LukeHodgeDealing_with_Difficult_Physicians.ppt

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Dealing with Difficult Physicians:
Preparing For and Minimizing Trouble
Colin Luke
Leigh Anne Hodge
Jo Moore
November 3, 2009

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Agenda
A. Lessons Learned – Recent Horror Stories
Leigh Anne Hodge 10:00 – 10:40 a.m.
B. Are your Medical Staff Bylaws Up to Date?
Colin Luke 10:40 – 11:10 a.m.
C. Reporting to the National Practitioner Data Bank;
When, Where and How
Jo Moore 11:15 – 12:00 a.m.
D. Responding to Recommendation Requests Regarding
Difficult Physicians
Colin Luke 12:45 – 1:15 p.m.
E. Strategies to Avoid Litigation/Settlement Options
Leigh Anne Hodge 1:20 – 2:00 p.m.
F. Questions and Answers

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Lessons Learned –
Recent Horror Stories
Leigh Anne Hodge

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Butler County physician arrested for more sex crimes
A Butler County physician was arrested Friday by state police and charged with sex crimes involving two male
juveniles.
The doctor, who spent more than two decades serving as a Boy Scout leader in Butler County, was also arrested
in March by state police for earlier sex crimes in which former Scouts were the victims, police said. The Scouts
came forward nearly two decades after the alleged crimes occurred, police said.
Dr. David Allen Evanko, 56, of Butler, surrendered to state police Friday at the Butler barracks on the most
recent charges. He was charged by state police with two counts each of institutional sexual assault, unlawful
contact with a minor, corruption of minors, endangering the welfare of children and indecent assault.
Police said the crimes occurred between April 2008 and March 2009 at Butler Medical Associates on Medical
Center Road in Chicora, Butler County, and at Summit Academy on Herman Road in Summit Township, Butler
County. Butler Medical Associates is a family practice that was operated by Evanko.
Evanko was arraigned before district judge Lewis Stoughton, and he was released on an unsecured $30,000
bond.
Evanko took a voluntary leave of absence from Butler Medical Associates and from the medical staff of Butler
Memorial Hospital after the March arrest.

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Two Sources of Statutory Immunity
• Federal Immunity: Health Care Quality
Improvement Act (HCQIA)
• State Immunity: Alabama Peer Review
Statutes

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HCQIA Grants Qualified Immunity:
• Peer Review Participants
• Entities
• “Engaging in Good Faith Peer Review”
Confers Confidentiality:
• Information reported to the National
Practitioner Data Bank (“NPDB”)

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Health Care Quality Improvement Act (HCQIA)
42 U.S.C. § § 11111-11152
Standards for Professional Review Actions.
In order to have immunity from liability, a professional review
action must be taken –
(1) in the reasonable belief that the action was in the
furtherance of quality health care,
(2) after a reasonable effort to obtain the facts of the
matter,
(3) after adequate notice and hearing procedures are
afforded to the physician involved or after such other
procedures as are fair to the physician under the
circumstances, and
(4) in the reasonable belief that the action was warranted
by the facts known after such reasonable effort to obtain
facts and after meeting the requirement of paragraph (3).
42 U.S.C. § 11112(a).

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HCQIA Notice and Hearing Requirements
Notice of Proposed Action
– Information that a professional review action has
been proposed against the physician.
– Reasons for the review action.
– Physician has right to request hearing.
– Any time limit (not less than 30 days) within
which to request hearing.
– Summary of rights in the hearing.
42 U.S.C. § 11112(b).

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Notice of Hearing
– If physician timely requests a hearing:
– Notice must be given at least 30 days in advance of
hearing.
– Notice must include:
• Place, time, and date of hearing;
• A list of witnesses expected to testify for professional
review body.
42 U.S.C. § 11112(b)(1)–(2).

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Hearing to be conducted by:
– Mutually acceptable arbitrator;
– Hearing officer appointed by the
entity who is not in direct
economic competition with the
physician; or
– Panel of individuals appointed by
the entity and who are not in
direct economic competition with
physician.
• Physician may waive hearing if
he/she fails to appear, absent good
cause.

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• At hearing, physician has the right –
– To be represented by an attorney or
other person of the physician’s
choice;
– To have a record of the proceedings
upon payment of reasonable
charges;
– To call, examine, and cross-examine
witnesses;
– To present evidence; and
– To submit a written statement at the
close of the hearing.

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• Upon completion of the hearing, the
physician has the right -
– To receive a written recommendation that includes
the basis for the recommendation; and
– To receive a written decision of the health care
entity, including the reasons.
42 U.S.C. § 11112(b)(3).

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Adequate Procedures
for Investigations
• Hearing and notice procedures not required if there is
no adverse professional action.
• Hearing and notice procedures not required in the
case of a suspension or restriction of clinical
privileges for 14 days or less, during which an
investigation is being conducted.
• Hospital may at any time take immediate action to
suspend or restrict clinical privileges subject to
subsequent notice and other adequate procedures,
where failure to take action may result in imminent
danger to the health of any individual.
42 U.S.C. § 11112(c).

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For HCQIA Immunity to Apply:
1. Compliance with fairness standards.
2. Adequate notice and a hearing.
3. Members of hearing panel must not be in direct
economic competition with affected physician.
4. Report the results of the review action to the
appropriate authorities in compliance with 42
U.S.C. § § 11131-34.

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Alabama Peer Review Statutes
Alabama Code § § 22-21-8; 34-24-58; 6-5-333
Alabama Peer Review Statutes:
 Protect all records, documents and materials furnished to
peer review committees concerning accreditation or
quality assurance or similar functions.
 Protect all records, documents and materials created by
peer review committees;
 Protect all decisions and actions taken by peer review
committees acted upon in good faith and without malice
on the basis of facts reasonably believed to exist.
 Provide qualified immunity to action of peer review
committee members.

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Exceptions to Privilege / Confidentiality
Under Alabama Peer Review Statutes:
1. Materials can be obtained from their primary
source. Ex: medical records.
2. Information and facts within personal
knowledge of physicians or other individuals
participating on peer review committee.

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Potential Claims Against Hospital
Arising out of
Credentialing & Peer Review
Activities

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Claims by Patients
• Negligent Credentialing
– Public looks to hospital and not individual
physicians for treatment
• ER
• Anesthesiologists
• Pathologists
– Hospital Potentially Liable – Not directly for
malpractice, but for breach of duty to care for patient
• Selecting physicians
• Renewing staff privileges

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Claims by Aggrieved Physicians

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CLAIMS BY HOSPITAL STAFF
HARASSED BY DISRUPTIVE
PHYSICIANS

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• Rebecca, a surgical nurse, filed a suit against Dr. Michael and St.
Vincent’s Hospital. Ms. Farr alleged Dr. Michael gripped her in a bear
hug, held on to her while she thrashed to get away, rubbed his body
against her chest, and actually reached down into her scrub top and
pulled it away from her body so that he could stare down at her chest.
• Previously, at a different hospital, Dr. Michael had taken a staple gun
and stapled a nurse’s forehead and forearm when she angered him.
• Ms. Farr is suing St. Vincent’s for its negligent hiring, training, and
retention of Dr. Michael.

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Moore v. Williamsburg Regional Hospital
(4th Cir. 2009)
(cert. denied by U.S. Supreme Court October 2009)
HCQIA Immunity for hospital and members of peer
review committee that suspended general surgeon over
allegations that surgeon and his wife had sexually
abused adopted teenage daughter.

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(4th Cir. 2009)
• Review of Facts
– Hospital Chief of Staff and Chairman of Medical
Executive Committee learned that Department of
Social Services (“DSS”) had taken surgeon’s three
adopted children into emergency custody based
upon allegations of sexual abuse.
– General surgeon’s practice included adults and
children.
– Hospital summarily suspended privileges.
– Hospital reported suspension to NPDB, because of
“serious allegations of sexual misconduct of minor
child.”

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(4th Cir. 2009)
• Hospital provided hearings, notice, and
upheld summary suspension.
• Months later, DSS dropped charges and
surgeon petitioned for reinstatement of
privileges.
• Hospital did not reinstate. Surgeon would
not authorize the hospital where he had been
practicing to release credentialing
information.

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(4th Cir. 2009)
• Lawsuit
– Defendants: Hospital and Peer Review
Participants
– Damages Claims:
• Intentional infliction of emotional distress
• Tortious interference with business relations
• Breach contract (hospital bylaws)
• Defamation
• Unfair trade practices
• Violation Federal Due Process

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(4th Cir. 2009)
• Holding:
– Hospital prevailed because it complied with
fairness and procedural requirements for HCQIA
immunity.
– Pivotal Issue: Was peer review process a
“professional review action.”
– Court rejected surgeon’s argument that his
conduct was private and not properly the subject
of peer review.
– Nexus between allegations and potential harm to
patients.
– Limits: driving infractions, messy divorces, tax or
financial difficulties - - tenuous or speculative
relation to medical competence.

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Chudacoff v. University Med. Ctr. of S. Nevada
(D. Nev. April 14, 2009)
No HCQIA Immunity For Hospital and Peer Review
Committee Members For Failure to Comply with Notice
and Hearing Requirements.

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(D. Nev. April 14, 2009)
Facts:
5/28/08: By letter, Hospital MCC notified Dr.
Chudacoff, OB-Gyn, of suspension and
ordered drug testing and physical and
mental examinations. Dr. had no notice of
proposed action or the reasons for the action.
6/2/08:Counsel for Dr. requested hearing.
6/16/08: Hospital filed NPDB report: privileges
suspended for substandard or inadequate care.
6/18-20/08: Dr. lost privileges at other facilities due to NPDB
Report.
6/23/08: Dr. obtained medical record numbers for patients
in NPDB Report.

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(D. Nev. April 14, 2009)
7/2/08: Dr. filed lawsuit for damages and injunctive relief,
alleging violation of Due Process rights. Still no
response to request for Fair Hearing.
7/18/08: Hospital MEC informed Dr. that Fair Hearing set for
9/11/08.
9/5/08: MEC disclosed list of witnesses, but no information
about nature of testimony.
9/11/08: At hearing, Dr.’s attorney not allowed to present
evidence, question witnesses, or participate in
hearing. In addition to substandard care allegations,
Fair Hearing Committee addressed discrepancy on
Dr. application to join staff.

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(D. Nev. April 14, 2009)
10/1/08: Fair Hearing Committee decision. Disagreed with
suspension, but recommended peer review.
Indicated that concern about application would be
addressed to MEC with appropriate action.
10/28/08: MEC hearing to consider Fair Hearing Committee
recommendations.
11/7/08: MEC decision by two letters: (1) Adopted Fair
Hearing Committee recommendation of peer review;
(2) Suspended privileges pending revocation for
material misrepresentations on application.
Unknown: Dr. requested Fair Hearing on suspension for
application.

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(D. Nev. April 14, 2009)
11/25/08: Dr.’s attorney given 3-hour notice of MEC meeting
to discuss discrepancy in application. One hour
after meeting, MEC informed Dr. that it was
suspending privileges.
11/25/08: Dr. appeal substandard care issues.
Early 2009: Board sided with Dr. and awarded Dr. $10,000
for costs and fees. Board also opined there was a
need to re-write reporting policies to allow
procedural due process before suspension.

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(D. Nev. April 14, 2009)
Holding: Lessons Learned
1. Privileges revoked without any notice to Dr. that privileges
were in jeopardy.
2. Hospital reported suspension to NPDB before Dr. had
opportunity to be heard.
3. Failure to comply with procedural requirements results in
loss of HCQIA immunity and potential liability for
damages.

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Poliner v. Texas Health Systems
(5th Cir. 2008)
$366 Million Damages Award to physician
reversed by appeals court. Hospital and Peer
Review Committee Member entitled to
HCQIA immunity where Hospital complied
with HCQIA, notwithstanding failure to
comply with Hospital Bylaws.

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(5th Cir. 2008)
Facts:
• Dr. Poliner, cardiologist, was granted temporary
privileges at Hospital in 1996 and obtained full
privileges in October 1997. However, questions about
quality of care began to arise in September 1997
following a patient death after procedure in cath lab.
• Dr. Poliner’s cases were under review by Clinical Risk
Review Committee (“CRRC”) when, on May 12, 1998,
he misdiagnosed a patient and performed angioplasty
to wrong artery, leaving the blocked artery
untouched.

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(5th Cir. 2008)
• The next day, on May 13, 1998, Dr. Knochel, head of
Department of Internal Medicine, requested Dr.
Poliner to agree to “abeyance” for fourteen days to
allow investigation. Hospital Bylaws required
consent.
• Dr. Knochel told Dr. Poliner that if he refused to
agree to abeyance, he would suspend privileges.
• Dr. Knochel testified at trial that at time of
compulsory abeyance, he did not have enough
evidence to determine if Dr. Poliner was a present
danger to patients.
• On June 12, Hospital suspended Dr. Poliner’s
privileges.

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(5th Cir. 2008)
Issue:
• Damages at trial based solely on forced abeyance of
May 13, 2009.
• Jury found no agreement as required by Hospital
Bylaws.
• Jury found abeyance did not meet HCQIA standards
for 14 day suspension in case of health emergency
because Dr. Knochel testified that he did not have
enough information to determine if Dr. Poliner was a
present danger.

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(5th Cir. 2008)
Holding:
(1) HCQIA immunity applied.
(2) 14 day HCQIA requirement satisfied - decision
made before May 14 even though Hospital did
not request Poliner’s consent to extension of
abeyance until day 15.
(3) Hospital met “imminent danger” standard
based upon CRRC’s determination that Poliner
had provided substandard care in half of cases
reviewed plus seriousness of mistake in clinical
judgment resulting in misdiagnosis and error in
treatment of patient the day before the abeyance.

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(5th Cir. 2008)
(4) HCQIA “reasonableness requirements” were
intended to create objective standard of
performance, rather than subjective good faith
standard.
(5) Focus of reasonableness standard is not whether
peer review committee’s decisions were correct
or even whether peer review committee had bad
motives. Instead, focus should be on whether
decision was reasonable based upon facts known
at that time.

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(5th Cir. 2008)
Lessons Learned:
1. Be diligent about time limitations for
emergency suspensions.
2. Emergency suspensions based upon
“imminent danger” must be based on
reasonable belief and based upon facts.

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Adkins v. Christie (11th Cir. 2007)
• No HCQIA privilege for documents relating to
medical peer review proceedings in federal
employment discrimination cases.
• The court emphasized that the privilege must be
considered against a corresponding and overriding
goal – the discovery of evidence essential to
determining whether there has been discrimination
in employment. The documents that the Hospital
seeks to protect are the very documents that Adkins
needs to prove his discrimination claims.

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ALABAMA PEER REVIEW
STATUTE CASES

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Ex parte Fairfield Nursing and
Rehabilitation Center, L.L.C. (Ala. 2009)
Holding: Incident reports and witness statements were
privileged, notwithstanding the fact that they were
not created by a peer review or quality assurance
committee, where medical center established that
reports and statements:
1. Are not kept in ordinary course of business;
2. Such documents do not become a part of a patient’s
medical chart; and
3. Reports and witness statements are created for
quality assurance purposes.

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Ex parte St. Vincent’s Hospital v. Anesthesia
Services of Birmingham (1994)
Holding: Letter in possession of Hospital Infection Control
Committee not privileged.
• Zeneca, Inc. and St. Vincent’s were codefendants in a medical
malpractice/products liability action.
• St. Vincent’s filed a cross-claim against Zeneca alleging that
Zeneca failed to warn St. Vincent’s of the dangers associated
with using the scrub, Hibiclens.
• The plaintiff, a patient of St. Vincent’s, was injured when
Hibiclens got into his eye during surgery because the medical
staff used the scrub on his face.

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Ex parte St. Vincent’s Hospital v. Anesthesia
Services of Birmingham (1994)
• Zeneca sought discovery of a letter in possession of the
Infection Control Committee. Zeneca sent the letter to
St. Vincent’s several months before the accident, warning
St. Vincent’s that the scrub should not be used around
the face or eyes.
• St. Vincent’s refused on the grounds that the letter was
privileged under Alabama Peer Review Statutes.
• The Supreme Court of Alabama held that the letter was
not privileged.
• The court concluded that St. Vincent’s failed to show that
the Infection Control Committee served as either a
utilization review committee or that the Committee
served as accreditation or peer review function.

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Ex parte Burch (Ala. 1999)
Holding: Physician participant of peer review
committee prohibited from testifying about
statements made by affected physician to Peer
Review Committee for purpose of impeaching
testimony.
Facts
• Surgeon and hospital were named as defendants in medical
malpractice / wrongful death suit.
• As a result of patient’s death, hospital’s Surgery Committee held
a special meeting to review surgeon’s performance in case
leading to patient’s death.
• During discovery in lawsuit, surgeon’s deposition testimony
conflicted with what he told Surgery Committee.

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Ex parte Burch (Ala. 1999)
• Dispute centered on what hospital staff
communicated to surgeon about patient’s condition.
• Hospital wanted to offer testimony of Head of
Surgery Committee for purpose of impeaching
surgeon’s trial statement.
• Head of Surgery Committee had no knowledge of
incident, other than what he learned in Committee
meeting.
• The Court refused to allow the Head of the Surgery
Committee to offer testimony to impeach surgeon on
the grounds that such information was privileged
under Alabama Peer Review Statutes.

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Ex parte Cryer (Ala. 2001)
Holding: Handwritten notes of physician made in
preparation for meeting with physician
shareholders of a private medical practice not
privileged by Alabama Peer Review Statute.

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• Mr. and Mrs. Cryer filed suit against Dr. Corbett and her
employer, Mobile Ob-Gyn (“MOG”) claiming the defendants
negligently cared for the Cryer’s infant during labor and
delivery, and that as a result, the infant died.
• The Cryers sought damages against MOG alleging negligence in
hiring and retaining Dr. Corbett.
• Dr. Corbett refused to disclose handwritten notes she made in
preparation for a meeting with the physician shareholders of
MOG.

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• The Supreme Court of Alabama held that the handwritten
notes did not constitute part of the peer-review process, and
thus fell outside the scope of § 22-21-8. The Court concluded
that the written statement was made in preparation for a
meeting to discuss job performance.
• Shareholder physicians of a private corporation do not qualify
as “medical staff” under Alabama Peer Review Statutes.

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Lessons Learned from Recent Cases:
1. Provide adequate notice and hearing procedures.
2. Physicians win in the courtroom – and win big – if
the hospital fails to provide adequate notice and
hearing procedures.
3. Avoid allowing a physician in direct economic
competition with affected physician to serve on
committee.

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Lessons Learned
4. Incident reports and witness statements should
never become a part of the patient’s medical record.
5. Peer review and quality assurance discussions, and
activities must remain confidential to guard
privilege and qualified immunity.

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Are your Medical Staff Bylaws Up to Date
For Dealing With Difficult Physicians?
Colin Luke
Presentation to Alabama Hospital Association
November 3, 2009

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Medical Staff Bylaws…
• Can be the “First Line of Defense”
if they are well written;
• Will be Used Against the Hospital
by Troublesome Physicians;
• Create a Contract between the
Hospital and each member of the
medical staff;
• Must be Followed Uniformly and
Precisely.

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The Health Care Quality Improvement Act of 1986
Requires the following for Professional Review Actions:
1. Notice of Action:
• that a professional review action has been proposed to be
taken against the practitioner and the reasons for the
proposed action;
• that the practitioner has the right to request a hearing on
the proposed action and a time period, of not less than 30
days, within which to request such a hearing, and
• a summary of rights in the hearing.
2. If a hearing is requested on a timely basis, the
practitioner involved must be given notice stating:
• the place, time, and date of the hearing, which shall not be
less than 30 days after the date of the notice:
• a list of the witnesses, if any, expected to testify at the
hearing on behalf of the professional review body.

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3. If a hearing is requested on a timely basis:
• the hearing shall be held, before a panel of
individuals who are appointed by the entity and are
not in direct economic competition with the
practitioner involved;
• the practitioner has a right to representation;
• the practitioner has a right to have a record made of
the hearing;
• the practitioner has a right to call, examine and
cross-examine witnesses;
• the practitioner has a right to present evidence; and
• the practitioner has a right to make a written
statement at the close of the hearing

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4. Upon completion of the hearing:
• The practitioner has a right to receive a written copy of
the decision of the panel with a statement of why it was
made;
• The practitioner has a right to receive a written copy of
the final decision of the health care entity with a
statement of why it was made.

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JOINT COMMISSION HOSPITAL
ACCREDITATION STANDARD:
MS.01.01.01 requires the Medical Staff Bylaws to address:
(a) Appointment and reappointment of medical staff membership
and clinical privileges;
(b) Suspension of clinical privileges and memberships;
(c) The process of investigations and fair hearings; and
(d) The composition of the hearing committee.

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ADDITIONAL JOINT COMMISSION
REQUIREMENTS:
Ongoing Professional Practice Evaluation (OPPE)
• OPPE is achieved through routine monitoring of current
competency for current Medical Staff members through
systematic data collection and evaluation.
• The OPPE information is factored into the decision to
maintain an existing privilege, to revise an existing
privilege, or to revoke an existing privilege to or at the
time of re-appointment.

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ADDITIONAL JOINT COMMISSION
REQUIREMENTS:
Focused Professional Practice
Evaluation
• A process whereby the organization evaluates
the privilege-specific competence of the
practitioner who does not have documented
evidence of competency performing the
requested privilege.
• This process may also be used when a
question arises regarding a currently
privileged practitioner’s ability to provide
safe, high quality care.

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The Top 10 Most Important Things
to Include in Your Medical Staff Bylaws:
1. Credentialing Process:
- Release of Liability
- Burden on Applicant
- References
- Gaps in History
- Retain Element of Subjectivity
- Probationary or “Associate”
Status

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2. Call Responsibilities:
- Emergency Room
- Consulting Responsibilities
- Timeframe for Response
- Ability to Refuse Call
3. Summary Staff Suspension
- How Initiated
- Clear Grounds for Invoking
- How Long it Can Last
- Appeal Rights

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4. Exclusive Contract Provisions
- Which Departments
- Automatic Termination of Privileges if
Contract is Terminated
- No Appeal Rights
5. Participation by Competing
Physicians
- Definition of Competition
- Provisions for Outside Appointments
- Limits on Ability to Influence the
Process
- Allow Use of Outside Reviewers

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6. Clear Parameters for
Informal Investigations
7. Procedures for Single
Hearing after MEC
makes its
Determination
The Top 10 Most Important Things to
Include in Your Medical Staff Bylaws:

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8. Appeal Process After Hearing.
• Single Appeal
• Limited Review without New
Information
• Short Time Frame for
Decision
• Automatic Denial if Physician
Does Not Participate

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9. Databank Reporting.
• Mandatory Timeframe for
Submission
• No Approval Rights by
Practitioner

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10. Reappointments and
Suspensions
– No Automatic
Reappointments
– Mandatory Release
– Requirement of
Additional Information
The Top 10 Most Important
Things to Include in Your Medical
Staff Bylaws:

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Reporting Requirements to the
National Practitioner Data Bank
By Jo Moore

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Creation of the National Practitioner
Data Bank (“NPDB”)
The Health Care Quality Improvement Act of
1986 (the “Act”)
• Final Regs published in Fed Reg Oct. 17, 1989
• Codified at 45 CFR Part 60
• US Dept. of Health & Human Services is
responsible for implementation
• NPDB opened Sept. 1990

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Specific Concern
• Congress believed that physicians and
dentists were unreasonably discouraged from
participating in effective peer review due to
potential personal liability arising from peer
review participation.
• Through the Act, Congress provided incentive
and protection for physicians engaging in
effective professional peer review.

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Incentive and Protection - Immunity
• Hospitals and other entities subject to the Act
are immune from private damages in civil
suits under Federal and State law where the
professional review action is conducted:
• With the reasonable belief of furthering the quality
of health care and with proper regard for due
process (typically governed and provided by
Hospital medical staff bylaws).
• This immunity is extended to reporting to the
NPDB.

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Creation of the NPDB
• Is an information clearinghouse relating to the
professional competence and conduct of
physicians, dentists and certain other health
practitioners
• Meant to serve as a resource to assist State
licensing boards, Hospitals, and other health
care entities in conducting independent
investigations of the qualifications of the
healthcare practitioners they seek to license,
hire or grant clinical privileges

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Purpose of the NPDB
“To improve the quality of healthcare by
encouraging State licensing boards,
Hospitals, and other healthcare entities and
professional societies to identify and
discipline those who engage in
unprofessional behavior and to restrict the
ability of incompetent physicians, dentists and
other practitioners to move from State to
State without disclosure or discovery of
previous medical malpractice payment and
adverse action history.”

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NPDB Reporting Statistics
• As of September 30, 2006, there were a total of
403,310 reports on 235,942 practitioners since the
inception of the NPDB
– 73% malpractice payments
– 15% licensure actions
– 4% adverse clinical privileges actions
– 8% exclusion actions
• The NPDB is encouraging use of the NPDB and
increasing its enforcement actions
– Form letters have been sent to Hospitals and other
healthcare entities with no or few queries/reports to the
NPDB reminding those Hospitals of their NPDB obligations.

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Reporting to the NPDB
The following entities must report information to the
NPDB:
• An entity that makes a medical malpractice payment
• A board of medical examiners or a state licensing
board taking an adverse action against a physician or
a dentist
• A professional society that has a peer review process
and qualifies as a “health care entity” which takes an
adverse membership action as a result of
professional review
• A health care entity that takes an adverse clinical
privileging action as a result of professional review

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• Medical malpractice payments made on
behalf of a physician
• Adverse clinical privilege actions taken by the
Hospital
Hospitals Are Required to Report to
the NPDB

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Reporting Medical Malpractice
Payments
• A Hospital must report to the NPDB all payments for
the benefit of a physician or other healthcare
practitioner in settlement of, or in satisfaction in whole
or in part of, a claim or a judgment demanding
monetary damages against the practitioner.
• A Hospital must also report the payment to the
appropriate state licensure board.

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NPDB’s Interpretation of Medical
Malpractice Information
“[A] payment in settlement of a medical
malpractice action or claim shall not be
construed as creating a presumption that
medical malpractice has occurred.”
NPDB Regulations 60.7(d)

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When Appropriate to Report
• Where the Hospital pays a malpractice payment on
behalf of physician who is named in the complaint or
claim and also named in the settlement, release or
final adjudication
• Where the Hospital refunds a practitioner fee due to a
written complaint or claim demanding monetary
damages against the physician
• Where the Hospital pays loss adjustment expenses
(legal fees and costs) as part of the medical
malpractice payment

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Not Reportable
• An individual person, who out of personal funds,
makes a medical malpractice payment on his or her
own behalf of on another’s behalf
• Malpractice payments made solely for the benefit of a
business entity such as a clinic, group practice, or
Hospital
• Medical malpractice payments made on behalf of
unlicensed student providers
• Dismissal of physician prior to the settlement or a
judgment
• Inclusion of a physician in a settlement agreement
who was not named in the complaint or claim

93
Table E-2. Medical Malpractice Payments Determining Reportable
Action NPDB Reporting Responsibility
A malpractice settlement or court judgment includes
stipulation that the terms are kept confidential
Must file report.
Malpractice settlement is structured so that claimant receives
an annual sum for each year he or she is alive
Report the initial payment after NPDB opening; identify as
multiples payments.
Malpractice settlement involves five practitioners. Must file a separate report on each of the five practitioners.
Payment is made based only on oral demands. No report is required.
Payment made by an individual. A professional corporation or other business entity comprised
of sole practitioner must file a report. No report is required for
an individual making payment out of personal funds.
Payments made for corporations and hospitals. Payments made for the benefit of a corporation such as a clinic
group practice or hospital are not currently reportable.
Payment is reportable when made for business entities
comprised of sole practitioners.
Payments made for licensed residents and interns. Must file report.
Practitioners fee refund. Must file report of refund is made by an entity (including so
incorporated practitioners). No report is required if refund is
made by an individual.
Dismissal of defendant from lawsuit. No report required if defendant is dismissed prior to settlement
or judgment. Report is required if dismissal results from
condition in settlement or release.

94
Time Period to Report Medical
Malpractice Payments
Within 30 days that the payment is made
• If multiple payments made, 30 days from the
date of the first payment.

95
Penalties for Failure to Report
Medical Malpractice Payers
• Civil money penalty of up to $11,000 for each
payment not reported.
• If the Hospital has failed to report, the failure
will be printed in the Federal Register and the
Hospital will lose its immunity for professional
review activities for three years.

96
Reporting Adverse Clinical
Privileges Actions
• Hospitals must report adverse clinical
privileges actions based upon a physician’s
professional competence or professional
conduct that adversely affects, or could
adversely affect, the health or welfare of a
patient.
• Only applies to physicians
• The Hospital may but is not required to report
adverse clinical privileges actions taken against
other health care practitioners (i.e. CRNA or nurse
practitioner)

97
Adverse actions based on the practitioner’s
professional competence or professional
conduct include:
• Reducing, restricting, suspending, revoking, or
denying privileges
• Hospital’s non-renewal of privileges or denial of
expansion of clinical privileges
• Physician’s non-renewal or withdrawal of clinical
privileges while under investigation.

98
“Investigation”
• Not defined by the Act
• Case law and the NPDB Guidebook provide that
there is an “Investigation” if
– Investigation is carried out as a precursor to a professional
review action
– Investigation is carried out by the Hospital, not an individual
– There is written evidence (minutes, notices, or orders) that
an investigation was initiated at the time of the physician’s
resignation or non-renewal.
– Investigation complies with the medical staff bylaws
– Investigation focuses on the specific physician and is not
routine

99
Adverse Clinical Privilege actions do not
include:
• Censures, reprimands or admonishments
• Adverse actions relating to the physician’s
business practices rather than patient care
– For example, adverse actions relating to the physician’s
advertising practices, fee structure, salary arrangement,
or competitive business acts are not reportable.
• Denial of clinical privileges relating to eligibility

100
Adverse Clinical Privileges Action
NPDB Rules specify that Hospitals and other health
care entities must report
• Professional review actions that adversely affect a
physician’s clinical privileges for a period of more than 30
days.
• Acceptance of a physician’s surrender or restructure of
clinical privileges while under investigation by the entity for
possible professional incompetence or improper professional
conduct or in return for not conducting an investigation on
professional review action.
• Summary suspension of physician based upon professional
competence or conduct for more than 30 days by Hospital.

101
Table E-3. Determining Reportable Actions for Clinical Privileges
Action Reportable
Based on assessment of professional competence, a proctor is assigned to a physician or dentist for a period of more than 30 days. The
practitioner must be granted approval before certain medical care is administered.
Yes
Based on assessment of professional competence, a proctor is assigned to supervise a physician or dentist, but the proctor does not
grant approval before medical care is provided by the practitioner.
No
As a matter of routine hospital policy, a proctor is assigned to a physician or dentist recently granted clinical privileges. No
A physician or dentist voluntarily restricts or surrenders clinical privileges for personal reasons; professional competence or
professional conduct is not under investigation.
No
A physician of dentist voluntarily restricts or surrenders clinical privileges; professional competence or professional conduct is under
investigation.
Yes
A physician or dentist voluntarily restricts of surrenders clinical privileges in return for not conducting an investigation of professional
competence or professional conduct.
Yes
A physician’s or dentist’s application for medical staff appointment is denied based on professional competence or professional
conduct.
Yes
A physician or dentist is denied medical staff appointment or clinical privileges because the health care entity has too many specialists
in the practitioner’s discipline.
No
A physician’s or dentist’s clinical privileges are suspended for administrative reasons not related to professional competence or
professional conduct.
No
A physician’s or dentist’s request for clinical privileges is denied or restricted based upon assessment of clinical competence as defined
by the hospital.
Yes

102
Within 15 days from the date the adverse
action was taken or clinical actions were
voluntarily surrendered
Time Period to Report an Adverse
Clinical Privilege Action

103
Adverse Clinical Privileges Action
Reporting to State Licensure Board
• Must also mail a copy of the report sent to the
NPDB and NPDB verification of receipt to the
appropriate state licensure board

104
Penalty for Failure to Report Adverse
Clinical Privilege Actions
• HHS will conduct an investigation
• Hearing rights are offered to the Hospital
• If the Hospital has failed to report, the failure
will be printed in the Federal Register and the
Hospital will lose its immunity for professional
review activities for three years.

105
Reporting Requirements Under
Alabama Law
• The CEO of each Hospital must report to the Alabama State
Board of Medical Examiners any disciplinary action taken
concerning any physician when the action is related to
professional ethics, negligence or incompetence in the practice
of medicine, moral turpitude, sexual misconduct, abusive or
disruptive behavior, or drug or alcohol abuse. Disciplinary action
shall include termination, revocation, probation, restriction,
denial, failure to renew, suspension, reduction, or resignation of
Hospital privileges for any of the above reasons.
• The report must be in writing and be made within 30 days of the
date of the action.
• Failure to file a report may in the State Board of Health's
discretion, result in a civil monetary penalty in an amount not to
exceed $2,500.00 for each violation.
Ala. Code § 34-24-
59

106
Section 1921 of the Social Security
Act
• Section 1921 expanded the government’s
authority to collect information concerning
sanctions taken by State licensing authorities
against health practitioners.
• To date, final rules have not been
promulgated, but Section 1921 will require
Hospitals and healthcare entities to report all
adverse actions (not limited to conduct and
competence) to the NPDB

107
Queries to the NPDB
A Hospital must request information from the NPDB
• When a physician or other healthcare practitioner
applies for medical staff appointment or clinical
privileges (including courtesy, non-clinical, or
temporary)
• Every two years thereafter on all physicians or other
healthcare practitioners who are on the medical staff
(including courtesy, non-clinical, or temporary) or who
hold clinical privileges
• To add or expand existing staff or clinical privileges of
a physician or other health care practitioner.

108
• Hospital’s queries are not limited by these mandatory
requirements. In addition to these mandatory
requirements, Hospitals may query about a
physicians or other healthcare practitioner at any
time.
• In 2007, the NPDB launched its Proactive Disclosure
Service (PDS) which allows the Hospital to receive
any new reports of the Hospital’s physicians within
one day of the filing of the report. Participation of the
Hospital in PDS satisfies the Hospital’s query
requirement for its existing physicians and other
practitioners.
Queries Cont’d

109
Penalties for Failure to Query
• Results in a presumption that the Hospital
knew the information provided by the NPDB
which can be detrimental to the Hospital.

110
Resources
The NPDB Website
www.npdb-hipdb.hrsa.gov
The NPDB Guidebook
www.npdb-hipdb.hrsa.gov/pubs/gb/
NPDB_Guidebook.pdf

113
Responding to Recommendation Requests
Regarding Difficult Physicians
Colin Luke
Presentation to Alabama Hospital Association
November 3, 2009

114
Key Points to Remember:
• You do not have to complete the
recommendation form.
• If you complete the reference or
recommendation form, it must be accurate
and complete.
• Do not allow references to be submitted
without appropriate review.
• Do not allow the requesting physician to
review the response or to submit a suggested
response.

115
Kadlec Medical Center v.
Lakeview Anesthesia Associates (“LAA”)

116
• Kadlec Medical Center, in Richland, Washington, brought suit
against LAA, the LAA shareholders, and Lakeview Regional
Medical Center (“defendants”) because they failed to disclose
Dr. Berry’s on-duty use of narcotics in response to Kadlec’s
reference request.
• Dr. Robert Berry, an anesthesiologist and former shareholder of
LAA, worked at Lakeview Medical until he was caught using
Demerol at work. He failed to answer a page while on-duty at
the hospital and he was discovered in the call-room, asleep,
groggy, and unfit to work. He was fired soon thereafter.

117
• After being terminated by Lakeview
Medical and LAA, Dr. Berry sought
work at Kadlec Medical Center through
Staff Care.
• Upon receiving his application, Kadlec
began its credentialing process and
examined a variety of materials,
including referral letters from LAA and
Lakeview Medical.
• LAA’s Dr. Preau and Dr. Dennis, two
months after firing Dr. Berry for his
on-the-job drug use, submitted referral
letters for Dr. Berry to Staff Care, with
the intention that they be provided to
future employers.

118
• The letter from Dr. Dennis stated that he had worked with Dr.
Berry for four years, that he was an excellent clinician, and that
he would be an asset to any anesthesia service.
• Dr. Preau’s letter said that he worked with Berry at Lakeview
Medical and that he recommended him highly as an
anesthesiologist.
• Dr. Preau’s and Dr. Dennis’s letters were submitted on June 3,
2001, only 68 days after they fired him for using narcotics while
on-duty and stating in his termination letter that Dr. Berry’s
behavior put “patients at significant risk.”

119
• Kadlec also sent Lakeview Medical a request for credentialing
information about Dr. Berry. The request included a detailed
confidential questionnaire, a delineation of privileges, and a signed
consent for release of information.
• Lakeview Medical responded to the requests for credentialing
information about 14 different physicians. In 13 cases it responded
fully and completely to the request; however, the response concerning
Dr. Berry was handled differently. Lakeview Medical drafted a short
letter that stated:
This letter is written in response to your inquiry regarding [Dr. Berry].
Due to the large volume of inquiries received in this office, the following
information is provided.
Our records indicate that Dr. Robert L. Berry was on the Active
Medical Staff of Lakeview Regional Medical Center in the field of
Anesthesiology from March 04, 1997 through September 04, 2001.
If I can be of further assistance, you may contact me at (504) 867-4076.

120
• Kadlec then credentialed Dr. Berry, and he began working there.
• Shortly thereafter, Dr. Berry was in a car accident
and suffered a back injury. After the accident, nurses
began to notice he appeared sick and exhibited mood
swings.
• Several months later, Dr. Berry gave a patient too
much morphine during surgery, and she had to be
revived using Narcan. The neurosurgeon was irate
about the incident.
• The letter did not disclose LAA’s termination of Dr. Berry; his on-duty drug
use; the investigation into Dr. Berry’s undocumented and suspicious
withdrawals of Demerol that “violated the standard of care”; or any other
negative information.

121
• On November 12, 2002, Dr. Berry was assigned to the operating
room beginning at 6:30 a.m. He worked with three different
surgeons and multiple nurses well into the afternoon.
• According to one nurse, Dr. Berry was “screwing up all day” and
several of his patients suffered adverse affects from not being
properly anesthetized.
• Kimberley Jones was Dr. Berry’s fifth patient that morning. She
was in for what should have been a routine, fifteen minute tubal
ligation. When they moved her into the recovery room, one
nurse noticed that her fingernails were blue, and she was not
breathing. Dr. Berry failed to resuscitate her, and she is now in
a permanent vegetative state.

122
• Dr. Berry confessed he had been using Demerol since his
car accident and that he had become addicted to Demerol.
• Jones’ family sued Dr. Berry and Kadlec, and both Dr.
Berry’s and Kadlec’s insurers settled the claims.
• In this case, Kadlec and its insurer have filed suit against
LAA, Dr. Dennis, Dr. Preau, Dr. Parr, and Lakeview
Medical alleging intentional misrepresentation, negligent
misrepresentation, strict responsibility misrepresentation,
and general negligence.

123
• In the lower court, a jury found Lakeview Medical and the three
shareholders/doctors of LAA liable. The court held that, in order to
protect future patients of an impaired physician, Lakeview Medical and
its physicians had a duty to disclose Dr. Berry’s impairment to a second
hospital where the physician relocated and applied for privileges.
• On appeal, the Fifth Circuit Court of Appeals held that:
– the defendants, after choosing to write referral letters, assumed a
duty not to make affirmative misrepresentations in the letters.
– the doctors’ reference letters were misleading, while the letter from
Lakeview Medical was not.
– the defendants had no affirmative duty to disclose negative
information about Dr. Berry in their referral letters.
– Lakeview Medical did not breach any duty owed to Kadlec, and
therefore the judgment against it was reversed.

124
Additional Pointers:
• Do not feel the need to stay within the form
used for the reference request;
• Do not respond to verbal requests for
references or provide information via email or
telephonically;
• Confirm every answer made with
documentation in file; and
• Do not rush to complete the reference request
and do have it reviewed before it is submitted.

126
Strategies to Avoid
Litigation/Settlement Options

128
“MOTIVATED BY CONCERN ABOUT THE
PATIENT”
Hospital receives a complaint about Physician A
from Physician B who competes with Physician A.
Physician A was reported to have approached patient in
hospital bed to tell patient that patient’s primary care
physician, Physician B, was no longer accepting
Medicaid patients because Physician B was only
concerned about money. Since Physician A was
“motivated by concern about the patient”, Physician A
was willing to accept responsibility for the patient and
move the patient over to his service. Patient moved over
to Physician A.

129
“EVERYONE NEEDS A LITTLE HELP”
Hospital nursing supervisor received complaints
from three operating room nurses regarding new
Surgeon X. These nurses alleged that Surgeon X was
not familiar with even the most basic operating room
supplies and asked them to download and read out loud
instructions from the internet during a surgical
procedure. Surgeon X reportedly asked the operating
room nurses several questions about what to do next
during operating room procedures. As part of a routine
review for new physicians, Surgeon X was found by an
outside reviewer to have violated the standard of care
during several surgical procedures. Surgeon Y, the only
other surgeon in Surgeon’s X’s specialty on the medical
staff, refuses to participate in the peer review process.

130
“I CAN’T BE EVERYWHERE AT ONCE”
Physician 1, the hospital’s only neurosurgeon,
receives a consult request from hospital for an inpatient
in serious condition in the ICU. Physician 1 learns that
request for consult was initiated by Physician 2 who was
his former partner. Hospital’s medical staff bylaws
require that active members of the medical staff accept
consults if they are available. Physician 1 reports that he
is unavailable as he is out of the area. Physician 1 later
that day arrives at hospital to see one of Physician 1’s
patients. Physician 1 states that he cannot see Physician
2’s patient as the two physicians do not get along.

131
“KEEP YOUR HANDS TO YOURSELF”
Hospital nursing supervisor received a complaint
from an R.N. in the Labor & Delivery unit that one of
the Ob-Gyn doctors approached her in the medicine
room, pulled her to him in a bear hug, rubbed his upper
body against her breasts, and then pulled her scrub top
away from her body and looked down her shirt.
Another R.N. who happened to be in the medicine room
observed the incident. Nurse number two told Nurse
number one that this is not the first time that the Ob-
Gyn doctor has behaved in this way.

132
“THE CASE OF THE ABUSIVE SURGEON”
(OR “MY FIRST NAME IS GOD”)
Surgeon X, the hospital’s most prominent
cardiothoracic surgeon, has a reputation for yelling at
nurses and support staff during procedures and for
throwing sutures, bandages, and other items in the O.R.
The hospital nursing supervisor received a complaint
from an O.R. nurse that Surgeon X became enraged
during a procedure when his favorite brand of staple gun
was not available. The O.R. nurse presented Surgeon X
with one of the staple guns that the hospital currently
stocked. Surgeon X closed the patient’s incision and
then used the staple gun on the O.R. nurse and stapled
her shoulder and scalp. The O.R. nurse left the
operating room in tears. Surgeon X completed the
procedure. Patient care was not compromised.

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