CMA files brief with California Supreme Court in important peer review case

April 19, 2021

The California Medical Association (CMA) is involved as amicus curiae in an important case before the California Supreme Court that will have lasting ramifications on a physician’s ability to challenge peer review hearing officers for impermissible bias.

The plaintiff in this case — Natarajan v. Dignity Health — is a hospitalist who lost his privileges after a peer review hearing. In his appeal, he did not dispute the factual findings and conclusions of the peer review panel, but rather claims that the hearing officer in his peer review proceeding was biased and should have been disqualified.

The appellate court ruled against the plaintiff, holding that the “fair procedure” standard forbids only a direct financial interest in the outcome of the proceeding and the appearance of bias is not sufficient to disqualify a peer review hearing officer. Significantly, the appellate court’s ruling rejects precedential case law on this issue established in the Yaqub case from 2004. There, the court adopted a fact-specific inquiry into the impartiality of a hearing officer based on the potential for bias, harmonizing the “fair procedure” standard with the language of the peer review statute, Business & Professions Code §809, et. al.

CMA filed an amicus brief in this case, which sought to provide the court with the appropriate background, procedural understanding and evidentiary foundation to fashion a robust and clear hearing officer impartiality standard. Our brief also suggested guiding principles for crafting such a standard.

CMA’s brief argues that the Yaqub court’s approach to analyzing hearing officer bias is the proper interpretation and application of a legal standard for hearing officer impartiality. The brief discusses the ways in which the appellate court’s “actual bias” standard is too narrow, and unmoored from both the legislature’s intent in enacting the peer review statute and the current health care landscape, in which large hospital systems are a significant presence.

Unlike other briefings that have been submitted, CMA, as the sponsor of the bill that created the peer review statute, presents to the court a deep historical and empirical understanding of the role of hearing officers in the peer review process. CMA’s brief concludes by underscoring the importance of a robust impartiality standard that will ensure competent practitioners are shielded from arbitrary and discriminatory review while also upholding the protection of the public. The case is currently pending before the court.


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