EXECUTIVE SUMMARY
If in doubt, err on the side of calling for help from legal counsel. A timely consultation can help minimize any potential liability from a situation that may have legal implications.
- A phone call may confirm you can handle the issue on your own.
- Not every contact with an attorney should result in a bill.
- Some regulatory issues should always prompt contact with your attorney.
You have just been notified of a problem that could lead to liability or regulatory penalties. Do you get to work handling the issue right away, or do you call your internal or external legal counsel for advice? The answer is not always easy.
Risk managers might hesitate to call on legal expertise because they do not want to appear unable to handle it themselves, or because they think the circumstances just do not warrant the attention of a lawyer. They also may be apprehensive about the cost of a lawyer’s time.
That uncertainty is understandable, but in most cases, it is better to err on the side of caution and pick up the phone. A short chat with your attorney could put your mind at ease, or you may find out that you indeed need the lawyer involved in what could become a serious matter.
Deciding when to call can depend in part on the size and sophistication of the healthcare entity, says Ayman Rizkalla, JD, partner with Akerman in Washington, DC. Rizkalla urges clients to consider the issue at stake and whether there are people in-house who can address it adequately. The scope of the potential exposure also is important, with a larger exposure suggesting more of a need to talk to counsel.
Risk managers also must assess regulatory risk. Do you have the expertise to assess it? Time also can be a factor, with some situations requiring immediate attention — but the possibility of making the wrong move.
“A lot of these hospitals are understaffed, so law firms can throw a lot of resources at the issue, addressing it much, much faster,” Rizkalla says.
Internal politics also can be a factor, Rizkalla notes. If bad news must be delivered to upper management, sometimes it is more strategic for outside counsel to deliver the news.
Cultivate Good Relationships
The question of when to call becomes easier if the risk manager and attorney work in partnership, rather than a more transactional relationship in which the lawyer is called in to perform a specific service and then is gone until next time, says Noam B. Fischman, JD, healthcare litigation co-team leader with Akerman in Washington, DC.
“We encourage risk managers to have a relationship either internally with their own counsel or externally with your chosen counsel so that they know your business. They know how you operate, and they know your political considerations,” Fischman says. “The conversations can be quick. If you have any questions, it’s worth a quick phone call, but you have to trust that your lawyer is not going to turn a quick phone call into something more to generate time and hours.”
If you have a good relationship with your lawyer — whether internal or external counsel — you can call and ask if this is a big issue or not. Should you handle it alone, or are there some angles you are not seeing? That 10-minute conversation can give you comfort that what you are doing internally is enough, or it could help you brainstorm to find some risks that you might not have been thinking about, Fischman says.
That good relationship also helps avoid being nickeled and dimed by the law firm, Rizkalla says. “If we get one-off phone calls, we’re not billing the client because we have a long-standing relationship with them. They call us for 10 or 15 minutes, we’re not going to generate a bill for that,” he explains. “That’s because we’ve built that relationship with the business, and we don’t need to spend so much time getting background on how the business operates. We already know all this. We know the players, so the phone calls become much more efficient.”
Fischman says he encourages risk managers to establish that kind of relationship with attorneys rather than seeing them as just vendors to hire for particular jobs. This approach can be especially helpful for younger or less experienced risk managers who may need a bit more guidance or have more questions.
“I encourage them to go beyond the doors of your office or cubicle to meet people face to face, become involved in the community, make relationships, and realize people will invest in you if you invest in that,” Fischman notes. “It makes a difference when you call and say you have a quick question or need a word of advice.”
Making that phone call will not always lead to the lawyer’s involvement. In some cases, it is good to avoid bringing in outside counsel because that can send the wrong signal to management, employees, and the public, Rizkalla says. The intervention of outside counsel can signal that the issue is serious and can inadvertently escalate a small problem into a larger one.
Fischman notes that bringing in outside counsel too readily also can undermine the risk manager’s credibility. “Part of what good outside counsel does is prop up the folks internally and say, ‘Listen, you don’t want me on this. You don’t need me on this,’” he explains. “‘Here are four factors for your issue. Run with it, and let’s consult Monday morning to see where you are.’”
Fischman notes that some issues should always prompt a call to your attorney. Sometimes, they seem like small issues, but they have so much risk associated with them that you should always treat them like a big issue, he says. These include any civil investigative demand (CID) from the government, which is akin to a subpoena.
If you receive a CID or any document from the Department of Justice, the Office of Inspector General, or a similar agency, call your attorney before responding in any way, Fischman advises, even if you can easily respond to the requests.
“It’s going to be a bunch of document requests, and you should always consult with fraud and abuse counsel, or white collar,” Fischman suggests. “It’s going to involve certification and testing the truthfulness of what you’re going to provide. Whenever you do that, you should consult legal counsel.”
It is best to contact your attorney early to understand if there is a breach of the law that will require outward reporting or an internal policy issue, says John F. Howard, JD, senior attorney with Clark Hill in Scottsdale, AZ.
Hiring an attorney also will ensure protected attorney-client privilege. Work product protection as an attorney will determine what information should be included so that important items do not get discarded, Howard says. There is no downside to speaking with your attorney when you detect a problem. They can help determine the gravity of the situation and help you take the proper steps to protect the organization.
“What I’ve seen is that people within hospitals and healthcare industries often don’t fully understand the scope of the compliance obligations, or what information to look for when they’re investigating a potential issue,” Howard says. “Having a conversation early with your counsel doesn’t necessarily mean you need to bring them into the situation right away, but they can help provide the guidance to understand what to look for because the issue might be complex. A lot of times, the evidence that you’re gathering to fully understand if there’s a compliance issue or legal issue isn’t always clear.”
If there is a borderline situation, the attorney also can get involved to help make sure privilege is established early. Then, if things grow to a point where there is a definite legal issue or compliance issue that carries any sort of reporting obligation or the potential for litigation, privilege has been established, Howard explains.
The attorney also can help determine if a litigation hold is necessary, Howard says. Often, and especially in the digital world, it is good to have a hold early in these complex situations. That way, evidence does not roll off systems when logs refresh, or with archiving or automatic deletion of communications.
Risk managers sometimes hesitate to make that call, and it can hurt them in the long run, Howard says. “I’ve got several matters that I’m working on right now where we’re in situations where the individual or the organization didn’t think it was a big deal at first. They kind of just went at it on their own, and as they were going along, they realized, ‘Oh, wait, this is growing. It’s growing big time,’” he recalls. “We’ve gotten into situations where some of the evidence that we need to support legal conclusions isn’t available anymore. We have to do a lot of work to obtain the evidence we need, either through interviews or otherwise. It also becomes more of a framing exercise to try and make sure that we’ve got the picture that we need for regulators.”
Regulators want proof of just about everything, Howard says. Not having that available can make things take longer, be more expensive, and appear less certain. “There definitely are mistakes that happen by people just kind of sitting on their laurels a little too long,” he says.
There are bright lines on calling your legal counsel, says Tonya Oliver Rose, JD, partner with Thompson Coburn in St. Louis. Any time there is litigation or an indication of litigation, bring in legal counsel immediately, she says. If someone complains and says they have a lawyer, they are going to hire a lawyer, or they are going to sue you, pick up the phone right away. Organizations often have a process or a policy that applies to a particular situation and dictates when to involve legal counsel.
“Outside of those situations, I think most experienced risk managers develop a good sense and good judgment over time of what is routine and within their scope to kind of manage in their day to day, and what needs to be immediately escalated,” Rose says. “You develop that over time, but for anyone who is new to their role, or even for experienced risk managers who are new to an organization or who are working with a new legal contact, it’s really better for everyone to err on the side of overcommunication.”
Reluctance to call for legal advice can be an offshoot of a risk manager who is new to the role and unsure of the relationship, Rose says. Unfortunately, it also can result from a bad relationship with the internal or outside counsel.
“It can also come with the experience that they get when they do escalate things. How does the lawyer respond? Is it hard to track down the lawyer? Are they stretched so thin that they’re not helpful and responsive, or that they openly express their annoyance if you call about little things?” Rose asks. “All those soft skills and individual quirkiness really can feed into it. But I think with most risk managers and compliance professionals, there is a symbiotic relationship with the attorney.”
Take Advantage of Guidance
In many cases, a situation that is legally challenging to the risk manager will be straightforward to legal counsel, says Paul D. Werner, JD, an attorney with Buttaci Leardi & Werner in Princeton, NJ. But that does not mean the call was unwarranted or that the attorney will not offer useful guidance.
“If the thought popped into your head about whether I should be asking our lawyers about this, the answer to the question is almost always yes,” Werner explains. “While it might be a difficult call for the risk manager in terms of whether it’s something that requires their attorneys to be involved, it’s going to be readily apparent, very quickly, to that attorney whether this is something they need to wade into the water on, or whether the risk manager can start things going and go from there.”
If the answer is that the risk manager should go ahead and take it from here, the attorney probably will offer advice about trying to go down this path or try steering clear of that path, Werner says.
Risk managers may sometimes avoid involving legal counsel to keep an issue from escalating, particularly if they think the other party will respond negatively to communication from a lawyer rather than someone within the organization, Werner notes. That can put the healthcare organization at a disadvantage. By the time an issue gets to the risk manager, that person already may be talking to their lawyer, and the lawyer is feeding them with information and the right things to say. Lawyers speak a unique language, and some words and phrases have particular meanings.
“We’ve had instances where something’s been brought to our attention, and it’s been obvious to us from the beginning that they had a lawyer on the back end feeding the script. That’s important to recognize up front, because then maybe we take the same role,” Werner says. “Just because you as the risk manager contact your lawyer doesn’t mean that you lose control of the case, and the lawyer takes it and runs with it.”
SOURCES
- Noam B. Fischman, JD, Co-Team Leader, Akerman, Washington, DC. Phone: (202) 824-1725. Email: [email protected].
- John F. Howard, JD, Senior Attorney, Clark Hill, Scottsdale, AZ. Phone: (480) 684-1133. Email: [email protected].
- Ayman Rizkalla, JD, Partner, Akerman, Washington, D.C. Phone: (202) 393-6222. Email: [email protected].
- Tonya Oliver Rose, JD, Partner, Thompson Coburn, St. Louis. Phone: (314) 552-6119. Email: [email protected].
- Paul D. Werner, JD, Buttaci Leardi & Werner, Princeton, NJ. Phone: (609) 799-5150. Email: [email protected].
If in doubt, err on the side of calling for help from legal counsel. A timely consultation can help minimize any potential liability from a situation that may have legal implications.
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