a set up by the legal firm to garner money with little work.    

Poliner v Texas Health

The American Hospital Association has filed an amicus brief in support of the hospital and HCQIA protections in the famous Poliner case.  Poliner was awarded over $300 million for the hospital's cavalier attitude and malice in attempting to destroy a physician's career.  The damages were reduced to a more reasonable amount, about $20 million.  The AHA wrongly states that the 14 day summary suspension does not have to be to protect imminent danger to the patient and they want all hospitals protected under HCQIA no matter how poorly they perform. HCQIA only works if the hospital follows certain guidelines.  This hospital did not and will hopefully pay the price.  They are already the poster boy for bias and cheating in the peer review arena.  The problem is that they are not alone.       Top


Brookdale Univ. Hosp v HIP & Cogent

In a rare and interesting case that will decide when a hospitalist is a hospitalist, the hospital is suing the HIP of New York and Cogent Healthcare of racketeering.  In this rare situation Cogent, a provider of hospitalists to hospitals has as its contractee the Health Insurance Plan of New York and not the hospital.  The hospital has accused the plan of using the medical licenses of the Cogent physicians to spy on them and as the conduit to deny 20% of the charges.  The discovery should be interesting as to how much is divulged to HIP by Cogent physicians.  

Bankruptcy of Granada Hills Hosp
Bankruptcy Ct.  Ca.

A bankruptcy judge approved a settlement of $1.5 million against the hospital directors and officers.  The bankruptcy trustee sued the directors for hiring and not supervising the turnaround company after the bankruptcy.  The judge ruled the settlement was equitable even thought the former directors had immunity under the business judgment rule.  The original suit was for $11 million.      Top


Abigail Alliance v FDA
DC App Ct.

The Abigail Alliance sued the FDA stating the erroneous proposition that terminally ill patients have a constitutional right to experimental medication.  The erroneous argument stated that dying patients are deprived of their right of self defense, a violation of the 5th amendment.  This will be appealed to the US Supreme Court.  Although I feel for the people involved, the legal arguments are weak and the issue is legislative, not legal.        Top


Washington Med Assn v Regence

Regence BlueShield has settled.  This means they have capitulated and will not form a false high performance network of physicians.  They have now issued a formal apology to the physicians of the state.  Regence will now allow the medical society to be involved in any performance measurement program before implementation.  Under the settlement, physician will be able to appeal any score or rating given to them both internally, via arbitration or via law suit.        Top


Blake v U. Mississippi
5th Circ

Dr. Blake was terminated from his employment due to a charge of sexual harassment.  Dr. Blake never did any internal appeals.  This appeal is based on the allowing into evidence polygraphs.  The court stated that both parties had agreed to the polygraphs as part of the internal investigation therefore  could be admitted into evidence.         Top 


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.