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Health Care Alert - Valuable Guidance To Those Involved In Physician Peer Reviews And Related Litigation

January 11, 2012

By: Daniel S. Katz

In Freilich v. Upper Chesapeake Health System, the Maryland Court of Appeals offers valuable guidance to those involved in physician peer reviews, as well as to attorneys involved in peer review litigation. In short, due process and fairness are critical to protecting those involved from the costs and burden of retaliatory lawsuits by disgruntled physicians. In fact, those involved in properly administered peer review activities are immune from liability to disgruntled physicians.

Believing that an open and honest peer review process is instrumental to quality patient care, Congress enacted the Health Care Quality Improvement Act ("HCQIA"). To encourage meaningful peer review, Congress built protections into the HCQIA to encourage candid reviews and to protect peer review participants from damage awards to disgruntled physicians. These protections take the form of qualified immunity from liability and a built-in "presumption" that requires a plaintiff to prove that the peer review process was objectively unreasonable.

Freilich v. Upper Chesapeake Health Systems arose from a long and contentious relationship between Dr. Freilich and Upper Chesapeake Health System ("Upper Chesapeake"). Between 1982 and 1997, Dr. Freilich practiced medicine at Harford Memorial Hospital ("Harford") and Fallston General Hospital ("Fallston") which were both operated by Upper Chesapeake. During her time at the hospitals, Dr. Freilich was the subject of numerous complaints. Although many of the complaints related to her competence as a practitioner, most of the complaints alleged ethical violations and unprofessional conduct. Dr. Freilich maintained that the complaints against her were simply retaliation for her reporting of substandard medical care by her peers and subordinates.

After Fallston suspended Dr. Freilich citing unprofessional behavior, Harford began its own investigation. After a somewhat protracted review process, Dr. Freilich’s application for reappointment at Harford was denied. As a result, Dr. Freilich sued Upper Chesapeake, Harford’s Board, and individual members of Harford’s Board. When the defendants sought summary judgment based on HCQIA immunity, Dr. Freilich tried to rebut the presumption of HCQIA immunity by claiming the decision to deny her reappointment was in retaliation for her reporting of substandard medical care. The Circuit Court was not swayed and granted summary judgment against Dr. Freilich on all counts. The Court of Special Appeals affirmed in an unreported decision and Dr. Freilich petitioned the Court of Appeals for further review.

In affirming the entry of summary judgment the Court rejected the defendants’ suggestion that evidence of retaliation was inadmissible and entirely irrelevant to the HCQIA immunity determination. Instead, the Court concluded that any evidence is relevant if it could lead to the conclusion that the immunity standards of the HCQIA were not met. Critically, however, the Court instructed that to overcome summary judgment, and the presumption of HCQIA immunity, a plaintiff must demonstrate "how" the claimed retaliation tainted the peer review process. The proper standard is an objective one which looks to the totality of the circumstances to determine if the peer review action was objectively reasonable. Because Dr. Freilich presented no evidence of how the peer review process was tainted, the presumption of immunity was not rebutted and summary judgment was proper.

Obviously, the HCQIA provides important guidance and protections to those involved in the peer review process at all levels. However, the HCQIA does not prevent a disgruntled physician from filing a lawsuit. In this regard, it is critical that those involved in peer review activities consult with an attorney to ensure that proper peer review policies and procedures are in place and followed.

"An ounce of prevention is worth a pound of cure." Benjamin Franklin.

For a copy of this case, or more information about physician peer reviews or related litigation, contact Dan Katz at 410.752.9725.

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