Hospital at center of “existential threat” to self-governance files for bankruptcy

September 20, 2017
Area(s) of Interest: Amicus Briefs Medical Staff Self Governance Hospitals and Health Facilities Licensing & Regulatory Issues 

The Tulare hospital embroiled in a bitter legal battle over the self-governance rights of its medical staff has filed for Chapter 9 bankruptcy. The filing came just two days before closing arguments were scheduled in the case, Tulare Regional Medical Center Medical Staff v. Tulare Regional Medical Center, et al.

Although the hospital is in bankruptcy, the California Medical Association (CMA) will continue to seek a legal remedy in this matter. If the medical staff is unable to resolve the case out of court, the trial court could resume the case and render a judgment after the hospital emerges from bankruptcy.

In 2016, lay hospital administrators at Tulare Regional Medical Center (TRMC) terminated the entire medical staff and its duly elected officers. The hospital then adopted new medical staff bylaws in secret and without input from physicians at the hospital. The hospital dictated leadership and standards of medical care, seized control of the disciplinary process without legal or factual justifications, and prohibited the terminated medical staff from voting on medical staff matters or holding leadership positions.

CMA has been actively and aggressively supporting the medical staff in this case since the illegal actions of the hospital board in January 2016. CMA believes that, if left to stand, the hospital’s actions will create a dangerous precedent that could have much broader implications for the fundamental rights of medical staffs and physicians’ ability to care for patients in hospitals.

“Every once in a while, you get a really important case that’s a flashpoint,” said Long Do, CMA legal counsel and director of litigation in an interview with the American Medical Association (AMA). “This case serves as an existential threat to independent hospital medical staffs.”

CMA filed pre- and post-trial amicus briefs and has organized fundraising for the case. Recognizing the far-reaching implications of this case, the AMA Litigation Center and state medical societies have also provided legal and financial support to the physician plaintiffs.

“This case epitomizes why protecting medical staff independence and self-governance is a matter of great public importance,” Do wrote in CMA’s post-trial brief. “The record abundantly demonstrates that the hospital has committed serious violations of the medical staff’s rights to independence and self-governance and that such illegal conduct is causing real harm to patients.”

It cannot be understated how grave the consequences could be on patient care and safety if the hospital’s illegal actions are left to stand. Medical staff self-governance would become meaningless if a hospital can pick for itself a replacement medical staff and eschew the large body of laws and regulations that require a truly independent medical staff that is self-governing and democratic.

This case was recently featured in a New York Times op-ed, which provides a good look at why this local conflict could have a dangerous effect on patient care in U.S. hospitals.

If interested in contributing to CMA’s Legal Defense Fund, which is used to litigate cases of critical importance to physicians, please download the contribution form or contact Sarah Wolley directly at NSkadsen@cmadocs.org.

The Legal Defense Fund of the California Medical Association is a collection of monies voluntarily contributed by the CMA membership for appropriate litigation costs. These funds shall be administered by the Executive Committee of the CMA Board of Trustees. The purpose of this fund shall be to provide monetary support in cases, generally brought by our members, which seek to protect or establish important legal rights of physicians. CMA will consider providing assistance only in those cases which reflect those principles and policies that CMA has established and that impact our members in their practice of medicine. Contributions to the California Medical Association Legal Defense Fund are not tax deductible as charitable contributions for federal income tax purposes. However, the contribution may be tax deductible as a business expense for federal income tax purpose. Contribution to this fund is not a political contribution.



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