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Peer Review: Dr. Ulrich's battle


When this internist protested staff layoffs, his hospital launched an investigation of his clinical conduct. He sued, and a jury awarded him $4.3 million.

In an ideal world, the peer review process is designed to investigate and expose clinical incompetence or professional misconduct. But, here in the real world, some hospital administrators use the process as a weapon of intimidation or retaliation to silence outspoken staff physicians. That's what apparently happened to John Ulrich Jr., an internist in San Mateo, CA.

Ulrich had been employed for nearly 10 years at San Francisco's Laguna Honda Hospital, a large, long-term-care facility run by the city and county health departments. Like many public hospitals that attract mostly Medicare and Medicaid patients, Laguna Honda was having budget problems in the late 1990s, which resulted in staff cutbacks. That's when Ulrich's troubles began.

In August 1998, Ulrich learned that the hospital was planning to lay off medical personnel, including physicians. At a staff meeting that month, he protested the layoffs, calling them "an injustice" to the hospital's patients as well as to its physicians. His comments sparked a discussion in which other staff members also voiced their opposition. The following week, Ulrich and 29 of his colleagues signed a letter of protest to top officials at the city's health department. The letter claimed that the layoffs could limit the medical staff's ability to provide adequate patient care.

Ulrich was scheduled to meet with the review committee to defend himself on Oct. 22. But he was so disgusted by the layoffs and by the hospital's apparent reprisal against his protest that he decided to quit.

On Sept. 30, the day the layoffs took effect, Ulrich posted a notice at the nurses' station, addressed to "the staff, families, residents, and medical director of Laguna Honda Hospital." The notice announced his resignation, and stated: "I am deeply disappointed by the recent decision . . . to lay off two outstanding and very dedicated physicians from further service when they are near retirement."

Rivero saw the letter, and told the hospital's top executives about it. The following day, she wrote to Ulrich accepting his resignation effective Nov. 1. Two weeks later, Ulrich consulted a lawyer who advised him that resigning while under peer review investigation, and while he still had clinical privileges, could trigger an "adverse action" report to the state medical board and the National Practitioner Data Bank.

Ulrich wrote to Rivero on Oct. 16, rescinding his resignation pending the completion of the peer review investigation. He also requested a postponement of his Oct. 22 meeting with the review committee to give him more time to prepare for it. On Oct. 26, four days after the scheduled meeting, Rivero wrote to Ulrich stating that the hospital would not revoke his resignation, and that the meeting had been canceled due to "your announcement that you would not be attending." The letter concluded: "Given your resignation effective November 1, 1998, no further peer review action is necessary as you will no longer have privileges or be a member of the Laguna Honda Hospital Staff."

A report to the NPDB leads to a lawsuit On Nov. 6, the hospital filed the following report with the California Medical Board and the NPDB: "Dr. Ulrich resigned from the Medical Staff, and relinquished his privileges, following receipt of a letter announcing the commencement of a formal investigation into his practice and professional conduct. . . . That investigation was prompted as a result of concerns regarding apparent deficiencies in his practice and conduct spanning the full range of Hospital care, including incomplete diagnoses, inappropriate diagnostic and therapeutic orders, failures to accept appropriate responsibility for the course of patient treatment, and overall absence of clear, effective management of hospitalizations. Dr. Ulrich submitted his resignation before this investigation had progressed to any findings or recommendations."

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Jennifer N. Lee, MD, FAAFP
© National Institute for Occupational Safety and Health
© National Institute for Occupational Safety and Health
© National Institute for Occupational Safety and Health
© National Institute for Occupational Safety and Health
© National Institute for Occupational Safety and Health