October 15, 2004 Recent Legal News



National Practitioner Data Bank





Fraud and Abuse


Buckhorn v St. Jude Heritage
CA Ct. App.

Buckhorn was hired by St. Jude Heritage Medical Group and in his employment contract was an arbitration clause.  He was later terminated and sued for wrongful termination and post-termination issues of defamation and interference with prospective economic advantage.  The defendants asked the court for arbitration and were denied.  They appealed.  The Court of Appeal reversed the lower court stating that arbitration applied since all issues were rooted in the employment not when they actually occurred and there was a valid arbitration agreement.      

Howard v Life Care Ctr. of Am.
Tenn. Ct. App.

Dr. Howard was an independent contractor medical director for Life Care.  During his tenure he found alleged mismanagement and fraud.  He reported it to the Life Care and when nothing was done he did report it to the feds.  He was then told his contract would not be renewed.  He sued for the termination for whistleblowing, which was against a state law.  The company stated they did not terminate him but only failed to renew the contract.  The trial court agreed and so did the Court of Appeal.  Dr. Howard was not an employee and the whistleblower statute is an exception to the employee at will rule.  The court of appeal stated that the contract was only for one year with no penalty for failure to renew. 

Nemzoff v Baptist of Alabama

 Nemzoff was fired by Baptist and sued under breach of contract.  Baptist originally called the suit frivolous. They later paid the piper an undisclosed sum.  Nemzoff had sued for up to $7.5 million for work done for the hospital system.  Originally they stated Nemzoff's work was overly aggressive as opposed to know the laudatory of Nemzoff.  Obviously, the system had to do this to avoid paying even more money.   I will let the reader decide on the lying of the System's representatives originally. 

California v Catholic Charities
US Supreme Court

The US Supreme Court has denied to hear the case taken by the Sacramento Catholic Charities against the California law that states any organization that gives prescription benefits must provide contraception.  The Charities are now looking into ways to get around the law without stopping prescription benefits.  The Charity attorney was disappointed stating that if this is the case they may force Catholic institutions to provide abortions.  The answer is yes they may.     Top


Salvagno v Frew
Md. Ct. Spec. App.

In a convoluted case Frew sued Dr. Salvagno for med mal and loss of consortium.  Maryland has a rule that prior to suit for med mal for over $5000 there must be an arbitration of all malpractice claims but not for lack of informed consent.  The plaintiff could not find anyone to be an expert for him and dropped the med mal claim but entered a lack of informed consent claim.  There was still no expert identified.  The arbitration board denied the case to go forward.  The plaintiff argued in court that the expert could be the person being sued in an informed consent case.  The trial court agreed and so did the upper one.  The case goes forward with arbitration prior to going to court.  As a byproduct, the incident occurred in 1997.

Evans v Medical Inter-Ins

Read the fine print.  Evans sued LeFlore for med mal.  The surgery was in July, 1994.  The suit was filed in July 1997.  LeFlore had a claims made policy from May 1997 to January 1, 1998.  The insurance company had a clause that the insurance was only good for retroactive cases to January 1, 1995.  The insurance company did not defend nor agree to pay the $5.6 million damages.  The upper court agreed with the lower court that the company did not cover the incident and nothing happened to her by LeFlore during the retroactive period.  The plaintiff has to go after the physician.  How do you spell no assets?

Inglis v Providence Hosp
Mich. Ct. App.

Inglis sued the physician and the hospital for malpractice.  The plaintiff agreed the physician was an independent contractor but stated the physician was an ostensible agent.  The lower and upper courts agreed that the plaintiff did not prove the connection.  In Michigan, there is a three part test for ostensible agency.  The first is a reasonable belief that the person is an agent.  The second is that the belief must be caused by some act or omission of the principal.  The last is the person relying on the agent authority must not be negligent.  Here the person who died is the one who is important, not the family who is suing.  There was no evidence that the dead person reasonably believed the physician was an agent of the hospital.

Roberts v Sankey
Ind. Ct. App.

N. Roberts died in a hospital where a nurse was killing patients.  L. Roberts, the representative of the estate, sued multiple people at the hospital including the pathologist, Dr. Sankey.  Sankey was released on summary judgment and the appeals court agreed.  There was no patient physician relationship between the pathologist and N. Roberts.  The argument was that Dr. Sankey had a duty to oversee the the professional practices at the hospital and he breached the duty.  The court disagreed.  Even if the pathologist has a duty under a statute that does not mean there is a private right of action if the statute is not followed.

Flatt v Kantak
ND Supreme Ct.

Flatt signed a consent form allowing Kantak to perform a circumcision on her newborn son.  The plaintiff then sued all for lack of informed consent and that the circumcision was against the equal protection due to a female mutilation law.  It's obvious there was an organization backing this suit.  The high court threw out the arguments that experts should have been allowed to testify in the lack of informed consent, that videotapes of instruments should have been allowed and that the jury instructions were valid.  The court also awarded costs to the defendants.

Cruz v Superior Ct. Orange County
Ca. Ct. App.

Cruz's parents sue the OB for med mal for a birth brain injury.  The defendants moved to compel the mother to undergo a blood test for a congenital disease that may have caused the injury.  The court after been briefed on the matter stated the mother can be compelled to give a blood sample since she was treated at the same time as the child and she was also a party to the controversy.   

Does v Emory University
To Be Filed

Emory University has sent notification to 98 former patients that they may have been accidentally exposed to Creutzfeldt-Jacob Disease.  The patients are neurological patients that were operated on with instruments that had been used on a patient with the disease.  The hospital states the risk is low since they sterilize all the instruments.   

Arandas v Baylor University

Baby Arandas needed a liver transplant.  The lab mislabeled the blood of the baby's parents and the baby got the partial transplant from the wrong parent.  The baby died.    Top

National Practitioner Data Bank

Doe v Thompson

In what sounds like an erroneous decision the District Court in DC ruled that Doe right of privacy of a psychiatric exam was correct and the Bank should not have published it.  However there is a two year statute of limitation son any suit against the Bank and this was filed eight years post banking.  The doctor argued that each time the psychiatric report was published it extended the statute of limitations.  The court said no.  I believe the court was wrong since the Privacy rules did not come into being until 2000.  The privacy rules should have taken over at that point and any medical information should be redacted from the files.        Top


McLaren Med Ctr. v City Owosso
Mich. Ct. App.

In what may be a blow to all non-profit hospitals, the Michigan Court of Appeals found that the non-profit hospital and its physician arm were to pay property taxes for the years in question.  The Wexford Medical Group was denied since even though it took Medicaid and Medicare patients it was not a charitable institution.  It practiced like a physician's office.  The hospital also was not charitable since it could not prove outside of the taking of all comers that it did any charitable work in the community.  It treated individual patients and not the community as it did no public health services.        Top


Sinaiko v Med Board
Ca. Ct. App.

In a decision good for the California physician, the Court of Appeal has ruled that the Medical Board of California must give credence to expert witnesses of alternative therapy practitioners.  The Board did not give due process to Dr. Sinaiko by discarding all of his witnesses.  The Board had found all the witnesses credible in their field but not qualified for purposes of the hearing.  A true contradiction.  Dr. Sinaiko will now get a new hearing on his license with all his experts being heard.  The Medical Board must give deference to alternative therapies by law.        Top


Heritage IPA v PacifiCare

Heritage IPA in Dallas, Texas, went bankrupt after PacifiCare stopped paying them.  They sued and the state stepped in.  Texas received $4.25 in fines and PacifiCare agreed to arbitration.  The arbitration came down in favor of the IPA but PacifiCare can appeal the ruling to the court.  PacifiCare was told to pay $6.9 million but that money will be tire up in bankruptcy court and will probably never go to the physicians.       Top 


Colorado v 

In western Colorado, the coroner, who may be looking for a higher office, has stated a person who declared brain dead at two hospitals was not dead.  He named the cause of death as removal of vital organs.  He stated, and it may be true, that the self inflicted gun shot victim did not get the proper tests to determine brain death.  The victim was also a registered donor.  The coroner would not discuss what tests he believes should have been done.

The rest of the Colorado coroners disagree with the one who stated the death was a homicide from organ removal.  The donor alliance stated in nice terms that the coroner lied.  The legislature is now looking into the state's laws to see how they differ from other states.         Top

Fraud and Abuse

US v Baptist Mississippi

The government has alleged that Mississippi Baptist paid physicians for referrals and then hid the money in a myriad of subsidies and computer services.  This whistle blower suit should net the government over $40 million and the blower al tidy sum as well.  Mississippi Baptist states the charges are without merit and if necessary will vigorously defend itself in court.  No they won't.  They will concede and pay.  

US v Olstein, MD

Olstein, a Urologist in Lewiston Maine has been sentenced to one year of unsupervised probation and a fine of $20,000 for his guilty plea in the illegal billing of Lupron to the Medicare program.  He was given the light sentence for helping the feds with the TAP investigation.       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.