Holden v. Rockford Memorial Hosp.
| Decision Date | 27 March 1997 |
| Docket Number | No. 2-96-0784,2-96-0784 |
| Citation | 222 Ill.Dec. 730,678 N.E.2d 342,287 Ill.App.3d 320 |
| Parties | , 222 Ill.Dec. 730 John P. HOLDEN, Plaintiff and Counter-defendant-Appellee, v. ROCKFORD MEMORIAL HOSPITAL, Defendant and Counter-plaintiff-Appellant. |
| Court | United States Appellate Court of Illinois |
John J. Holevas, Scott C. Sullivan, Timothy J. Rollins, Williams & McCarthy, P.C., Rockford, for Rockford Memorial Hospital.
Michael J. Hedeen, Rockford, Richard R. Haldeman, Haldeman & Associates, Rockford, for John P. Holden, M.D.
Jerry P. Clousson, Joseph T. Butz, Clousson & Butz, Chicago, for Amici Curiae Downstate Physicians Alliance, Illinois Heartland Physicians Association, Independent Physicians Network, McLean Area Medical Association, Peoria County Medical Society.
Thaddeus J. Nodzenski, Mark D. Deaton, Illinois Hospital & HealthSystems Association, Naperville, Michael R. Callahan, Katten, Muchin & Zavis, Chicago, for Amici Curiae Illinois Hospital & HealthSystems Association, Metropolitan Chicago Healthcare Council.
Robert John Kane, Saul J. Morse, Illinois State Medical Society, Springfield, Michael L. Ile, American Medical Association, Chicago, for Amici Curiae American Medical Association, Chicago Medical Society, Illinois State Medical Society, Lake County Medical Society, Winnebago County Medical Society.
Defendant and counterplaintiff, Rockford Memorial Hospital, appeals from the trial court's order granting summary judgment. The trial court determined as a matter of law that an employment agreement between the hospital and plaintiff and counterdefendant, Dr. John Holden, was unenforceable because under the corporate-practice-of-medicine doctrine hospitals are prohibited from employing physicians. On appeal, the hospital contends the corporate-practice-of-medicine doctrine does not apply to hospitals and that the employment of physicians by hospitals is not against public policy. We affirm.
Dr. Holden and Rockford Memorial Hospital (hospital) entered into an employment agreement on May 28, 1993. Under the agreement, Dr. Holden was an "employee of the [h]ospital" and was to "provide reproductive endocrinology services" in that department. Further, pursuant to the agreement, Dr. Holden was to "[d]evote all professional practice time to or on behalf of and at the direction" of the hospital. The agreement stated also:
"In the event this Employment Agreement is terminated for any reason (or expires), whether during or at the conclusion of the term of this Agreement, the Physician shall, for a period of two years after the termination or expiration date, be barred from practicing reproductive endocrinology in the following counties of the Hospital's service area: in Wisconsin, Rock County; and in Illinois, Winnebago, Boone, Ogle, Whiteside, Lee, DeKalb, McHenry, Stephenson, and Kane."
On October 26, 1995, Dr. Holden submitted his resignation. He remained as an employee of the hospital through February 28, 1996. On March 4, 1996, Dr. Holden filed a complaint for declaratory judgment and injunctive relief seeking a declaration that his employment agreement with the hospital was void and unenforceable as a matter of law. The hospital filed a counterclaim for injunctive relief against Dr. Holden and damages from his breach of the employment agreement.
Dr. Holden then filed a motion for summary judgment. The hospital filed a cross-motion for summary judgment. After reviewing the evidence and hearing oral arguments, the trial court granted Dr. Holden's motion. Specifically, the trial court stated that it was bound, as a matter of law, to follow the fourth district's ruling in Berlin v. Sarah Bush Lincoln Health Center, 279 Ill.App.3d 447, 215 Ill.Dec. 940, 664 N.E.2d 337 (1996), in reaching its decision.
In Berlin, the fourth district was presented with the same issue that is before this court. In Berlin, a physician filed a complaint for declaratory judgment seeking to have his employment agreement with a health center declared unenforceable. As is true in the instant case, the health center was a not-for-profit medical provider. See Berlin, 279 Ill.App.3d at 452, 215 Ill.Dec. 940, 664 N.E.2d 337. The physician in Berlin stated that the agreement was void because by employing physicians the health center was violating the corporate-practice-of-medicine doctrine. The Berlin court agreed with the physician and upheld the trial court's order granting summary judgment. Berlin, 279 Ill.App.3d at 459, 215 Ill.Dec. 940, 664 N.E.2d 337.
On appeal, the hospital contends that the Berlin case was wrongly decided because the corporate-practice-of-medicine doctrine does not apply to licensed hospitals. Further, the hospital argues that there is no public policy that prohibits licensed hospitals from employing physicians.
Summary judgment is appropriate only when the pleadings, depositions, and admissions on file, together with affidavits, if any, disclose that there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Bolingbrook Equity I Limited Partnership v. Zayre of Illinois, Inc., 252 Ill.App.3d 753, 764, 191 Ill.Dec. 909, 624 N.E.2d 1287 (1993). Summary judgment is a drastic measure and should be granted only if the movant's right to judgment is clear and free from doubt. Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill.2d 90, 102, 180 Ill.Dec. 691, 607 N.E.2d 1204 (1992). Therefore, where a reasonable person can draw divergent inferences from undisputed facts, summary judgment should be denied. Outboard, 154 Ill.2d at 102, 180 Ill.Dec. 691, 607 N.E.2d 1204. Finally, our review of the trial court's entry of summary judgment is de novo. Monticello Insurance Co. v. Wil-Freds Construction, Inc., 277 Ill.App.3d 697, 701, 214 Ill.Dec. 597, 661 N.E.2d 451 (1996).
First, we note that the trial court was bound to follow the Berlin decision as neither this court nor the supreme court has ever addressed the issue of whether a not-for-profit hospital may employ physicians without violating the corporate practice doctrine. See Glasco Electric Co. v. Department of Revenue, 87 Ill.App.3d 1070, 1071, 42 Ill.Dec. 896, 409 N.E.2d 511 (1980), aff'd, 86 Ill.2d 346, 56 Ill.Dec. 10, 427 N.E.2d 90 (1981). The Berlin decision, however, is not binding upon this court because it is a decision by a court of coordinate jurisdiction. See People v. Spahr, 56 Ill.App.3d 434, 438, 14 Ill.Dec. 208, 371 N.E.2d 1261 (1978). Therefore, although we acknowledge the Berlin court's decision and its analysis, we are not obligated to follow that court's ruling or its reasoning.
The hospital's primary contention is that the corporate-practice-of-medicine doctrine does not apply to not-for-profit hospitals. To support this argument, the hospital claims that the Illinois Supreme Court, the Illinois Appellate Court, and the Illinois legislature have all recognized that hospitals employ physicians. In essence, the hospital argues that, by recognizing that hospitals employ physicians, the courts and legislature have carved out an exception to the corporate-practice-of-medicine doctrine as it applies to hospitals.
First, the hospital relies on the supreme court's decision in Darling v. Charleston Community Memorial Hospital, 33 Ill.2d 326, 211 N.E.2d 253 (1965), which held that a hospital could be directly liable for negligent medical treatment. Specifically, the hospital points this court to language in the Darling decision, where the court stated that hospitals " 'regularly employ on a salary basis a large staff of physicians' " as proof that hospitals are not prohibited from employing physicians. See Darling, 33 Ill.2d at 332, 211 N.E.2d 253, quoting Bing v. Thunig, 2 N.Y.2d 656, 666, 163 N.Y.S.2d 3, 10-11, 143 N.E.2d 3, 8 (1957).
Second, the hospital cites several appellate court cases where Illinois courts have included language that refers to a hospital's "employing" physicians. According to the hospital, these references to the word "employ" also prove that Illinois courts have recognized that hospitals may employ physicians, thereby essentially abandoning the corporate-practice-of-medicine doctrine as it applies to hospitals.
Third, the hospital repeatedly reminds this court that the legislature has never explicitly stated that hospitals may not employ physicians. On the contrary, the hospital argues, the Mental Health Code of 1967 () referred to an individual's needing to obtain a certificate of a physician not an employee of the hospital where the individual sought hospitalization before the individual could be admitted for involuntary emergency hospitalization. Additionally, the hospital notes that section 5(c) of the Osteopathic and Allopathic Healthcare Discrimination Act (225 ILCS 62/5(c) (West 1994)) states that no licensed hospital shall discriminate with respect to employment against a licensed physician.
Finally, the hospital informs this court that the Illinois legislature has prohibited the employment of certain professionals by any type of corporation except under certain circumstances, but that the legislature has never enacted a similar prohibition on the employment of physicians. For example, the hospital notes that section 44 of the Illinois Dental Practice Act (225 ILCS 25/44 (West 1994)) prohibits the employment of dentists by any type of corporation. Additionally, the hospital states that the legislature has enacted similar prohibitions in the Corporation Practice of Law Prohibition Act (705 ILCS 220/1 et seq. (West 1994)) and the Clinical Psychologist Licensing Act (225 ILCS 15/1 et seq. (West 1994)). Therefore, the hospital argues, the Medical Practice Act of 1987's (225 ILCS 60/1 et seq. (West 1994)) not placing a similar prohibition on physicians...
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Holden v. Rockford Memorial Hosp.
...the exercise of this Court's supervisory authority, the judgment of the Appellate Court, Second District, in case No. 2-96-0784, 287 Ill.App.3d 320, 222 Ill.Dec. 730, 678 N.E.2d 342 is VACATED. The Appellate Court, Second District, is directed to reconsider its judgment in light of Berlin v......