Medical staff autonomy a must: Courts take note

An Illinois appeals court ruling would let hospitals ignore important medical staff bylaws.

Posted July 17, 2006.

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California and Florida are among the state courts that have recognized the importance of medical staff autonomy in recent years, and the Illinois court system needs to do the same.

An Illinois trial court in 2005 got it right. It recognized that a hospital board and medical staff both must approve a change in policy that would require physicians on staff at the hospital to be required to carry medical liability insurance policies with higher limits or face losing their staff privileges.

But in a 2-1 decision in late May, the Illinois Fourth District Appellate Court issued a ruling that undid that and paved the way for the hospital to make some important decisions without needing a vote from the medical staff.

Specifically, the court in Fabrizio v. Provena said it was OK for Provena United Samaritans Medical Center in Danville, Ill., to require physicians to carry medical liability policies with at least $1 million per incident and $3 million aggregate annually even though the medical staff voted against raising the policy limits. Previously, the medical staff and hospital had agreed to a $200,000/$600,000 policy, a much less expensive policy during a time when physicians' medical liability insurance rates in Illinois have skyrocketed.

Although the Third District Appellate Court in a different case, Lo v. Provena, only a year ago had said bylaws are a contract between a hospital and its staff, the Fourth District said the case before it was different because it was not made in the "context of a staff-privileges dispute" as Lo was. The Fourth District court held that Lo enforced procedural rights within the hospital bylaws when staff privileges were revoked, reduced or suspended.

Consequently, the majority ruled, medical staff bylaws are not "enforceable in their entirety on a contractual basis." The court said that means that doctors can't challenge the process by which bylaws or resolutions come into existence, as was the case in Fabrizio in which doctors challenged how the higher insurance limit requirement came to be. Allowing that, the court said, would put the staff on "equal footing with the hospital" on administrative issues and would "convert the bylaws into something akin to a collective bargaining agreement."

But medical staff bylaws need to be enforced in their entirety, not just in situations in which, as this court seems to suggest, a physician's clinical competence is in question.

Medical staff bylaws are a contract between the organized medical staff and the hospital, and both sides are bound by them. Hospitals shouldn't be able to change bylaws unilaterally or to ignore them.

The Illinois State Medical Society, which filed a friend-of-the-court brief in the Fabrizio case along with the American Medical Association/State Medical Societies Litigation Center, has said bylaws are one of the few things that physicians have within a hospital institution that they can use to govern their practice of medicine.

And the blow to medical staff autonomy is not the only disappointment in the ruling.

If the Fabrizio decision stands, it's also a blow for physicians who would have to pay more for medical liability insurance.

In today's litigious world, physicians would love to be able to carry the higher insurance limits, and many do. But the current medical liability climate can be unaffordable for some to do that. The hospital's higher limit requirements could result in some physicians losing their privileges at the hospital because they cannot afford to stay in business if they have to pay the higher premiums.

Doctors are asking the Illinois Supreme Court to consider the case. The state's high court hears only a fraction of the cases it is asked to, but this should be one of them. The court should recognize the importance of medical staff autonomy just as the trial court did and just as courts in other states have done.

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