Landmark Peer Review Ruling – Fifth Circuit Reverses Poliner
After the shock of the Texas-sized, multi-million dollar award in a seeming case of peer-review gone wrong (Poliner v. Texas Health Systems, 239 F.R.D. 468 (N.D.Tex 2006)), hospitals can finally breathe a sigh of relief. The Fifth Circuit has reversed the award and has explained that subjects of peer review investigations “are entitled to a reasonable effort, not a perfect effort” judged as of the time of the investigation, not in hindsight. Poliner v. Texas Health Systems, 537 F.3d 368, 380 (5th 2008).
The July 23, 2008 Fifth Circuit Poliner decision provides additional clarity on immunity under the federal Health Care Quality Improvement Act; 42 U.S.C. 11101(1),(2) (HCQIA) and offers more certainty regarding the protection available to hospitals engaging in the peer review process.
The United States Fifth Circuit overturned the Texas district court judgment, which awarded $33 million to Dr. Lawrence Poliner, a cardiologist who alleged a hospital’s temporary restrictions on his medical staff privileges were improper and injured his reputation and career. Poliner and his professional association sued Presbyterian Hospital and the individual members of the peer review committee after his privileges were summarily suspended. He claimed defamation, and improper and malicious use of the peer review process.
On a motion for summary judgment, the district court found that, for the suspension, the hospital was entitled to immunity from money damages under HCQIA and granted partial judgment accordingly. The focus of the case then shifted to the temporary restriction of Poliner’s privileges prior to the suspension, in the form of an alleged “forced abeyance.” Specifically, the trial court found a fact issue as to whether Poliner’s consent to the pre-suspension abeyance, and a later extension of it was vitiated by the threat that, if he did not consent, his privileges would be summarily suspended. The trial court found a fact issue as to whether defendants were entitled to HCQIA immunity for this temporary restriction. Ultimately, the jury considered the abeyances and Poliner’s tort claims and found in Poliner’s favor, awarding $366 million in damages despite defendants’ claim of immunity under HCQIA. The award was substantially reduced on remittitur.
On appeal, the Fifth Circuit overturned the district court’s decision on the abeyance and the extension of the abeyance finding both instances were professional review actions under HCQIA, such that the defendants were entitled immunity.
The Fifth Circuit explained that the district court incorrectly interpreted several of the requirements for immunity under HCQIA. Its opinion focused on whether the defendants in Poliner had followed the provisions for immunity under HCQIA, 42 USC §11112(a): (1) Were the actions taken in the reasonable belief that they furthered quality healthcare? (2) Was there a reasonable effort to obtain the facts? (3) Were adequate notice and hearing procedures afforded to the affected physician? (4) Did the defendants reasonably believe that their adverse action was warranted by the facts known?
The Fifth Circuit found that the reasonableness requirement was intended to create an objective standard of performance, rather than a subjective good faith standard, thus the good or bad faith of the reviewers was irrelevant. In addition, the court clarified that the reasonable belief standard of HCQIA is satisfied if the reviewers, with the information available to them at the time of the professional review action, would reasonably have concluded that the action would restrict incompetent behavior or would protect patients. Thus, the Act does not require an actual improvement of the quality of healthcare, nor does it require that the conclusions reached by the reviewers are, in fact, correct.
The Fifth Circuit also clarified that HCQIA immunity is not coextensive with compliance with an individual hospital’s bylaws. Rather, the Act imposes a uniform set of national standards. If the peer review action complies with the standards, a failure to comply with hospital bylaws does not defeat the hospital’s peer reviewer’s right to HCQIA immunity from money damages.
Finally, the Court emphasized that HCQIA immunity only extends to money damages. It acknowledged that alternative remedies such as injunctive or declaratory relief are available to physicians in the event of unjustified or malicious peer review.
The Fifth Circuit’s Poliner decision should reassure hospitals that even if its bylaws are not followed exactly, HCQIA immunity can still be available. Further, the ruling confirms that in peer review matters, regardless of allegedly “evil motives” of peer reviewers, a court’s overriding concern is whether those participating in the proceeding behaved in an objectively reasonable manner to reach an objectively reasonable determination at the time they took the action at issue. It matters not whether, in hindsight, the peer review determination was actually correct.
Ms. Grey is a partner in the healthcare section of Breazeale, Sachse and Wilson, LLP in Baton Rouge. and Ms. LaNasa was an associate with the firm when this article was written.