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Fourth Circuit Finds Hospital Immune from State Employment Claims under HCQIA

    Client Alerts
  • March 20, 2009

Hospital employers enjoy special immunity from certain state law employment claims under the provisions of the Health Care Quality Improvement Act (HCQIA).  This law provides hospitals with protection from damage claims resulting from professional reviews of physicians if certain procedural protections are in place.  HCQIA is intended to encourage open and rigorous peer review by physicians, with the hope that this will result in fewer incompetent physician decisions that affect patient care.

Last week in Moore v. Williamsburg Regional Hospital, the Fourth Circuit Court of Appeals (which includes North and South Carolina) used HCQIA to dismiss claims brought by a physician based upon suspension of privileges unrelated to direct patient care issues.  In this case, the physician was accused by South Carolina DSS of sexually abusing his adopted children.  As a result of these accusations, the hospital suspended his privileges.  After several layers of internal administrative reviews upheld the suspension, the physician sued, claiming infliction of emotional distress, interference with contract, breach of contract, estoppel, unfair trade practices, defamation and conspiracy.

The plaintiff contended that HCQIA did not apply to this suspension, because his professional competence was never called into question.  The Fourth Circuit affirmed dismissal of the claim, refusing to draw a bright line between types of misconduct.  The court noted that professional conduct away from the hospital can have an impact on patient care.  Erratic or destructive behavior outside of work can be a strong indication of possible patient care issues.  The hospital does not have to wait until such patient care issues arise before taking action.

The Fourth Circuit cautioned that not all physician conduct falls under HCQIA’s extension of immunity.  For example, physician privilege suspensions based upon messy divorces, or tax or financial problems would not fall within the statute’s protections.  There must be a “clear nexus” between the alleged conduct and the physician’s medical practice.

Hospitals should use this new guidance to determine if their review and administrative actions regarding physicians provide them with possible immunity from certain state law employment claims.