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Federal Appeals Court Clarifies HCQIA Standard |
The First Circuit decision in John Doe, MD v. Michael O. Leavitt, Secretary of Health and Human Services, 552 F.3d 75 (1st Cir. 2009), decided on January 14, 2009, provides some much needed clarification as to when an investigation may be considered to have concluded under the federal Health Care Quality Improvement Act (HCQIA). Under the HCQIA, a hospital has a duty to report physicians to the National Practitioner Data Bank if a physician has been reprimanded for conduct or quality issues or if clinical privileges have been surrendered by a physician while under investigation. Significantly, the First Circuit determined that an investigation is ongoing until a final disciplinary action is taken or until the investigation is formally closed.
The proceedings leading up to this valuable decision arose from a challenge to the Secretary of Health and Human Services’ interpretation of the word “investigation” as found in the HCQIA. The challenging physician (given the alias “Dr. Doe”) relinquished his clinical privileges following allegations of misconduct by an operating room nurse. The hospital reported his resignation pursuant to the HCQIA requirement that a hospital must report to the Secretary of Health and Human Services if it accepts the resignation of a physician who is under an investigation. 42 U.S.C. §11133(a)(1)(B)(i).
In the underlying administrative proceeding, Dr. Doe claimed that because he resigned after the hospital’s ad hoc investigating committee presented its report to the executive committee, he did not resign while “under an investigation.” He maintained that the statutory language only applies to the fact-gathering phase rather than the entirety of an inquiry. The Secretary held that an “investigation” is ongoing for purposes of HCQIA reporting requirements until a final action is taken or the investigation is formally closed, thereby confirming the hospital’s duty to report Dr. Doe’s resignation.
In its opinion, the First Circuit found that the Congressional purpose behind the HCQIA’s reporting requirement was to restrict the ability of incompetent physicians to move from state to state without disclosure or discovery of a previous adverse action. Dr. Doe’s proposed interpretation of the term “investigation” as only pertaining to the fact-finding portion of an inquiry would provide a loophole for physicians to avoid being reported. In reaching its conclusion, the First Circuit overviewed the Secretary of Health and Human Services’ decision, which reasoned that allowing physicians to avoid reporting by resigning prior to disciplinary action was in conflict with the HCQIA’s statutory purpose. Because the word “investigation” can be interpreted in different ways, the Court found that it was necessary to establish a definition that was in keeping with the broader statute. This definition is applicable in all cases of HCQIA reporting and overrides an individual hospital’s conflicting use of the term in its bylaws.
As a result of this important determination, the First Circuit has provided much needed clarity to the issue of what constitutes the investigatory timeframe during which reporting is mandated by the HCQIA. Now, it is evident that this period ends when a healthcare entity’s decision making authority either makes a final decision or formally closes the investigation.
Traci Thompson is an associate at Breazeale, Sachse & Wilson, LLP in Baton Rouge. Amy Gardner was a second year law student at Paul M. Hebert Law Center at Louisiana State University, at the time this article was written.
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