This doctor's peer review suit cost him $240,000

June 21, 2002

When a hospital restricted his privileges, he sued. Not only did the court slap him down, it forced him to pay the other side's legal expenses.

 

This doctor's peer review suit cost him $240,000

Jump to:Choose article section...The surgeon challenges his peer review—in court The legal challenge results in a double defeat It's not easy to breach peer review's legal protections

When a hospital restricted his privileges, he sued. Not only did the court slap him down, it forced him to pay the other side's legal expenses.

By Berkeley Rice
Senior Editor

When vascular surgeon Nedunchezian Sithian had his operating room privileges curtailed, he decided to fight back, suing the hospital and its peer review committee. Now that the case is nearly over, he may wish he hadn't.

A New York court dismissed Sithian's lawsuit as frivolous, and—in a rare ruling—ordered him to pay the legal bills of those he sued. Peer review advocates applaud the ruling as a victory for good medicine and a blow against needless litigation.

Sithian had practiced for many years at Staten Island (NY) University Hospital. In 1993, hospital officials became concerned about a "high incidence of morbidity and mortality" among his patients. The hospital commissioned a review of his cases by an outside surgeon who found "serious quality of care issues."

In 1995, after reviewing the outside report, the hospital's new director of surgery, Richard Spence, recommended that Sithian's privileges be restricted pending the results of a full peer review. Hospital administrators agreed. The restriction temporarily prohibited Sithian from performing complex procedures involving aortic, carotid, and peripheral arteries. When Sithian complained that he was the victim of anticompetitive bias, the hospital hired Benjamin Chang, a vascular surgeon at Albany (NY) Medical Center Hospital to conduct another independent review of Sithian's cases.

Before Chang submitted his report, however, Sithian requested an immediate ruling on his status at a hearing before a medical staff committee. That body recommended that Sithian be permitted to temporarily continue performing vascular surgery, but only after a pre-op consultation with another vascular surgeon on staff, and only if another vascular surgeon was present in the OR.

The following week, the hospital received Chang's review. In it, he concluded that Sithian had "failed to provide surgical treatment commensurate with accepted medical and surgical standards," and should not be permitted to perform complex vascular procedures. After reviewing that report, the hospital's medical executive committee voted unanimously to recommend that the board of trustees uphold the suspension of Sithian's privileges until he underwent retraining through an approved fellowship program.

The surgeon challenges his peer review—in court

In April 1997, while the trustees were considering the matter, Sithian filed a complaint against the hospital with the New York State Public Health Council, charging that the actions taken against him were improper and anticompetitive, and that his rights to due process had been violated. After an investigation, the Council found no grounds for Sithian's complaint, concluding that the hospital's decision to suspend his privileges was based on legitimate questions about his competence and concern for patient safety.

At about the same time, Sithian filed civil lawsuits against Spence, Chang, and the hospital's medical executive committee, administrators, and trustees, charging them with defamation and economic interference. The defendants moved for dismissal, claiming peer review immunity under the federal Health Care Quality Improvement Act (HCQIA) and under the state's Public Health Law. That law protects institutions and physicians against liability or damages "on account of any recommendation or evaluation regarding the qualifications, fitness, or professional conduct or practices of a physician," except when the information is "untrue, or communicated with malicious intent."

In January 2000, the trial judge upheld the defendants' claim of immunity, explaining that "retaliatory lawsuits of this nature are precisely what the HCQIA and the state immunity statutes were intended to discourage, in order to encourage frank, open, and meaningful medical peer review to monitor the quality of care rendered to patients."

Sithian appealed, criticizing the hospital's peer review procedure, and citing several sources in defense of his medical skill. His expert in surgical data questioned the accuracy of the hospital's analysis of his performance. The chairman of the surgery department at another hospital where he holds privileges stated that his rate of complications there was "acceptable, and possibly meritorious." The NY State Dept. of Health's Office of Professional Medical Conduct investigated the allegations about his performance and closed the case without taking any action. Nevertheless, in May 2001 the state appellate court unanimously upheld the trial judge's ruling.

The legal challenge results in a double defeat

Following their victory in court, the defendants filed a motion demanding that Sithian pay their legal costs and attorney fees. Such penalties are provided for under HCQIA if the defendants' peer review process has been proper, and if the claimant's suit is found to be "frivolous, unreasonable, without foundation, or in bad faith."

Noting that no court in New York had ever awarded such fees under HCQIA, the trial judge, Joseph Maltese wrote: "The HCQIA was purposely designed to prevent the chilling effect which this type of lawsuit could have upon the participants in the peer review process. . . . Doctors who are sufficiently fearful of the threat of litigation will simply not do meaningful peer review. . . . Clearly the defendants have proven that they were engaged in a legitimate endeavor—to conduct a peer review of Dr. Sithian. . . . There was no evidence that any defendant acted with malice or in bad faith.

"In order to have commenced his action," the judge continued, "the plaintiff should have had proof of actual malice—to do otherwise was to bring a frivolous lawsuit."

The judge ruled that Sithian owed the defendants "reasonable" attorney fees and legal costs. The court ordered Sithian to pay $215,000 to Leonard Rosenberg, who represented all the defendants except Chang, and another $23,000 to Chang's lawyer.

Sithian remains on the staff at SUIH, but still operates under restricted privileges. He has appealed the award of attorneys' fees and costs, and that appeal is still pending. On the advice of his attorney, he declined to be interviewed for this article.

 

It's not easy to breach peer review's legal protections

While the awarding of legal fees and costs to the defendants in the case described in the accompanying article is highly unusual, the dismissal of a peer review suit isn't. Peer review committees are well insulated from legal challenges under state and federal laws that grant immunity to committee members and confidentiality to the review proceedings. The AMA has publicly opposed attempts to breach that immunity and confidentiality, arguing that those protections are necessary to encourage physicians to participate in candid reviews of their colleagues' performance.

And, so far, appellate courts around the country have generally upheld peer review immunity for hospitals and their committees, and dismissed suits brought against them by doctors whose privileges have been restricted or cancelled, according to a report by Jack Schroder, a health care attorney with the Atlanta firm of Alston & Bird.

In Nevada, for example, an appellate court ruled last year that plaintiffs in such cases must meet a burden of proof to overcome the presumption that the hospital and its peer review committee have complied with HCQIA requirements. And a federal appellate decision in Pennsylvania upheld peer review committee members' immunity—even if they reach an incorrect conclusion about a particular medical issue—as long as their decisions are based upon a reasonable belief that they're trying to protect health care quality.

But HCQIA immunity does not protect peer reviewers if they violate federal or state civil rights laws. As a result, some physicians have attempted to circumvent HCQIA immunity by alleging that the committees' adverse actions were based upon their race, sex, religion, age, or national origin. In several cases, however, federal and state courts have ruled that mere allegations of racial or sexual discrimination—without convincing evidence—are not sufficient to breach HCQIA immunity. Even if there is such evidence, most staff physicians are independent contractors, not hospital employees, and are therefore not covered by Title VII of the Civil Rights Act.

Taking another tack, some physicians have sued hospitals or peer review committees on the grounds that committee members in the same specialty are economic competitors, and are therefore influenced by financial motives.

It's very difficult for doctors to successfully challenge privilege restrictions if they feel they've been judged unfairly. Says attorney Leonard Rosenberg: "That's only happened in a handful of cases in the entire country over the past decade, usually because the peer review process didn't follow the hospital's bylaws, or because the committee violated the doctor's right to due process."

 

Berkeley Rice. This doctor's peer review suit cost him $240,000. Medical Economics 2002;12:26.