April 15, 2002 


County Drops Law Suit


Fraud & Abuse




MD versus Hospital

Hospital versus Insurer

MD versus Insurer



Liar, Liar, Pants on Fire


County Drops Law Suit

Russell County, Alabama will drop their ridiculous law suit to stop a hospital from closing.  In return for not filing the suit, the owners of the hospital will pay for the county's ambulance service to the closest hospital if the county can not collect due to geography.  They will work with Alabama law enforcement so they can retrieve evidence from Georgia at the new hospital.  They will also support any new county built hospital.  None of this costs any money.  Hopefully, the county will think and re-think it's position about building a new 70 bed hospital with an emergency room and the money they will lose due to the nature of their patients.        Top 


Doe v Sacred Heart Hospital 
Super. Ct. Allentown PA

A 7 year old boy born prematurely was awarded $7 million by a jury in Allentown, Pennsylvania.  The hospital was accused of not having adequate staff to deliver premature babies after 5 p.m.  There was a delay in resuscitation with resultant brain damage.  The hospital states it will appeal since it was not their fault but was because the child was born at 27 weeks gestation or it happened at St. Christopher's Hospital in Philadelphia where the boy was transferred.  I'm sure St. Christopher's will be happy to continue to accept patients from Sacred Heart.        

Miller v Women's Hospital of Houston
Texas Supreme Court

The Texas Supreme Court is reviewing a case with multiple legal and ethical dilemmas.  A four month premature infant was delivered.  Prior to delivery, the parents stated "no heroic measures".  The hospital policy was resuscitation in any infant over 500 grams.  Baby Miller was 629 grams.  The child had no deformities at birth but after resuscitation had multiple deficiencies.  The child developed brain hemorrhaging secondarily to the unconsented to treatment. The parents sued in state court and won a $60 million damage claim in trial court.  This was tossed by the Court of Appeal which stated the parents could refuse treatment only if the baby was terminal.  The problem is that this is a case of negligence and battery with alot of emotional overlay.  It will be up to the Supreme Court to focus on the facts and the law and not allow the emotional pro-life and pro-choice people to interfere.

Jones v Kaiser 
Binding Arbitration 

Jones is a 40 year old male who presented to Kaiser in November 1998 with an unusual lesion on his upper outer arm.  The lesion was evaluated by a family practice resident in June 1999 who used liquid nitrogen on the lesion.  He also saw a neurologist at Kaiser for seizures and complained to him in August and September, 1999 of the same lesion.  In December 1999 he underwent a shave biopsy which showed it to be a melanoma of 2.5 mm. depth.  A workup showed a positive sentinel node.  the remainder of the node dissection was negative.  He was started on interferon and in February 2001 was found to have pulmonary metastases.  Kaiser claimed that the lesion was clinically atypical, being non- pigmented and nodular.  They denied the patient complained about the lesion until June 1999.  They even stated that the CT showing the pulmonary mets meant that the lesion had metastasized prior to the supposed 1998 visit.  The arbitration panel stated the practice was below the standard of care but that there was not significant evidence for causation. The Kaiser expert on causation stated that the metastasis to the lungs occurred as early as 1997, four years prior to first being discovered and was believed.   Kaiser undeservedly won the case.

Brancifort v St. Joseph Hospital
Los Angeles Superior Ct.

A newborn discharged from the hospital at 24 hours of age and two days later was noted by the parents to be very jaundiced.  They contacted the on call physician and were told to take the baby to Valley Presbyterian but asked and received permission to go to St. Josephs Hospital which they did.  They were seen at the urgent care center within St. Josephs and the baby was examined by both a nurse and a physician.  All agreed an immediate bilirubin test was indicated.  The urgent care physician then called the primary pediatrician for authorization to perform the needed test.  The pediatrician stated to the mother that the baby should go to Valley Presbyterian.  The bilirubin test was not done for several hours.  The baby had Kernictus and is brain damaged.  The plaintiff sued St. Joseph for not doing the test.  The defendant hospital stated that the pediatrician (who had already settled) was at fault for taking control of the situation before a test could be done.  The trial lasted five days and the jury concluded fault in two hours and damages in six hours.  The hospital lost damages of $5,023,897 net.  The hospital is planning an appeal.  They deserve to lose.  By now all know that the ED physician is in charge and the patient can not be transferred without being stabilized.  This is true in an emergency room or anywhere in a hospital where the patient comes for treatment. The pediatrician should not have been called until after the test was performed, the results back and treatment started.        

Case not filed

In another dumb emergency room case a twelve year old boy awoke with sever testicular pain.  He was taken to the ED of a major hospital in southern California.  He was examined by a physician assistant who diagnosed a groin strain.  He returned two days later with an obvious torsion of the testicle and had surgery.  The arbitration won $175,000 for the child.  As a urologist for thirty years, I have never seen and do not know what a groin strain is.  A teenage boy with acute onset of testicular pain has torsion of the testicle until proven otherwise.  I hope the arbitration did not take over ten minutes except for damages, especially if he lost testicular function.    

Fen Phen Suits 

Wyeth, who purchased American Home Products, now believes the cost to settle the 1000-2000 serious claims against it will cost about $13 Billion.  The reasoning is mass litigation.  This is where a company is attacked in multiple courthouses all over the country at the same time.  In order to get out of the legal quagmire, settlements are reached that far exceed the damages. The U.S. Supreme Court Chief Justice Rehnquist has asked Congress to enact laws to curb the practice. The majority of the money paid goes to the attorneys.  

Liorente v Jackson Memorial 

In a case that has not yet been filed the state is investigating how a woman in restraints freed herself, opened a window and jumped 7 stories to her death. There was a hospital person in the room at the time who was taking care of the patient in the next bed behind a curtain.  The patient was in the hospital due to a head injury from an auto accident.  

Bragg v Valdez
Torrance CA Superior Ct.

A judge has ruled that Drs. Valdez and Movesian can not be sued for wrongful death.  The physicians had released Joshua Lee from Robert Kennedy Medical Center.  Lee killed Bragg and then hung himself while in custody for the Bragg murder.  The judge ruled that Bragg was not a "foreseeable victim" and therefore could not sue for failure to warn.  Braggs attorney states the suit is not about forseeability but about negligent care. The plaintiff also filed suit against the medical center but it was fought by the physicians.  If they can not be held negligent, then they may agree to the settlement by the medical center.  Not to be outdone, the plaintiff also filed against the estate of Lee.  The reason for this is Lee's mother has filed a $5 million suit against the County for negligent treatment of her son.  If she gets money so will the Braggs.         Top  

Fraud & Abuse

US v. Brumer & Klein
NY Fed. Ct.

Brumer & Klein, two podiatrists have pled guilty to illegal kickbacks.  These were the leaders of about a dozen podiatrists that did false billings for tests not performed. The potential penalty is 20 years, restitution and a $250,000 fine.  Eleven others previously pled guilty and six other podiatrists come to trial in the end of April.        

US v Medical College of Wisconsin

The Medical College of Wisconsin has agreed to pay the government $8.9 million for improper Medicare billing between 1990 and 1995.  This was under the PATH program where many medical schools got hit for improper billing.  It involved the attending physicians billing for work performed by residents.  So far, the PATH audits have returned over $100 million to the government.        Top



The Obstetric & Gynecology of Napa Valley California settled with the feds for antitrust.  The group which consisted of basically all the OB/GYNs in the county with active staff privileges at thee only two acute care hospitals in the county agree that they were anticompetitive in their dealing with insurers.  They agreed to disband and not to reform.  They were a single-specialty IPA that broke off from an all physician IPA, NVP.  They wanted more money and faster payments from NVP.  OGMC agreed on boycotting NVP if they did not get what they wanted.  This led to NVP not being able to contract with HMOs.  There was no clinical or financial integration that would have led to greater efficiencies.  The consent decree basically takes away their ability to negotiate with any plan unless there is a qualified risk sharing joint agreement.  This order dies in only 20 years.          Top


Martinez v Hosp. Menonita De Cayey
1st Circ.

The first circuit through out an EMTALA claim by a patient against a hospital.  The hospital had stated there was no emergency due to a swallowed partial pork bone.  The court stated that EMTALA only applies if there is differential treatment between patients or a refusal to screen.  Also the court respected other court decisions stating that there was not an EMTALA negligence action.        Top


People v Paolino
Penn Sup. Ct.

Richard Paolino, MD has been charged with practicing without a license and prescribing OxyContin without a good faith examination.  His license was yanked in 2000 because of lack of malpractice insurance.  He then hired two physicians to help him.  One of them, Dr. Harmon, has already pled guilty of also practicing without a license and delivering controlled substances.  The other physician, Wesley Collier, signed multiple blank prescription forms for Paolino to fill out.  He is also on trial.        Top

MD v Hospital

Levenstein v U. of Ill., Chicago
DC ND Ill.

Dr. Levenstein was accused of sexual harassment.  The investigation by his employer, the University of Illinois , took over one year.  During this time Dr. Levenstein was removed from his position and made to watch and critique old medical training videos.  Dr. Levenstein had accused the Administrator Bernard Salafsky of potential malfeasance with school funds.  It was Salafsky who imposed the purgatory sentence while the case was decided.  Dr. Levenstein case was finally decided by the faculty advisory committee.  They ruled that he should not be terminated.  Before the university president could make a decision, Levenstein resigned and sued for constructive discharge.  The court refused a summary judgment for the university and the case is scheduled for trial.  The University was in the wrong.  It should never take a year to investigate a case and the making of a respected physician review old training videos is a measure of their malice.  

Spunberg & Phillips v JFK Med. Ctr.

Drs. Spunberg and Phillips, radiation Therapists, were barred from treating patients at JFK Medical Center five years ago due to an exclusive contract between the center and the University of Miami.  They sued and won a $22 million jury verdict against both entities.  The appeals Court overturned that verdict due to a judicial error.  The physicians continued to work at the center during the interim.  This settlement allows them to  practice with safeguards against the center ever doing again an exclusive contract without guarding the rights of the physicians.  They also received compensation.      

Bernard v Sumner Health Sys
Tenn. Ct. App. 

A physician had his privileges revoked for a violation of the sexual harassment policy.  He sued the hospital for breach of contract after the hospital requested the physician's medical group help in the removal of privileges.  This was a communication from the CEO to the medical group. The appeals court stated that the communication was privileged under a common interest privilege.   I have no problem with the termination of anyone for breaking the sexual harassment policy, as long as they follow the bylaws.  I have a real problem with the CEO breaking confidentiality and speaking to the medical group about peer review matters. The court may say it's legal, but it's certainly not moral.  I would have a difficult time ever trusting that administrator again.         Top

Hospital Versus Insurer

Cleveland Clinic v Commerce Group
Ohio Ct. App

The Ohio Court of Appeals stated that the insurer was liable for $88,000 of damages plus hospital costs for misrepresentation on two occasions that a patient was covered for care when they weren't.  The hospital in relying on the preauthorization admitted and treated the patients on two occasions and was due payment based on that reliance.        Top

MD Versus Insurer

Anesthesia Care v Blue Cross of Cal.
CA Superior Ct.

The Court has authorized a class action certification by a group of anesthesiologists against Blue Cross of California.  The case centers around a contract of adhesion (where one party has no choices).        Top


Johnson v Univ. Hosp. of Cleveland
Ct. App. Ohio

Johnson filed a malpractice claim against the hospital and asked as part of the discovery the hospital's incident reports regarding the claim.  The trial court ordered the hospital to produce the document.  The hospital appealed stating the incident report is privileged under Ohio law and the appeals court reversed.  The hospital stated the incident was privileged under the peer review statute and attorney-client privilege.  The hosspital put in it's policy manual that incident reports are prepared for the risk management committee and present opportunities for improvement.  The manual also states that incident reports are not part of the medical record but the underlying facts are.  In this case, the facts as to why the person died are not present in the medical record.  The Court stated that only those facts in the medical record are privileged and not the whole report.  The court remanded for an en camera review to determine by the trial court whether the facts of the matter to be determined were indeed in the medical record.  This removes any notion that an incident report by itself is privileged.  In most states none of the report is privileged since it was prepared in the normal course of business.      

Tucci v Norwalk Hosp.
Conn. Super. Ct. 

 A hospital mistakenly gave a peer review report to a malpractice plaintiff by failing to separate the report from the medical record.  It then sued to suppress the report.  The judge said that since it voluntarily gave the report and even if the report is protected under the peer review statute, the hospital waived it's right of confidentiality.  I hope hospitals read this and be careful and look at each piece of paper they are giving to the requestor.        Top


Pearl v Idaho Board 
Idaho Supreme Court

Pearl was accused of practicing below the standard of care.  There was a hearing before a hearing officer who sided with the physician.  The Board overruled the hearing officer and issued a reprimand.  This was appealed for not allowing the physician a hearing before her peers.  This was rejected by the court but the case was sent back since the Board violated her due process rights by considering evidence not in the original complaint.  This is not unusual in both medical staff and state board license hearings.         Top

Liar, Liar, Pants on Fire

The Texas Attorney General has accused Howard Phanstiel, the CEO of PacifiCare of making untrue and misleading statements in a conference call about the Texas investigation of the plan.  The attorneys for PacifiCare have spun it to say that the CEO's remarks were misinterpreted.  Texas had filed a lawsuit against PacifiCare in February for unpaid claims and other high crimes and misdemeanors.  This will continue the free fall of the stock and hopefully put the organization out of business.  PacifiCare has stated they have cooperated completely with the state investigation.  The state says they have not cooperated at all.          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.