GWU School of Law

Health Care Law

GWU School of Law

Professor Rosenbaum

Fall 2013

Contents

PART ONE: ACCESS TO HEALTH CARE 9

Chapter 1. Barriers to Access and the Right to Health Care 9

Part 1. Health Insurance and the Uninsured 9

Part 2. The Consequences of Being Uninsured 10

Part 3. A Right to Health Care 10

The Right to Health Care 11

Chapter 2. The Common Law: From “No Duty of Care” to Limited Social Responsibility 11

Part 1. A Brief Overview of American Common Law 11

Part 2. The Basis of the “No Duty” Principle 11

Hurley v. Eddingfield 11

Part 3. Termination and Formation of the Doctor-Patient Relationship: “Undertaking” and “Abandonment” 12

Ricks v. Budge 12

· Muse v Charter Hospital of Winston Salem 12

Part 4. Medical Ethics as the Basis of a Duty to Care 12

Part 5. The Evolution of the “No Duty of Care” Principle under the Common Law 13

o Wilmington Gen. Hosp. v. Manlove 13

· Childs v. Weis 13

· Hiser v. Randolph 13

· Dillon v. Silver 14

· Payton v Weaver 14

o New Biloxi Hospital v. Frazier 14

o Campbell v. Mincey 14

EMTALA 15

Chapter 3. Federal Legislative Reform of the “No Duty” Principle: The Emergency Medical Treatment and Labor Act (EMTALA) 15

Part 1. Introduction 15

Part 2. The EMTALA Statute 15

o Barris v. County of Los Angeles 17

o Power v. Arlington Hospital Ass’n 17

Part 3. The Duty to Provide an Appropriate Screening 18

Power v. Arlington Hospital Association 18

Summers v. Baptist Medical Center Arkadelphia 18

Lewellen v. Schneck Medical Center 18

Part 4. What Does it Mean to “Come to” the Hospital’s Emergency Department? 19

Part 5. The Duty to Stabilize Persons with Emergency Medical Conditions 19

o Bryan v. University of Virginia 20

o Moses v. Providence Hospital and Medical Centers 20

o Arrington c. Wong 20

In the Matter of Baby K 20

Part 6. The Duty to Stabilize and Furnish A Medically Appropriate Transfer 21

Part 7. The Duties of Transferee Hospitals 21

Part 8. On-Call Specialists 21

Dabney v. Fort Walton Beach Medical Center 22

Part 9. How Does the EMTALA Stabilization Duty Apply to Inpatients? 22

Lopez Soto v. Hawayek 22

Urban v. King 22

Roberts v. Galen 22

Harry v. Marchant 23

Bryant v. Adventist Health 23

How the Law Creates Access to Health Care 23

Chapter 4. Civil Rights and Access to Health Care 23

Part 1. Prohibiting Discrimination on the Basis of Race and National Origin by Recipients of Federal Financial Assistance under Title VI of the 1964 Civil Rights Act 24

Part 3. Prohibition of Discrimination on the Basis of Disability: The Americans with Disabilities Act and the Realization of Health Care as a Public Accommodations 25

The Role of Civil Rights law in Access to Health Care 26

Chapter 5. Direct Public Provision of Medical Care 26

Part 1. Safety-Net Hospitals 26

Part 2. Community Health Centers 26

PART TWO: HEALTH CARE FINANCING 28

The Rise and Evolution of Insurance 28

Chapter 6. The Rise and Evolution of Health Insurance 28

Part 1. Health Care Costs and the Search for Solutions 28

Part 2. The Evolution of Heath Insurance and Health Insurance Law 29

o Sorrell v. IMS Health Inc 29

§ Hailey v.California Physicians' Service 30

Part 3. Escalating Costs and New Models of Health Insurance 33

Part 4. The Patient Protection and Affordable Care Act 34

Supplement. Slogging Toward the New Normal: Implementation of the Affordable Care Act 34

Insurer Obligations and Remedies under State Law 37

Chapter 7: Defining Insurer Obligations and Remedies Under State Law 37

Part 1. Remedies for Bad Faith Breach of Contract in Denying Coverage 37

Albert H. Wohlers & Co. v. Bartkis 37

ERISA 38

Chapter 8. ERISA 38

Part 2. History and Statutory Structure 38

Part 3. Fiduciary Duty of Information and Disclosure 38

Mondry v. American Family Mutual Insurance Company 39

Part 4. Full and Fair Review of Claims 39

Shelby County Health Care Corp. v. Majestic Star Casino, LLC Group Health 40

Part 5. Health Benefit Plan Design and the ERISA Settlor Function 40

McGann v. H&H Music 41

Jones v. Kodak 41

Part 6. Judicial Review of Fiduciary Decisions 42

o Firestone Tire & Rubber v. Bruch 42

Krauss v. Oxford Health Plans 43

Part 7. ERISA and Preemption of State Law 44

o Shaw v. Delta Airlines 45

o New York State Conference of Blue Cross & Blue Shield Plans v. Travelers 46

o California Division of Labor Standards Enforcement v. Dillingham Construction 46

o De Buono v. NYSA-ILA Medical and Clinical Services Fund 47

· Boggs v. Boggs 47

· Foster v. Blue Cross and Blue Shield of Michigan 47

· Egelhoff v. Egelhoff 47

o Massachusetts v. Met Life 47

o Rush Prudential HMO v. Moran 47

o Kentucky Ass’n of Health Plans, Inc. v. Miller 48

o Pilot Life Insurance Co. v. Dedeaux 49

o Rush Prudential v. Moran 49

o Connecticut General Life v. Insurance Commissioner 50

The Interaction of Coverage and the Americans with Disabilities Act 50

Chapter 9. Private Health Insurance and Coverage Discrimination 50

Part 1. Introduction 50

Part 2. The Americans with Disabilities Act 50

· Doe v. Mutual of Omaha Insurance Company 51

Medicare 52

Chapter 10. Medicare 52

Part 3. Defining the Scope and Limits of the Medicare Entitlement 54

Part 4. Appeals of Individual Medicare Claims Denials 55

Supplement. Note: The Final Demise of the Improvement Standard 55

Medicaid 55

Chapter 11. Medicaid 55

Part 4. Medicaid’s History 55

Enactment 55

Movement to Medicaid Managed Care: Medicaid as a Market Purchaser 56

Achievements 56

Challenges 56

o National Federation of Independent Business v. Sebelius 57

How Medicaid works 58

Statutory Requirements for the States 58

General Requirements 58

Rules for Assessing Eligibility 58

People Who MUST be Covered 58

Rules for what Medical Care MUST be Covered 59

Acceptable State Coverage Limits 59

§ Curtis v. Taylor 59

§ Cowan v. Meyers 60

§ Miller v. Whitburn 60

§ Dexter v. Kirschner 60

Unacceptable State Coverage Limits 60

§ Pinnecke 60

§ Weaver v Reagan 60

Rules on Provider Participation and Compensation 60

Getting the Plan Approved 61

Medicaid Statutory Entitlement 61

Private Enforcement of Federal Obligations 61

Chevron U.S.A. Inc. v. Echazabal 61

Providers Rights when dealing with the Termination of Contract with the State 62

· Goldberg v. Kelly 62

· MEDCARE HMO v. Bradley 62

Beneficiaries Rights when there is a Violation of the State Plan 62

Beneficiaries and Providers Rights when the State Plan is in Violation of the Federal Medicaid Statute 62

Implied Right of Action/Supremacy Clause 62

· Rosado v. Wyman 62

· Douglas v. Independent Living Center of Southern California 63

· Wos v. E.M.A 64

General Federal Cause of Action Statute - 42 USC 1983 66

· Maine v. Thiboutot 66

· Wilder v. Virginia 66

· Suter v. Artist M. 66

· Blessing v. Freestone 67

· Gonzaga v. Doe 67

Special Concerns: Americans with Disabilities Act 67

Paying for Health Care 68

Chapter 12. Paying for Health Care: Conceptual and Structural Considerations 68

Introduction 68

Provider Payment 69

What services to cover? 69

Setting Payment Rate 70

Selecting Payment Method 70

Pay for Performance 71

Special Issues for Medicare and Medicaid 71

Disproportionate Share (DSH) Payments 71

o Adena Regional Medical Center v. Leavitt 71

Bad Debt 72

o Battle Creek v. Leavett 72

Medical Necessity 73

Special Issue for Private Insurance 73

Provider Access to Health Insurance Markets: Selection and De-selection 73

Fair Procedure Doctrine Applies to Exclusion 73

§ Palm Medical Group v. State Compensation Ins. Fund 73

Any Willing Provider Laws 74

ERISA Preemption and Provider Payment 74

o Franciscan Skemp v. Central States 74

PART THREE: HEALTH CARE QUALITY 76

Medical Malpractice 76

Chapter 14. Medical Malpractice and Health Care Quality 76

Part 1. What Does Medical Malpractice Tell Is About Health Care Quality? 76

Part 2. From Physician Authority to Egalitarian Social Contract and Market Competition: Medical Malpractice Law and Transformation of the Professional Standard of Care 78

Part 3. From Local Medical Customer Practices to a “National Standard” of “Acceptable Care” 78

§ Shilkret v. Annapolis Emergency Hospital Association 79

§ Hall v. Hilbun 79

Part 4. The Problem of Competing Standards: The “Two Schools of Thought” or “Respectable (or Reputable) Minority” Doctrine 79

§ Jones v. Chidester 79

Part 5. Overriding the Professional or Industry Standard of Care 80

§ TJ Hooper 80

§ Helling v. Carey 81

Part 6. When Has a New Standard Emerged? The “Best Judgment Rule” and the Problem of New Knowledge and Technologies 81

Washington v. Washington Hospital Center 81

Part 7. Clinical Practice Guidelines and the Standard of Care 82

Diaz v. New York Downtown Hospital 82

Part 8. Challenging Professional and Industry Standards 82

The “Equally Well-Informed Expert” and “Available and Proven Scientific Safeguards” Doctrines 82

United Blood Services v. Quintana 82

§ Osborn v. Irwin Mem. Blood Bank 83

Part 9. Should the Professional Standard of Care Be Adjusted to Account for Patients’ Economic Circumstances? 83

§ Murray v. UNMC Physicians 83

§ Greater Washington DC Area Council of Senior Citizens v. District of Columbia Government 84

Informed Consent 84

Chapter 15. Informed Consent to Treatment 84

Part 1. Introduction 84

Part 2. The Ride of a Patient-Oriented Standard of Informed Consent 85

Canterbury v. Spence 85

Part 4. Conflicts of Interest and the Physicians Fiduciary Duty 86

Moore v. The Regents of the University of California 86

Health Information Confidentiality and Health Information Privacy 86

Chapter 16. The Confidentiality of Health Information and Information Privacy 86

Part 1. Introduction 86

MacDonald v. Clinger 86

Part 2. Health Information Privacy: The HIPAA Privacy Rule 87

Liability Reform 88

Chapter 17. Medical Liability and the Politics of Legal Change 88

Part 2. What Is the Nature and Extent of the Medical Liability Problem? 88

Part 3. Fixing the Medical Liability “Crisis” 89

Part 5. Enterprise Liability 89

Definition 89

Proposals for Systematic Enterprise Liability in Health Care 90

Hospitals and Health Care Quality 90

Chapter 18. Hospitals and Health Care Quality 90

Part 2. The Role of Law in the Age of Expanding Hospital Authority 90

Charitable Immunity Doctrine 90

Part 4. The Rise of Respondeat Superior 91

§ Truhitte v. French Hospital 91

Part 5. Non-Employee Physicians and the Expanding Concepts of Agency Nondelegable Duty 92

Nondelegable Duties for Hospitals 92

o Jackson v. Power 92

Part 6. The Rise of Hospital Corporate Liability 92

The Structure of Hospital Governance 92

The Scope of Corporate Liability 93

The Hospital’s Duty to Monitor Treatment Done by Staff with Privileges 93

Darling v. Charleston Community Memorial Hospital 93

Corporate Interference with Appropriate Medical Care 94

Hospitals have a duty not to implement policies that interfere with the medical judgment of the physicians they employ. If the hospital breaches that duty, it will be liable for any damages caused by the policy. 94

Muse v. Charter Health Care 94

Part 7. The Charitable Immunity Doctrine and Contractual “Releases” 95

Tunkl v. Regents of University of California 95

Part 8. Structuring the Hospital Peer Review Process: State-Law Immunity, Privilege, and Regulation 95

Peer Review 95

Bryan v. James E. Holmes Regional Medical Center 96

Part 9. Substantive Grounds for Adverse Hospital Action 96

Payers and Health Care Quality 96

Chapter 20. Payers and Health Care Quality: Awakening the Sleeping Giant 96

Part 1. Introduction: Old Concerns, Old Techniques and the Rise of “Value-Based Purchasing” 96

Utilization Review (UR) of providers for them to participate 97

Professional Standards Review Organizations (PSROs) 97

Peer Review Organizations (PROs) 97

Quality Improvement Organizations (QIOs) 97

o Doyle v. Secretary of Health and Human Services 97

Part 2. Legal Issues in Value-Based Purchasing 98

Liability of Payers for Medical Negligence and ERISA Preemption 98

Chapter 21. Liability for Medical Negligence: Special Issues that Arise in Situations Involving Insurers and Health Plan Administrators 98

Part 2. Insurer Negligence in Connection with Coverage Determinations 98

· Wickline v. State of California 98

· McEvoy v. Group Health Cooperative of Eau Claire 99

Part 3. Liability for Medical Injuries Arising From Health Care Negligence 100

Vicarious Liability and Agency 100

· Boyd v. Albert Einstein Medical Center 100

· Chase v. IPA, Inc. 100

· Petrovich v Share Health Plan of Illinois 100

· Williams v Good Health Plus, Inc. 100

Corporate Liability 100

· McClellan v. HMO 101

· Shannon v. McNulty 101

· Jones v. Chicago HMO 101

Part 4. When Does ERISA Preempt the Medical Liability of Insurers and Plan Administrators? 101

Corcoran v. United Healthcare 101

Dukes v. U.S. Healthcare 102

Pegram v. Herdrich 103

Aetna Health v. Davila 104

SUMMARY 105

PART FOUR: REGULATION OF HEALTH CARE TRANSACTIONS 105

Tax Exemption in the Modern Health Care System 105

Chapter 23. Tax Exemption in the Modern Health Care System 105

Part 1. The Nature of Community Benefit 105

Part 2. The Integral Part Doctrine 105

Part 3. Joint Ventures with Nonexempt Entities 105

Health Care Fraud and Abuse 106

Chapter 24. Health Care Fraud and Abuse 106

Part 1. False Claims Act 106

Part 3. The Anti-Kickback Statute (AKS) and Stark 106

Antitrust and Health Care 106

Chapter 25. The Application of Antitrust to Health Care 106

Part 1. Market Power 106

· United States v. Long Island Jewish Medical Center 106

Part 2. Exclusionary Conduct or Lawfulness 107

Part 3. Special Problems Raised by Horizontal Collaborations 107

PART ONE: ACCESS TO HEALTH CARE

Chapter 1. Barriers to Access and the Right to Health Care

Part 1. Health Insurance and the Uninsured

(Today in the United States, 18% of Americans do not have health care coverage.)

Causes of un-insurance