May 15, 2001




TB is Costly to Fresno

Peer Review Records
Statute of Limitations

HMO Negligence

Medical Board Wins Appeal

Physician Suit Anti HMO Lost Round One, On to Two

Painful Lawsuits

Liens on MediCal Patients

A Billion here; A Billion There

Informed Consent

Non-Compete Clauses


A federal judge approved an antitrust settlement between the government and Mylan Labs.  The government contends that Mylan monopolized the market and illegally price fixed.  The settlement, the largest in FTC history is $100.5 million.  The medications were lorazepam and clorazepate, both used for Alzheimer's, depression and anxiety. Consumers will be refunded $72 million for the overcharges between 1/1/98 to 12/31/99. The remaining money will help reimburse states for their Medicaid charges.  I see nothing in the settlement for attorney's fees for those entitled to refunds.  Top


Mission Hospital in Panorama City, California has settled a law suit and hopefully all hospitals will learn from it.  The case involved a contract signed by a son to pay for the care of his father if insurance wouldn't.  The problem is the contract was in English and the son spoke and read only Spanish.  Since he had no idea what he was signing the contract was void, the hospital wrote off the $13,000 medical bill presented to the son and agreed to not attempt to collect from third party guarantors from the past six years, tell the public of the availability of interpreters, how to apply for free or low-cost health care, and better third party contracts stating care will be provided regardless of the patient's ability to pay (an EMTALA rule). Top

TB Costly to Fresno

Not following the rules has cost Fresno County $1.2 million plus a written apology from the Board and a special ceremony at the jail to recapture the spirit of the Laotian woman.  The woman had a multiple drug resistant strain of TB stated a new TB controller who could not read X-rays, had a history of alcohol and drug addiction and had been sued multiple times for malpractice. He started the patient on intravenous drugs which had significant side effects without prior testing. When the patient stated she was moving to Ohio, but didn't, she was summarily jailed.  The law in California is when one refuses therapy they must undergo a checklist of of assessments to persuade them to take the treatment.  The statutes also give the detainees the right to counsel, a court hearing and periodic judicial review of their confinement. This patient got none of the above. This is an expensive and embarrassing lesson to the County.       Top


Neonatal Injury

In two settlements a MD, JD malpractice attorney has won $3.5 million in each case.  The first one in San Bernadino County was an complete abruption of the placenta.  The paramedics responded to a 911 call but did not take the patient to the nearest hospital but to the hospital the patient selected.  The hospital noted the vaginal bleeding but did not call the OB timely.  A baby was born via C-Section with severe acidosis and terrible Apgars.  The baby went home after six months and expects to need home care for the duration of life. 
The second case was in Sacramento, California where a VBAC went well but the patient bled significantly post delivery.  After a long delay she was taken to the OR where an exploration showed an inverted uterus.  The uterus was righted but the patient had a cardiac arrest.  She has physical deficits requiring long term care.  This attorney specializes in OB and bad baby cases.   

Arbitration of Vasectomy Miscue

Hanel v Kaiser Permanente

Following a vasectomy at Kaiser the patient continued to have a significant amount of live sperm in the semen analysis.  On the fourth one a technician stated that all was clear.  A baby was then forthcoming.  The question is if over a period over months there are significant amount of sperm and on one occasion there were none, is another negative count the standard of practice.  The arbiter stated that it was and awarded the plaintiff $316,000 for performing below the standard of care but not for wrongful birth.  I always wonder if the physician from Kaiser Permanente is reported to the MBC.            

Baldi v Cook Count Hospital

In the largest malpractice payment in Cook County Hospital  history a settlement was for $12 million for the accidental overdose of a 42 year old female with three children.  She entered the hospital for burn treatment  patient resulting in severe brain damage. The nurses at the hospital mixed the medication instead of having it done in the pharmacy. The medication was potassium phosphate and the patient received five times the standard dose due to a nurse mixing error. 

Peer Review Records

   Tucker v US

In an interesting twist Tucker sued physician and hospital for medical malpractice.  The physician was an employee of the hospital and the hospital was insured by an arm of the Federal Government.  This meant the action could be tried in a Federal Court under the Federal tort Claims Act. The United States took over the claim and the hospital and physician were dropped.  This allows federal law to preempt state law. Since there is no peer review privilege in federal law peer review information may be discovered. 

Statute of Limitations

Paul v Skemp
Wisc. Supreme Ct.

The Wisconsin Supreme Court ruled that a death of a patient and not the misdiagnosis sets the time of the running of the statute of limitations.  The reasoning is that if the statute began at the time of the misdiagnosis many people would file suit when there were not nor ever be damages, a requirement for a malpractice suit. 

HMO Negligence

McCall v PacifiCare of California
Cal. Supreme Court

The California Supreme Court in a 5-2 decision has ruled along with most other states that Medicare HMOs may be sued for negligence under state law.  This is not when there are differences in the definition of coverage.  Those are covered by Medicare Administrative Act, a federal law, and must be tried in Federal court. The remedy for that federal miscue is only the amount that the plan would have had to pay.  The facts in this case were that the physicians taking care of McCall would not inform him of the possibility of nor recommend lung transplant for him as long as he was a member of an HMO.  As soon as he went to straight Medicare they put him on a transplant list but it was too late and he died.  The Supreme Court ruled that the HMO as well as the physicians could be sued since the alleged negligence was only incidental to related to Medicare benefits.  PacifiCare has stated they did not deny him a transplant but only his choice of hospitals (an administrative and not a negligence decision) and they may appeal to the US Supreme Court.   Top

Medical Board Wins Appeal

MBC v Superior CT. (Lam)
Ca Ct. App. 3rd

Lam is licensed in Wisconsin and California. He was investigated by Wisconsin and ordered not repair any rectovaginal fistula.  California then filed an accusation against lam stemming from the Wisconsin action.  After a hearing in which Lam did not appear he was suspended for 90 days and fined $683 for investigative and enforcement costs.  Lam appealed the ruling to the Superior Court and won.  The Board filed this appeal.  I won't report the issues since they are very technical but it should be noted that the Board won the appeal and was awarded costs of the Appeal.  This will cost significantly more than the original money and the suspension which had been completed earlier still stands.  It should be noted that there is a Supreme Court case on point in the educational arena which forbids the state to collect investigative and enforcement costs.  I believe if anyone fights this MBC rule, they would win.        Top

Physician suit Anti HMO Loses Round One, on to Round Two

The lawsuit by 600,000 physicians and three medical societies against six HMOs lost its bid to use racketeering as a cause of action for cheating on fees. The next step in the suit is to attempt to get class action status.  If the judge rejects this then the suit may unravel since the damages to any one physician are small.        Top

Painful Lawsuits

Bergman v Chin
Ca. Superior Ct.

A case goes to trial on 5/8/01 by the children of a man who apparently died in pain.  The plaintiffs allege under-prescribing of pain medication to their father in the last week of his life.  He was treated by Vicodin followed by an injection of Demerol and a Fentanyl patch. A hospice nurse asked the doctor for morphine which was not prescribed. California prohibits legal action by a family for pain and suffering when a patient dies, the suit here is for elder abuse.  The motto here is treat the patient as you would like to be treated.  Top 

Liens on MediCal Patients

Olszewski v ScrippsHealth
Ca. App. Ct.

An appellate court in San Diego has forbidden the use of liens on MediCal patients for more money than allowed under the state program.  ScrippsHealth and another provider had placed a lien on any award Olszewski won in a action against the driver of another car that injured him.  He won $410,000 in a settlement.  The lien was for the reasonable value of services rendered and came to $200,000.  The appellate court stated that all the providers are entitled to is the amount they would have gotten under MediCal.  It is illegal under federal law to bill above additional amounts.  There was a prior decision from another appellate court that stated the opposite but it was decertified for publishing, so can not be used for precedent.                    Top

A Billion Here; A Billion There

The OIG believes that fines and settlements against medical facilities could be as much as $2 billion in 2001.  This is up from $750 million three years ago.  The OIG states this money goes to HHS general fund and the Medicare trust fund.                                            Top

Informed Consent

Following a hernia repair a patient developed testicular atrophy.  He had signed a standard pre-op consent form stating "the nature and purpose of the surgery the possible alternative methods of treatment and the risks involved with the possible complications have been explained to me."  The plaintiff's expert stated that there was no informed consent who stated that based on the review of the records there is an absence of any of the specific risks or complications most commonly associated with hernia surgery.  This lack of documentation cased him to question informed consent was obtained. the patient also gave an affidavit that stated the physician did not explain any of the risks such as testicular atrophy.  The trial judge said this is enough to proceed to trial and let the jury decide the issue.  There is a split among malpractice defense attorneys as to what to place in the medical record.  Some believe you should place all the significant >2% likelihood and some say only use the general terms as above. I believe the real difference is if you list all and one of those happen the informed consent issue is off the table without a trial.  If a complication happens that was not listed then to trial.  If you use a general statement as the above doctor did it is likely that the case will move to trial but that the physician will win if he/she can show that it is the office standard to list the complication that occurred.             Top


A Florida Court stated that a physician who had signed a non-compete clause was bound by it but so was the binding party.  in this case the physician went to work for another clinic that had two offices.  One of the offices was within the five mile non-compete radius and the other was outside the limit.  The physician could only work at the clinic outside of the radius.
In Georgia an employee signed a non-compete clause which would not allow working in the county for twelve months.  The physician left and wanted to open her own practice in the county.  The doctor then went to court to have the non-compete clause rendered unenforceable since it limited her right to practice.  The court said it does not deprive the doctor of earning a living just not in the county.  In California non-compete clauses are against public policy. Top

Medical Marijuana

The United States Supreme Court in an unanimous decision stated that marijuana is a Class I drug without any benefits. They closed the ability of the growers and distributors of the drug to use medical necessity as a legal defense.  The may not have closed the door on the patient using the medical necessity defense. 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.