Freilich v. Upper Chesapeake Health, Inc.

• Decision Date: 13 December 2002
• Docket Number: No. 01-1890.,01-1890.
• Citation: 313 F.3d 205
• Parties: Linda FREILICH, M.D., P.A.; Linda Freilich, M.D., Plaintiffs-Appellants, v. UPPER CHESAPEAKE HEALTH, INCORPORATED, formerly know as Harford Memorial Hospital; Board of Directors of Upper Chesapeake Health, Incorporated, formerly known as Harford Memorial Hospital; Cecilio T. Camacho, M.D., as a Director and individually; Joan P. Edwards, M.D., as a Director and individually; Scott S. Haswell, M.D., as a Director and individually; Shirley S. Klein, as a Director and individually; James Lambdin, as a Director and individually; Anthony J. Meoli, as a Director and individually; Lyle E. Sheldon, as a Director and individually; David F. Gonano, as a Director and individually; Sherif H. Osman, M.D., as a Director and individually; Roger E. Schneider, M.D., as a Director and individually; Diane K. Ford, as a Director and individually; H. William Acker, as a Director and individually; Randall Worthington, Sr., as a Director and individually; United States of America; State of Maryland, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

313 F.3d 205

Linda FREILICH, M.D., P.A.; Linda Freilich, M.D., Plaintiffs-Appellants, v. UPPER CHESAPEAKE HEALTH, INCORPORATED, formerly know as Harford Memorial Hospital; Board of Directors of Upper Chesapeake Health, Incorporated, formerly known as Harford Memorial Hospital; Cecilio T. Camacho, M.D., as a Director and individually; Joan P. Edwards, M.D., as a Director and individually; Scott S. Haswell, M.D., as a Director and individually; Shirley S. Klein, as a Director and individually; James Lambdin, as a Director and individually; Anthony J. Meoli, as a Director and individually; Lyle E. Sheldon, as a Director and individually; David F. Gonano, as a Director and individually; Sherif H. Osman, M.D., as a Director and individually; Roger E. Schneider, M.D., as a Director and individually; Diane K. Ford, as a Director and individually; H. William Acker, as a Director and individually; Randall Worthington, Sr., as a Director and individually; United States of America; State of Maryland, Defendants-Appellees.

No. 01-1890.

United States Court of Appeals, Fourth Circuit.

Argued October 29, 2002.

Decided December 13, 2002.

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ARGUED:

Paul Steven Blumenthal, Law Office of Paul S. Blumenthal, P.A., Annapolis, Maryland, for Appellants. Jonathan Barkasy Sprague, Post & Schell, P.C., Philadelphia, Pennsylvania, for Appellees Upper Chesapeake Health, et al.; Wendy Ann Kronmiller, Assistant Attorney General, Baltimore, Maryland, for Appellee State of Maryland; Katherine Sutherland Dawson, Appellate Staff, Civil Division, United States Department of Justice, Washington, D.C., for Appellee United States.

ON BRIEF:

Jennifer M. Valinski, Law Office of Paul S. Blumenthal, P.A., Annapolis, Maryland, for Appellants. Brian M. Peters, Post & Schell, P.C., Philadelphia, Pennsylvania, for Appellees Upper Chesapeake Health, et al. J. Joseph Curran, Jr., Attorney General of Maryland, Baltimore, Maryland, for Appellee State of Maryland. Robert D. McCallum, Jr., Assistant Attorney General, Thomas M. DiBiagio, United States Attorney, Mark B. Stern, Alisa B. Klein, Appellate Staff, Civil Division, United States Department of Justice, Washington, D.C., for Appellee United States.

Before WILKINSON, Chief Judge, and WIDENER and KING, Circuit Judges.

Affirmed by published opinion. Chief Judge WILKINSON wrote the opinion, in which Judge WIDENER and Judge KING joined.

OPINION

WILKINSON, Chief Judge.

Dr. Linda Freilich is a physician. Harford Memorial Hospital decided to terminate Dr. Freilich's medical staff privileges after undertaking an extensive review of her application for reappointment. Dr. Freilich then filed a complaint challenging the constitutionality of the federal statute granting immunity to peer review participants and the Maryland physician credentialing statutes. In addition, Dr. Freilich alleged violations of both the Americans with Disabilities Act and the Rehabilitation Act and made various other common law claims. Dr. Freilich's complaint is an attempt to have a federal court supervise what amounts to little more than a physician-hospital dispute over hospital policies and the expenditure of hospital resources. We affirm the judgment of the district court dismissing her claims. Freilich v. Bd. of Dirs. of Upper Chesapeake Health, Inc., 142 F.Supp.2d 679 (D.Md.2001).

I.

Dr. Linda Freilich is a Board Certified Internist and Nephrologist who maintained unrestricted hospital privileges at defendant Harford Memorial Hospital (HMH), a private, non-profit hospital, from 1982 until April 12, 2000. During her tenure at HMH, Dr. Freilich states she advocated the rights of her patients in order to improve their quality of care. Specifically, Dr. Freilich complained that the outsourcing of quality assurance and oversight services for dialysis patients led to an improper standard of care.

Maryland state regulations require physicians to apply for reappointment every two years. See Code of Maryland Regulations (COMAR) § 10.07.01.24. During the reappointment process, each hospital must collect specific information about the physician applicant. The hospital then must analyze the physician's pattern of performance based upon seven factors, including "adherence to hospital bylaws, policies, and procedures" and "attitudes, cooperation, and ability to work with others." Id. Pursuant to COMAR regulations, HMH Medical Staff Bylaws provide that HMH will consider in the reappointment process "ethics and behavior in the Hospital, cooperation with Hospital personnel as it relates to patient care or the orderly operation of the Hospital, and general demeanor and attitude with respect to the Hospital, its patients and its personnel."

In July, 1998, Dr. Freilich applied for reappointment to HMH. Her application went through several layers of review, passing before the HMH Credentials Committee, the Medical Executive Committee, and the Appellate Review Committee. Further, Dr. Freilich received a hearing before the Ad Hoc Hearing Committee. Although the different committees disagreed on whether to accept or reject Dr. Freilich's application, on April 11, 2000, HMH's Board of Directors voted to deny Dr. Freilich's application and terminated her medical privileges. In a letter to Dr. Freilich explaining the basis for its decision, the Board quoted the "ethics and behavior" language in the HMH Bylaws.

On December 11, 2000, Dr. Freilich filed a 14-count, 76-page complaint against HMH and fourteen individuals who were involved in her peer review (collectively the "hospital defendants"), the State of Maryland, and the United States. The complaint alleged that HMH and its Board of Directors denied Dr. Freilich's application for reappointment because she did nothing more than advocate the rights of her patients. Specifically, Dr. Freilich alleged that the Health Care Quality Improvement Act (HCQIA), 42 U.S.C. § 11101 et seq., which provides qualified immunity from damages to persons who participate in physician peer review, and the Maryland statute and regulations governing physician credentialing, Health-General Article § 19-319(e) and COMAR § 10.07.01.24(E), are all unconstitutional. She also brought a claim under 42 U.S.C. § 1983 against the hospital defendants, contending that the termination of her staff privileges violated her constitutional rights. Finally, Dr. Freilich alleged violations of both the Americans with Disabilities Act (ADA) and the Rehabilitation Act (RA).

In an extensive opinion, the district court dismissed the federal claims with prejudice and the state law claims without prejudice. Freilich v. Bd. of Dir. of Upper Chesapeake Health, Inc., 142 F.Supp.2d 679 (D.Md.2001). Dr. Freilich now appeals. We review a dismissal for failure to state a claim de novo, Eastern Shore Mkts., Inc. v. J.D. Assoc. Ltd. P'ship, 213 F.3d 175, 180 (4th Cir.2000), and assume the facts as stated in the complaint are true. See Jenkins v. Medford, 119 F.3d 1156, 1159 (4th Cir.1997) (en banc).

II.

Dr. Freilich brings several constitutional challenges to the Health Care Quality Improvement Act, 42 U.S.C. § 11101 et seq. The HCQIA limits liability in damages for those who participate in professional peer review. For HCQIA immunity to attach, however, the peer review action must comport with due process. More specifically, the professional review action must be taken (1) "in the reasonable belief that the action was in the furtherance of quality health care;" (2) "after a reasonable effort to obtain the facts of the matter;" (3) "after adequate notice and hearing procedures are afforded;" and (4) "in the reasonable belief that the action was warranted by the facts known after such reasonable effort to obtain facts." 42 U.S.C. § 11112. The HCQIA also sets forth detailed standards to ensure that a physician receives adequate notice and a hearing and exempts any claim alleging a civil rights violation or claims for declaratory or injunctive relief. Id.

A.

We first address Dr. Freilich's due process and equal protection challenges to the HCQIA. Dr. Freilich first alleges that the HCQIA violates the Fifth Amendment because it "authorizes and encourages the Defendants [to] act irresponsibly in matters of credentialing, reappointment to the hospital staff, and wrongful denial of hospital privileges...."¹ Because the HCQIA does not burden any fundamental right or draw distinctions based on any suspect criteria, it is subject only to rational basis review. Rational basis review is "a paradigm of judicial restraint," FCC v. Beach Communications, Inc., 508 U.S. 307, 314, 113 S.Ct. 2096, 124 L.Ed.2d 211 (1993), which prohibits us from "sit[ting] as a super-legislature to judge the wisdom or desirability of legislative policy determinations." City of New Orleans v. Dukes, 427 U.S. 297, 303, 96 S.Ct. 2513, 49 L.Ed.2d 511 (1976) (per curiam). According a strong presumption of validity to the HCQIA, we thus need only determine whether the HCQIA is rationally related to a legitimate governmental purpose. See Beach Communications, 508 U.S. at 314-15, 113 S.Ct. 2096 (1993).

The legitimacy of Congress's purpose in enacting the HCQIA is beyond question. Prior to enacting the HCQIA, Congress found that "[t]he increasing occurrence of medical malpractice and the need to improve the quality of medical care ... [had] become nationwide problems," especially in light of "the ability of incompetent physicians to move from State to State without disclosure or discovery of the physician's previous damaging or incompetent performance." 42 U.S.C. § 11101. The problem, however, could be remedied through effective professional peer review combined with a national reporting system that made information about adverse professional actions against physicians more widely available. However Congress also believed that "[t]he threat of private money damage liability under Federal laws, including treble...