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Agency CRNA injured in OR: who was liable for her comp.?

CASE ON POINT: Shatto v. McLeod regional medical center, 4865, (8/10/2011)-SC

ISSUE: Are you an employ cc of an agency or a hospital?

CASE FACTS: On March 26, 2007. Staff Care, Inc. (Staff), a temporary medical staffing company in Irving, Texas. entered into an Agreement (Stalling Agreement) to provide temporary medical personnel for McLeod Physician Associates (McLeod). Pursuant to the Staffing Agreement, Stall acted as a placement agent for McLeod. In addition, the Staffing Agreement required Staff to verily the health care providers' medical licenses, arrange and complete travel and housing accommodations, provide malpractice insurance, and pay health care providers on behalf of McLeod. Mildred Shatto, a CRNA contacted Staff after finding a posting on the internet. She was unaware that Staff was going to assign her to McLeod. She sent Staff her resume, copies of her licenses and medical certifications her health record, and references. On October 10, 2007. she entered into a Provider Services Agreement (provider Agreement). The next day, she signed an independent contractor declaration form stating Staff "does not have the right to direct or control the manner in which I practice my profession." Additionally, the independent contractor declaration from provided that the nurse was not an employee of Staff. She was responsible for paying local, state, and federal taxes, and was not entitled to unemployment and workers' compensation benefits from Staff. On October 24. 2007. Staff sent Nurse Shatto a confirmation letter regarding her assignment to provide temporan C RNA services for McLeod from November 2007 to February 2008. The letter also indicated that Staff agreed to pay an hourly rate of $95 and $25 per diem. Additionally the nurse chose which shift she wanted to work while at McLeod. Nurse Shatto underwent a McLeod employee drug screening and employee health assessment, received an identification badge, and signed several forms. On December 21, 2007 she fell on the OR floor while assisting in the anesthetization of a patient. She was treated in the ER and diagnosed with a contusion to the right eye. At the end of December 2007 her assignment with McLeod was terminated. On April 30, 2008, Nurse Shatto tiled a claim for Workers' Compensation against both McLeod and Staff. A single commissioner (JCC) heard the ease. and alter a hearing, found that the nurse was an employee 01 McLeod and thus. awarded her Workers' Compensation benefits. McLeod appealed.

COURT'S OPINION: The Court of Appeals of South Carolina reversed the decision of the lower court, which held that the nurse was an employee of McLeod thus, holding McLeod responsible For paying Workers' Compensation benefits to the CRNA. The court remanded the case hack to the lower court for a determination as to whether the CRNA was an employee of Stall The court looked at the necessary to establish an employer-employee relationship. The court outlined them as follows: 1. the right to control: 2. The Furnishing of equipment; 3. The method of payment: 4. The right to lire. Accordingly. since the court found that none of the necessary elements were furnished b), Staff, the alternative was whether since the nurse was not an employee of McLeod. was she actually an employee of Staff. Thus. the court remanded the case back to the lower court so that it could address that issue and decide the issue of the nurse's eligibility for compensation from Staff.

LEGAL COMMENTARY: It appears that Staff was attempting to have the best of both worlds. On the one hand it disavowed any responsibility for covering the nurse with Workers' Compensation, as well as attempting to disavow any responsibility to withhold state and federal taxes as well as social security contributions from the nurse (not to mention the equal amount it was obligated to pay to match the nurse's contributions for her social security) as well as any other withholding it was obligated to pay. One of the advantages that hospitals have when they utilize temps from an agency. is the fact that they are not obligated to get involved in the course of the myriad of paperwork involved in withholding the proper amounts for state and federal taxes. as well as social security benefits (again not to mention that they are not required to contribute a matching amount to IRS for the temp's contribution to his or her social security benefits). Thus, many hospitals are eager to utilize competent stall through competent agencies. The savings can be enormous. Given the contents of Stairs agreement some might wonder whether or not Stair was involved in its own "Ponzi-Scheme," Obviously, that will be determined one way or another, when the case is heard in accordance with the Court of order remanding the case back to the lower court for a determination as to whether or not Staff is liable to pay Workers' Compensation benefits to the CRNA.
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Title Annotation:Nursing Law Case of the Month
Publication:Nursing Law's Regan Report
Article Type:Case overview
Date:Sep 1, 2011
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