Supreme Court Definitively Bans “Error in Judgment” Defense in Medical Malpractice Cases

As previously reported on obrlaw.com, on May 23, 2012, the Supreme Court of Pennsylvania granted petitions for allowance of appeal filed on behalf of a defendant physician and her practice group, to address the Superior Court’s analysis of the “error in judgment” defense in the underlying case of Passarello v. Grumbine, M.D., et al., 29 A.3d 1158 (Pa. Super. 2011).

On February 7th, 2014, a divided Pennsylvania Supreme Court prohibited the “error in judgment” jury instruction from medical malpractice cases as it creates a risk of clouding jurors’ understanding of the applicable standard of care.  Previously, this defense supported the belief that physicians should not be liable for errors of judgment when their care met the standard of care.  The Pennsylvania Superior and Supreme Court have both found that this defense injects a subjective view into what should be an objective inquiry into whether a defendant physician was negligent.

The case underlying the Supreme Court holding stems from the death of a two-month-old infant in 2001.  The child’s parents sued their pediatrician, who had seen the infant multiple times after his birth and diagnosed him with gastroesophageal reflux.  The parents eventually brought their son to the emergency room where he died of an acute heart infection. 

During trial, plaintiffs’ counsel failed to object to the error in judgment jury instruction and the jury found for the defense.  As a result, the plaintiffs appealed to the Superior Court, which granted a new trial.  The physician defendant and her practice petitioned to the Supreme Court to review the Superior Court’s analysis of the error of judgment defense, as well as the retroactive application of its decision in Pringle v. Rapaport, 980 A.2d 159 (Pa. Super. 2009).  The Pringle decision had denounced the defense in medical malpractice actions based on its potential for confusion.  The Supreme Court granted their petition in 2012.

The Supreme Court’s four-justice majority opinion found that appellants failed to demonstrate that the defense was necessary when others were available.  For example, the “two schools of thought” defense remains as an option to illustrate a physician’s decision-making.  The Court further noted that its standard civil jury instruction committee had declined to include the error in judgment defense as a proposed instruction because of its potential to confuse jurors’ understanding of how to weigh the evidence.  Finally, the court also found that the Superior Court’s reliance on Pringle was proper and that there was no reason to overturn its conclusion that the error in judgment defense was ill-suited for medical malpractice claims.

Justice Edward G. Saylor authored a dissenting and concurring opinion against applying Pringle retroactively to the instant matter.  He felt it should only be applied proactively.  Chief Justice Ronald D. Castile and Justice J. Michael Eakin also wrote dissents.  Chief Justice Castille wrote that there were times when the error in judgment instruction could be properly used in cases where the defendant had more than one viable treatment option and his decision to pursue one over the other fell within the standard of care, but nonetheless resulted in an injury or death.

Pennsylvania Superior Court Finds Statute Banning Wrongful Birth and Wrongful Life Actions Unconstitutional

In an opinion authored on November 14, 2012, a three-judge panel unanimously found that the statute banning wrongful birth and wrongful life actions in Pennsylvania (42 Pa.C.S.A. §8305) was enacted unconstitutionally. 

Generally, wrongful birth is a claim made by the parents of a child born with birth defects, wherein the parents allege that the healthcare provider failed to warn them about the defects.  Wrongful life, on the other hand, is a claim made by the child for failing to prevent the birth. 

According to the panel, section 8305 violated the “single-subject rule” contained in Article III, Section 3 of the Pennsylvania Constitution, which requires that all provisions in a bill assist in carrying out a bill’s main objective or are otherwise germane to the bill’s subject.  Section 8305 was signed into law as Act 47 of 1988.  The panel examined the final version of that bill  and concluded that the majority of the provisions related to post-trial matters in criminal cases.  The panel therefore found that all provisions contained in Act 47 not related to post-trial matters in criminal cases, including section 8305, violated the “single-subject rule” and was enacted unconstitutionally.    

Superior Court Remands Defense Verdict because Admission of Breach required Finding of Negligence

The Superior Court recently remanded a medical malpractice case back to the Clarion County Court of Common Pleas after ruling that the jury erroneously found a clerk’s admitted filing error was not negligent.  

In writing on behalf of the unanimous three-judge panel, Judge Anne E. Lazurus explained that, because the file clerk’s employers admitted that she misfiled an ultrasound report and that mistake constituted a breach of the standard of care, the defense verdict bore no rational relationship to the evidence.

The events underlying the original action began when the minor-plaintiff’s mother presented for a diagnostic ultrasound during her third trimester of pregnancy.  The ultrasound showed a large cyst on the fetus’ right kidney.  Before the report made its way to the defendant obstetricians’ office, the mother went into labor and delivered a baby boy.  Once the ultrasound report arrived at the office, a file clerk placed it in the wrong pile of papers.

About ten days later, the parents brought their baby to the hospital because the baby was lethargic and vomiting.  An abdominal ultrasound revealed the kidney cyst, and he was transferred to the Children’s Hospital of Pittsburgh for an emergency surgery to correct an obstructed urethra.  The parents initiated a medical malpractice suit against the radiologist, the hospital, and the obstetricians and their practice.  Amongst their several charges of negligence and vicarious liability, the plaintiffs contended that the obstetricians failed to maintain proper procedures for obtaining radiology reports.  The jury found in favor of the obstetricians.  The plaintiffs appealed.

In the opinion, Judge Lazurus agreed with the plaintiffs that the obstetricians’ admission that their staff member was negligent required that the defense decision be set aside.  During their depositions and cross-examination, the physicians testified that the misplaced ultrasound report delayed their timely review of the results and constituted a breach in the standard of care.  Even without an expert to opine as to the communication policies in place at the obstetricians’ practice, Judge Lazurus held that the facts mandated a finding of negligence.  In doing so, she cited two Superior Court cases that found that experts are not needed to prove negligence when lack of skill or care is obvious to laypeople.  As a result, the Court ordered that only the obstetrician defendants and their practice should be brought before a jury again to determine causation, liability and damages.

OIG Issues Favorable Opinion Regarding Payment of Per Diem Fees to Physicians in Emergency Department

On October 23, 2012, the U.S. Department of Health and Human Services, Office of Inspector General (OIG), issued a favorable Advisory Opinion (Opinion 12-15) regarding the payment of per diem fees by hospitals to physicians providing on-call coverage to unassigned patients who presented to the hospital’s emergency department. In its Opinion, the OIG advised that under the federal Anti-Kickback Statute, neither civil monetary penalties nor administrative sanctions would be imposed on the parties involved with the arrangement at issue.

Specifically, the arrangement at issue involved a charitable, tax-exempt hospital which operated its own emergency department on a 24/7 basis. As to those patients treated in the ED, approximately 19% were treated without compensation given to the hospital, while services rendered to the remaining 81% were reimbursed through some form of insurance, including federal health care programs. The ED was staffed by 130 specialist physicians who pursuant to a written agreement, provided unrestricted call coverage within the hospital. The agreement required the physicians to respond within thirty minutes of a call, regardless of whether they were on-site or elsewhere. In addition, the physicians were required to provide appropriate follow up care and other services in their office practices for any patients who they themselves admitted.

As payment for the physicians’ on-call services, the hospital created a per diem fee system pursuant to an analysis of various factors related to the physicians’ respective call burdens. These factors included the number of days per month the physicians would likely be called, the number of patients per call day they were likely to see, and the likely number of patients requiring inpatient and follow up care. Based on these factors, a total call coverage payment would be allocated and then divided by 365 to determine the per diem fee paid by the hospital to each individual physician.

The federal Anti-Kickback statute makes it a crime to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce or reward referrals of services which are reimbursable by a federal health care program, such as Medicare or Medicaid. That said, there are several provisions under the statute which protect arrangements that fit within certain parameters, commonly referred to as “safe harbors.” Notably, the safe harbor pertinent to the arrangement at issue was identified by the OIG as one encompassing “personal services and management contracts.”

In deeming the arrangement at issue to have a “low risk” of fraud and abuse, the OIG took into account several factors. For example, the hospital had certified that its total call coverage payment allotment had been reviewed by an independent consultant, who in turn had certified that the coverage was commercially reasonable, consistent with the applicable fair market value, and independent of volume and/or value of referrals. The hospital had also certified that the physicians’ per diem fees were applied uniformly and were not dependent or based on the referral patterns of individual physicians. Noting the validity of the payments themselves, the OIG also determined that every year, the payments were calculated and allocated in advance, and were ultimately distributed independent of individual referral patterns. Finally, with regard to the services provided by the physicians, the OIG determined that such services were “actual and necessary,” and that the majority of them were paid for solely by the per diem payment allocated by the hospital.

Its opinion notwithstanding, the OIG noted several qualifications to its ruling, advising that its opinion was limited in scope to the specific arrangement at issue, could not be relied upon by any other individual entity, and was limited solely to the federal Anti-Kickback statute (as opposed to other state or federal laws).

Superior Court Orders New Trial after Evidence of Informed Consent was Improper in Medical Negligence Case

In an opinion issued on November 12, 2013, a three-judge panel for the Pennsylvania Superior Court held that repeated references to a patient’s consent to the surgeries at issue in a medical malpractice trial were both irrelevant and unduly prejudicial.  Given the extent of these violations, the Court held that a new trial was appropriate. 

The underlying case of Brady v. Urbas, M.D., et al. involved a plaintiff who brought suit against her podiatrist alleging injuries related to several surgeries performed on her by her podiatrist.  The complaint set forth claims sounding in negligence and loss of consortium, the latter of which was brought on behalf of her husband. 

Prior to the trial, a motion in limine was filed on behalf of the plaintiff, seeking to preclude all evidence related to the plaintiff’s consent regarding the risks of the procedures at issue.  In the motion, counsel for the plaintiff argued that the issue of informed consent was not a defense to negligence and was irrelevant to the issue of whether the conduct of the defendant breached the standard of care.  Moreover, counsel asserted that evidence of consent would confuse or mislead the jury, thereby resulting in unfair prejudice.  The trial court denied the motion and throughout the ensuing trial, numerous references were made to the plaintiff’s consent to the risks associated with the procedures at issue, including a copy of the consent form which was sent back with the jury during deliberation.  A verdict was subsequently returned in favor of the defendant.  Counsel for the plaintiff then filed post trial motions for a new trial, which were denied. 

Thereafter, an appeal was filed with the Superior Court on behalf of the plaintiff, alleging that the trial court had abused its discretion by allowing evidence of the consent-related material.  Noting that the claim at issue was one sounding in medical negligence, and taking into account the elements required to prove this claim, the Superior Court held that evidence of informed consent had no relevance in a claim for medical negligence.  Even if the evidence did hold some marginal relevance, the Court noted that such evidence could have deceived the jury into believing that the plaintiff’s injuries “simply were a risk of the surgeries and that she accepted such risks, regardless of whether [the physician’s] negligence caused the risks to occur.”  Therefore, it was the opinion of the Court that the plaintiff’s knowledge of the risks associated with her surgeries, along with her consent to the same, were impermissible, and that the case was to be remanded for a new trial.