Know bylaws that protect medical staff

A column analyzing the impact of recent court decisions on physicians

By Tanya Albert amednews correspondent— Posted July 11, 2005.

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Are you one of those physicians who think being actively engaged in the hospital medical staff isn't important?

"Someone else will read through those sometimes lengthy documents and make sure I'm protected," you may think. "And really, how much do they really matter?" you may ask. After all, you've got patients to tend to.

Well, think again.

A recent court case -- one of a growing number of medical staff bylaw suits that pit medical staffs against hospital boards -- illustrates how crucial it can be to know exactly what is going on with those seemingly tedious medical staff issues.

It also shows how important it can be to be involved with the nitty-gritty details of the medical staff bylaws.

The case, Fabrizio v. Provena United Samaritans Medical Center, is winding its way through the court system in Illinois, one of the 20 states the American Medical Association says is suffering from a medical liability insurance crisis.

That's significant, because the issue in this case is whether the 100 doctors on staff at Provena United Samaritans Medical Center in Danville, Ill., must carry medical liability insurance with limits of $200,000 per incident and $600,000 aggregate annually or $1 million per incident and $3 million annually.

For a handful of doctors on staff at the hospital, the answer to that question means the difference between being able to afford insurance and continuing to practice or having to retire early or move to another state.

The trial court's final determination of which insurance limits are required came down to the contents of the medical staff bylaws.

Looking at bylaws as a contract

In 2004, Danville physicians turned to the Vermilion County Circuit Court after the dispute arose and the hospital said it could suspend or revoke the staff privileges of physicians who didn't carry the more expensive $1 million/$3 million policy.

While both sides agree that there had been discussions between the hospital medical executive committee and the medical staff about raising the required limits, the medical staff argued that no agreement had been reached.

Medical staff officers pointed to their bylaws specifically stating that those on staff needed to carry a $200,000/$600,000 professional liability policy. The hospital board of directors approved and adopted those medical staff rules and regulations in January 2003, according to court records.

Hospital administrators pointed to a memo from its president and chief executive officer, Mark S. Wiener, as proof that they could dismiss doctors who didn't carry the higher limit.

The "Wiener memo" informed the medical staff of the hospital's intent to require $1 million/$3 million professional limits, court records show. It made no mention of amending the bylaws and didn't discuss the lower limits already in place, records say.

The AMA considers medical staff bylaws to be a contract between the medical staff and the hospital, with each side bound by contract. In deciding which side was correct, Vermilion County Judge James K. Borbely said he was going to look at the case in that context -- as a contract case.

"Counsel correctly points out that it is not the business of this or any other court to micromanage the hospital's business," he wrote in the May opinion. "The court will make no attempt to do so. The dispute in the case at bar is basically one of contract, nothing more and nothing less."

Looking at the case in that light, the court said the bylaws adopted in 2003 had never been changed, and with no change in the bylaws, the hospital couldn't require the higher amount.

"A review of the facts in the case at bar reveals that there have indeed been discussions regarding medical malpractice limits from time to time over the years, both among the medical staff and the medical executive committee and between the medical executive committee and the board of directors," Borbely wrote.

"None of these discussions ever ripened to the point of an amendment to the bylaws," he said in the opinion. "The memorandum, standing alone, does not and cannot have the force and effect of a duly promulgated bylaw of the corporation."

Borbely's word is not the final one. Provena spokeswoman Lisa Lagger said the health system is appealing his ruling. But for now, it means that one psychiatrist has been able to regain his hospital privileges while maintaining the lower insurance limit, which he can afford. If the physicians ultimately prevail, all physicians on staff would have that option without fear of having their privileges suspended or removed.

It's important to pay attention

Thomas Pliura, MD, the Danville physicians' attorney as well as an emergency physician himself, said the judge was right in not allowing the hospital to adopt a policy that overrides a bylaw.

"Otherwise, what it the point of bylaws?" asked Dr. Pliura, who practices in LeRoy, Ill. "It's important for all physicians to know that the bylaws really are a contract and to not change them lightly. Any proposed changes could potentially have a big impact."

Although how courts see bylaws varies from state to state, most have looked at them as contractual, said Elizabeth A. Snellson, a St. Paul, Minn.-based attorney who specializes in medical staff issues.

She said recognition is important and that physicians need to take the contract seriously. "The need for physician involvement is absolutely key," Snellson said.

As hospitals increasingly have told physicians that they can take care of bylaws, doctors shouldn't hand over the responsibility, she added.

Doctors should know what is in their medical staff bylaws, said Robert John Kane, legal counsel for the Illinois State Medical Society. If the hospital proposes bylaw changes, medical staffs should hire an outside attorney who is familiar with medical staff issue to review them, he said.

"It's important to understand that hospitals can't run roughshod over the medical staff," Kane said.

Danville cardiologist Joseph Fabrizio, MD, past president of the county medical society and one of the physician-plaintiffs in the lawsuit, said he felt vindicated by Borbely's ruling.

Dr. Fabrizio said the doctors on his staff had seen how being involved makes a difference: "People have realized that they can change things."

Tanya Albert amednews correspondent—

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