IMPORTANT
INFORMATION
FOR PHYSICIANS
(Archives)
California
Statute Limiting Appeals of Medical Board Discipline Ruled Unconstitutional
A California Court of Appeal has ruled unconstitutional a new California law that
limited appeals by physicians of discipline imposed by the Medical Board. In the case of Leone
v. Division of Medical Quality (1997) 97 CDOS 7635, the Second Appellate District
issued an opinion voiding as unconstitutional a revision to Business and Professions Code
ß2337, which eliminated the rights of physicians to take a full appeal from unfavorable
Superior Court decisions on disciplinary orders from the Medical Board. The new law had
provided that the procedure in the court of appeal was limited to writ petitions, which
are much more streamlined and easy to deny, rather than a full appeal. The court of appeal
held that the legislature was without the authority to abridge this basic appellate right
and that the law was therefore unconstitutional.
California
Supreme Court Agrees to Decide Potvin case
The California Supreme Court has agreed to hear the Potvin
v. Metropolitan Life case in
which a lower court had announced that managed care plans have an obligation to give
terminated physicians "fair procedure" prior to termination, regardless of the
reason or basis for the termination. By agreeing to hear the case, the Supreme Court has
automatically vacated the lower court decision. It will probably take a year for the case
to proceed through briefing and oral argument to a decision.
Brock Phillips, August 1997
Court of Appeal Reaffirms Immunities
for Medical Board Investigators
Broad immunities exist for state employees carrying out investigative and prosecutorial
duties. Those immunities apply to Medical Board investigators and members of the attorney
general's office who prosecute disciplinary cases for the Medical Board. This was
underscored in the recently decided case of Vincent Bradley v. Medical Board of
California (97 CDOS 5663) in which a California appellate court rebuffed Dr. Bradley's
charges that those who investigated and prosecuted the action against his medical license
violated his state and federal rights through an "entrapment" type of
investigation.
Dr. Bradley was accused of improper prescribing of controlled substances and as part of
its investigation the Board sent investigators into his office posing as patients seeking
prescriptions for controlled substances. The prescriptions he provided to the
investigators posing as patients became part of the case against his license. He
ultimately surrendered his license but sued numerous individuals involved in his
investigation and prosecution, claiming violations of his rights. Not only did the
appellate court throw out Dr. Bradley's suit, it ordered him to pay the state's costs for
defending the appeal.
Brock Phillips, July 1997
Metropolitan Life petitions the
California Supreme Court to overturn the Potvin decision
By now the Potvin decision, which came out of the California Court of Appeal on 30
April 1997, is quite well known in the managed care and physician communities. That court
of appeal decision requires a managed care plan or payor to give a "deselected"
physician a due process hearing. It is not clear from the decision whether the right to a
due process hearing arises every time a physician is deselected, regardless of the reason,
or whether the right is confined to deselections for quality of care concerns.
In any event, not surprisingly, Metropolitan Life has petitioned the California Supreme
Court to hear the case. As of the end of June the court had not responded to this request.
The question of whether managed care entities should be required to provide due process
hearings to excluded or deselected physicians similar to those required of hospital
medical staffs and private peer organizations is hotly disputed by HMO's and other managed
care providers. They maintain that their relationships with providers are purely
commercial arrangements governed by their contracts, including without cause termination
clauses. Advocates for physicians argue that the common law which evolved around
exclusions from hospital medical staffs and other peer organizations is equally applicable
to managed care organizations which increasingly possess great market power. This view has
been gaining currency with the courts. In 1996 both the New Hampshire and Connecticut
supreme courts found a right to a hearing in the cases of Napoletano v. Cigna
(Connecticut) and Harper v. Healthsource New Hampshire Inc. (New Hampshire). Two other
California decisions, Ambrosino v. Metropolitan Life Insurance and Delta Dental Plan
v.
Banasky also appear to graft the hospital medical staff common law onto expulsions from
managed care provider panels.
Brock Phillips, July 1997
Bad Faith Wrongful Termination Defined
In Cotran v.
Rollins Hudig Hall Intl., Inc. (1998) 98 CDOS 58, plaintiff, hired under an implied
agreement not to be dismissed except for good cause, was terminated for sexual harassment.
He strongly denied harassing fellow employees and sued his employer for wrongful
termination.
The California
Supreme Court held that the jury was not to decide whether the plaintiff actually harassed
the employees, but whether the factual basis on which the employer concluded a
dischargable act had been committed was reached honestly, after an appropriate
investigation, and for reasons that are not arbitrary or pretextual.
When an employee is
fired for misconduct and sues, the employer's actions are judged by not whether the
misconduct actually occurred, but by whether the employer's response to the allegations of
misconduct were fair, honest, reasonable, and in good faith.
Delbert
Gee, February 1998
Investigation By Attorney Not Privileged
In Wellpoint
Health Networks v. Superior Court (1997) 97 CDOS 8639, the Court of Appeal held that
an investigation by a law firm retained by an employer to investigate allegations of a
hostile work environment by an employee was not protected from discovery by the
attorney-client or attorney work product privileges in a subsequent employment
discrimination action where the employer contended that it took reasonable corrective or
remedial action upon learning of the allegations since the investigation could be evidence
of its reasonableness.
The Court also held
that if the employee contends that the attorney did not perform the investigation as an
attorney, but as part of the employer's normal method of dealing with such allegations,
the employee must also present evidence of the employer's routine assignment of
investigations to its outside counsel.
Delbert
C. Gee, December 1997
Supreme Court Agrees to Hear Guz
v. Bechtel
The California Supreme Court granted
the petition for hearing on the Guz v. Bechtel National case on August 27, 1997. The
Court of Appeal's decision was vacated and the Supreme Court will now take up the issue of
defining what is "at will employment".
Delbert Gee, August 1997
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