Florida judge upholds status of medical staff bylaws

Florida physicians won a major courtroom victory in a power struggle with a hospital that lasted nearly a decade, averting what doctors called a precedent that could have put the state's medical staffs at the mercy of hospital boards.

Instead, doctors say, the case provides yet another court decision that upholds medical staff bylaws as a binding contract hospitals cannot ignore.

A judge in the Second Judicial Circuit Court in Leon County ruled in March that the St. Lucie County Hospital Governance Law is unconstitutional. The court found that the law's sole purpose was to allow Lawnwood Medical Center Inc. to override the peer review process and physicians' appeal rights outlined in the medical staff bylaws. Because no hospitals outside the county have such "far-reaching" powers, the court concluded the law violates the state's constitution by giving one corporation a special privilege.

Although the ruling is likely to be appealed, doctors say the court, for now, has made it clear that hospitals must play by the rules.

"Most importantly, the court reaffirmed that the bylaws of the medical staff should be adhered to and once formulated and approved by the [hospital] board cannot be disregarded when a dispute occurs," said William B. Monnig, MD, chair of the Organized Medical Staff Section of the American Medical Association, which served as an adviser to the medical staff in the case.

The AMA/State Medical Societies Litigation Center also assisted with legal expenses.

Dr. Monnig said creating special legislation is an "unacceptable" method of conflict resolution. "Hopefully [the ruling] will act as a deterrent to others attempting something as egregious."

The Florida Medical Assn. was involved in extensive lobbying against the bill and was concerned it ultimately would become a state law, according to the FMA's general counsel, John Knight.

The court's decision puts a halt to legislation "that would basically make medical staffs subservient to hospital boards," he said. "As these issues come up more, we hope the courts would look at precedents like this around the country."

Beth Williams, spokeswoman for Lawnwood Medical Center, said the hospital intends to appeal the ruling. "This governance law and the actions we have taken have been aimed at the sole mission of ensuring quality care for our patients," she said.

Escalating dispute

The St. Lucie County Hospital Governance Law emerged out of a dispute between Lawnwood's hospital board and the medical executive committee that began in 1999. At that time, the hospital board dismissed the medical staff, claiming it failed to uphold its peer review duty to resolve problems in the hospital's pathology department.

The medical staff denied allegations it failed to conduct proper peer reviews. In 2000, a trial court ordered the hospital to reinstate the doctors, finding that the hospital violated the bylaws. Lawnwood challenged the ruling and lost on appeal. The AMA and FMA filed a friend-of-the-court brief in the earlier case, asking the court to uphold the validity of the medical staff bylaws. After that, the hospital succeeded in having the governance law passed, which became effective in July 2003. The statute was exclusive to St. Lucie County and stated the hospital board's bylaws would prevail over medical staff bylaws in conflicts over "medical staff privileges, quality assurance, peer review and contracts for hospital-based services."

According to court records, Lawnwood officials and members of the state Legislature said the law protects the public's health and welfare. But Thomas Crapps, an attorney representing the doctors in the case, disagreed.

"[The hospital] enacted the statute, so they could reject medical staff recommendations for any reason," he said.

The tension between the two sides escalated when the hospital board presented amendments to the medical staff bylaws to confirm the hospital would control the areas delineated in the new law. The medical staff rejected the changes and the authority of the statute.

Both parties took the law to court. The hospital, in December 2003, sued the medical staff in Leon County, the location of the state capital, Tallahassee. It asked the court to declare the law constitutional. One month later, the medical staff sued the hospital in St. Lucie County, asking the court to declare the law unconstitutional. The cases were consolidated before the Leon County court.

The central question before the court was whether the Legislature could enact a law that essentially applied to only one entity for its individual benefit. The court's ruling acknowledged that Florida case law recognizes that "hospital bylaws become a binding and enforceable contract between a hospital and its medical staff when adopted by a hospital's governing board."

Consequently, the court said, the St. Lucie County Hospital Governance Law violated the state constitution by altering the medical staff contract and giving the hospital extraordinary authority not agreed upon in the bylaws. The court found the law "was instead a means to bypass previous court interpretations of the medical staff bylaws" The court said the law was not a mechanism for reconciling conflicts between the two sides.

"[The ruling] does have national as well as statewide implications, because it says that a hospital corporation cannot circumvent doctors' rights by using its influence with the Legislature," Crapps said.

Lawnwood's attorneys had not returned calls for comment.