UPDATE: Court Stays Order Compelling Production of Quality Reviews, Allowing Appellate Review of Peer Review Protection Act

by Mark Bauman | Jun 2, 2023 | Legal News, Medical Malpractice

Last month, Lackawanna County Court of Common Pleas Judge Terrence R. Nealon granted a plaintiff’s discovery appeal in her medical malpractice case and ruled that the Peer Review Protection Act (“PRPA”) did not shield quality-of-care reviews conducted by hospital plan corporation First Priority Health IPA-HMO, a subsidiary of co-defendant Blue Cross of Northeastern Pennsylvania.  Judge Nealon’s interpretation of the PRPA may now be reviewed by the Pennsylvania Superior Court, as he recently stayed his order compelling production of the quality-of-care reviews upon the motion of Blue Cross and First Priority.

In his opinion granting the stay of his August 2014 order, Judge Nealon conceded that the Pennsylvania Supreme Court case on which he based his decision—McClellan v. Health Maintenance Organization of PA—was a plurality opinion and therefore has no precedential value, as Blue Cross and First Priority argued.  Accordingly, Judge Nealon stated in his most recent order that there was no appellate review of the issue whether the PRPA encompasses peer reviews conducted by hospital plan corporations.  With no appellate review, Judge Nealon found that the moving defendants possessed the requisite substantial ground for difference of opinion necessary for an appeal to the Superior Court.

Despite the imminent appeal, Judge Nealon anticipated that the case is at least nine months away from trial in Lackawanna County and the issue should be decided to avoid irreparable harm that may result from prematurely exposing the reviews before their discoverable nature was defined.  

PA Supreme Court to Test Ostensible Agency & MCARE Requirements for Non-Physician Experts

by Mark Bauman | Jun 1, 2023 | Legal News, Medical Malpractice

Last month, the Pennsylvania Supreme Court granted allocatur to a case questioning whether a jury should be allowed to consider a vicarious liability claim based on a theory of ostensible agency where a physician provides emergency treatment at the behest of a hospital to a patient who was not previously her own patient.  Additionally, the justices will decide whether the Medical Care Availability and Reduction of Error (“MCARE”) Act prevents nurse experts from offering causation testimony

In the case, Green v. Pennsylvania Hospital, plaintiff’s decedent presented to the emergency department with complaints of shortness of breath, rapid breathing, and wheezing, and he was admitted to the ICU.  The patient also had several underlying medical conditions, including circulatory failure, respiratory failure, and an infection.  After medication failed to alleviate his symptoms, the patient was intubated and he remained in critical condition.  Several days later, the patient was placed on a feeding tube and received a tracheostomy.  The tracheostomy site began to bleed and an emergency team was called to address the issue by performing a bronchoscopy, repeat intubation, and placing chest tubes for subcutaneous emphysema.  Despite their efforts, the patient arrested and died.  The executor of the patient’s estate sued the hospital and several nurses and physicians who treated the patient, alleging that their combined efforts led to the patient’s death.  The executor did not sue an ear, nose, and throat (“ENT”) physician who responded to the emergency and who had privileges at the hospital, but who was not a hospital employee. 

At trial, plaintiff attempted to show that the non-party ENT physician was negligent and that the hospital was vicariously liable for her actions because she was an ostensible agent of the hospital.  Ostensible agency is found when a person who may not necessarily be an agent or employee would reasonably be believed to be an employee of the hospital.  To prove ostensible agency under the MCARE Act, a plaintiff must demonstrate that a reasonably prudent person in the patient’s position would be justified in believing that the care in question was rendered by the hospital.  If so, the hospital would be vicariously liable for that physician’s negligent actions.  Here, the trial court found that the plaintiff failed to meet his burden because he did not elicit any testimony regarding the organizational structure of the hospital or the way that the ENT physician presented herself to the decedent, who was unconscious at the time.  Instead, the trial testimony merely demonstrated that the plaintiff and the decedent’s brother could not recall who treated the patient and that they only saw “shadows of people.”  Accordingly, the trial court entered nonsuit against the ENT physician. 

The trial court also entered nonsuit against one of the nurse defendants because the plaintiff’s nursing expert had been precluded based on the MCARE Act’s requirements for expert testimony.  Although plaintiff attempted to stretch a footnote caveat found in the 2012 case Freed v. Geisinger Medical Center regarding trial court discretion to allow nonphysician experts to provide medical causation testimony, the trial court ruled that the MCARE Act required an expert with a medical license to opine as to the medical causation of an alleged harm.  Thus, the nurse was precluded from offering causation testimony as to the decedent’s cause of death. 

On appeal, a split Superior Court authored an opinion in January of this year upholding the trial court’s findings.  In writing for the majority, Senior Judge William H. Platt stated that, “Ultimately, viewing the evidence and all reasonable inferences arising from it in the light most favorable to appellant, a jury could not reasonably conclude that the elements of the cause of action had been established where appellant failed to adduce any evidence” suggesting that the ENT physician worked for the hospital when she was not a hospital employee.  President Judge Susan Peikes Gantman, however, dissented as she believed that this question should be decided by a jury.  She explained that, when looking at the facts in a light favoring the appellant, the record demonstrated that the ENT physician worked as part of an emergency response team set into action by the hospital.  A jury would therefore be properly equipped to decide whether a reasonably prudent person would believe that the ENT physician, as past of the emergency team, acted on behalf of the hospital.

As for the discretion to permit the nurse’s causation testimony, Judge Platt stated that the plaintiff misconstrued the MCARE Act’s requirements and that permitting a nurse to testify about causation—even as it applied to the nurse defendants only—where the indivisible treatment was provided by a team would have created an “anomalous result.”  Judge Gantman concurred with this conclusion.  Now, the plaintiff will have his theories heard by the Pennsylvania Supreme Court to further define these issues for future lawsuits.

Health Insurance Quality Reviews Not Privileged Under Peer Review Protection Act

by Mark Bauman | May 30, 2023 | Legal News, Medical Malpractice

In an issue of first impression, the Lackawanna County trial court recently declined to extend the Peer Review Protection Act to quality-of-care reviews conducted by health insurance companies, regardless of who the company hired to conduct the peer review.

In Venosh v. Henzes, M.D., et al., the plaintiff sued an orthopedic surgeon for injuries related to a total knee replacement surgery.  The plaintiff was insured by First Priority Health IPA-HMO, a subsidiary of Blue Cross Northeastern Pennsylvania.  Blue Cross performs quality-of-care reviews to investigate treatment rendered to its insureds by healthcare professionals and facilities.  The reviews, which are typically conducted by nurse analysts, can be done at the request of insureds, healthcare providers, and facilities, or the insurance company itself.  

During discovery, the plaintiff learned that the surgeon provided a statement to Blue Cross regarding the treatment she received; however, the surgeon’s attorney maintained that the statement was protected by the Peer Review Protection Act (“PRPA”).  Plaintiff subpoenaed Blue Cross for the statement but encountered a similar position that the review was privileged peer review material.  Blue Cross additionally filed a Motion to Quash, which a special trial master initially denied, but the decision was reversed and the master granted the motion.

During arguments, plaintiff argued that First Priority conducted the review, not the parent company, and thus the PRPA did not apply.  She further contended that the review’s main purpose was for the insurer’s business as opposed to improving the quality of medical care, which is at the heart of the PRPA.  Blue Cross asserted that it conducted the review and that it is not an IPA-HMO, but rather a hospital plan corporation.  It further disputed that, if its reviews were discoverable, insurance companies will be reluctant to conduct quality-of-care reviews, which in turn could effect the quality of medical care in Pennsylvania. 

Judge Terrence R. Nealon examined the PRPA language and held that, because Blue Cross is neither a healthcare practitioner nor operates a healthcare facility, its quality-of-care reviews are not privileged.  Whether the reviews were conducted by Blue Cross or First Priority did not matter.  Judge Nealon cited the 1996 Pennsylvania Supreme Court decision in McClellan v. Health Maintenance Organization of PA, which also examined these reviews conducted by HMOs and ruled that they were discoverable.  He further held that the peer review privilege could be extended “to health insurance companies or hospital plan corporations only by legislative amendment.” 

Judge Nealon’s decision was also not affected by Blue Cross’ retention of a third-party orthopedic surgeon to evaluate the defendant surgeon’s conduct and that the third-party surgeon’s report that was shared with the plaintiff’s providers.  Hiring a third-party physician did not transform Blue Cross into a provider for the purposes of the PRPA.  Rather, Judge Nealon stated that, “while it is laudable that Blue Cross conducts peer reviews of the quality and efficiency of the treatment that health care professional and facilities provide to its subscribers, only those peer reviews which are undertaken by a ‘professional health care provider’ are immune from discovery under the act.” 

This decision was not the only blow to the defendants’ peer review arguments in the Venosh matter.  Prior to plaintiff’s discovery appeal, the defendant hospital also argued that its event reports were privileged under the PRPA, but Judge Nealon disagreed.  In writing an opinion to the hospital’s discovery appeal, Judge Nealon found that the reports were discoverable because the hospital’s reporting policy and the language contained in the event report forms indicated that the reports were not intended to be part of a quality assurance assessment and were not generated for peer review committees.  The Superior Court upheld Judge Nealon’s decision in July 2014.