Peer Review: Practical Aspects and Legal/Ethical Issues Faced By the Medical Staff

The peer review process is an important subject for physicians to understand, but one that few physicians understand at a granular level. The difficulty for physicians is that many of the issues presented at peer review are cloaked in legal concepts for which physicians lack education, training, and familiarity. Hospital bylaws and regulations are complex, and it requires time and energy to become knowledgeable regarding their intent and application in the hospital setting.

This article explores the roles and duties of the medical staff and the hospital administration in relation to the following:

• Peer review;

• The medical staff bylaws and how they aid the hospital administration and medical staff in their mission of making it possible for physicians to practice quality and safe medicine;

• The intricacies of the credentialing and privileging process;

• Prompts for peer review, such as reappointment, complaints, and medical errors;

• The process of peer review and role of medical staff leadership versus hospital administration;

• The interaction between the alleged wrong-doing physician and the peer-review committee;

• The need for legal representation to ensure due process;

• Potential liability for peer review; and

• The consequences of peer-review actions, including sanctions on the physician’s medical practice, expulsion from the medical staff, and reporting to the state boards and national practitioner data bank. This conversation is important for all physicians to develop a deep understanding of the peer-review process and how it can impact a physician’s reputation, professional status, and livelihood.

What are the Roles and Duties of the Medical Staff and Hospital Administration in Relation to Peer Review?

The relationship between the medical staff and the hospital administration in connection to peer review is complex. The complexity surfaces because of the variable relationships of hospital-employed versus independent contractor physicians with hospital administration, as well as the emergence of corporate responsibility for quality of care and patient safety. These variable relationships must maintain the trust that an honest and fair peer-review process will be available for all medical practitioners. A breakdown in that trust relationship can result in medical staff chaos.

Professional activities must meet the standard of care, and physician behavior must meet the hospital code of conduct.

The medical staff and hospital administration must work in harmony to employ a peer review process that correctly gauges professional activities and conduct. Professional activities must meet the standard of care, and physician behavior must meet the hospital code of conduct. The hospital board expects physicians on the medical staff to better define and monitor processes for physician credentialing, evaluation, peer review, and disciplinary actions. Because these issues are delicate and sensitive, they can be addressed best by an organized medical staff that has a trusting relationship with the hospital administration. Staff physicians need hospital administration to clarify the roles and responsibilities of the president of the medical staff, the chief of staff, and the qualified administrative officer. This interplay is crucial in the development of appropriate medical staff and hospital administration relationships and processes.1,2

Medical Staff Bylaws: Outlining Expectations of the Medical Staff

Practitioners should have certain expectations of each other as members of the medical staff. These expectations reflect current medical staff bylaws, policies, and procedures, and organizational policies reflecting the medical staff and hospital administration’s values, culture, and vision. These expectations provide a guide for the medical staff in selecting measures of practitioner competency.

Patient Care

The medical staff is expected to provide patient care that is compassionate, appropriate, and effective for the promotion of health, prevention of illness, and treatment of disease. The goal is to provide effective patient care that meets or exceeds medical staff standard of care as defined by medical literature review, comparative outcome data, and the results of peer review data. Medical staff members should demonstrate caring and respectful behaviors when interacting with patients and their families and counsel and educate patients and their families.

Medical Knowledge

The medical staff is expected to use evidence-based guidelines when available, as recommended by the appropriate specialty, in selecting the most effective approach to diagnosis and treatment. Physicians must maintain ongoing medical education and board certification and demonstrate superior medical knowledge and technical skills.

Interpersonal and Communication Skills

Medical staff are expected to communicate effectively with other practitioners, caregivers, patients, and families to ensure accurate transfer of information through oral and written policies established by hospital policy. Practitioners should request inpatient consultations in a clear, succinct manner, and such consultations should be practitioner to practitioner in urgent or emergent situations. The medical staff must maintain medical records consistent with the medical staff bylaws, rules, regulations, and policies. All medical staff members must work civilly and effectively with all members of the healthcare team.

Professionalism

Practitioners are expected to demonstrate behaviors that reflect a commitment to continuous professional development, ethical practice, an understanding and sensitivity to diversity, and a responsible attitude toward patients, families, peers, and the public.

Medical staff must act in a professional manner at all times and adhere to the Medical Staff Code of Conduct. There must be a prompt response to all patient needs; participation in emergency call rotations as outlined by the bylaws, rules, and regulations; adherence to ethical principles pertaining to patient information, informed consent, and adverse medical and surgical outcomes; and sensitivity and responsiveness to culture, age, gender, and disabilities of patients and staff.

Credentialing and Privileging

Credentialing is the process of verifying qualifications to ensure current competence to grant privileges. The term credentialing covers verification of education, training, experience, and licensure to provide services.

Credentialing and privileging are duties fundamental to medical staff peer review.

The companion piece to credentialing is privileging, which is the process of authorizing a licensed or certified healthcare practitioner’s specific scope of patient care services. Privileging is performed in conjunction with an evaluation of an individual’s clinical qualifications or performance.

Credentialing and privileging are duties fundamental to medical staff peer review. These duties are essential to building a trustworthy and competent medical staff. The process can result in differences of opinion as to what privileges will be granted and whether a physician has the credentials to be on the medical staff. Today it is common practice for hospitals to recruit physicians as employees This can lead to conflict between private practice physicians and employed physicians, resulting in “tribalism” between employed and non-employed hospital staff members, potentially leading to prejudiced evaluations in credentialing and privileges. In jurisdictions that recognize negligent credentialing as a cause of action, the hospital interest in defending itself against these claims may conflict with the medical staff interest in protecting the confidentiality of the peer review processes (Rabelo v Nasif and Milford Regional Hospital. Worcester Superior Court Civil Action No. 2011 (2013)).

Hospitals are expected to initiate a review of physicians requesting hospital privileges. This review establishes that physicians have the necessary education and training to perform requested privileges. A second component of credentialing and privileging is a review of the physician’s practice pattern to ensure he or she has met the standard of care within the scope of the practitioner’s practice. A third component of credentialing and privileging is assurance that the physician has behaved in a manner consistent with the hospital’s code of conduct.3

The Triggers for Peer Review

In United States hospitals, peer review may be instigated for several reasons4:

• For physicians requesting hospital privileges;

• To investigate allegations that a physician is practicing below the standard of care;

• When a physician is acting outside the boundaries of normally accepted hospital behaviors;

• In randomly selected cases to improve the overall quality of patient care; and

• To investigate adverse outcomes to determine root causes for errors, and develop processes to prevent future adverse events.4

The Potential for a Sham Peer Review

A review of the Timothy Patrick case helps illuminate the following:

• The interplay between the alleged physician wrong-doer and the peer review committee;

• The need for legal representation;

• Due process;

• The potential for liability for peer review; and

• The consequences of peer review actions, including sanctions on medical practice and expulsion from the medical staff.

The personification of fraudulent peer review is identified in the Dr. Timothy Patrick case. Dr. Patrick, a vascular surgeon, sued Columbia Memorial Hospital (CMH) after he was subjected to a deceitful peer review for economic reasons.5 Patrick initially had joined a group practice in Astoria, Oregon. After several years with the group, he elected to decline partnership and establish his own practice in the same geographic region. His previous colleagues reported Patrick to the hospital executive committee at CMH for peer review, asserting “irresponsible behavior” in his medical care of patients. The peer review committee was chaired by a member of the group Patrick left to pursue his own practice. An investigation of the alleged “irresponsible behavior” occurred, and the committee voted to terminate Patrick’s hospital privileges.5

Patrick filed a federal antitrust lawsuit against the Astoria clinic physicians, claiming the defendants partook in a bad faith peer review to quash competition (7. US Supreme Court. Certiorari to the United States Court of appeals for the ninth circuit, 1988). The United States Supreme Court ruled in favor of Patrick. This ruling by the highest court in the land had an unnerving affect on physician willingness to participate in peer review. Physicians perceived themselves at magnified legal risk if they participated in a review that ultimately was determined to be a sham. This fear emanated from the Supreme Court decision, which awarded Patrick a $2.2 million verdict.

The Patrick decision had a huge negative impact on the necessary and important peer review process. The response to the subsequent reticence of physicians to participate in peer review was congressional action that introduced the Health Care Quality Improvement Act (HCQIA (Health Care Quality Improvement Act of 1986, 42 U.S.C & 11101, et seq.). This act resulted in immunity for physicians when participating in peer review. This immunity was subject to several factors, including:

• That the purported allegation brought to the peer review committee was a furtherance of quality of care issues;

• That there would be a due diligence approach to fact finding; and

• That there would be adequate notice and a fair hearing offered to the physician under review.

The introduction of HCQIA transformed the law, granting peer review committees and hospitals limited to almost unqualified immunity.6 This transformative congressional ruling created a situation of grave unease for physicians working in a setting of intense marketplace competition where some hospitals attempt to stifle competition to gain control of the marketplace.

Reporting to National Practitioner Data Bank

The National Practitioner Data Bank (NPDB) was created under the Health Care Quality Improvement Act of 1986.6 The NPDB is a repository for reports of medical malpractice payments and certain adverse actions related to healthcare practitioners. The NPDB is intended to act as an alert system to gather and disclose adverse information about physicians and other healthcare practitioners to prevent them from continuing their medical practices without people knowing of their previous incompetence or unprofessional actions.

The information reported to the NPDB includes but is not limited to:

Medical malpractice payment;

• Licensure restrictions and clinical or hospital privilege restrictions related to professional competence and conduct;

• Professional society membership actions related to professional competence and conduct;

• Drug Enforcement Administration (DEA) certification actions; and

• Exclusions from participation in Medicare, Medicaid. and other federal healthcare programs.

Physicians would be prudent to understand the importance of NPDB reporting requirements, because reporting to the NPDB has serious consequences. Even though the NPDB itself does not provide a private cause of action, entities that report practitioners improperly may face lawsuits from reported practitioners. NPDB reports have an impact on practitioner careers and reputations. The impact of a report depends upon the underlying facts and how the report is worded.

Failure to report to the NPDB when required by law has serious consequences. Any malpractice payer that fails to report medical malpractice payments is subject to a civil penalty. Any hospital or other healthcare entity that fails to report adverse actions will have its name published in the Federal Register, and the organization will lose its immunity from liability under Title IV with respect to professional review activities for a period of three years from the date of publication in the Federal Register. Additionally, the Secretary of Health and Human Services shall publish a public report that identifies those government agencies that have failed to report information on adverse actions as required.

What actions must be reported to the NPDB? Hospitals and other healthcare entities with formal peer review must report the following: professional review actions based on reasons related to professional competence or conduct adversely affecting clinical privileges for a period longer than 30 days; and voluntary surrender of privileges while under, or to avoid, an investigation. “Professional review action” is a peer review action “which is based on the competence or professional conduct of an individual physician (which conduct affects or could affect adversely the health or welfare of a patient or patients)” (42 U.S.C. & 11115(9)). In addition, hospitals may report clinical privilege actions taken against healthcare practitioners other than physicians if the practitioner’s professional competence or conduct could adversely affect the health or welfare of a patient.

Conclusion

This brief overview of peer review gives the reader insight into the complex nature of belonging to a medical staff. The potential risks of participating on the medical staff and being subject to peer review are self-evident, including reputational damage and loss of professional status and livelihood.

A fair and honest peer review process is in the best interest of all participants on the medical staff and for the patients.

Peer review, hearing and appeals procedures, credentialing and privileging, and medical staff bylaws are all critical to fair and equitable treatment of physicians participating on medical staffs. Given the current competitive healthcare landscape, it is imperative that all physicians take the time to understand the peer review process and to be knowledgeable about concepts that are embedded in the interchange between the medical staff and the governance of the hospital board. It is prudent to have legal counsel review the contractual relationship between the medical staff and the hospital executive committee to determine that all safeguards are present to ensure a fair and equitable review process. A fair and honest peer review process is in the best interest of all participants on the medical staff and for the patients. It is imperative that physicians understand the history of sham reviews, as highlighted in the Patrick case discussed earlier. Physicians and hospital leadership must ensure all physicians on hospital staffs receive fair and equitable treatment when issues are presented to a peer review committee. Lack of knowledge or understanding of the bylaws and policies is never a defense when subjected to peer review.

References

1.    Edmonstone J. Clinical leadership: the elephant in the room. Int J Health Plann. Manage. 2009;24:290-305.

2.    Rothman DJ. Who’s in charge here? Health Manage Q. 1993;15(1):17-21.

3.    Bass BL, Polk HC, Jones RS, et al. . Surgical privileging and credentialing: a report of a discussion and study group of the American Surgical Association. J Am Coll Surg. 2009;209:396-404.

4.    Edwards MT, Benjamin EM. The process of peer review in US Hospitals. Journal of Clinical Outcomes Management. 2009;16:461-467.

5.    Kelly JP. Patrick v. Burget. Healthspan. 1988;5(6):2-5.

6.    Kadar N. How courts are protecting unjustified peer review actions against physicians by hospitals. J Am Phys Surg. 2011;16:17-24.