Welcome Clarity for Medical Staff and Healthcare Entities Facing Frivolous or Retaliatory Lawsuits | Procopius, Cory, Hargreaves & Savitch LLP

California’s Court of Appeals for the Third District recently upheld the actions of a health care facility that reported a provider to the National Practitioner Data Bank who resigned while under investigation. In so doing, the court provided a welcome example of the immunities and protections afforded to those involved in bona fide peer review, while clarifying the broad interpretation and meaning of the term “investigation”.

In the matter of Wisner v. Dignity Health (2022) 2022 WL 16706648, a surgeon sued the St. defamation, willful interference with your right to exercise a lawful profession, willful negligent interference with potential economic advantage, illegal business practices and willful infliction of emotional distress.

The surgeon started the process after the SJMC reported him to the NPDB for resigning while under investigation. The surgeon disputed that he was under investigation and stated that he resigned in good standing.

The SJMC responded to the complaint by filing a motion to dismiss the action (ie, an anti-SLAPP motion). The SJMC argued that the complaint arose from the protected activity (ie the filing of the NPDB report for dismissal while under investigation) and the case should therefore be effectively dismissed. The lower court granted the motion finding that the NPDB’s report was true when filed and that the Federal Health Care Quality Improvement Act granted SJMC immunity from liability for its peer review activities. The Court of Appeal agreed and upheld the lower court order granting the motion to dismiss the complaint.

This case provides an example of how the immunities afforded by law to those engaged in bona fide peer review can and do protect medical staff, medical staff members, and healthcare entities from frivolous or retaliatory lawsuits.

We often hear that Peer Review Board members are hesitant to take corrective action or report a colleague for fear of retaliation, especially in the form of litigation. The law, however, encourages peer review for the safety and well-being of patients and for public policy purposes of maintaining a high level of quality of care in our healthcare facilities.

The law grants medical staff immunities from liability for engaging in good faith peer review. (See 42 USC 11101 et seq.) Here, the peer review activity includes investigation and reporting to the surgeon’s NPDB for dismissal while under investigation. The term “investigation” is not defined by the State of California or federal law. As indicated by the court in Wisner v. Dignity Health, the US Department of Health and Human Services has published an NPDB Guide that provides guidance on what constitutes an “investigation”. Looking at this guidance, the court in Wisner v. Dignity Health noted that the routine review is not an investigation. An investigation results when there is “’a formal and targeted process’” that “’is used when issues relating to the competence or professional conduct of a specific professional are identified.’” More importantly for medical staff, the court stated that the definition of “ investigation” in the Medical Staff Bylaws does not control the review and is not a determining factor whether an investigation has taken place. Doing so would create inconsistent and arbitrary findings by different health facilities and medical teams regarding the imposition of an investigation and thus create inconsistency in mandatory reporting. Here, the court concluded that SJMC had engaged in a targeted review of a specific provider, the surgeon, which was a precursor to possible adverse action against its privileges. Thus, the surgeon was under investigation and his dismissal triggered the SJMC’s duty and obligation to report him to the NPDB.

Procedurally, in litigation, SJMC filed an anti-SLAPP motion. This allows for early settlement or filing of meritless lawsuits arising from protected activities. In other words, it is essentially a mechanism for defendants, such as the SJMC, to withdraw the complaint and dismiss the action stating that the action is being brought with the aim of preventing the valid exercise of the right to freedom of expression or protected activity. Peer review activities, such as the investigation and subsequent reporting by the NPDB, are protected activities. The SJMC was therefore able to effectively use the anti-SLAPP motion with the immunities granted to it for engaging in good faith peer review to dismiss the lawsuit filed by the surgeon.

This case, therefore, is an excellent example of how good faith peer review is protected, as well as demonstrating how the legal mechanics work to dispatch a case that is brought to cool such protected activity. At the same time, it provides us with additional insight into the meaning of the often ambiguous term “research”.

Welcome Clarity for Medical Staff and Healthcare Entities Facing Frivolous or Retaliatory Lawsuits | Procopius, Cory, Hargreaves & Savitch LLP

Leave a Reply

Your email address will not be published.

Scroll to top