LACBA - LACMA Presentation · CMA filed amicus curiae brief (hospital lawyer responded with personal attacks and request for sanctions) Closing argument was scheduled on Oct. 2, 2017

M E D I C A L S T A F F I N D E P E N D E N C E A N D S E L F - G O V E R N A N C E

i n T u l a r e , C a l i f o r n i a a n d b e y o n d

ASMAC Fall Conference

November 19, 2017

Long X. Do, Esq.

Legal Counsel & Director of Litigation

CMA Center for Legal Affairs

Part 1 | What happened

Part 2 | Legal analysis

Part 3 | Consequences and implications

C A L I F O R N I A M E D I C A L A S S O C I A T I O N © 2 0 1 7

TOPICS

2

BACKGROUND

Tulare County

• Pop. 61,000

• 11.9% bachelor degree or higher

• 78.3% above federal poverty level

• #1 milk producer in nation ($1.7B in 2015)

• Top or near top in nation in overall agriculture

• Home to U.S. Rep. Bob Mathias (1967-

75), 2-time Olympic gold medalist in

decathlon (1948 London, 1952

Helsinki)


part 1 | what happened3

BACKGROUND

Tulare Regional Medical Center

• Opened in 1951

• 103 beds today

• Owned by Tulare Local

Healthcare District Authority

• Elected board of five

• 170 physicians on staff (OMSS member)

• 40 percent of revenue from Medi-Cal



BACKGROUND

• CEO fired in 2012, was rehired,

and fired again in 2014

• “Tower of Shame”

• Bond measure for $55M failed

in Nov. 2016 election

• 2014 management services

agreement with Health Care

Conglomerates, Inc. (HCCA)



JANUARY 26, 2016

MEDICAL STAFF COUP


part 1 | what happened

In the course of a one-hour

board meeting, the hospital

dissolved a decades-old

medical staff organization

(eliminating democratically

established bylaws and

officers); unilaterally propped

up a sham medical staff with

hospital-appointed leaders and

medical staff bylaws written by

hospital lawyers; and

disenfranchised all physicians

at the hospital.

6

THE MEDICAL STAFF’S

LAWSUIT



• Legal claims:

- Medical staff independence

and self-governance under

Bus. & Prof. Code §2282.5

- Retaliation under Health &

Safety Code §1278.5

• Originally filed by medical

staff’s counsel and later joined

by litigation specialists

• Three different law firms and

an LA-based PR firm defend

the Hospital defendants

7

Bob

Mathias’s

nephew

CMA INITIAL ENGAGEMENT



• Recognize and acknowledge gravity of

the situation on all medical staffs

• Immediate, direct intervention with the

hospital board

• Mobilize and organize physician

community

8

MOBILIZATION – SUPPORT THE LAWSUIT



• Assemble litigation team from CMA contacts and network

• Take a public stand in the local media

• File amicus brief and argue at TRO

hearing

• Fundraise

• Determine litigation budget

• Develop fundraising campaign

• Secure initial cash infusion from

the AMA Litigation Center

THANK YOU AMA LITIGATION CENTER!

9

MOBILIZATION – BROADEN ADVOCACY



• Hospital regulators (Cal. Dept. of Public Health & CMS)

• California Hospital Association

• Local elected officials

10

FILE UNDER: CRAZY



THREE APPLICABLE LEGAL PRINCIPLES

1. Hospital governance structure

“Hospitals in this state have a dual structure, consisting of an

administrative governing body, which oversees the operations of the

hospital, and a medical staff, which provides medical services and is

generally responsible for ensuring that its members provide

adequate medical care to patients at the hospital.”

- California Supreme Court in El-Attar v. Hollywood Presby. Med. Ctr. (2013)


part 2 | legal analysis12


2. Medical staff independence and self-governance

Functions of Self-Governance

• Propose, adopt, and amend medical staff bylaws, rules and regulations (subject to hospital governing board approval, not unreasonably withheld)

• Elect and remove medical staff officers

• Establish membership criteria and determine members

• Establish clinical criteria and standards to oversee and manage quality assurance, UR, and other meetings of the medical staff

• Collect and use medical staff dues

• Establish patient care standards

• Retain independent legal counsel (at medical staff’s expense)

(Bus. & Prof. Code §2282.5)




3. Hospital board relationship with the medical staff

“[T]he governing board of a hospital must act to protect the quality of

medical care provided and the competency of its medical staff . . . . The final

authority of the hospital governing board may be exercised for the

responsible governance of the hospital or for the conduct of the business

affairs of the hospital; however, that final authority may only be exercised

with a reasonable and good faith belief that the medical staff has failed to

fulfill a substantive duty or responsibility in matters pertaining to the quality

of patient care. It would be a violation of the medical staff’s self-

governance and independent rights for the hospital governing board to

assume a duty or responsibility of the medical staff precipitously,

unreasonably, or in bad faith.”

(AB 1325, §1 (2004) (enacting Bus. & Prof. Code §2282.5)



EVALUATING HOSPITAL’S ACTIONS

Functions of Self-Governance

• Propose, adopt, and amend medical staff bylaws, rules and regulations (subject to hospital governing board approval, not unreasonably withheld)

• Elect and remove medical staff officers

• Establish membership criteria and determine members

• Establish clinical criteria and standards to oversee and manage quality assurance, UR, and other meetings of the medical staff

• Collect and use medical staff dues

• Establish patient care standards

• Retain independent legal counsel (at medical staff’s expense)

(Bus. & Prof. Code §2282.5)



HOSPITAL’S DEFENSES

• The medical staff was completely dysfunctional

• CMS was going to revoke Medicare/Medicaid status unless the hospital got rid

of the dysfunctional medical staff

• All hospitals have “ultimate authority” to do what is necessary for the protection

of the hospital and patients

• CMA is behind the case and controls the medical staff and CDPH!

Proven at trial to be factually false, exaggerated, and/or misleading

Hospital’s own expert on cross-examination admitted the hospital’s

actions were “not justified”

“Ultimate authority” narrowly permits hospital to assume a specific

medical staff function affecting patient care only upon failure of that

function; can never justify replacing an entire medical staff


16part 2 | legal analysis

STATUS OF THE CASE

Trial and post-trial briefing completed in mid-September 2017

CMA filed amicus curiae brief (hospital lawyer responded with

personal attacks and request for sanctions)

Closing argument was scheduled on Oct. 2, 2017

Case stayed on Sept. 30, 2017 due to Chapter 9 bankruptcy filing

All three law firms originally defending the hospital defendants are

no longer involved in the case

Settlement talks ongoing


part 3 | consequences and implications17

VOTER REVOLT

• Rejected Measure I by 67% ($55M

hospital bond to complete construction of

“tower of shame”

• By 67%, voted two new, independent

citizens onto the hospital board

• By 81%, voted to recall hospital vice-

chairman and key architect of medical

staff coup and replace him with new

independent board member

• Fourth and fifth members of board that

voted to terminate medical staff resigned



CAL. DEPT. OF PUBLIC HEALTH INVESTIGATIONS



CAL. DEPT. OF PUBLIC HEALTH INVESTIGATIONS



“When faced with a potential threat to hospital revenues, the Board failed to

exercise efforts to work with MS 1. Instead, the Board removed the medical staff's

right to self-governance by "terminating the relationship" and installing a medical

staff with officers to its liking. The Board's failure to respect MS 1's right to self-

govern disrupted medical staff functions, interrupted clinical oversight of

department responsibilities, and removed 174 medical staff members from Active

status without due process, just cause, or their consent to give up their self-

governance. As a result in part, many members of the previous medical staff

resigned or lapsed in membership. One entire pediatric group resigned abruptly

creating a crisis period when the obstetric and emergency services were not

supported. Obstetric activity continued to dwindle as obstetric providers also left

the hospital. Such outcomes put patients at risk for delays in treatment or errors by

unqualified providers.”

IMPACT ON PATIENT CARE AT HOSPITAL

• CMS investigation (Nov. 2016) found 2 patient deaths caused by

surgery staff shortages that true medical staff was trying to fix

• CDPH investigated and substantiated 11 complaints concerning

medical care at the Hospital after medical staff termination

(almost triple total number in the four prior years)



FORWARD PROSPECTS

Valley Voice (local Tulare newspaper)

www.ourvalleyvoice.com

Nov. 6, 2017



http://www.ourvalleyvoice.com/

NATIONAL IMPACT



“How the court rules in the Tulare case, once it resumes, will have profound consequences for

whether medical staffs can do their work independently of nonclinical administrators. And it

will also provide an answer to the more important question of who should be in charge of

hospital care.”

“The case . . . is a symptom of a

much bigger problem in

American medicine: the gradual

loss of autonomy by physicians at

our nation’s hospitals. If a

hospital board can dismiss

elected medical officers with

impunity, as at Tulare, it will

indicate to many doctors the

increasingly tenuous nature of

the position they currently hold.”

KEY LESSON LEARNED



Support and participate in organized medicine!

end

Long X. Do, Esq.

California Medical Association

1201 J Street, Suite 200

Sacramento, CA 95814

[email protected]

(916) 444-5532


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Documents

LACBA - LACMA Presentation · CMA filed amicus curiae brief (hospital lawyer responded with personal attacks and request for sanctions) Closing argument was scheduled on Oct. 2, 2017