33 F.3d 1318 (11th Cir. 1994), 92-2963, Bryan v. James E. Holmes Regional Medical Center

Docket Nº:92-2963.
Citation:33 F.3d 1318
Party Name:Floyd T. BRYAN; Floyd T. Bryan, M.D., P.A., Plaintiffs-Appellees, Cross-Appellants, v. JAMES E. HOLMES REGIONAL MEDICAL CENTER, a/k/a Holmes Regional Medical Center, Inc., Defendant-Appellant, Cross-Appellee, Raymond A. Armstrong, M.D., individually and as Chairman, Department of Surgery, HRMC and as Member of the Board of Directors, HRMC; Richard
Case Date:October 04, 1994
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit
 
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33 F.3d 1318 (11th Cir. 1994)

Floyd T. BRYAN; Floyd T. Bryan, M.D., P.A.,

Plaintiffs-Appellees, Cross-Appellants,

v.

JAMES E. HOLMES REGIONAL MEDICAL CENTER, a/k/a Holmes

Regional Medical Center, Inc.,

Defendant-Appellant, Cross-Appellee,

Raymond A. Armstrong, M.D., individually and as Chairman,

Department of Surgery, HRMC and as Member of the Board of

Directors, HRMC; Richard N. Baney, M.D., individually and

as Member of the Board of Directors, HRMC; Michael J.

Foley, M.D., individually and as Medical Director, HRMC;

Michael V. Gatto, individually and as Member of the Board of

Directors, HRMC; James E. Gray, III, individually and as

Secretary of the Board of Directors, HRMC; Joseph A. Gurri,

M.D., individually and as Chief of the Medical Staff, HRMC;

Martin W. Isenman, M.D., individually and as Member of the

Board of Directors, HRMC; David M. Jones, Maj. Gen.

(Retired), individually and as Treasurer of the Board of

Directors, HRMC; Michael F. Maguire, individually and as

Member of the Board of Directors, HRMC; Fred L. McFarlin,

individually and as Member of the Board of Directors, HRMC;

John E. Miller, Ph.D., individually and as Second Vice

Chairman of the Board of Directors, HRMC; Barry A. Mills,

M.D., individually and as Chairman, Executive Committee,

HRMC; Lyle Saltzman, M.D., individually and as Member of

the Executive Committee, HRMC; Val M. Steele, individually

and as Member of the Board of Directors, HRMC; Lynn Stoldt,

R.N., individually and as Head Operating Room Nurse, HRMC;

Russell P. Sullivan, Jr., individually and as Chairman of

the Board of Directors, HRMC; John F. Turner, Jr.,

individually and as First Vice Chairman of Board of

Directors, HRMC; Rita Wheeler, R.N., individually and as

Operating Room Supervisor, HRMC, Defendants.

No. 92-2963.

United States Court of Appeals, Eleventh Circuit

October 4, 1994

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Christopher K. Kay, Ronald M. Schirtzer, Foley & Lardner, Orlando, FL, Sylvia H. Walbolt, Carlton, Fields, Ward, Emmanuel, Smith & Cutler, St. Petersburg, FL, Alan C. Sundberg, Carlton, Fields, Ward, Emmanuel, Smith & Cutler, Tallahassee, FL, for James E. Holmes.

Jennifer S. Carroll, Metzger, Sonneborn & Rutter, PA, West Palm Beach, FL, George H. Moss, Moss, Henderson, Van Gaasbeck, Blanton & Koval, PA, Vero Beach, FL, Larry Klein, Klein & Walsh, PA, West Palm Beach, FL, for Floyd T. Bryan.

Appeals from the United States District Court for the Middle District of Florida.

Before TJOFLAT, Chief Judge, DUBINA, Circuit Judge, and DYER, Senior Circuit Judge.

TJOFLAT, Chief Judge:

In this case, a Florida hospital, after completing a lengthy internal disciplinary process, terminated the clinical staff privileges of a staff physician. The physician sued the hospital, alleging various state and federal causes of action and seeking money damages. After an eleven-day trial, a federal jury concluded that the hospital had revoked the physician's staff privileges in violation of its bylaws and awarded the physician nearly $4.2 million in damages for breach of contract. The hospital appeals that judgment as well as the district court's denial of its post-trial motion for judgment as a matter of law, which contended that the hospital was immune from liability in money damages under the Health Care Quality Improvement Act of 1986 ("HCQIA"), 42 U.S.C. Secs. 11101-11152 (1988 & Supp. IV 1992), and under Florida law, Fla.Stat.Ann. Sec. 395.0193(5) (West 1993). Because we conclude that the hospital was entitled to protection from monetary liability under HCQIA, we reverse.

I.

Peer review, the process by which physicians and hospitals evaluate and discipline staff doctors, has become an integral component of the health care system in the United States. Congress enacted the Health Care Quality Improvement Act to encourage such peer review activities, "to improve the quality of medical care by encouraging physicians to identify and discipline other physicians who are incompetent or who engage in unprofessional behavior." H.R.Rep. No. 903, 99th Cong., 2d Sess. 2, reprinted in 1986 U.S.C.C.A.N. 6287, 6384, 6384. Congressional findings, recited in the text of the statute itself, note that "[t]he increasing occurrence of medical malpractice and the need to improve the quality of medical care have become nationwide problems that warrant greater efforts than those that can be undertaken by any individual State," 42 U.S.C. Sec. 11101(1), and that these problems "can be remedied through effective professional peer review," id. Sec. 11101(3). In furtherance of this goal, HCQIA grants limited immunity, in suits brought by disciplined physicians, from liability for money damages to those who participate in professional peer review activities. Id. Sec. 11111(a).

Prior to the passage of HCQIA, the specter of litigation seriously impeded the development and vigorous enforcement of hospital peer review procedures. Congress found that "[t]he threat of private money damage liability under [state and] Federal laws, including treble damage liability under Federal antitrust law, unreasonably discourages physicians from participating in effective professional peer review." Id. Sec. 11101(4). 1 Accordingly, HCQIA provides that, if a "professional review action" (as defined in the statute) meets certain due process and fairness requirements, then those participating in such a review process shall not be liable under any state or federal law for damages

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for the results. Id. Sec. 11111(a)(1). Thus, "[d]octors and hospitals who have acted in accordance with the reasonable belief, due process, and other requirements of [HCQIA] are protected from damages sought by a disciplined doctor." H.R.Rep. 903, at 3, reprinted in 1986 U.S.C.C.A.N. at 6385.

HCQIA is designed to facilitate the frank exchange of information among professionals conducting peer review inquiries without the fear of reprisals in civil lawsuits. 2 The statute attempts to balance the chilling effect of litigation on peer review with concerns for protecting physicians improperly subjected to disciplinary action; accordingly, Congress granted immunity from monetary damages to participants in properly conducted peer review proceedings while preserving causes of action for injunctive or declaratory relief for aggrieved physicians. Because the statutory scheme is somewhat convoluted, we discuss the immunity provisions in detail. 3

The provision of HCQIA that limits the availability of damages for professional review actions provides as follows:

If a professional review action (as defined in ... this title) of a professional review body meets all the standards specified in section 11112(a) of this title, ...

(A) the professional review body,

(B) any person acting as a member or staff to the body,

(C) any person under a contract or other formal agreement with the body, and

(D) any person who participates with or assists the body with respect to the action,

shall not be liable in damages under any law of the United States or of any State (or political subdivision thereof) with respect to the action.

42 U.S.C. Sec. 11111(a)(1). 4 The standards that professional review actions must satisfy to

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entitle the participants to such protection are enumerated in section 11112(a) as follows:

For purposes of the protection set forth in section 11111(a) of this title, a 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 to the physician involved or after such other procedures as are fair to the physician under the circumstances, and

(4) in the reasonable belief that the action was warranted by the facts known after such reasonable effort to obtain facts and after meeting the requirement of paragraph (3).

Id. Sec. 11112(a). Importantly, HCQIA also creates a rebuttable presumption of immunity: "A professional review action shall be presumed to have met the preceding standards necessary for the protection set out in section 11111(a) of this title unless the presumption is rebutted by a preponderance of the evidence." Id.

Section 11112(b) of HCQIA then enumerates the minimum, or "safe harbor" procedures that will, in every case, satisfy the adequate notice and hearing requirement of section 11112(a)(3). Id. Sec. 11112(b). Organized in the form of a detailed checklist, the provision defines what hospitals conducting peer review disciplinary procedures must do to obtain the Act's protections for itself and the members of its peer review bodies. We discuss this checklist in more detail infra in part III. Congress was careful to explain, however, that "[a] professional review body's failure to meet the conditions described in this subsection shall not, in itself, constitute failure to meet the standards of subsection (a)(3) of this section." Id.

The legislative history of section 11112(a) indicates that the statute's reasonableness requirements were intended to create an objective standard of performance, rather than a subjective good faith standard. As the House Committee on Energy and Commerce explained:

Initially, the Committee considered a "good faith" standard for professional review actions. In response to concerns that "good faith" might be misinterpreted as requiring only a test of the subjective state of mind of the physicians conducting the professional review action, the Committee changed to a more objective "reasonable belief" standard. The Committee intends that this test will be satisfied if the reviewers, with the information available to...

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