September 1, 2008 Recent Legal News

Peer Review





Physicians Rights




Peer Review

Isaiah v WHMS Braddock Hosp
D Md

The physician, a surgeon, had a precautionary suspension of his privileges and then a full suspension of his privileges.  He went through peer review proceedings and then sued when he lost his appeal.  He lost again.  The court stated that no particular patient need be named in a precautionary suspension only that there is a reasonable belief that danger may result to a patient absent a precautionary suspension.  The court issued a HCQIA standard hospital summary judgment finding that the hospital fulfilled the 4 prongs of the test.

Zamorano v Wayne State Univ.
ED Mich

The physician accused the hospital of gender discrimination and wanted the peer review records of other physicians.  This was denied since it was not relevant to her claim.  

Adeduntan v Athens Reg. Med Ctr.

The physician lost the law suit against the hospital and individual physicians for his loss of privileges.  The defendants in the original suit then sued the physician for attorney fees and costs. The HCQIA allows the original defendants to get costs and attorney fees if the law suit is considered frivolous.  The physician lost the suit and has to pay the hospital and physicians their costs and attorneys fees because there is in the original application for appointment a release that states that the applicant agrees to reimburse the hospital and any staff member costs and reasonable attorney fees if the applicant does not prevail.  There is nothing in this release that mentions anything about the frivolous law suit.  The bylaws of the hospital state that the members sued be indemnified to the fullest extent permitted by law.  The court stated that this does not necessarily mean the hospital but if it did then the hospital could look to the plaintiff for reimbursement.  This is another reason medical staff members should read what they sign and that the independent medical staff attorneys should look at all the documents to make sure there is fairness.  The fair thing is to have the hospital indemnify the members if the suit is frivolous and if the suit is not frivolous there should be no reimbursement.  The court would decide in its opinion if the suit was frivolous or not.   There was another recent District Court decision in a more enlightened jurisdiction on HCQIA that stated the suit was not frivolous and therefore no reimbursement was necessary.  

Salem Women Clinic v Salem Hosp
D Or

A physician had her privileges removed at the hospital and sued under antitrust.  The physician's midwives were then hired by the hospital.  The physician sued the clinic and the hospital for conspiracy to restrain trade in the birthing market.  The court refused to allow the case against the hospital for hiring the midwives to go forward and also tossed the requested injunction against her losing her privileges.  It did allow an amendment to her complaint to add the midwives and the clinic as defendants in biased peer review to restrain trade.  

Hamrick v Charleston Medical Ctr.

Dr. R. E. Hamrick of Charleston, West Virginia, had his privileges suspended in 2004.  He sued and won a $25 million jury verdict due to fraudulent, malicious, oppressive and reckless conduct by the administration.  The hospital appealed and the judge reduced the award to $10 million plus interest.  The hospital has agreed to pay the physician $11.5 million and drop its appeal to the state Supreme Court.  The original clash was due to med mal insurance.  The physician wanted to self insure for $1 million instead of using a commercial insurance company.  That was the impetus for the physician losing his privileges.  The physician showed evidence of insurance to the hospital.  The reading of the comments in the newspaper after the story was enlightening.  There was a consensus that the physician had a huge ego and the hospital administration had an even bigger ego.      Top


US v Amerigroup

Amerigroup agreed to cough up $225 million to settle the suit against it that it only enrolled healthy patients and refused pregnant or unhealthy patients in Medicaid enrollments.  They admitted no wrongdoing but paid the money out of the kindness of their heart.  This was a whistleblower lawsuit and the blower got $56 million.      

Florida v WellCare
Partial Settlement

 WellCare, a mangled care organization in Tampa, agreed to repay the state $35.2 million in understatements of premium refunds due to "accounting errors".  This does not include any interest or penalties that also may apply nor any release of any civil actions against the organization.    

US v Ellegood

 Dr. Rajtha Goli, Dr. James Ellegood and Mrs. Ellegood were indicted in Missouri for making false claims to Medicare.  The charge is that employed nurses made home visits to patients but the billing reflected the physician made the visit.  Dr. Ellegood signed off on the visits when he was out of the country.  Also services by a Medicare excluded provider, Dr. Goli, were billed fraudulently under Dr. Ellegood's identifier number.  

US v Mitts

Mr. Estill Mitts operated the 7th Street Assessment Center in Los Angeles.  He used the Center to recruit homeless patients to hospitals for tests and surgeries they did not need in order to defraud the government.  Mr. Mitts states the hospitals City of Angels and the Tustin Hospital in Orange County, both owned by the arrested Dr. Rudra Sabaratnam, paid kickbacks to him.

US v Harris

Dr. Ronald Harris of Miami and his clinic administrator both pled guilty of fraud by billing for HIV services not provided or billing for unnecessary services.      Top


Holland v Duke Univ.
Superior Ct.

In the first of many such cases the court allowed the patient to sue Duke University instead of arbitration since the arbitration would have cost $14,000 was too costly.  This follows the North Carolina Supreme Court ruling earlier in the year that pricey arbitrations may be void.  This is a case where the University used hydraulic fluid to rinse surgical instruments.  The patient claims multiple injuries secondary to the fluid and that the arbitration agreement was just another in a stack of papers needed to be signed to be treated.  This should cost Duke a significant amount of money.  

Montanez v Temple University
Superior Ct.

Montanez, a 20 year old female on Medicaid, had headaches and numbness along with nausea and vomiting.  Her pregnancy test was positive.  She was seen in two emergency rooms for three days and no one did a CT scan.  The hospitals were owned by Temple University and the jury found the physicians working in the ED guilty of med malpractice.  The verdict was for $11.2 million.  This is the third verdict in Philadelphia for over $10 million this year, more that the previous three years combined.  The plaintiff's lawyer hammered on the fact that she was on Medicaid and the hospital would only be reimbursed $135 for the scan.  Of course, that did not impact what the physicians would be paid.    

Sabock v Cherry Hospital
To Be Filed

Steven Sabock was 50 years old and died in the waiting room of North Carolina's Cherry Hospital after sitting there for 22 hours waiting to be seen.  The hospital is now being investigated by the state and has been threatened with the cutting of its federal funding.      Top


Hospitals v Anthem Blue Cross
Settlement (NO)

Anthem proposed a settlement of $11.8 million for the non payments to California hospitals due to the insurers illegal rescissions of medical policies.  Three large hospital chains have opted out of the settlement of a class action law suit against Anthem.  Since there must be enough hospitals or Anthem may drop the settlement, the settlement may be dropped.  The hospital chains refusing to join are Sutter, CHW and St. Joseph.  

Vaimakis v United HealthCare

Dr. Vaimakis was contracted with the insurer to do laproscopic and bariatric procedures.  The physician cancelled the contract but continued to see and operate on United's patients.  She continued to be paid the participating physician rate instead of the higher non par rate.  She sued.  United tried to defend by stating the patients were ERISA and asked for the case to go to federal court.  At the federal court it was decided that this was a state and not an ERISA issue and the case was remanded back to state court to determine when the physician actually became a non par and was due that pay.   

Patients v Health Net

Health Net has paid $41 million in fines and restitution to insureds that the HMO shorted for out of network payments.  The HMO made out well with this since the time value of money made the fraud worthwhile.  

Blue Shield v Aoki Diabetes Research Inst.
Ca Ct App

There was a contract between the non profit Aoki and Blue Shield to pay for treatment.  Blue Shield paid for PIVIT, a therapy for diabetes.  Years later it stopped paying for the procedure calling it experimental.  Blue Shield was sued by CalPERS and lost.  They still did not pay Aoki and Aoki sued.  Blue Shield tried to defend by stating that Aoki is a non profit and is contradictory to the California ban on corporate practice of medicine.  The court said that didn't matter and the insurer was estopped from claiming experimental since it had already lost on that point in the prior lawsuit.      Top


Jill v Cytyc

Jill from Iowa went to her physician for an operation on her uterus. While at the physician's office representatives from Cytyc, the company that trains physicians on the procedure used on Jill were present and obtaining information.  Several months after the procedure she states a person called for follow-up medical information.  The follow-up was from NovaSure.  Jill contends she refused NovaSure's request to use her information.  An article using her name then showed up on several newspapers including her hometown newspaper.  Jill is suing both companies for breach of privacy , humiliation and depression.  This will be settled for a significant amount of money for Iowa.  In Iowa it is fairly common to snoop hospital records by people who have no legitimate business looking at the records and hospitals in Iowa are lax in disciplining their employees for medical snooping.   The Des Moines Register printed this story and stated it intentionally omitted Jill's last name and city even though it was printed in several other papers. 

Cardoza v USC
CA Ct App

Cardoza sued USC for fraudulently concealing her mother's advance directive.  If it would have been followed, the mother would not have had two operations.  The appellate court stated that the plaintiff could amend her complaint to make it come under the ambit of Health Care Decision Law.    Top 

Physicians Rights

Benitez v Brody
Ca Supreme Ct

Benitez, a lesbian, went to Dr. Brody for artificial insemination.  Dr. Brody refused on the basis of her religious convictions about insemination on any unmarried woman and referred Benitez to another physician outside of the practice for the insemination.  Benitez sued and the California Supreme Court stated in an unanimous decision that the physicians can not discriminate on the basis of marital status.  Of course, the law at that time allowed discrimination based on marital status.  This allow Benitez to continue with her suit against the physician and the clinic for emotional distress.  It will also make sure that anyone who has any belief of their religion will not do any insemination on anyone, married or not. Just another bar to access to care.       Top


Martin v Univ of California
Ca Ct App

Martin's contract was not renewed and she sued for gender discrimination.  There had been complaints about her during her tenure and this plus her not showing enough proof of discrimination led to a summary judgment for the University.        Top


North Carolina v Weaver
Superior Court

The court sentenced a 23 year old disc jockey, Joshua Weaver, to 30 month probation for having sex without the use of a condom.  Mr. Weaver has HIV.  He was accused of not informing his sexual partners and those he might share a needle with of his disease.  State law requires all with HIV to limit exposure, sign an agreement which orders them to practice safe sex and be honest with their partners.  If Mr. Weaver breaks his parole he goes to jail for all of 10 days.        Top  


Illinois v Provena
Ill. Ct. App.

The Court of Appeal overturned a lower court decision and stated that Provena in Urbana, Illinois should lose their tax exempt status.  The hospital did not do enough charity work to justify its non profit status.  The charity was under 1% of its revenue.  The idea that this was a religious hospital held no water since the operation was more business than religion.  The hospital may owe many millions of dollars in back taxes.          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.