October 1, 2002 Legal News



Peer Review


Assisted Suicide





Rosenburg v Aetna
Superior Ct. Calif.

The LA Times reports on a case filed against Aetna by the family of a patient.  The suit alleges Aetna Medicare Choice had the man discharged from a hospital early and sent to a ill-equipped nursing home.  The patient had multiple myeloma and after chemotherapy was sent to the nursing home.  He worsened there with heart failure and died after being transferred back to the hospital.  The charge is that the physician had a financial incentive to reduce costs by early discharges.  The suit also states that he did not get his meds while at the nursing home and was not seen by a physician.  The plaintiff will use the ostensible agency theory for Aetna where they get the patient by the use of their name and then do no oversight of the care by the physician or hospital.        

Doe v Kaiser

Kaiser lost $1,781,570 on a delayed diagnosis of Ewing's Sarcoma.  It took them from August 12, 1999 to January 4, 2000 to obtain a chest x-ray on a patient with recurrent visits to Kaiser for chest pain.  The patient received treatment for the disease but it recurred.  The path report showed that if treated earlier it may have been contained within the surgical specimen.  The patient got $250,000 for pain and suffering, $22,870 for past loss of earnings and the remainder for future loss of earnings as a public sector attorney.  She had been accepted into law school.

Moore v Kaiser 

Kaiser lost $272,000 on this case.  The patient was morbidly obese and had eye surgery.  Post-op there was difficulty in extubation and there was no one available who could reintubate him or do a trach.  He died. Kaiser was at fault due to the lack of foreseeing the difficulty and having anyone in house who could assist.

London v Kaiser

Kaiser Sacramento needs to pay $2.25 million for not following through on blood sugar tests on a newborn.  This led to permanent blindness and seizures.  The newborn was large at over 10 pounds and therefore his blood was tested for glucose which came back low.  the parents were not told of the consequences of the low blood sugar.

Sevrik v Carr
Ohio Ct. App.

The mother and father of a baby sued for medical malpractice after their son had a skull fracture due to the negligent use of forceps.  they later amended their complaint to include the hospital.  The trial court gave summary judgment to the hospital and the court of appeal overturned.  The senior court stated that the hospitals propaganda (advertising) give rise to triable facts as to whether or not the plaintiffs could have believed the hospital might have been responsible for their care and the physician was acting as the hospital's agent.  This case shows that hospitals must be careful with their advertising and their documents.        

Zbras v St. Vincent Med Ctr.
Conn. Superior Ct.

A patient sued a hospital after a back surgery alleging vicarious liability and bad pedicle screws.  The patient lost since the physician was an independent contractor and the hospital is in a service profession and not the business of selling screws.        Top


US v Burton Barmore III. MD

Dr. Barmore pled guilty to two criminal counts on illegal prescribing of OxyContin.  The judge took away his license and can sentence him to 25 years in prison and a $1.25 million fine.  This would include the 234 counts of illegal dispensation which were not included in the plea.

US v Krishnaswami Sriram, MD
US Dist. Illinois

Dr. Sriram pled guilty to mail fraud by fraudulently billing Medicare.  He billed by visits to dead patients and in one day billed for 187 visits.  He was also accused of doing unnecessary angiograms but denied that charge. He will be sentenced next year and faces up to 18 years in prison.        Top

Peer Review

Parker, MD v St. Mary's Health Network
Nev. Superior Ct.

Dr. Parker sued the network for an improper peer review.  The jury had already ruled for the physician for $550,000 that the network had violated its bylaws, committed fraud and acted in bad faith.  They were considering the punitive damage stage when the judge threw out the case stating the hospital and the physicians were immune from civil damages under HCQIA.  The physician had already spent $400,000 of his money on this case. The judge had previously ruled on several occasions the case could proceed.  The case is to be appealed but the physician will lose because the judgment is correct.  A physician can sue for equitable relief but not damages under HCQIA. 

Culp v Providence Alaska Med. Ctr.
AK Supreme Ct.

This case will determine if in Alaska a hospitals unusual occurrence reports are protected under peer review or not under business records.  The AHA filed an Amicus brief in favor of the hospital.  

Rafiy v Nassau County Med. Ctr.

Two Persian physicians who were father and son were kicked off the ED panel and clinical schedules without any due process hearing.  They sued and lost.  The hospital's summary judgment was sustained since the physicians did not have a property right to on call and clinical schedules.  These were not delineated in the hospital list of privileges.  The court also admonished the physicians for coming to federal court prior to exhausting their state court claims.  The physicians also alleged racial discrimination and that was dismissed since they did not have enough evidence to support the claim.  They sued for retaliation for freedom of speech.  the court said nope.  The speech was not protected and even if it was they did not have enough evidence of retaliation for the speech.      Top 


Abortion Clinics v S. Carolina

A South Carolina law was found unconstitutional by a federal district court and then that decision was overruled by the Court of Appeals.  The law allows inspectors to view all patient's medical records.  The law was legal since the state was required to keep the information obtained confidential.  The Appeals Court also ruled that the abortion clinics are required to make clergy members available for counseling  and this does not violate the separation of church and state.  The vote was 2-1 with a stinging dissent.        Top

Assisted Suicide

The Department of Justice has filed an appeal with the 9th Circuit to overturn a District Court ruling regarding assisted suicide in Oregon.  The District Court ruled that the Attorney General's ruling to go after the license of physicians prescribing the drugs used for the patient to take to commit suicide under the Oregon State law was unconstitutional.  This is like the case of medical marijuana where the State has one law and the Feds have another.  The question is not only preemption but also state rights under the 10th Amendment.  Prior attempts to overturn the law have failed.          Top


Doctor's Win Major Victory

In the law suit by multiple medical associations against multiple HMOs, Judge Moreno has given a significant victory for the physicians.  He has allowed the suit to be classified as a class action. This means that if the HMOs (PacifiCare, Aetna, Cigna, United, Coventry, WellPoint, Humana and Anthem) lose the damages could put them out of business.  If these are for-profit the stock will take a fall to close to zero.  This ruling tosses out the arbitration smoke screen that the HMO attorneys were trying to get through. At the same time Judge Moreno did not allow class action status for the patients. This may kill the case for the patients.  The insurers are going to appeal the physician decision.  The US Supreme Court is to decide soon whether they will take up or let stand a Circuit Court ruling denying the arbitration request by the health plans.        Top


Carter-Shields v Alton Health 
Ill. Supreme Ct.

A physician and a non-profit corporation had a contract for the doctor to perform medical services.  The contract had a restrictive covenant.  The two parties split and the physician sued to declare the entire employment contract void.  The reason was the corporation was employing the physician against state law which says there will be no corporate practice of medicine.  The lower court ruled that this fell into an exception in the law and the appellate court overruled.  The supreme court agreed with the appellate court that the agreement was against the corporate practice of medicine act.  This was because at the time of the contract the corporation was not licensed to practice medicine and therefore not under the exemption. 

Odich v Columbia University
NY Sup Ct.

Two doctors were required to pay a dean's and a departmental assessment of a percent of the gross revenues from clinical service to belong to the faculty plan.  Later the doctors resigned but wanted to continue to teach and use the hospital.  The school agreed but only if the doctors agreed to give the school a percent of their income wherever generated.  The doctors refused and were essentially terminated. The unhappy doctors stating this was an illegal fee split.  The courts agreed that that use of this all practice income was fee splitting.  The court also ordered the medical school to forward the applications to the hospital since New York law does not permit a hospital to deny privileges except for patient quality of care considerations.  

Ulrich v San Francisco
9th Circ

Dr. Ulrich was constructively removed from Lagunda Honda Hospital for complaining about the conditions at the city run hospital. He had resigned in protest to the cuts at the hospital and then was not allowed to reapply and then was investigated for quality of care. The lack of the ability to get his job back triggered a report to the NPDB for his resignation under investigation.   He sued the city for not giving him his job back and the 9th Circuit agreed that he was only doing his free speech.  The court stated the lower court should allow Ulrich's case to go forward.

Smith v Columbia, HCA
Olympia, Washington Superior Ct.

Dr. Smith, a radiologist at a HCA hospital since 1997 when his group sold to HCA.  The contract had a non-compete clause and Smith is now attempting to open a practice in the county that is restricted.  The problem is the length of the non-compete clause.  Smith states it was only for five years and HCA states it lasts as long as HCA owns the practice, which may be indefinitely.  The judge will decide. Top


Webb v Ariz. Medical Bd. 
Ariz. Ct. App.

The Arizona Medical Board was taken to task by the Arizona Court of Appeals for not giving due process.  The Board can have the physician in for an informal interview and use this against the doctor.  The Board did not give the physician a chance to question the expert who testified against him.  The physician was not told he could have had a hearing instead of the interview.  The Board now gets to do it all over and change all of its processes.  The Court stated that there must be a standard of practice set by experts and then there must be a showing of how the standard was breached.  There must also be given an opportunity to question your accusers and the decision can not rest on either undisclosed evidence or personal knowledge of the facts.          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.