An Overview of the Physician Peer Review Process and the Importance of Legal Counsel

 

A hospital peer review has the potential to seriously disrupt a physician’s medical practice, often bringing with it a cascade of legal consequences that can devastate a health professional's practice and reputation. If you are a physician facing the prospect of a peer review due to allegations of unprofessional behavior or a standard of care complaint, the earlier you seek help from an experienced healthcare law attorney familiar with the peer review process, the better positioned you will be to protect yourself against these consequences.

An understanding of the process and its possible sequela is important for any physician faced with the prospect of a peer review. There is much more at stake for the physician than whether he or she will retain their ability to work at a particular hospital and many pitfalls which can catch the doctor unawares.

For example, if a physician resigns his privileges during the course of a hospital investigation, the resignation will likely result in a report to the National Practitioner Databank ("Databank" or "NPDB") , a national clearinghouse of information regarding physician misconduct. A report will also be forwarded to the Texas Medical Board which will then open an investigation leading to potential disciplinary action. The NPDB report, and possible Board order, will be visible to other hospitals where the physician holds privileges, and may result in yet further investigations. Any attempt to move on and gain new privileges will require an explanation of the report. Finally, the NPDB report will raise questions with insurance carriers, whom may attempt to remove the physician from their provider network.

The Investigation Stage:

Broadly speaking, the peer review process takes place in two stages: an investigation followed by a fair hearing.  The specifics of this process will be governed by the hospital's medical staff bylaws which outline any right of the physician to participate in the investigation and the procedural details of the subsequent fair hearing.

Investigations are typically initiated by the hospital's Medical Executive Committee ("MEC") following a poor patient outcome or complaints about a physician's behavior or professional conduct. In some instances the hospital administration will also have the authority to open an investigation which will then be passed on to the MEC.

In cases where there is a perceived threat the physician's continued practice would pose an imminent threat to the hospital's patients or staff, the MEC may decide to immediately suspend the physician’s privileges pending further investigation. In addition to the severe damage such a temporary suspension inflicts on a physician's practice and reputation, should such a suspension continue for more than thirty days, the hospital is required to file a report with the NPDB and Medical Board.   

If the MEC proceeds without temporarily suspending the physician's privileges, the formal investigation process will begin and the physician will receive official written notice of the allegations. If the investigation is related to medical care, the MEC will likely send the relevant medical records out for external peer review by medical professionals in the same field as the physician. After these reviews are complete, the MEC or an investigative panel, made up of other physicians, will then interview the physician.

During the hospital’s investigation, the physician’s ability to actively defend against the allegations is usually limited. For example, the physician may be given little to no access to the relevant medical records. Likewise, the physician may not be allowed to speak with staff members who are potential witnesses to the issue under review. Additionally, the hospital will often restrict the participation of the physician's lawyer during the MEC's investigative meeting(s) even though the physician is typically asked to attend and answer questions.

When the investigation is concluded, the MEC will consider the evidence and make a recommendation. If the recommendation is to drop the allegations, the peer review ends. If, however, the MEC decides to modify, suspend, or revoke a physician's privileges, the physician must be timely notified in writing of the proposed action, the reasons for this recommendation, and informed their right to a fair hearing. In Texas, physicians also have the right to attempt to mediate the dispute with the MEC and hospital.

The Fair Hearing Stage:

If the physician does not agree to the MEC’s recommendation, they may request a fair hearing. A fair hearing is usually conducted at the hospital before a panel of physicians who are also on the medical staff. Ideally, the panel should include one or more physicians in the same specialty. The panel should not include any doctor in direct economic competition with the physician being peer reviewed.  

A hearing officer, normally a lawyer, will be appointed to oversee the hearing. The hearing officer's role is to resolve disputes between the physician and the hospital regarding the admissibility of evidence and hearing procedure and advise the hearing panel on other legal issues.  A hearing officer should also ensure that the hearing is conducted in compliance with provisions of the Federal Health Care Quality Improvement Act ("HCQIA"). The HCQIA requires the hospital to provide a physician certain due process rights, and a failure on the hospital’s part to provide these rights could result in the hospital and MEC losing its statutorily granted immunity from certain types of lawsuits.

 

 These due process rights include:

·         Allowing representation by an attorney or other person of the physician's choice;

·         Having a record made of the proceedings;

·         Permitting the physician to call, examine, and cross-examine witnesses;

·         Giving the physician an opportunity to present evidence determined to be relevant by the hearing officer, regardless of admissibility in a court of law; and

·         Allowing the physician to submit a statement at the close of the hearing

The medical staff bylaws may provide other procedural rights for the physician, such as limited discovery.  After the hearing, the panel will provide its recommendation to the MEC, who can either uphold or modify the panel's recommendation. If after the fair hearing the MEC decides to proceed with a recommendation adverse to the physician's privileges, medical staff bylaws usually allow the physician to appeal the MEC’s decision to the hospital's governing board. It is only after the governing board upholds the recommendation that the adverse action becomes final and a Databank report containing the MEC's recommendation is generated.  

Contact a Professional:

It is important that a physician involved in a peer review quickly retain legal counsel with both experience in this process and knowledge of applicable state and federal peer review laws. Even during the preliminary investigative phase, an attorney can guide and assist the physician in his interactions with the hospital, with an eye toward a subsequent fair hearing or law suit. An attorney is also necessary to ensure the hospital conducts the process in accordance with state and federal laws, and preserve evidence of any infringement of the physician's rights or illegal motives behind the peer review. 

Despite being called a fair hearing, this process is anything but. The medical staff bylaws are typically drafted to provide maximum advantage to the hospital and any subsequent lawsuit or appeal claiming the hospital made the wrong decision is unlikely to succeed. Texas courts have consistently held the due process rights which must be provided to a physician are minimal and the hospital's decision will not be second guessed by the judicial system. Peer review is often used as a sword in a political fight involving the medical staff and/or hospital administration with odds stacked against the physician. Even if the physician does not wish to continue practicing at the hospital, it is vital that an exit strategy be crafted protective of the doctor's interests.

The consequences of an adverse action on a physician's privileges will follow the physician for the rest of their career, regardless of where he or she practices.  If you believe you are about to be the subject of a peer review, it is imperative that you contact an experienced health care law attorney immediately.

 

Texas Department of Insurance-Division of Worker's Compensation Increases Oversight and Enforcement Actions Against Designated Doctors

 

For the past several years the Texas Department of Insurance-Division of Worker's Compensation (TDI-DWC) has steadily increased the number of enforcement actions initiated against Designated Doctors serving the Texas worker's compensation system. The results of such enforcement actions can range widely— from a requirement that the Designated Doctor (DD) complete additional training, the payment of a sizable administrative penalty, to removal of the physician's Designated Doctor (DD) status. Most DD's are likely aware of this trend as it corresponds with broader efforts by DWC to more tightly regulate the worker's compensation process.

To accommodate this augmented activity the Division of Worker's Compensation's enforcement division has expanded its staff through recruitment from other state healthcare agencies, such as the Texas Medical Board. As a by-product of this hiring policy the DWC has adopted and modified many of the procedures commonly used by these other administrative bodies. This includes implementing an informal conference procedure which largely models that used by the Medical Board. Similarly, DWC Staff also frequently forward a proposed settlement agreement to a Designated Doctor prior to an informal conference or other adequate opportunity to respond to alleged deficiencies. This procedure mirrors that used by the Texas Board of Dental Examiners and Texas Board of Nursing.

A DD will often first become aware of a pending enforcement action through a records request from DWC's enforcement division asking for all documentation still in the DD's possession related to one or more specified patients. Alternatively, DWC will send the Designated Doctor official correspondence expressly notifying them an enforcement action has been opened, listing the matters being investigated, and ask for a response. Prior to providing a response, a Designated Doctor in receipt of such a letter from the Division of Worker's Compensation should promptly contact an experienced attorney to discuss their case and determine whether it is advisable to retain legal representation. We have seen many clients unknowingly do irreparable harm to their case by submitting a response first and only seeking legal counsel after they receive a proposed resolution from the enforcement division.

The DWC can initiate an enforcement action against a Designated Doctor for a broad array of different reasons, including submitting Designated Doctor's Evaluations (DDE) late, establishing a date of Maximum Medical Improvement (MMI) or Impairment Rating (IR) with which the Division's Office of the Medical Advisor disagrees, or having an Administrative Law Judge subsequently overturn the DD's findings in a hearing involving an injured worker. In fact, the kind of conduct, issues, errors, and omissions that can be considered a violation of the DWC's Rules is vast and many may seem picayune to the physician or outside observer. Regardless, the enforcement division pursues each issue zealously and makes full use of DWC's broad discretion to regulate its DD's in seeking enforcement action.

Any Designated Doctor who has been targeted for a possible enforcement action by DWC should immediately contact an attorney experienced in representing clients before the agency. The risks of going it alone are substantial and the DWC does not shy from removing physicians as Designated Doctors, particularly not in the overactive regulatory climate which currently prevails. My firm has been very successful in achieving successful outcomes for DD's before DWC and this includes physicians whom the enforcement division sought to have removed from the program. A vigorous rebuttal and/or remedial presentation by a lawyer experienced in advocating before the DWC can make all the difference in the final outcome.

 

The Ryan Haight Act and the Changing Face of Telemedicine

 

The advent of telemedicine has made it possible to provide high quality medical care for underserved areas of Texas. Patients in rural areas now have the opportunity to receive care from the state’s best physicians when before travel costs would have made it impossible. Because of the new nature of telemedicine, state and federal laws and regulations have remained in flux. It is important for any telemedicine provider to be aware of these changes to ensure they remain compliant. 

One of the most significant changes to telemedicine was the passage of the Ryan Haight Act in 2008. The Act places a number of restrictions on the practice of online pharmacies and the ability of practitioner's to prescribe medications through the internet. It was named after Ryan Haight, a teenager who died of a drug overdose in 2001 from controlled substances he bought from an online pharmacy. Mr. Haight was able to procure a prescription for Vicodin online without ever meeting a doctor.

The Act regulates anyone who delivers, distributes, or dispenses medication by means of the internet. The Drug Enforcement Agency treats a practitioner who prescribes medication following a telemedicine evaluation as covered under the Act. Generally a practitioner is in violation of the act if he or she does not perform at least one in-person assessment of the patient before prescribing medication.

The Act does exempt practitioners from this requirement as long as a practitioner meets the federal definition of practicing telemedicine. A physician practicing telemedicine may prescribe controlled substances without an in-person evaluation if: (1) The patient is treated by, and physically located in a hospital or clinic which has a valid DEA registration; and (2) the telemedicine practitioner is treating the patient in the usual course of professional practice, in accordance with state law, and with a valid DEA registration. 21 USC 802(54)(A). The most important thing to note for a practitioner is that the location where the patient is being treated must be a hospital or clinic that is itself registered with the DEA.

The requirement that the patient be in a hospital or clinic with a DEA registration is more stringent than Texas Medical Board requirements. Under Board rules, a physical, in-person evaluation is not necessarily required to prescribe medication and there is no requirement that the hospital or clinic have a DEA registration. A physician may treat a patient solely through telemedicine as long as the physician creates a physician-patient relationship, the patient is being treated at an “established medical” site, e.g., a clinic or hospital, and all additional requirements are met, including the use of a qualified presenter to examine the patient. Texas law also mandates that a telemedicine provider create and maintain detailed written protocols aimed at preventing fraud and abuse as well as separate policies covering the protection of patient privacy.

There are a number of other special types of telemedicine that under federal law allow a practitioner to prescribe medication without an in person visit, such as practicing telemedicine while working for the Veterans Administration, or receiving a special exemption from the Attorney General. The interaction between federal law and state law in this field is complicated and changing, and made all the more complicated by the piecemeal construction of the Controlled Substances Act.

If you are a physician who is thinking of beginning a telemedicine practice, it is important to seek the advice of experienced counsel to ensure your practice meets all federal and state law requirements.  The applicable law can be complex and involve overlapping mandates on both the state and federal level. In Texas the rules regarding telemedicine continue to evolve as the Texas Medical Board frequently revisits this issue, often with an eye towards making more stringent regulation. The attorneys at the Leichter Law Firm have aided numerous physicians and other providers navigate both state and federal telemedicine law and implement best practices to help avoid the most common problems endemic to this field. In our experience, telemedicine is a complaint rich area where seeking the advice of a qualified attorney prior to being subjected to state or federal scrutiny makes all the difference.

 

TSBP Adopts New Rule Requiring Pharmacists to Verify Prescriptions Meet Applicable Medical Standard of Care

 

Texas pharmacists should take note of a new Rule recently adopted by the Texas State Board of Pharmacy which places increased responsibility on the licensee to ensure that dispensed medications were prescribed for a valid medical purpose and pursuant to a proper patient-physician relationship. The Rule, which can be found at §291.29 in Title 22 of the Texas Administrative Code, is clearly aimed at controlling some of the worst abuses of internet pharmacy as well as the non-therapeutic prescribing of pain medications. The potential problem lies in that it creates a duty for pharmacists to verify that the prescriptions they dispense were generated by physicians working within their own practice standards as outlined in the Medical Practice Act and Rules of the Texas Medical Board. It is unclear to what extent this means Texas pharmacists are now expected to be fully educated on the applicable standards of care for Texas physicians, as interpreted by the TMB, in the treatment of chronic pain and use of internet and telemedicine. 

Specifically, the rule requires a Texas pharmacist to “make every reasonable effort” to confirm that a prescription has been issued for a legitimate medical purpose. A licensee is prohibited from dispensing a prescription if the pharmacist “knows or should have known” that the order was issued without a valid pre-existing patient-physician relationship as defined in the Texas Medical Board’s administrative Rules. Interested pharmacists can find these Rules at §§174.4 and 190.8 in Title 22 of the Texas Administrative Code.

Internet pharmacies are expressly barred from dispensing a prescription unless such medication is for a valid medical purpose and the prescribing physician has conducted at least one in-person physical evaluation of the patient. Prescription by online questionnaire is explicitly noted as unacceptable. The Rule goes further to prohibit a pharmacist from dispensing medications in the absence of a valid patient-physician relationship or if the prescription is “otherwise in violation of the practitioner’s standard of practice.”

Plainly, the Pharmacy Board’s new Rule could be interpreted as imposing a wide-sweeping burden on Texas pharmacists to perform their due diligence and ensure they are not filling prescriptions that do not meet the appropriate medical standard of care or were prescribed without an in-person physical examination. The obvious target of the new regulation is pharmacists who are seen as functioning as the tail end of a “pill mill” whether such prescriptions are generated online or at a physician’s office. Pharmacists who fill large quantities of pain medications, particularly the popular chronic pain “cocktails,” or other suspect drugs such as cough syrup should be aware that under the new rule they could risk a disciplinary action by the Texas State Board of Pharmacy if a reasonable person would have known the prescriptions were not medically valid or were issued without a proper examination or physician-patient relationship. It is not simply enough that the pharmacist can disclaim actual knowledge; if a reasonable pharmacist should have known or suspected they were being asked to fill such prescriptions, they are potentially vulnerable to a disciplinary action by the Pharmacy Board.

It is important to stress that Section 291.29 refers back to parts of the Medical Practice Act and the Texas Medical Board’s own Rules to define what constitutes a non-therapeutic prescription or a valid patient-physician relationship. This may be confusing to Texas pharmacists who are unfamiliar with the law and regulations as it applies to physicians, However, as an attorney who has represented hundreds of physicians before the Medical Board, I can affirm the TMB takes a strict and conservative stance towards these same issues and regularly pursues practitioners whose primary practice involves the treatment of chronic pain on the basis that they engage in non-therapeutic prescribing of narcotics and related medications. The TMB is also zealous in pursuing physician’s engaged in telemedicine which does not conform to the strict standards outlined in their Rules on Telemedicine (which can be found at Chapter 174 in Title 22 of the Texas Administrative Code). Given the strong interweaving of Rule 291.29 with the Medical Practice Act, I its adoption was coordinated with the Texas Medical Board and that Pharmacy Board and TMB attorneys and Staff may start to synchronize their enforcement actions against “bad” physicians and the pharmacists who fill their prescriptions.

Thankfully, the recently adopted Rule does provide some guidance as to when a pharmacist should be on guard. Several potential warning signs of bad prescriptions are expressly listed: these include the number of prescriptions authorized on a day-to-day basis by a practitioner, the geographical distance between the practitioner and the patient, the manner in which the prescriptions are authorized and received by the pharmacy, and whether the pharmacist knows the prescriptions are issued based on a questionnaire or over the internet.     

The bottom-line is Texas pharmacists need to be extra vigilant in confirming dispensed prescriptions were written in line with the applicable standard of care and were issued following a valid face-to-face medical examination. The adoption of §291.29 could potentially signal the beginning of a new round of enforcement actions by the Texas State Board of Pharmacy and any pharmacist unsure as to their possible liability would be wise to consult with an attorney familiar with the TSBP and the applicable legal standards. 

Texas Board of Nursing and Standard of Care Violations

 

Mirroring general trends, the number of standard of care complaints against Texas nurses have risen dramatically in the past few years. All too often, the Board has chosen to punish nurses as individuals for what are actually institutional defects in the larger medical entities where they practice. This is particularly true for nurses serving marginalized patients such as those found in the prison system. Further, just as in cases of chemical dependency, unprofessional conduct, and criminal convictions, the danger to a nurse’s license is very real.

 

These cases can be especially frustrating for clients because the basic challenge is to their competency as a nurse. All too often the Board is willing to pin the blame on a nurse for situations in which there was no clear breach of the standard of care and in fact no evidence that the stated medical intervention would have made a difference. Modern nursing practice can be a hectic experience and unfortunately the Texas Nursing Board is often reluctant to accept that people do in fact die or get sicker in hospitals without a breach in the standard of care by a nurse. Additionally, the dynamic of these matters is such that the Board may investigate one nurse who then tries to shift blame, whether real or nonexistent, onto another. 

 

The need for legal representation in such cases cannot be stressed enough. Effective advocacy in standard of care cases generally requires the parsing of voluminous medical records and the development of expert testimony on the applicable standard of care and whether or not it was met in that case. A nurse without an attorney will be placed in a decided disadvantage by the lack of their own expert who can independently challenge or verify the opinion of the Board of Nursing’s expert who, not too surprisingly, seems to always side with BON. Add to this the development of any applicable mitigation evidence, and most nurses will be left with a complex situation where an attorney on your side will be an immeasurable help. It’s not worth going it alone, as the Board generally feels they can do what they want to a nurse who doesn’t have a lawyer. Remember, your license and ability to provide for yourself and your family is at stake.

Member of Texas Medical Board Resigns Amid Flood of Criticism

The resignation last week of Keith Miller, MD, a 2003 Perry appointee to the Texas Medical Board, has sparked an outpouring of relief and further recriminations from the beleaguered doctor’s many critics.[i]  A longtime member of the TMB’s disciplinary committee, Dr. Miller claims his resignation is due to the enactment of a rule law barring Board members from serving as expert witnesses in medical malpractice cases. Dr. Miller, who has a long history of serving as a plaintiff’s expert in such cases, believes his resignation was necessary to prevent any appearance of a conflict of interest.[ii]

Opponents of Dr. Miller have alleged that he has exploited his position on the Enforcement Committee, which has the power to revoke and restrict a physician’s state medical license, in his role as an expert witness.[iii]  They claim his involvement in disciplining doctor’s who have violated the Medical Practice Act, including standard of care allegations, at the same time that he has maintained close connections with the plaintiff’s bar and served as an expert, has placed a cloud of impropriety on the Board. In fact opponents could point to his resignation in response to a new Board Rule addressed to precisely this issue as vindication of this claim. 

However, critics of Dr. Miller’s tenure have further accused him of improperly using his position on the TMB to transform the Enforcement Committee into a virtual arm of the insurance industry.[iv]   Board Rules allow anonymous complaints to be made to the TMB which can then serve as the basis of a disciplinary action. Aggrieved physicians have alleged that insurance providers who are dissatisfied with the level of care provided to a covered patient have used such anonymous complaints as a way to punish doctors and maintain low cost levels. Such physicians point out that it is not actually the standard of care which motivates these anonymous complaints but rather a doctor’s decision to supply care whose cost exceeds insurance company guidelines and therefore hurt profits. These maligned anonymous complaints originate from the insurance providers and not the actual patients. In fact the patients whose care is supposedly at issue are frequently surprised when notified of the pending disciplinary action and often testify in favor of their doctor.

However, critics of Dr. Miller’s tenure have further accused him of improperly using his position on the TMB to transform the Enforcement Committee into a virtual arm of the insurance industry.[i]   Board Rules allow anonymous complaints to be made to the TMB which can then serve as the basis of a disciplinary action. Aggrieved physicians have alleged that insurance providers who are dissatisfied with the level of care provided to a covered patient have used such anonymous complaints as a way to punish doctors and maintain low cost levels. Such physicians point out that it is not actually the standard of care which motivates these anonymous complaints but rather a doctor’s decision to supply care whose cost exceeds insurance company guidelines and therefore hurt profits. These maligned anonymous complaints originate from the insurance providers and not the actual patients. In fact the patients whose care is supposedly at issue are frequently surprised when notified of the pending disciplinary action and often testify in favor of their doctor.

Miller’s opponents specifically point to his position on the Texas Medical Advisory Committee of Blue Cross Blue Shield as evidence of his close ties with insurance providers. For instance, Dr. Steven Holtze president of the Project for Freedom of Access to Natural Solutions has alleged that Dr. Miller has used his position to sanction practitioners of environmental medicine, an area of practice disfavored by some insurance providers. This included disciplinary proceedings against Dr. William Rea, the founder of the Environmental Health Center in Dallas.[ii]

The Texas Medical Board initiated their investigation into Dr. Rea following an anonymous complaint which was later found to have been made by the insurance provider for five of his patients. Even though eighteen expert witnesses and all five patients testified in favor of Dr. Rea, the TMB, relying on a single anonymous expert witness, still ruled against the doctor. At the proceeding, Dr. Miller is alleged to have explicitly disregarded all of Dr. Rea’s rebuttal evidence and assured him that he was going to get his license no matter what.

Other cases pointed to as exemplars of the “Star Chamber” style of the Enforcement Committee during Dr. Miller’s tenure include the disciplinary proceeding of Dr. Chris Kuhne.[iii]  There the Board completely ignored an unfavorable decision of the Honorable Administrative Law Judge Wendy Harvel and imposed harsh sanctions for a minor billing error concerning charges for copied of medical records.

It should be noted that any non-anonymous disciplinary sanction no matter how minor will virtually always result in the effected doctor losing access to insurance provider networks and hospital privileges. The cost involved in such a loss, not too mention the often large legal bills required to defend such a case, can be financially devastating. These severe consequences have led many to express a sigh of relief that the Keith Miller era has finally come to a close.

Investigatory Gymnastics by the TMB: Quality of Care & Documentation

Many doctors consider the possibility of a disciplinary action based on inadequate or improperly kept medical records to be remote. Yet, the Texas Medical Board will oftentimes use a complaint based on other grounds, such as an alleged standard / quality of care violation, as an opportunity to thoroughly investigate a licensee’s compliance with Board Rules concerning the maintenance of medical records. Even if the original complaint is found baseless, the TMB has the right to pursue disciplinary sanctions for any other violations found during their investigation, and in a quality of care case this investigation will certainly include a thorough review of medical records.

Under the Texas Administrative Code, the Texas Medical Board has adopted official agency rules regarding the proper maintenance of medical records. For example, § 165.1 contains numerous mandatory guidelines concerning the maintenance of “adequate medical records.” Title 22 Texas Administrative Code § 165.1. Moreover, pursuant to the Medical Practice Act, the TMB has the same authority to pursue the full range of disciplinary sanctions for non-compliance with this provision as it does for any other Rule. Texas Occupations Code § 164.051(a)(3).

When the Board initiates an investigation into a complaint, they are searching for any breach of either the Texas Medical Practice Act or TMB Agency Rules, not only for evidence regarding the original allegations. Unsurprisingly this investigation will include a searching review of medical records completed and maintained by the physician. This is all the more true with quality of care cases where a final determination will necessarily involve an expert review(s) of the relevant records. At this point the Board may decide that no clinical breach in the quality of care occurred, however, they can, and frequently will, next initiate a licensure action regarding improper medical documentation. The Board will then pursue a sanction such as placing the doctor’s license on probationary status complete with onerous conditions that can remain in force for years. Further, any disciplinary action will likely remain part of the licensee’s record and could trigger mandatory reporting requirements to other state licensure boards, the National Practitioner’s Database, and the doctor’s place of practice. Texas doctors need to be aware of this stepping-stone potential and its latent consequences.