Three State Medical Societies Sue
California, Georgia and Texas Medical Societies have
banded together with individual doctors in seven states to sue in
federal court eight insurers. The insurers are Aetna, Cigna,
Coventry Health Care, Humana, United Health, Health Net, PacifiCare and
Wellpoint. The basis for the suit is a pattern of racketeering activity
to deny necessary medical care. The complaint states the insurers used
cost based criteria to approve or deny claims. The guidelines used are
from Millman & Robertson and InterQual. The complaint also alleges
that insurer reviewers were paid a bonus for denying a certain
percentage of claims no matter if they were medically necessary. This
suit is only one of several. There is also a suit waiting for
class action status by consumers and another suit by Connecticut Medical
Association against insurers in that state. There are also cases
against Kaiser and Aetna in California state courts. Recently a
federal circuit panel in New York agreed to hear a law suit
against Prudential for breach of contract, fraud, and deceptive trade
practices. The medical societies are finally taking action when the
legislator's will not. See next story.
Millman Robertson Guidelines
Batas v Prudential
NY Appellate Division
A class suit against Prudential and its HMO has been
allowed to go forward. The HMO utilized the Millman Robertson
guidelines by a nurse to refuse to pay for the time in the hospital
needed by two patients. No physician was ever consulted by the nurses.
The first case refused more time in the hospital requested by the
patient's physician following a hysterectomy for a 3 1/2 pound fibroid.
The nurse only allowed 48 hours as that is what the book stated should
be allowed. The second case was a pregnant woman with Crohn's
Disease that was not allowed to be hospitalized. One week later her
intestines ruptured and significant emergency surgery was required. Four
days later Prudential again sought hospital discharge. Stupidity
costs a lot of money. Does your hospital use these guidelines?
In Placer County in rural California a judge reduced a
drug conviction for use of marijuana from a felony to a misdemeanor. The
judge fined the person $2,700 and ordered 120 days of alternative
sentencing (no jail time). The DA had recommended dropping the charges
on this defendant and another both of which had physician's notes.
The California Supreme Court has agreed to hear a case
involving whether Prop. 215 is an absolute or an affirmative defense
that must be specifically pled by the user of marijuana. This
should help clear the murky waters surrounding the use of marijuana for
The US Supreme Court has also agreed to hear the Oakland
case deciding whether or not Proposition 215 and its progeny are legal.
Roberts v Galen of Virginia
DC WD Kentucky
In a case sent back to District Court from the US
Supreme Court, the jury decided in favor of the hospital. The
hospital had discharged a patient six weeks after admission to a nursing
home. The original ruling was for the plaintiff at the 6th Circuit
Breord v Catholic Med. Ctr. of Brooklyn
A pregnant female miscarried after several trips to the
hospital ED and her physician's office. She sued under EMTALA.
She lost since she did not offer any evidence that the hospital deviated
from their usual screening procedures. There was no evidence that
showed her symptoms of mild abdominal pain and passing water constituted
an emergency. The federal court then remanded back to state court the
woman's claims of malpractice and negligent infliction of emotional
Fraud and Abuse
HCA, after settling a fraud and abuse charge for $840
million with the Feds is now under scrutiny again for new fraud charges.
These may cost the company many more hundreds of millions of fines. This
does not seem to be a good time of buy the stock. Also, think of the
good that money may do if given to the Medicare program.
In another story Medicare states that physicians have
been double billing, but blame there own internal lack of monitoring for
the double payments. The doctors have not returned the double payments
unless contacted by the inspector general.
U.S. V Mackby
A physical therapy clinic in Larkspur, California was
found guilty of violations of the False Claims Act (FCA) by instructing
the billing company to use his father's PIN number in boxes 24k and 33
of the claim form for services performed by the office. Mackby was
an unlicensed individual but his father was an MD. Dr. Mackby had no
knowledge of the use of his PIN. A violation of the FCA occurs when a
false claim is presented to the US for payment with knowledge the claim
was false. It doesn't matter if the service was performed or not. The
false insertion of information into box 24k, where the PIN of the
performing person goes and box 33 where the PIN of the billing entity is
entered, is enough for a false claim. The defendant was found guilty and
fined $729,000. The 9th upheld the verdict but remanded back for the
amount of the fine. Top
Allen v Healthcare Partners Medical Group
In a blow to MICRA, the California malpractice reform
legislation, a judge in Orange County Superior Court has ruled that a
case against a medical group does not qualify for MICRA protection since
the group does not hold a medical license. This may effect physician
partnerships and managed care groups. The physician's medical group,
Healthcare Partners was the only named defendant. This case, as a
Superior Court case, holds no precedential value. The appeal will
be interesting. If this holds medical partnerships will dissolve
and Permanente Medical Group will probably dissolve unless the
legislature would intervene. Top
Right to Die
Time Magazine recently printed an article on the
Wedland case. I reviewed this case several months ago. The
case is now to go to the California Supreme Court to determine if
someone without an advanced directive and who is not completely comatose
has the right to have a feeding tube removed. This case pits the
wife who states that her husband had expressed his desire not to live if
he could not be a father and husband. The patient's mother states
that her son would not want the tube removed. This is one of the
most important medical ethics cases to be heard in many years and
potentially may be heard by the US Supreme Court.
Cooley v Granholm
In this Michigan case the US Court of Appeal
ruled there is no fundamental right to physician assisted suicide and
the law that would allow the prosecution of physicians for participating
is legal. Top
HCA v Miller
Tex. Ct. App.
In this interesting case the parents of a severely
impaired newborn requested no heroic live saving measures prior to the
child's birth. They were overruled by the hospital rules and
lifesaving tactics were utilized with the result being a severely
mentally retarded newborn. The parents were allowed to deny care
only for urgently needed care AND if the child was terminal. Their
child was not terminal. Top
A NY Appeals court has held that an HMO can be held
liable for injuries caused by an employed physician. This is true in NY
state even though the law specifically states that HMOs are not medical
Commercial Insurers and
Blue Cross and Blue Shield Association that
represents 46 of the nations Blues have recovered more than $130 million
from fraud settlements in 1999.
In a another case Allstate has won $8.2 million in a
fraud case against six physicians who ran nine Southern California
clinics. The physicians were found guilty of fraud by altering
medical records and bills to support PI lawsuits against Allstate.
US Supreme Court Search and
Ferguson v City of Charleston
In a 6-3 decision the US Supreme Court ruled that the
testing of pregnant female urine samples for cocaine without their
consent and turning the result over to the police is a violation of the
4th Amendment. This is true even if the intent was the welfare of
the fetus and mother. The hospital was not a police entity but was
a state hospital and acted like police. This case was
distinguished from "special needs" cases since the hospital
did not inform the patients of the nature and purpose of the urine
testing and the primary purpose of the program was prosecution to force
pregnant women into treatment.
State Sue Assisted Living Entity
The Connecticut state's attorney has filed reckless
endangerment charges against a assisted living company that evicted an
Alzheimer's patient while he was at his physician's office. The patient,
a diabetic, was forced to live with his family who were not equipped to
care for the patient. The patient subsequently died. The facility
denies all charges.
Peer Review Lawsuits
McLeay v Bergan Mercy Health Sys
Neb. FED. Ct. App.
A general surgeon was notified the medical staff was
investigating an unspecified number of his patients. Two months
later he was informed that he was to be monitored for surgeries. Later
at an ad hoc meeting he was told of the names of the eight patients
treated over the past 15 months that constituted the basis for the
monitoring. No files or charts were available for review to rebut any
charges. The doctor was told he would remain on monitoring for one year
and he could do a laundry list of minor procedures without monitoring.
One month later he again met with the committee and was asked to sign
the prior months minutes. The minutes included a statement that the
doctor would be removed from the ED call list. Several days later after
a meeting to which he was not asked to attend he was shown the minutes
of that meeting and again signed the minutes. The hospital Board
approved the restriction and then there was a report to the NPDB. The
doctor responded to the hospital's letter to the NPDB stating the
information was inaccurate.
One year after the doctor was first informed of the matter, he hired an
attorney. The attorney drafted a lawsuit against the hospital and
then the doctor was invited to another meeting but only without his
attorney. The doctor refused and was then summarily suspended.
Another NPDB report was sent regarding the summary suspension due to
incompetence, negligence, and malpractice.
The physician then sued on various counts and won $451,000 for breach of
agreement and $1 for breach of by-laws. This trial included expert
witness testimony regarding the need for NPDB reporting.
On appeal the appellate court struck down the verdict due to prejudice
of allowing the expert witness testify on a matter that did not need an
expert witness. The court also made several comments reflecting on the
quality of the hospital's lawyers work.
This case shows that physicians should at the earliest possible time
obtain legal counsel familiar with peer review. If done
early, none of the hospital's lack of due process would have occurred.
Payne v Harris Methodist H-E-B
Northern District Texas
A neurosurgeon on provisional staff with proctored
privileges had his appointment and privileges removed. He was given due
process but filed an antitrust suit against the hospital and proctoring
physicians as well as a defamation suit against the hospital for the
NPDB report. All defendants were given summary judgment due to HCQIA
protection. On appeal the physician attacked the quality of the
information available when the decision was made. The court stated
that all that is necessary for protection is an objective reasonableness
on the information available at the time. The court went on to say that
if the medical staff reasonably believed that the physician's conduct
could place a patient in imminent danger, summary suspension was
Vakil v Anesthesiology Associates of Taunton,
Mass. Ct. App.
An anesthesiologist had an employment contract with
Taunton who in turn had an exclusive contract with a hospital. The
anesthesiology group terminated the employment contract and Vakil
requested permission to continue to perform anesthesia at the hospital.
This was denied due to the exclusive contract. Vakil sued the hospital,
group and medical staff for various claims including failure to give him
a hearing as required by the by-laws. The court found against Vakil on
all counts including the lack of a hearing. Since he lost
privileges due to no longer being employed by the exclusive contractor
and not for quality concerns he was not entitled to a hearing.
Palm Springs General Hospital v Valdes
Fla. Dist Ct. App.
THE DOCTOR WINS. A radiologist was told he was no
longer able to read films at the hospital due to an exclusive contract
of which he was not a part. Prior to terminating the radiologist and
hiring the exclusive group, the hospital administrator stated he wanted
the radiologist fired due to a missed finding that resulted in a patient
death. The radiologist sued the hospital for not following their by-laws
and giving him a hearing based on the missed finding. The jury agreed
and awarded the radiologist $166,000. On appeal the court stated
that there was enough evidence to be heard so summary judgment was not
applicable. The jury verdict stood.
Johnson v Galen Health
Ky. Ct. App.
A MD challenged his termination of temporary
privileges for a violation of his recruitment contract. The physician
had lied on his application as well as other problems. After all
internal appeals he was released and filed suit. The trial court upheld
the termination and this was affirmed by the court of appeal. I don't
understand how one who lies on an application or his attorney can have
the gall to sue.
Kerrison v Kane Community Hospital
An anesthesiologist was fired by his employer
hospital for multiple events of poor patient care. He sued for racial
discrimination but lost since he could not rebut the hospitals
legitimate reason to terminate him. He felt since another physician on
the final case was suspended and then restated while the affected doctor
was not reinstated was discriminatory. He forgot about the other
cases used against him.
Marshall v Spectrum Med. Grp.
District Ct. Maine
A physician sued his medical group for discrimination
and wrongful termination under the ADA. He attempted to subpoena from a
non-party his credential file and testimony about the peer review
process against him. The hospital fought the subpoena under the peer
review privilege. The court said the hospital had to comply with the
subpoena since there is no federal privilege of information gathered in
the peer review process.
In re U of Texas Health Center
Texas Supreme Ct.
Patients who contracted an infection after open heart
surgery sued the Center. The patients requested in discovery the
Infection Control Committee minutes. The Center stated these were
privileged. The Court ordered an in Camera inspection by the Court.
Following the inspection the court without notice to the Center gave the
records to the plaintiffs. The Center objected and the trial and appeals
court allowed the plaintiffs to have the documents. The Texas
Supreme Court overturned the lower courts and stated the documents were
privileged and not discoverable under Texas law.
Sabatier v Barnes
A physician terminated from a medical staff for
quality reasons sued for ADA claims, defamation, breach of contract and
unfair trade practices. The defendants subpoenaed another hospital,
Jefferson, for production of their peer review records on the plaintiff.
Jefferson refused stating privilege. The Court ruled that Jefferson had
to give up it's peer review records since there is no right to privilege
under federal law. In the peer review records Jefferson was required to
redact the patient identity.
Kingsley v Sachitano
Alabama Supreme Court
The plaintiff sued in state court for negligence in
the peer review process and defamation. The physician plaintiff
subpoenaed hospital records including peer review records. The
hospital objected. the court ruled the records are privileged
under Alabama law, even if it's not a malpractice case.
Plaintiff v Hospital
Hendrix v Bexor County Hospital
Texas 31 SW 3rd 661
Fascinating case. A county hospital was immune
from suit for a sexual assault against the plaintiff by a hospital
employee. The plaintiff was called to an exam room by the employee and
asked to put on a gown with the opening in front, which she did.
The employee then came back in and fondled her breasts in the pretense
of doing an exam. The employee had no privileges to do breast exams. The
Texas Tort Claims Act immunizes governmental agencies from tort
liability. California had a case several years ago where a radiology
technician violated a female patient stating his penis was a vaginal
ultrasound. The hospital was found not liable in that case because the
technician was not acting within the scope of his employment.
Robinson v Health Midwest Development Group
Mo. Ct. App.
Plaintiff was injured in a auto accident with a
patient who received a shot of Compazine. She sued the hospital stating
the medical staff did not warn her not to drive following the shot and
this caused the injuries. The trial court granted summary judgment for
the hospital but this was overturned by the Court of Appeal that stated
that there is a public policy protecting the general public and the
third person could sue even though there was no direct relationship
between the patient and the hospital.
Hospital v Aetna
Charlotte North Carolina
Presbyterian Hospital won a suit against Aetna for
abruptly pulling out of a five year contract. The plaintiff's
economic expert believes the hospital would have been paid an additional
$23 million for the additional two years of the contract. The award
portion of the case will proceed shortly. Aetna states the
hospital suffered no damages.
KC Doctors sue Permanente
Three Kansas City physicians have sued as a class
action Permanente for cheating doctors out of money. The physicians were
shareholders in a Kaiser affiliate, Permanente Medical Group of
Mid-America. The doctors contend that Kaiser intentionally
misrepresented their financial situation at a shareholders meeting in
order to close two clinics and transfer 15,000 patients to another group
of clinics. The suit claims that Kaiser's actions cost them their jobs
and diminished their stock value. The physicians also believe that
Kaiser Kansas City made improper transfers of money to its parent
A patient living in Broward County Florida has sued Jackson Hospital in
Dade County for refusing to do a liver transplant on him. Jackson
refuses all non-emergency Medicaid cases from out of county. The
cost of a transplant is about $250,000. The payment from Medicaid
is about $20,000. In a prior battle regarding heart transplants, the
Florida legislature voted to pay a flat rate of $150,000.
Humphrey v Memorial Hospital Assn.
A medical transcriptionist with OC Disease was
constantly tardy to work. Her work itself was of good quality.
After an accommodation for her disease by flexible start time she
continued to be late. She wanted to work from home but that was
denied due to her disciplinary action. She was then fired and sued
under the ADA. The hospital won summary judgment since she had initially
refused a leave of action to get treatment. The 9th REVERSED
stating there was enough material fact that the hospital did not do
enough to satisfy alternative arrangements. The case now goes back
to the District Court.
Medical Malpractice Shorts
Mejia v Community Hospital of San Bernadino
Misdiagnosis of neck injury by ED resulting in
Fikes v County of Alameda
Pregnant psychiatric technician kicked by improperly
restrained patient causing multiple and permanent injuries to the unborn
An ophthalmologist in Orange County injured
patient doing a LASIK. He left the LASER on too long burning the
corneal flap. The patient needed reconstructive surgery. A
settlement resulted in a $725,000 projected value damage award.
A NC physician who was found not guilty in a medical
malpractice case released a letter to all the physicians in his small
town telling who the jurors were in his case. The jurors sued the
physician and the court of appeal has let the case go forward in the
allegation of obstruction of justice and intentional infliction of
emotional distress. The physician states he only released public
information to his colleagues.
A NJ Appellate Court has allowed patients to add
fraud to their malpractice claims when the physician has falsified
his/her credentials. The question to be put to the jury is a he said/she
said problem. The patient states the physician told him he had
done 60 similar surgeries in the past 11 years and that he was
board-certified. The physician stated he became boarded two years after
the surgery in question and denied he had told the patient any of the
patient's allegations. The court relied on two prior NJ cases in making
it's decision. In Perna v Pirozzi the surgeon didn't operate as
promised but had another person perform the surgery. This was
fraud. The second case Tonelli v Khanna showed that where
consent was obtained by fraud, battery was allowed. As an aside,
fraud and battery are not routinely covered in malpractice policies.
DISCLAIMER: Although this article is updated
periodically, it reflects the author's point of view at the time of
publication. Nothing in this article constitutes legal advice. Readers
should consult with their own legal counsel before acting on any of the