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What you don’t know can hurt you: Informal peer review can backfire

Introduction: Most surgery centers will need to deal with physician performance and/or behavior issues at some point.

Through a series of brief articles, the authors – a nationally-recognized administrative expert in outpatient surgery financial and operational management, regulatory compliance, surgery center best practices, performance benchmarking, patient safety, and efficient operation of surgery centers, and a lawyer with 30 years’ experience with medical staff issues – will address particular aspects of successfully managing physician issues. This initial article illustrates how well-intentioned efforts can put surgery centers and their leadership at legal and regulatory risk.

Fact Pattern: Dr. A has had a successful 25-year career as an ophthalmic surgeon. He has historically enjoyed an excellent reputation in the community. In the past couple of years, however, Dr. A’s surgical time and complication rates have increased. OR staff have reported that Dr. A’s hands are weak and unsteady, and he is increasingly reliant on staff during complex procedures. The ASC Board President and Medical Director have had a series of conversations about Dr. A. The conversations did not take place during ASC Board or committee meetings. Instead, some conversations took place in the physicians’ lounge, and others were over the phone on weekends. Eventually, the Board President and Medical Director agree that the ASC scheduler would be instructed to not schedule any of Dr. A’s cases at the ASC. When Dr. A was informed that he may no longer schedule cases at the ASC, Dr. A was livid and informed the Board President that he (Dr. A) will be consulting his attorney. What exposure, if any, does the ASC have if Dr. A sues, and how could the ASC have done things differently to limit its exposure?

Confidentiality: The conversations between the ASC Board President and Medical Director may not to protected by the applicable state peer review privilege. Most state peer review privilege law apply to formal activities of appropriately-constituted medical staff committees, not activities outside the formal peer review process. If the discussions between the Board President and Medical Director are not privileged, they could be the subject of legal discovery not only in a lawsuit brought by Dr. A but also in a lawsuit brought by a patient who claimed that the ASC is responsible for her bad outcome because ASC leadership were aware of issues involving Dr. A but continued to permit him to perform cases at the ASC. If these discussions had taken place pursuant to the formal peer review process in the ASC’s medical staff bylaws, they probably would have been privileged.

De Facto Summary Suspension: Instructing the scheduler not to schedule Dr. A’s cases could place the ASC at legal risk on several fronts. This action could be deemed by a court to be a de facto summary suspension. While most ASC medical staff bylaws provide a process for summary suspensions, few will have provisions authorizing the Medical Director to instruct the scheduler not to schedule cases of a particular surgeon. To the extent that the Board President and Medical Director failed to follow the process set forth in the ASC medical staff bylaws, the ASC could have exposure for a lawsuit based on failure to follow the ASC’s medical staff bylaws. If the process spelled out in the medical staff bylaws had been followed, the legal risk would be much less.

Immunity: Immunity from damages is available under the Health Care Quality Improvement Act (HCQIA). However, HCQIA immunity is only available when certain procedural due process is made available to the physician. In this instance, Dr. A was not given the right to a hearing and, as a result, HCQIA immunity would not be available for the ASC, Board President, Medical Director, or others involved in the decision to prevent Dr. A from scheduling cases. The hearing process can be expensive, disruptive, and stressful. However, providing the opportunity for a hearing is generally required to invoke HCQIA immunity. Many states have laws providing immunity for peer review actions. In many instances, state law immunity would also be unavailable because the actions did not take place through the formal process spelled out in the ASC’s medical staff bylaws.

Reporting: Restrictions of clinical privileges are reportable to the National Practitioner Data Bank (NPDB) and to many state medical boards. Is the decision to prevent Dr. A from scheduling cases at the ASC reportable? It could be if it were deemed a de facto summary suspension. The ASC would need to consult applicable state law, which sometimes mirror the NPDB reporting requirements and other times are significantly different.

Summary: It is essential to be familiar with the ASC’s medical staff bylaws and the processes for credentialing, peer review, disciplinary action, and rights of the medical staff members. When peer review and results of performance monitoring are to be discussed, remind all participants of the protections afforded within parameters determined by the bylaws, state laws, and the HCQIA. In this scenario, the Board President and Medical Director placed themselves, and the ASC, at legal risk by not following the processes spelled out in the medical staff bylaws. If the bylaws had been followed, the discussions likely would have been privileged and the ASC and its leadership protected by HCQIA immunity.

Authors:
Thomas J. Stallings, Attorney, Partner, McGuire Woods, Richmond, VA
Sandra J. Jones, President/CEO, Ambulatory Strategies Inc., Dade City, FL

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