For The Defense, July 2010 - DRI Today

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M E D I C A L L I A B I L I T Y A N D H E A LT H C A R E L A WOne reason for this strategy is thatplaintiffs’ attorneys may view prevailingas difficult in jury trials of medical liabilityactions. Of medical liability casesthat proceed to jury verdicts, most statisticsshow that health care providers winaround 70 percent of the time. “Severalstudies indicate that a large number ofclaims brought to trial are very weak, inthe estimation of the defense insurers.The largest to date examined a study of976 malpractice verdicts… in which thereviewers found that 10 percent of claimsinvolved negligent care, 11 percent were tooclose to call, and 78 percent involved weakclaims. The strong claims were outnumberedroughly eight to one. Other studieshave shown a 4:1 or 5:1 ratio of weakclaims to legitimate ones, in the view ofdefense insurers.” Jonathan Glauser, AreJuries Biased Toward Physician Defendants?Emergency Medicine News, Oct. 2007,available at http://journals.lww.com/em-news/Fulltext/2007/10000/Are_Juries_Biased_Toward_Physician_Defendants_.29.aspx; See also, TomBaker, The Medical Malpractice Myth 898(Univ. of Chicago Press 2005). The NationalJudicial Center has estimated that plaintiffswon only 36.7 percent of cases in 2002–03.Plaintiffs’ attorneys understand these statistics:“Believe it or not, reputable triallawyers who specialize in litigating malpracticecases do not relish taking everycase to court. Why? Because ‘we’re likelyto lose….” Shirley Grace, The Law: TrialLawyers Tell All, The Advocate (Fla. BarTrial Lawyers Section), Spring 2009, http://www.flatls.org/index.php?option=com_rubberdoc&view=category&id=38&Itemid=60; then follow“Spring 2009” hyperlink.This article offers suggestions on dealingwith these lawsuits, particularly focusingon requesting bifurcation and dealing with“other acts” evidence when representinghospitals and other health care providers.The ProcessA hospital grants credentials and privilegesthrough a detailed process designed to ensurethat a physician has the background,education, training and skill to practicemedicine and perform procedures in thehospital. The Joint Commission defines credentialingas “the collection, verification,and assessment of information regardingthree critical parameters: current licensure;46 n For The Defense n July 2010education and relevant training; and experience,ability, and current competence toperform the requested privilege(s). Verificationis sought to minimize the possibilityof granting privilege(s) based on the reviewof fraudulent documents.” The Joint CommissionAccreditation Manual, MS.06.01.03(2009). Credentialing is “the collection, verification,and assessment of information regardingthree critical parameters: currentlicensure; education and relevant training;and experience, ability, and current competenceto perform the requested privilege(s).Verification is sought to minimize the possibilityof granting privilege(s) based onthe review of fraudulent documents.” TheJoint Commission Accreditation Manual,MS.06.01.03 (2009). See, Nancy E. Gregor,Credentialing Decisions: Keeping the HospitalOff Of the Target List, DRI Medical Liabilityand Health Care Law Seminar (coursematerials) (2009).This peer review process requires a physicianto submit information and a hospitalor health care organization to confirmthe information before the physician canpractice with the institution. All hospitalsmust complete this process because obtainingand keeping Joint Commission or othercertification depends on it, as does billingstate and federal governments and privateinsurers. See, Darling v. Charleston CommunityMemorial Hospital, 211 N.E.2d 253,257 (1965), cert. denied, 383 U.S. 946 (1965)(“The Standards for Hospital Accreditation,the state licensing regulations andthe defendant’s bylaws demonstrate thatthe medical profession and other responsibleauthorities regard it as both desirableand feasible that a hospital assume certainresponsibilities for the care of the patient.”)Negligent Credentialing andPrivileging: Cause of ActionCourts have recognized causes of actionagainst hospitals for negligence in performingthis Joint Accreditation process,finding that hospitals have a duty exercisecare in granting medical staff credentialsand privileges to physicians.In regard to staff privileges, a hospitalhas a direct duty to grant and to continuesuch privileges only to competentphysicians. A hospital is not an insurer ofthe skills of private physicians to whomstaff- privileges have been granted. Inorder to recover for a breach of this duty,a plaintiff injured by the negligence of astaff physician must demonstrate thatbut for the lack of care in the selection orthe retention of the physician, the physicianwould not have been granted staffprivileges, and the plaintiff would nothave been injured.Albain v. Flower Hospital, 553 N.E.2d 1038(Ohio 1990); see also, Johnson v. MisericordiaCommunity Hosp., 301 N.W. 2d 156(Wis. 1981); Ferguson v. Gonyaw, 236 N.W.2d 543 (Mich. Ct. App. 1976).Many courts, applying basic negligenceprinciples, have found a duty on the part ofhospitals to ensure that physicians allowedto practice are qualified and to reasonablymonitor their competence. One courtlumped credentialing and privilegingtogether, referring to credentialing as “thegranting or retention of a doctor’s hospitalprivileges.” St. Luke’s Episcopal Hosp. v.Agbor, 952 SW 2d 503 (Tex. 1997).While hospitals are liable for the acts oftheir agents and employees, they are typicallynot liable for the actions of physiciansprivately employed by patients just becausethey have medical staff privileges. Cross v.Trapp, 294 S.E.2d 446 (W. Va. 1982). However,this rule has myriad exceptions basedon principles of ostensible agency. In Albainv. Flower Hospital, 553 N.E.2d 1038 (Ohio1990), the Ohio Supreme Court stated:A hospital may, in narrowly defined situations,under the doctrine of agencyby estoppel, be held liable for the negligentacts of a physician to whom ithas granted staff privileges. In orderto establish such liability, a plaintiffmust show that: (1) the hospital maderepresentations leading the plaintiff tobelieve that the negligent physician wasoperating as an agent under the hospital’sauthority, and (2) the plaintiff wasthereby induced to rely upon the ostensibleagency relationship.Id. at 1040.Courts have applied principles of ostensibleagency to hold hospitals liable fornegligent emergency room physicians, Torrencev. Kusminsky, 408 S.E.2d 684 (W. Va.1991), Simmons v. Tuomey Regional MedicalCenter, 533 SE 2d 312 (S.C. 2000), fornegligent physicians providing services inwhich the patient had no choice, such asradiology and anesthesiology, Thomas v.
Raleigh General Hospital, 358 S.E.2d 222,225 (W. Va. 1987), and based on advertising.Dolen v. St. Mary’s Hospital, 506 S.E.2d624 (W. Va. 1998). See, Hardy v. Brantley,471 So. 2d 358 (Miss. 1985); Thomas J. Hurney,Jr., Hospital Liability in West Virginia,95 W. Va. L. Rev. 943 (1993); See generally,Annotation, Liability of Hospital or Sanatoriumfor Negligence of Physician or Surgeon,51 A.L.R.4th 235 §5 (1987).A grant of credentials and privileges providesan independent basis of liability, notdependent on an agency relationship. Onceprivileges have been granted, the hospitalmust take reasonable steps to ensure thesafety of its patients if it knows, or shouldknow, that a physician has exhibited a patternof incompetent behavior. Strubhart v.Perry Mem’l Hosp. Trust Auth., 903 P.2d263, 273 (Okla. 1995). Hospitals have beenfound liable for allowing “incompetent”or unqualified physicians to practice aspart of their medical staffs. See, R.K., M.D.v. Ramirez, 887 S.W.2d 836, 838–39 (Tex.1994) (known substance abuse by a physicianmay result in a hospital being foundnegligent); Strubhart v. Perry Mem’l Hosp.Trust Auth., 903 P.2d 263 (Okla. 1995) (physicianwith a pattern of incompetent behavior);Blanton v. Moses H. Cone Mem’l Hosp.,Inc., 354 S.E.2d 455 (N.C. 1987) (unqualifiedphysician allowed to perform surgery);Phelps v. Physicians Ins. Co. of Wisconsin,Inc., 744 N.W.2d 880 (Wis. 2007) (lack ofoversight over inexperienced physician);Longnecker v. Loyola Univ. Med. Ctr., 891N.E.2d 954 (Ill. 2008) (duty to train and supervisephysicians); Fletcher v. South PeninsulaHospital, 71 P.3d 833 (Alaska 2003).In Bost v. Riley, 262 SE 2d 391 (N.C. App1980), the court found North Carolina hospitalshad a duty to properly credential andsupervise physicians:Since all of the above duties which havebeen required of hospitals in North Carolinaare duties which flow directly fromthe hospital to the patient, we acknowledgethat a breach of any such duty maycorrectly be termed corporate negligence,and that our State recognizesthis as a basis for liability apart and distinctfrom respondeat superior. If, asour Supreme Court has stated, a patientat a modern- day hospital has the reasonableexpectation that the hospitalwill attempt to cure him, it seems axiomaticthat the hospital have the dutyassigned by the Darling Court to make areasonable effort to monitor and overseethe treatment which is prescribed andadministered by physicians practicingat the facility.In Schelling v. Humphrey, 916 N.E.2d1029 (2009), the Ohio Supreme Court statedthat hospitals have “a direct duty to grantand to continue staff privileges only to competentdoctors…. [and] a duty to remove ‘aknown incompetent.’” Id. at 1033. Discussingthe elements of a negligent credentialingclaim, the court stated:To prove a negligent- credentialingclaim, a plaintiff injured by the negligenceof a staff doctor must show thatbut for the lack of care in the selectionor retention of the doctor, the doctorwould not have been granted staff privilegesand the plaintiff would not havebeen injured.Id.To prove causation, then, a plaintiff mustdemonstrate that a physician committedmalpractice that injured the patient. Inother words, the malpractice of the physicianis the causal link between the hospital’snegligence in allowing the physician topractice and the injury to the patient. Absenta negligent act by the physician, a plaintiffcannot prove causation to establish thehospital’s negligence in granting credentialsor privileges. See Purcell v. Zimbelman, 500P.2d 335 (Ariz. App. 1972). (“We believe itreasonably probable to conclude that hadthe hospital taken some action against Dr.Purcell, whether in the form of suspension,remonstration, restriction or other means,the surgical procedure utilized in this casewould not have been undertaken by thedoctor and Mr. Zimbelman would not havebeen injured.”); Rodrigues v. Miriam Hosp.,623 A.2d 456 (Rhode Island 1993).Limiting the Admissibilityof “Other Acts” in NegligentCredentialing CasesA key tool in the briefcase of a lawyerdefending against a negligent credentialingclaim is the general inadmissibility inmedical negligence cases of a physician’s“other acts.” Rule 404(b) of the FederalRules of Evidence and its state counterpartsgenerally state that evidence of characterand “other acts” are not admissible toprove an “action in conformity therewith.”In medical negligence trials, Federal Ruleof Evidence 404(b) is typically the basisfor excluding evidence of other lawsuits,disciplinary actions, license suspensions,failure to pass certification examinationsand comparable evidence, including evidenceof a hospital’s credentialing process.Coupled with Rule 404(b) is Federal Ruleof Evidence 403, which states that a courtmay exclude evidence, even if relevant, “ifits probative value is substantially outweighedby the danger of unfair prejudice,confusion of the issues, or misleading thejury, or by considerations of undue delay,waste of time, or needless presentation ofcumulative evidence.” Courts often weighthe admissibility of evidence of “other acts”under both Rule 404(b) and Rule 403.Medical negligence cases may involve awide variety of potentially inflammatoryand prejudicial evidence that plaintiffs mayseek to admit against physicians or otherhealth care providers. However, as long as amedical negligence case stands alone, withoutbeing combined with a negligent credentialingor negligent supervision case,courts largely exclude “other acts” as irrelevantand inadmissible. The position thatdefense counsel should take is that themedical liability case against the physicianshould stand on its own merits, without thecollateral evidence of “other acts,” underthe authority of Federal Rules of Evidence404(b) and 403 or state equivalents, whenapplicable. In the sections that follow wediscuss the major areas of “other acts” thatplaintiffs have attempted to use to establishthe negligence of physicians in “standalone” medical negligence claims.Prior Civil ActionsIn Gray v. Allen, 677 S.E.2d 862, 867 (N.C.Ct. App. 2009), the court affirmed the trialcourt’s decision to exclude evidence of priorlawsuits against the defendant, a physician,in the plaintiff’s malpractice case.Citing Rule 404(b) of the North CarolinaRules of Evidence, the appellate court heldthat prior malpractice suits against thephysician were irrelevant to determiningwhether the physician had been negligentin the case at hand. Id. Moreover, the courtnoted that evidence of prior negligenceactions against the defendant threatenedsubstantial prejudice. Id.For The Defense n July 2010 n 47
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