March 1, 2001 Legal News
MD vs. HMO
The Raleigh Pediatric Associates group after dropping Aetna is suing them for $58,000 of past unpaid claims. The charge is that Aetna purposely delays payment to make money on the interest. This is claimed to be unfair and deceptive trade practices. Aetna has paid $100,000 in back owed payments but not the additional $58,000. Raleigh has gone toe to toe with insurers in the past. They dropped their Blue Cross contract for low payment a year ago. Blue Cross recently has contacted Raleigh about a new contract. The Georgia Medical Association filed a similar suit against Aetna last year.
Two medical groups in Connecticut representing 7000 physicians have filed suit against Aetna, Oxford, Cigna, ConnectiCare, and Anthem Blue Cross. The suit charges that the HMOs systematically harmed patients by arbitrarily denying crucial medical treatment and illegally withholding millions of dollars in owed payments. This suit was filed in 11 county courts where the HMOs do business. The suit is filed by the state medical society and five separate suits by five medical groups. The state attorney general is providing help to the physician groups and the AMA also backs the suit. The Connecticut Association of Health Plans stated the suit had more to do with the trial association attorneys than patient care. Anybody believe that?
A Miami judge has allowed the law suit against HMOs to proceed on the issue of breach of contract but denied RICO status. Top
In re Guardianship of Schiavo
The parents of a patient in a persistent vegetative state went to court to obtain guardianship of their daughter in order to stop the husband from discontinuing life support. The trial court ruled in favor of the husband by stating that he had shown by clear and convincing evidence what the patient would have wanted if she could speak. The parents then appealed to the court of appeal and not only lost there but also were told a new trial was not necessary and the treatment could be withdrawn at any time. Top
U.S. v York Obstetrics & Gynecology, P.A.
Following a jury trial verdict for $60,000 against the medical group for failing to provide a sign language interpreter for a patientís husband as required under the ADA, the government asked the Maine District Court for monetary civil penalties. The Court did not award any more money. The government wanted the civil penalties for their legal costs.
In another hearing related matter a deaf patient with severe pulmonary hypertension was airlifted from Texas to Colorado for evaluation for a heart lung transplant. The patient died and the family is suing several hospitals in Texas and Colorado along with several physicians for malpractice and for the secret purpose of using the patientís organs for research without proper consent. This sounds like something out of Robin Cook.
In Iowa, the physicians are not happy campers about the rule requiring professional interpreters. They say they cannot afford to pay the $100 per hour charged by the interpreters. Most of the people involved are on Medicaid. Iowa could receive extra money from the Feds to help pay for the interpreters, but the state has declined. The head of Iowa Medicaid states that the physicians are already paid an amount that is expected to cover their business costs. Is this a regular or extraordinary business cost? I wonder if the state would feel differently if the physicians stopped seeing Medicaid patients. Top
Elder Abuse Reporting
Easton v Sutter Coast Hospital
EMTs removed Mrs. Easton from her sonís home after receiving an order by the sheriffís department. The home health nurse was visiting the Mrs. Easton and reported to the physician at Sutter Coast Hospital Emergency Department that the son and his wife would not take Mrs. Easton to the hospital for treatment of a urinary tract infection. Mrs. Easton was admitted to the hospital for three days and treated for the UTI. She died one-week post discharge. The son and his wife sued everybody for trespass, false imprisonment and negligent infliction of emotional distress. The Eastons lost in both the trial court and the court of appeal. All involved in an elder abuse claim have absolute immunity from prosecution for reporting a potential elder abuse. Hopefully, the attorney that took this case lost a significant amount of out of pocket money and learned that it is public policy is to protect people. Top
MediCal can Not Rely on Audit by Another to Deny Payment
Simonyan v Connell
Simonyan was a DME supplier and under investigation for fraud. An audit of his practice by the state controller showed "willful misrepresentation" and the provider was told that 100 percent of their MediCal payments would be withheld pending investigation. Simonyan sued to force DHS to lift the sanctions and to allow payment. The court ruled that in order for DHS (MediCal) to withhold monies the audit had to be done by them and not another agency, even with an Interagency Agreement. California has a rule that one agency can not delegate administrative decision making. The Court stated that since judgment of parameters of the audit is an administrative decision the audit could not be delegated. The DHS also claimed that the plaintiff had no private right of action against the State. The court stated that under the Civil Rights Act the plaintiffs had private right of action. The court issued an injunction forbidding the Controller from auditing the plaintiff and forbidding the DHS from withholding payment. Top
In 1998 Harper was vice president of the Florida Gulf coast Division of United Healthcare. At that time he found a "sinister pattern" to Floridaís bundling of claims with the use of software called Patterns. The Florida Patterns was set up differently from the rest of the nation. Memos seem to suggest that the Florida set up was how Harperís boss, Dunlap wanted it. After checking the software and finding nothing intrinsically wrong Harper informed the national office that Florida was using Patterns in an illegal manner. Harper was called into Dunlapís office and asked for his resignation. Harper refused and was fired. Harper has now been blackballed by United. United sent out letters stating they would not do business with anyone who employed Harper. Harper filed suit against United and was told he would have to go through arbitration. Harper is now attempting to into court via a state law guaranteeing whistleblowers a right to a trial. Harper is also going to be a prime witness against the HMO industry in a Florida class action suit. The Florida Department of Insurance is also following this action. In the suit are memos stating doctors are too emotionally involved in their work, always passionate about some critical test or getting paid. Executives scorned their heart on the sleeve ranting. Meanwhile, Dunlap is now gone and was replaced by Hoverman. Hoverman recently stated that the companyís revenue increasingly is coming from non-HMO business, like health care videos, consulting and research. He states "there is not any future in being an HMO and I donít want to be part of it." This sounds like the movie "The Insider" with Russell Crowe as the tobacco informer.
In another "whistleblower" action Donald McLendon, the main whistleblower in the HCA suit was awarded $25 million for his efforts. The government collected $745 million from HCA mainly due to the efforts of McLendon.
In yet another whistleblower suit, the Justice Department has just agreed to enter a Qui Tam suit against Tenet. This is not good news for Tenet. The suit alleges Tenet paid physicians in Fort Lauderdale, Florida that worked for the hospital more than fair market value to refer patients to their hospital. Top
Case Name Unknown
The New Jersey Supreme Court ruled January 23, 2001 that a physician doing an exam for a third party must inform the patient about a problem. In this case the chest x-ray showed a possible lymphoma. The physician told the employer and not the patient. The employer never told the patient. Six months later the patient returned to the physician with weight loss and flu symptoms, the physician still did not tell the patient. The patient died a year later. The same decision was reached in California many years ago when the physician for John Manville did not tell the patients about abnormal chest X-rays due to asbestos. This put the physician and the plant into bankruptcy. Top
In the January 15, 2001 legal news I reported on a lawsuit between several Georgia hospitals. Northside Hospital has an exclusive contract to take care of all obstetrics in the north side of Atlanta. Another hospital across the street from Northside is suing under antitrust for part of the patients. Now the Georgia Insurance Commissioner is getting into the act. The Commissioner, who has no direct authority over the hospitals, can use his power over the managed care organizations to help correct the problem. He stated that itís good for HMOs to negotiate discounted rates with hospitals but itís not good for consumers to have to drive halfway across Atlanta. Also the Georgia Insurance Consumer Advocate is now involved and called the exclusive contracts "very detrimental to consumers". I have a feeling that Northside or the managed care organizations will back down soon or have the weight of the state administration and the legislature against them. Antitrust can be very expensive, especially with treble damages. Top
Feds vs. CHW
The Sacramento Business Journal reports that the Feds have now entered a whistleblower case against CHW. This is not a good sign for CHW as the federal intervening is only permissive and they usually donít intervene unless they believe there is a good case with lots of damages. The case involves the filing of false Medicare cost reports by Mercy Healthcare Sacramento. Since the Department of Justice intervened the accusation has spread to 13 hospitals stating they knowingly double and triple charging the Medicare program for the same expenses. The claim by the government is now $20 million. The claim covers 9 years. CHW, if found guilty, is in deeper financial trouble. The fine may be no less than $5000 and no more than $10,000 per false reimbursement claim, no matter what the real damages are. Think about how many Medicare claims CHW filed in the nine years and multiply by $5000 per claim. Then triple the damages. Last week another whistleblower suit against CHW also joined by the government settled, but no amount has been made public as yet. Top
There have been reports of medication problems with the ordering of two chemotherapy agents. The two agents are Taxol and Taxotere. Associated with this are 21 errors in the mixing of Taxotere and the look alike packaging and labeling for Taxol 30 mg and 100 mg. Top
Ramirez v Good Samaritan Hospital
In a Los Angeles Superior Court the plaintiffs won $1,485,000 for a leg compartment syndrome secondary to Cardiac Bypass surgery. The patient had an intra-aortic pump in place postoperatively and complained of pain in his leg. Fifteen hours post surgery the surgeon came to check up on his patient and found the leg to be red and swollen. He diagnosed a compartment syndrome and ordered the patient immediately back to surgery for decompression. The patient did not return to surgery for an additional 21/2 hours. At that time he was found to have significant damage and required many more surgeries with residual damage. The plaintiff contentions included poor charting by the nurses, and failure to assess him on a regular basis. The trial took 12 days and the jury deliberated for nine hours.
Confidential Settlement in Orange County
The plaintiff sued a physician and the physicianís medical group along with a hospital for death secondary to sleep apnea surgery. The patient was diagnosed with sleep apnea and underwent an outpatient UP3 procedure. As part of the procedure and without consent the physician also did a tonsillectomy. Postoperatively his oxygen saturations were low and he was admitted to the hospital. The physician ordered Demerol plus Visteril for the patientís pain as well as continual oxygen saturations. The nurses did not do continual pulse oxyometry. Two days post operative the patient had low oxygen sats and coded. He died the morning of day three. The nurses had removed the pulse oxymeter. The coroner did an autopsy and attributed the cause of death to pulmonary edema due to Demerol intoxication. The plaintiff claimed the hospital did not follow its own protocols regarding checking the patient every four hours and placing the patient in the ICU. The patient also claimed the physician did not explain the non-surgical options for sleep apnea and the Demerol and Visteril order was inappropriate. The case settled for $1 million. Top
Shepard v Doctors Foot Care Clinic
The patient had a painful heel bone growth removed using minimally invasive surgery. Several days after discharge the patient ruptured her Achilles tendon. She claimed the minimally invasive surgery was below the standard of care and caused her injury. The patientís surgery was monitored by flouroscopic control. The podiatrist proved with x-ray evidence that they were not near the area of tendon insertion. The judge tossed the case for lack of evidence. The Podiatrist has countersued the plaintiff, her attorney and the Executive Officer of the California Board of Podiatric Medicine for malicious prosecution.
Kaiser Arbitration Cases
Kaiser won a southern California arbitration case involving a physical therapist alleging a non timely diagnosis of a wrist fracture and the failure to use a long arm cast. Kaiser claimed and won that the use of the long arm cast is optional. Kaiser offered $25,000 and that was refused.
Kaiser did not fare as well in another southern California case. Here, the plaintiff had a breast lump and the mammogram misread by a Kaiser radiologist, who also failed to take magnification views and there was a system failure of referral to a surgeon. Several years later she had metastatic breast cancer. This cost $90,000.
In yet a third southern California case Kaiser lost $271,000 for failure to follow up a patient with a rare brain stem tumor who continued to return multiple times to Kaiser for symptoms. A new MRI was not ordered for follow up for several years. When it was done it showed a large re-growth and she underwent another neurosurgical procedure. She has remained symptom free since the second surgery. Top
Mass. $5.5 Million Dollar Settlement
In a huge pre-trial malpractice settlement Fallon Clinic, St. Vincente hospital and multiple physicians paid out the huge settlement to the family of a 24 year-old woman who went to her HMO for a sore throat and five days later had a massive brain hemorrhage leaving her unable to move or speak. No throat culture had been done and she apparently was passed from physician to physician with no one suggesting hospitalization.
In another bizarre case a baby went to the hospital in North Carolina for diarrhea and dehydration. After an attempted IV where apparently a nurse was squeezing on the bag to make the fluid run, the baby died. An autopsy showed a large air embolism.
BE Careful! There have been lawsuits against Abbott Labs for its hCG-screening tests. There were some women treated mistakenly for trophoblastic tumors when the test came back abnormally high. There were no confirmatory tests done prior to surgery and/or chemotherapy. The suit alleges Abbott failed to prevent the erroneous readings by the addition of a chemical blocking agent. The suit also alleges Abbott know but did not warn of the dangers of the test. Abbott has since sent letters to physicians reminding them to perform confirmatory tests. Top
An Arizona physician and the abortion clinic supervisor were found guilty of manslaughter in the death of an abortion patient. The 75-year-old physician was found guilty after the patient bled to death secondary to a punctured uterus. He could be sentenced to up to 12 years in prison. The supervisor could be sentenced to up to 3 years. The civil suit against the physician and clinic starts in June. As reported in the last issue, the physicianís past was not allowed into evidence in this trial. The physician in the past had an attempted abortion on a 28-week-old fetus thinking it was 10 weeks. The medical board had sanctioned him in the past and had his license revoked in 1998. Top
In the ongoing saga of a New York neurosurgeon who allegedly operated on the wrong side of a brain, had his license revoked and then reinstated continues. The Health Department chief pushed for the voluntary surrender of his license and then imposed an $80,000 fine. Following this the chief held a press conference and did so prior to any hearing. When the hearing was held the neurosurgeon got his license back and no fine. The surgeon filed a defamation suit since the charges were dismissed by the investigation and the health chief did not follow the stateís guidelines that protect privacy of physicians under investigation. The doctor did sign an agreement to give up his license that the state will claim is a waiver of privacy. The waiver is for the state to notify the physicianís hospitals, not hold a press conference. The neurosurgeon was found guilty of gross negligence in one case where he operated on the wrong levels of the spinal cord for disc surgery. Top
In an interesting legal argument an estate of a person who died of smoking related illness was forced to repay the state of Massachusetts $16,000 for her care after the sale of her home. Congress passed a law in 1993 that allowed state reimbursement by estates of Medicaid persons for medical care paid by the state. This is usually done after the person dies and the property is sold. The difference here is the state has already been paid by the Tobacco Settlement of 1998. This, the estate argues is double dipping (being paid twice for the same thing). In a story the following day, the state defended its actions and stated there is nothing in the Medicaid law that prohibits recoupment of money from estates of patients that died of specific diseases such as tobacco. Top
In a Seattle Washington malpractice case a neuropsychiatrist lost a bizarre case of "erasing" a 31year old autisticís mind using drugs and attempting to turn the man into a trained killer. The man ended in a comatose state. The physician, who died last year, had told people that he worked for the CIA and was one of a few people that controlled the planet. The doctor had been diagnosed as bipolar and had his license suspended in 1994 but continued to practice. The insurance company lost $2 million on this settlement. Top
Santana v. Hospital Ryder Memorial
The mother of an infant who died from severe dehydration sued the hospital for non-stabilization and not doing a good faith medical screening exam under EMTALA. The hospital defended on a Puerto Rico statute of limitations of one year for EMTALA claims. The EMTALA law as passed by Congress states the statute is two years. Congress triumphs over state and the suit may go forward. Top
Alabama v Garrett
The U.S. Supreme Court in a 5-4 decision stated that a nurse who sought damages based on alleged discrimination secondary to a disability could not sue the state. The ADA, the high court stated, only goes as far as the Constitution requires. This means where a congressional law (ADA) comes in conflict with the Constitution (11th Amendment), the Constitution wins. Top
Abortion Clinic Rules and the Supreme Court
The Court refused to hear a case from the 4th Circuit that agreed with a South Carolina law requiring rules regulating any office that performs at least five first trimester or one second trimester abortion a month, including the use of RU-486. These rules include the mandatory testing for STD, allowing a state agency to copy and remove patient records and structural changes necessary for offices where abortions are performed, such as door widths, temperature and hourly air exchange rates. Other rules require RNs to assist, and installing alarms in bathrooms. The state and the Appeals Court agreed that these rules were for the welfare of the women seeking abortions. The law applies to no other procedure. This law was passed in 1996 and has never been enforced due to Court challenges. Three physicians doing first trimester abortions have asked for an immediate hearing with a lower court to keep the regs from taking effect until the affected people and clinics can prepare. Some clinics have already made the necessary changes. Tennessee, Louisiana and Texas have also passed similar regulations. Top
Malpractice Awards Making for Higher Premiums
The AMA reports that jury verdicts are higher for the third straight year even though plaintiffs are losing 2% more. Many of these high multi-million dollar verdicts are in states like Pennsylvania where there is no tort reform. The majority of malpractice insurers are planning to raise their rates this year with ranges from 6%- 50% with the average being 15%. The reasons for the increased damages are multiple. A million dollars isnít what it once was, managed care should be punished, sympathy for the patient and a shift in the types of cases that go to trial from mechanical errors at surgery to system and product errors. Top
Cigna has settled a wrongful death suit due to failed hospitalization related to cost pressures. In the Texas case, a patient with a heart condition died in 1997 and may have been saved had she been hospitalized. Documents showed Cardiologists were offered a 10% holdback premium if they contained costs. The contract also contained a gag clause so patients could not find out about the premium
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 information presented.