Hyperlink headaches and other Web woes.

THE GROWTH OF THE INTERNET HAS BROUGHT NEW OPPORtunities to long term care. By establishing a Web site, providers can reach out to the community as never before through improved communication and marketing capabilities.

But an understanding of the importance of the Internet and related technologies must be coupled with an appreciation of the unique liability and business risks associated with this new medium, risks that need to be addressed prior to going online.

Under negligence law, an employer can be held vicariously liable for the actions of employees. However, representations made on a Web site could expand your vicarious liability to include the actions of your independent contractors. For example, you may make representations regarding the care residents will receive from third parties such as physicians or outside vendors. If these third parties fail to measure up to your glowing assessments of them, a resident could sue you. Although the case law regarding representations made on the Internet is sparse, statements made by health care providers in other contexts could guide courts that are confronted with suits arising from statements made on Web sites.

Boyd v. Albert Einstein Medical Center involved an action against a Pennsylvania HMO for the alleged negligence of physicians performing services for its members. The HMO advertised that its physicians and other medical care providers were "competent" and that they had been "evaluated for up to six months" before being selected by the HMO. Although the physicians were not employees of the HMO, the court ruled that if an HMO characterizes a physician in a way that might lead a patient to a reasonable belief that the patient is being treated by the hospital or one of its employees, vicarious liability may result.

A similar conclusion was reached in McClellan v. Health Maintenance Organization of Pennsylvania, which also involved a suit against an HMO for the alleged negligence of an affiliated physician. The court found the physician was an ostensible agent of the HMO because the HMO represented that its primary care physicians were carefully screened and fully qualified physicians who would render competent medical care.

These liability concepts are particularly germane to long term care providers moving into cyberspace. Increasingly, consumers demand detailed and extensive information on Web sites. The pressure to "sell" oneself may lead providers to make representations concerning the care rendered by physicians or other related providers.

Another relevant issue if you're planning on having an Internet presence involves potential liability from hyperlinks on your Web site. Many provider sites contain hyperlinks to, say, a home health care or adult day provider. Once again, while there are no cases involving vicarious liability and hyperlinks, there are other rulings that may govern how a court will go should the matter come before it.

In Medical Laboratory Management Consultants, et al. v. American Broadcasting Company, a federal district court case in Arizona, a medical lab sued a television station for broadcasting an episode of "Prime Time Live" about alleged faulty Pap smear testing at the lab. Although the television did not have any part in producing the episode, the plaintiff contended that broadcasting the episode amounted to an endorsement of the content. The court disagreed, citing the station's complete "noninvolvement" in the underlying broadcast. The television station, the court held, was merely a "conduit" for a network program and played no role in the production of the program. Although the court did not find liability in this instance, the decision suggests what facts might lead to liability for such an "endorsement." Such facts might include a site that contains representations concerning the companies advertising on the page or the labeling of certain companies "preferred."

To avoid the possibility of a court finding that a hyperlink on your site constitutes an endorsement, when you enter into a hyperlink licensing agreement, insist that the company identified in the hyperlink indemnify you for any legal action brought against you based on its actions.

In addition, you should take care in selecting which companies you allow to advertise on your Web site. In some cases, you might want to provide a company with advertising space but not allow it to also have a hyperlink.

Advances in technology can vastly improve a facility's relations with the community and its client base. But providers must recognize and prepare for the associated risks.

Mark E. Reagan and Mark A. Johnson are a partner and an associate, respectively, in the San Francisco office of Foley & Lardner. They are members of the firm's litigation and long term care practice groups.