Peer review immunity? Think again: recent developments in federal and state law.
The court denied the hospital and peer review committee's claim of immunity under the Health Care Quality Improvement Act (HCQIA) stating that it is designed to encourage peer review but "does not encourage callous attempts to find dangerous doctors without concern for doctors' careers and in violation of the hospital's own bylaws and fundamental rules of fairness." (1)
The Poliner decision highlights the perils of peer review. Misinformation abounds on the decision, as well as the HCQIA in general.
Health Care Quality Improvement Act
Congress enacted the HCQIA in 1986 to restrict the ability of incompetent physicians of moving from state to state without disclosure or discovery of prior damaging or incompetent medical performance by establishing the National Practitioner Data Bank (NPDB). (2)
The law requires health care entities to report "adverse actions" taken against health care professionals within 15 days from the adverse action. To encourage reporting, Congress granted the reporting institution immunity from lawsuits. The law provides that "no person shall be held liable in any civil action with respect to any report filed pursuant to HCQIA provided such report was made "without knowledge of the falsity of the information contained in the report."
Immunity under HCQIA can be established if the peer review process meets four general standards.
1. It must be conducted with an objective, reasonable belief that its action furthered quality health care.
2. There must be an objective, reasonable effort to obtain the facts, under the totality of the circumstances.
3. The physician being reviewed must receive adequate notice and hearing (i.e., due process) procedures.
4. Lastly, the organization must have a reasonable belief that its actions were warranted.
Peer review immunity must be distinguished from reporting immunity. Courts have consistently found that when reporting to the NPDB immunity applies to any report of an adverse action. The underlying action is irrelevant.
This means that even if the circumstances and proceedings leading up to the adverse action were improper, the federally mandated "reporting requirements" are given immunity. With this background in mind, we now turn to the landmark Poliner decision.
In 1996, Poliner was granted temporary privileges at Presbyterian Hospital of Dallas. He subsequently obtained full privileges on September 29, 1997. Three committee event report forms were filed that year involving a patient death, cerebrovascular accident and the use of contaminated equipment in the cath lab.
While under investigation, a fourth case arose where Poliner was alleged to have performed an angioplasty on the wrong artery. On May 14, 1998, the chairman of the department of internal medicine met with Poliner and demanded that he voluntarily agree not to exercise his cath lab privileges or they would be summarily suspended. This is a key element of the case and will be known as the "abeyance letter."
Beginning with an ad hoc committee (AHC), 44 cases were reviewed, and 29 were deemed to fall below the standard of care. An internal medicine advisory committee (IMAC) reviewed the findings of the AHC and suggested review of echocardiograms with an outside cardiologist.
The IMAC unanimously recommended suspension of Poliner's privileges due to poor clinical judgment, inadequate skills, unsatisfactory documentation and substandard patient care.
Poliner then initiated the hospital medical staff hearing process that resulted in a final decision of the hospital board to restore privileges with conditions but approving the summary suspension.
Poliner filed a complaint in the Texas court one year later naming the hospital as well as the physicians that served on the AHC and IMAC as defendants. The allegations included:
* Breach of contractual due process rights
* Unlawful combination and conspiracy in violation of Texas antitrust statutes
* Violation of federal antitrust statutes
* Business disparagement
* Slander and libel
* Tortuous business interference
* Violation of the Texas Deceptive Trade Practices Act
* Intentional infliction of mental anguish and emotional distress.
Trial and appeal
The case was tried before a jury and Poliner was awarded compensatory and exemplary damages of over $366 million. The parts of the case of most interest to physician executives are the decisions involving discovery, summary judgment, immunity, and damages.
The discovery decision was important because without it, the case would have been dead on the courtroom steps. Poliner needed to obtain the peer review information from the IMAC and AHC, but the defendants claimed that the information was privileged under the HCQIA, Texas statute and Texas case law.
The court held in favor of Poliner and required that the peer review information be produced. "Far from creating a broad privilege, Congress, in enacting HCQIA, carefully crafted a very specific privilege, applicable to peer review material submitted to the secretary pursuant to the dictates of the mandatory reporting provisions of that statute. That is as far as Congress went, and that is as far as this court should apply the privilege contained therein." (3)
Summary judgment motion
The defendant hospital and physicians sought to have the case dismissed by a procedure called a summary judgment. In order to prevail on summary judgment, the moving party must show absence of material issue of fact and a right to prevail as a matter of law. The defending party must show more than conclusory statements or unsubstantiated assertions of the alleged issues and material facts.
Analyzing each claim, the court began with a discussion of the breach of contract and procedural due process claim. States vary on the question of whether hospital and medical staff bylaws are contracts. Under Texas law, the court found that the hospital bylaws in this case were indeed contractual in nature, and as such require procedural due process when disputes are at hand. The court therefore denied the defendants request for summary judgment for this claim and allowed the issue to go to trial. (4)
Next, the court analyzed Poliner's antitrust claims under Section 1 and 2 of the Sherman Act, Section 4 of the Clayton Act, and the Texas Free Enterprise and Anti-Trust Act of 11983. (5, 6, 7)
The court ruled in favor of the defendants thus precluding these claims from reaching the jury. As such, the court ruled that no antitrust statutes were violated.
The defendants sought summary judgment on the basis of peer immunity under both HCQIA and the Texas Peer Review Immunity Statutes. The court analyzed each aspect of the peer review process from the abeyance letter up to the AHC and IMAC examining each defendant's role in the process.
The court was most concerned with the abeyance letter stating that it was "... a complete failure to investigate and to gather all of the facts from both sides before Dr. Knochel summarily suspended plaintiffs privileges by telling the plaintiff to sign the abeyance letter or face immediate suspension." (8)
Additionally, the court found that there was a material issue of fact of whether the defendants acted with actual malice and harbored animosity in several stages of the peer review process and thus allowed the action to go forward.
Finally, the court denied summary judgment for the hospital and several physicians for the state-based tort claims. (9) These included interference with contractual relations, defamation and business disparagement, and intentional infliction of emotional distress finding issues of material fact in dispute. As such, these claims were allowed to be argued before a jury.
Jury decision and appeal
The case was tried on August 12, 2004, and the decision handed down on March 27, 2006. The jury unanimously found in favor of Poliner on all the claims awarding $366,210,159.30 in compensatory and exemplary damages.
Focusing on the abeyance action, the jury found that it was not undertaken with a reasonable belief that it furthered quality of care after adequate notice and adequate discovery of the facts. The summary suspension was not made in good faith and without malice and the implication that he was a dangerous doctor was false.
The defendants then moved for a new trial. The motion was denied; however the federal district court reduced the award consistent with Texas law. In Texas, the "one satisfaction rule" precludes plaintiffs from recovering for the same injury from multiple causes of action.
The defamation claim produced the greatest recovery and as such the claim was reduced to $21 million in actual damages and $1.54 million in punitive damages. (10)
The goal of improved patient care by peer review has long been supported by all sectors of the health care system. Reaching the halls of Congress, the HCQIA legislation was passed in 1996 to restrict the ability of incompetent physicians to move from state to state without disclosure and to provide immunity for physicians and hospitals engaged in peer review.
Courts throughout the country have been reluctant to limit immunity of hospitals and physicians involved in the peer review process even in the face of flawed proceedings. (11,12)
This case illustrates what may happen when a jury believes that the process is unfair and motivated by malice. Peer review procedures must abide by hospital and medical staff bylaws, and provide procedural due process throughout all steps of the process from initial notice through appeal.
The Poliner decision may represent a turning point, or simply an outlier in peer review litigation. Either way, physician executives must keep abreast of the law governing peer review.
Christopher Spevak MD, MPH, MBA, JD, is a physician attorney practicing in Washington, D.C. He is the president of the Medical Society of the District of Columbia and a clinical associate professor at Georgetown University Medical Center. Spevak may be contacted at 202-321-0598 or cjs@SpevakAssociates.com
1. Poliner v. Texas Health Sys., No. 3-00-CV-1007-P, 2006 U.S. Dist LEXIS 13125 (N.D. Tex. Mar. 27, 2006).
2. Health Care Quality Improvement Act (HCQIA) of 1986, 42 U.S.C.A. [section] 11101 (2005).
3. Poliner v. Texas Health Sys., No. 3-00-CV-1007-P, 2001 U.S. Dist LEXIS 13029 (N.D. Tex. June 29, 2001).
4. Poliner v. Texas Health Sys., No. 3-00-CV-1007-P., 2003 U.S. Dist. LEXIS 17162 (N.D. Tex. Sept. 30, 2003).
5. The Sherman Anti-Trust Act of 1890, 15 U.S.C.A. [section] 1-2 (1890).
6. The Clayton Act, 15 U.S.C. [section] 15 (1914).
7. Texas Free Enterprise and Anti-Trust Act of 1983, TEX. BUS. & COM. CODE [section] 15 (2005).
8. Poliner, 2003 U.S. Dist. LEXIS 17162, at *43
9. Texas Deceptive Trade Practices Act, TEX BUS. & COM. CODE [section] 17 (2005).
10. Poliner v. Texas Health Sys., No. 3-00-CV-1007-P, 2006 (N.D. Tex. Sept 18, 2006)
11. Gateway Cardiology P.C. v. Wright. No. ED 87226 (Mo. Ct. App. Oct. 31, 2006)
12. Wahi v. Charleston Area Medical Ctr. No.2:04-cv-00019 (S.D. W.Va. Sept 29, 2006)
Disclaimer- This article contains the advice, opinions, statements and views of the author and does not necessarily represent the advice, opinions, statements or views of Georgetown University Medical Center or its physicians. The content of this article is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax, career and/or other professional advisors.
By Christopher Spevak MD, MPH, MBA, JD
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|Title Annotation:||Health Law Update|
|Date:||May 1, 2007|
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