Do your bylaws invite suits from terminated doctors?
February 1, 1996 6 minutes read
Do your bylaws invite suits from terminated doctors?
Shape bylaws to reduce medical staff litigation
Risk managers can help reduce the risk of protracted discrimination lawsuits by making sure their hospitals' bylaws are drafted to ensure due process for departing medical staff.
Hospital bylaws should ensure that a medical staff member has clearly defined rights to a fair hearing when the doctor and hospital part company. Although these hearings can be a strain on a hospital's administration, the risk manager should not try to limit the right to these hearings in the bylaws, advises John C. Metcalfe, JD, FASHRM, director of risk management services at Memorial Health Services in Long Beach, CA.
Instead, you should review the bylaws to make sure they provide a clear procedure for a doctor to request and receive a hearing, Metcalfe says. If the bylaws are written so narrowly as to circumscribe the right to a fair hearing on termination, the hospital may be unwittingly inviting a discrimination lawsuit from the discharged doctor.
The broader the bylaws are written in terms of ensuring due process -- and a fair hearing is part of due process -- the less likely a physician will be able to engage a hospital in a lawsuit for discrimination for not ensuring due process, Metcalfe says.
"If the bylaws provide for due process and you've complied with the provisions of the bylaws, then any [discrimination] lawsuit should be able to be defended on the merits," he says.
Health care executives have kept watch over the issue since 1991, when Tennessee's Supreme Court seemed to expand the rights to a fair hearing that physicians previously could have expected. The court said that a staff radiologist who was denied access to a hospital after that facility signed an exclusive contract with a competing radiology group should get a fair hearing. That ruling departed from existing case law.
Protect against atypical rulings
Last year, however, courts in two other states did not follow Tennessee's precedent. Now, one law firm that specializes in health care matters has issued a guide for hospitals that want to protect themselves from similarly atypical rulings.
Clearly written medical staff bylaws hold the key, says James L. Hall Jr., JD, a partner at Crow & Dunlevy law firm in Oklahoma City.
The firm recommends that staff bylaws should set out three limits that deal with fair hearing rights and clinical privileges (unless state laws hold otherwise):
* The bylaws should explicitly limit a physician's right to a fair hearing only to those cases in which the hospital based its discipline on the doctor's bad professional conduct or competence.
* The hospital's administration takes action on factual issues, such as whether the physician holds a proper medical license, or can prescribe drugs. There is no right to a fair hearing in those cases.
* Bylaws also should distinguish between staff membership and clinical privileges.
Federal law creates the fair-hearing rights that medical staff bylaws must allow, says Hall. The federal Health Care Quality Improvement Act (HCQIA) requires hospitals and other licensing entities to report any actions they take against physicians that result from professional misconduct or incompetence to the National Practitioner Data Bank, Hall explains.
The HCQIA also requires that hospitals hold fair hearings when they act against any physician for a reportable offense, and describes the steps facilities must take to ensure due process.
The law's provisions might seem cumbersome -- at first. Yet, hospitals that follow the HCQIA actually gain a legal advantage over less attentive health care providers, Hall adds. The law also extends legal immunity from lawsuits that disciplined physicians might later file to hospitals that follow its reporting and fair-hearing provisions.
"It creates a presumption that you've complied with the law," explains Hall. "If you're sued by the doctor . . . it can be thrown out of court at a reasonably early stage."
An early dismissal of a lawsuit can save the hospital the costs it otherwise would incur during a full trial. In addition, the HCQIA provides immunity that protects hospital administrators and other staff physicians who take part in the fair hearing, board of trustee members involved in the hearing panel, and physicians who appear as witnesses.
Of course, a hospital might want to end its relationship with a physician for any number of reasons. All medical staff bylaws contain a "laundry list" of criteria physicians must meet, says Hall.
Basic requirements might include that the physician has to hold a proper medical license, for example, or have the authority to write prescriptions. Questions about those types of factual requirements don't qualify for protection under the HCQIA.
"They're cut-and-dried issues, and should be administratively determined," Hall says. Unnecessary hearings "cost a lot of money, they take a lot of professional time, and they add to the cost of health care."
Take, for example, a hospital that imposes a residency requirement to ensure its physicians can provide night or emergency coverage. Administrators may say, "'We want all the doctors on our medical staff to live within a 30-minute drive of the hospital,'" Hall says. "That should not be a matter that goes to a hearing. Either he does or he doesn't."
Hospitals should limit their staff membership criteria to factors that rationally might be expected to affect patient care, and enforce the requirements uniformly. In addition, administrators must give a physician the opportunity to respond to charges of criteria-based violations.
"They may have gotten a letter that was in error in saying, 'He didn't get a medical degree.' He ought to have a chance to respond to that," Hall says.
Other key points to remember include:
* Hold the physician responsible.
It's a good idea for staff bylaws to state that the physician is responsible for knowing what the bylaws require and complying with them, Hall says.
In fact, doctors should sign a statement to that effect when they join the medical staff and each time they're readmitted. That helps protect hospitals from lawsuits terminated physicians might file when they're denied a hearing.
"If it's done properly, there just shouldn't be any basis at all for a complaint," Hall says.
Membership is general, privileges specific
* Distinguish membership from privileges.
Hospitals also can avoid unnecessary lawsuits and hearings by clearly distinguishing between general medical staff membership and the clinical privileges practitioners receive for specific forms of practice.
Medical staff membership "involves an evaluation of your training, . . . your professionalism, your integrity, and those kinds of issues," Hall says. That process "can get fairly specific, but it's a general analysis of your training, competence, and experience."
Clinical privileges, on the other hand, involve specific categories of practice a physician is approved to perform. "We do have lots of physicians who are constantly training to expand [their] scope of services because of the economic pressures being placed on them," Hall says.
A cardiologist, for example, might have experience in doing bypass surgery, then attend a week-long course on angioplasties. "There has to be some evaluation of whether he really learned or not," Hall says. "So there's a constant process of changes in clinical privileges, even though the medical-staff issue is unaffected."
The distinction can come into play when a hospital contracts exclusively with one group of physicians to provide some service, as frequently occurs in anesthesiology.
"If the bylaws are all balled up and carry an implication that merely by being on the medical staff, you are entitled to clinical privileges, then the anesthesiologist who isn't part of the [contracting] group can sue, claiming he hasn't had his privileges taken away . . . yet he's being denied the 'right' to practice at the hospital," Hall says.
* Business decisions may be exempt.
In 1994, the Kansas Supreme Court ruled that a radiologist was not entitled to a fair hearing after the hospital where she had practiced contracted with another practitioner. In holding that the hospital's action was a business decision, and not based on the physician's professional qualifications, the court noted the following:
-- The hospital's action did not affect the radiologist's staff membership.
-- The medical staff bylaws specified that staff membership did not include any right to clinical privileges.
-- The bylaws also limited a physician's fair-hearing rights to deal with situations affecting professional competency or conduct.
In another decision in 1994, a Texas appellate court ruled that a hospital's decision to contract for anesthesiology services was purely administrative. It said that the contract did not breach the hospital's bylaws, and that a competing anesthesiologist therefore had no right to a fair hearing.
Of course, anyone with a real or perceived complaint can sue. It's also possible to get different results in different states.
"The area you can put this to rest is in the medical staff bylaws," Hall says. "If it's made very clear that just because you're on the staff, you don't necessarily have a right to clinical privileges or to practice . . . generally, you're going to get the right result." *
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