ABA Health eSource
February 2010 Volume 6 Number 6

Supreme Court Denies Review of Fourth Circuit Opinion Affirming HCQIA Immunity

by Travis G. Lloyd, Buerger, Moseley & Carson, PLC, Franklin, TN

AuthorEffective peer review is an essential tool for improving healthcare quality. Congress acknowledged as much when it enacted the Health Care Quality Improvement Act of 1986 (HCQIA), 1 which provides immunity to peer review bodies where certain conditions are met. Yet questions frequently arise as to how hospitals and other healthcare facilities should administer peer review processes to satisfy these conditions and preserve immunity while at the same time dealing with medical staff problems expeditiously. A recent decision by the United States Court of Appeals for the Fourth Circuit, Wahi v. Charleston Area Medical Center, 2 affirms the strength of HCQIA immunity and provides some helpful guidance to hospital and medical staff leaders. Now, following the Supreme Court’s January 19th denial of a petition for writ of certiorari in the case, the Fourth Circuit’s decision stands as one of the most important peer review decisions post- Poliner. 3

HCQIA Immunity

Under HCQIA, a “professional review body” 4 is immune from damages for “professional review actions” 5 where such actions are 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). 6

The statute contains a presumption, rebuttable by a preponderance of the evidence, that a professional review action has met these standards. 7 HCQIA also contains a safe harbor whereby a healthcare entity is deemed to have met the notice and hearing requirements of subsection (3) if it meets certain statutorily prescribed procedural standards. 8 A healthcare entity may, however, still receive immunity where it does not satisfy the requirements of subsection (3) if no adverse professional review action is taken or if a practitioner’s clinical privileges are suspended or restricted for no more than fourteen days, during which time the hospital undertakes an investigation. 9 Lastly, where concerns about a physician’s practice suggest that the failure to immediately suspend or restrict his or her privileges may result in an “imminent danger to the health of any individual,” healthcare entities may first take action and then subsequently provide notice and hearing or other adequate procedures. 10

Case Background

The key issue before the Fourth Circuit in Wahi was whether the physician failed to rebut the presumption that the hospital had provided adequate notice and hearing procedures under subsection (3). The case arose when, on July 30, 1999, Charleston Area Medical Center (CAMC) summarily suspended the clinical privileges of Dr. Rakesh Wahi, a cardiothoracic surgeon who was actively seeking reappointment. 11 This action was not the first taken against Wahi by CAMC. Indeed, during his tenure at CAMC, Wahi was the subject of numerous suspensions, restrictions, and investigations and no fewer than five reports to the National Practitioner Data Bank. 12

Following the suspension and subsequent denial of Wahi’s request for reappointment less than one month later, Wahi requested a hearing regarding both issues. 13 Over the next several months, Wahi, by counsel, and CAMC corresponded regarding access to Wahi’s quality file, objections to proposed hearing panel members, and other details of the hearing process, but the parties never scheduled a hearing. 14 Despite CAMC’s repeated requests, Wahi failed to provide any dates on which the requested hearing could be held. 15 Wahi unsuccessfully sought the intervention of a West Virginia state court and, thereafter, negotiations between the parties reached a standstill. 16 In January 2004, over four years from when his privileges were suspended and his application for reappointment denied, Wahi filed a complaint in the United States District Court for the Southern District of West Virginia, alleging a variety of claims under state and federal law. 17 Ultimately, the district court granted CAMC’s motion for summary judgment, finding that Wahi failed to rebut the presumption that the hospital met the requirements for immunity under HCQIA. 18

Summary of the Fourth Circuit’s Decision

On appeal, the Fourth Circuit affirmed the district court’s grant of summary judgment for the hospital. The court limited its review to whether the lower court erred in finding that Wahi did not overcome the presumption that CAMC met the procedural requirements contained in 42 U.S.C. § 11112(a) (3). 19 In holding that under the totality of the circumstances the district court did not err in finding the hospital was immune, the court clarified several issues concerning HCQIA immunity. First, healthcare entities can satisfy the requirements of subsection (3) without providing a formal hearing. As the court observed, “Congress’ intent -- and that expressed by the plain language of the statute -- is that a physician be afforded adequate and fair procedures with regard to professional review actions, which could be something other than a formal hearing in some circumstances.20 Second, a healthcare entity’s failure to provide the procedural safeguards found in the safe harbor does not necessarily mean that the entity has failed to meet the requirements of subsection (3). 21 Third, a healthcare entity’s failure to comply with 42 U.S.C. § 11112(c), outlining those circumstances in which peer review bodies may be immune without meeting the four general conditions, does not preclude the entity from meeting the requirements of subsection (3), even where it has not provided a formal hearing. 22 Finally, the court adopted the Fifth Circuit’s reasoning that a hospital’s compliance with its medical staff bylaws and HCQIA immunity are not “coextensive.” 23 So long as the hospital complies with HCQIA, its failure to comply with its own bylaws will not disturb its immunity under the statute.

Implications for Hospitals and Healthcare Facilities

In many ways, the Fourth Circuit’s decision tells us little that the plain language of the statute does not. As a practical matter, however, Wahi is a comforting affirmation of the strength of HCQIA immunity. In essence, after Wahi, provided that an objectively reasonable review of the totality of the circumstances demonstrates that the hospital afforded the physician fair procedures in taking a professional review action, the hospital will be entitled to immunity under HCQIA. Failure of the hospital to comply with every detail of the procedures outlined in its governing documents is not necessarily a bar to immunity. Hospital and medical staff leaders should, however, scrupulously document correspondence with physicians who are subject to professional review actions, particularly as pertains to the basis of an investigation or action, the physician’s opportunity to respond, and, in the case of an adverse action, the physician’s opportunity to have a fair hearing. Indeed, the hospital’s extensive documentation appears to have been essential to the Fourth Circuit’s ruling. 24

While the Supreme Court’s denial of Wahi’s petition for writ of certiorari does not constitute an endorsement of the Fourth Circuit’s opinion, 25 it does mean the Fourth Circuit’s decision remains undisturbed. As a result, hospitals and other healthcare facilities are left with useful guidance and reassurance as to the administration and immunity of their peer review processes.

1 42 U.S.C. §§ 11101 et seq.
2 562 F.3d 599 (4th Cir. 2009), cert. denied, 2010 U.S. LEXIS 625 (U.S., Jan. 19, 2010).
3 Poliner v. Texas Health Systems, 537 F.3d 368 (5th Cir. 2008). In Poliner, the United States Court of Appeals for the Fifth Court overturned a multimillion dollar judgment for a cardiologist who alleged that a hospital improperly suspended his clinical privileges. In finding that the hospital and the physicians involved in the peer review process were immune under HCQIA, the court clarified several key issues relating to HCQIA immunity including the effect of a peer review body’s failure to comply with medical staff bylaws and the standards to which such bodies would be held in the conduct of their investigations.
4 See 42 U.S.C. § 11151(11).
5 See 42 U.S.C. § 11151(9).
6 42 U.S.C. § 11112(a).
7 Id.
8 42 U.S.C. § 11112(b).
9 42 U.S.C. § 11112(c).
10 Id.
11 Wahi, supra note 2, at 603.
12 Id. at 601-02.
13 Id. at 603.
14 Id.
15 Id.
16 Id. at 604.
17 Id.
18 Id. at 605.
19 The court found that Wahi effectively waived his claims as to CAMC’s failure to comply with the requirements of subsections (1), (2), and (4) and accordingly limited its review to CAMC’s compliance with subsection (3). Id. at 607. On appeal, the court also addressed other federal and state law claims made by Wahi. Review of these claims is beyond the scope of this article.
20 Id. at 609 (emphasis added).
21 Id. at 607-08.
22 Id. at 609.
23 Id. (citing Poliner, supra note 3, at 380-81).
24 In analyzing the hospital’s immunity under HCQIA, the court undertook a detailed review of the communication between physician and hospital. See id. at 609-14.
25 See, e.g., Maryland v. Baltimore Radio Show, 338 U.S. 912, 919 (1950).

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