Tony Francis, MD, Orthopaedic Surgery, 10:36PM Jun 8, 2013
Consider a procedure whereby business competitors, who absolutely loathe each other, get a chance to review each other's work, make comments and recommendations that can never be subpoenaed or discovered, act on those recommendations and destroy the competition. And feel righteous doing it. Who would imagine this kind of thing would be ripe for abuse? Only the paranoid, so we are told. This is the way peer review works. As if doctors never act in their self interest, look to the bottom line, or are free from the moral failings afflicting all humans as described by Aristotle. That would be "ate" - moral blindness, "hamartia" - a normal reasoning process which is disordered, and "hubris" - an overwhelming and destructive pride. Of course, that never describes doctors. Right?
The peer review committees got teeth after the passage of The Healthcare Quality Improvement Act of 1986 (HCQIA) which was introduced by Congressman Ron Wyden from Oregon. (Title 42 of the United States Code, Sections 11101 - 11152). This was in response to Patrick v. Burget, the famous Astoria Oregon case in which surgeon Patrick won his case against a peer review committee which had used its power to violate Sherman Antitrust. HCQIA grants federal immunity to members of peer review committees who act in good faith. Of course, proving bad faith is as easy to catching fairies in the daisy patch. If the peer review committee wants to act on their conclusions in any substantive way, (that is restricting the practice of the doctor being reviewed), there must be some kind of due process hearing. The Fifth Amendment demands it.
Who could guess that the kind of hearing required in peer review had its beginnings in the Kansas City Stockyards? Whether that is appropriate is left to the reader to determine. Two massive cases, (known as Morgan v. US 1936 and Morgan v. US 1938) ended up in front of SCOTUS twice. The commissioner of Agriculture had set prices for beef without granting a hearing, or even listening to the affected parties. In part, SCOTUS ruled,
1. An order of the Secretary of Agriculture fixing the maximum rates to be charged by market agencies (commission men) at stockyards held void for failure to allow the "full hearing" before the Secretary required by the Packers and Stockyards Act. Morgan v. United States (1936).
2. In administrative proceedings of a quasi-judicial character, the liberty and property of the citizen must be protected by the rudimentary requirements of fair play. These demand a fair and open hearing.
3. In requiring a "full hearing," the Packers and Stockyards Act has regard to judicial standards -- not in any technical sense, but with respect to those fundamental requirements of fairness which are of the essence of due process in a proceeding of a judicial nature. Those requirements relate not only to the taking and consideration of evidence, but also to the concluding, as well as to the beginning and intermediate steps in the procedure.
Later, in response to the massive growth of agencies with regulatory power under the New Deal, Congress passed the Administrative Procedure Act of 1946 (APA) which provided the guidelines for a "fair hearing" conducted by "quasi-judicial" proceedings. A peer review committee is a "quasi-judicial" body, usually an extension of the state board of healing arts. The hospital by-laws will be some form of the APA. As you can see, the necessities for a fair hearing under APA are pretty amorphous. So, the hospital or clinic has wide latitude to do what it wants. As I have written before, peer review has had the effect of selecting certain personality types which fit into the hospital/clinic mold. For good or bad, it tends to reject individualists. One tip: if you go through a peer review hearing, demand a word for word transcript of the proceedings, even if you have to pay a few hundred dollars for it yourself. None of those "secretary minutes" which routinely leave out all the stuff that will be good for your side.
From the APA
§ 554. Adjudications (a) This section applies, according to the provisions thereof, in every case of adjudication required by statute to be determined on the record after opportunity for an agency hearing, except to the extent that there is involved - (1) a matter subject to a subsequent trial of the law and the facts de novo in a court; (2) the selection or tenure of an employee, except an administrative law judge appointed under section 3105 of this title; So in original. (3) proceedings in which decisions rest solely on inspections, tests, or elections; (4) the conduct of military or foreign affairs functions; (5) cases in which an agency is acting as an agent for a court; or (6) the certification of worker representatives. (b) Persons entitled to notice of an agency hearing shall be timely informed of - (1) the time, place, and nature of the hearing; (2) the legal authority and jurisdiction under which the hearing is to be held; and (3) the matters of fact and law asserted.
When private persons are the moving parties, other parties to the proceeding shall give prompt notice of issues controverted in fact or law; and in other instances agencies may by rule require responsive pleading. In fixing the time and place for hearings, due regard shall be had for the convenience and necessity of the parties or their representatives. (c) The agency shall give all interested parties opportunity for - (1) the submission and consideration of facts, arguments, offers of settlement, or proposals of adjustment when time, the nature of the proceeding, and the public interest permit; and (2) to the extent that the parties are unable so to determine a controversy by consent, hearing and decision on notice and in accordance with sections 556 and 557 of this title. (d) The employee who presides at the reception of evidence pursuant to section 556 of this title shall make the recommended decision or initial decision required by section 557 of this title, unless he becomes unavailable to the agency. Except to the extent required for the disposition of ex parte matters as authorized by law, such an employee may not - (1) consult a person or party on a fact in issue, unless on notice and opportunity for all parties to participate; or (2) be responsible to or subject to the supervision or direction of an employee or agent engaged in the performance of investigative or prosecuting functions for an agency. An employee or agent engaged in the performance of investigative or prosecuting functions for an agency in a case may not, in that or a factually related case, participate or advise in the decision, recommended decision, or agency review pursuant to section 557 of this title, except as witness or counsel in public proceedings. This subsection does not apply - (A) in determining applications for initial licenses; (B) to proceedings involving the validity or application of rates, facilities, or practices of public utilities or carriers; or (C) to the agency or a member or members of the body comprising the agency. (e) The agency, with like effect as in the case of other orders, and in its sound discretion, may issue a declaratory order to terminate a controversy or remove uncertainty.
§ 556. Hearings; presiding employees; powers and duties; burden of proof; evidence; record as basis of decision (a) This section applies, according to the provisions thereof, to hearings required by section 553 or 554 of this title to be conducted in accordance with this section. (b) There shall preside at the taking of evidence - (1) the agency; (2) one or more members of the body which comprises the agency; or (3) one or more administrative law judges appointed under section 3105 of this title. This subchapter does not supersede the conduct of specified classes of proceedings, in whole or in part, by or before boards or other employees specially provided for by or designated under statute. The functions of presiding employees and of employees participating in decisions in accordance with section 557 of this title shall be conducted in an impartial manner. A presiding or participating employee may at any time disqualify himself. On the filing in good faith of a timely and sufficient affidavit of personal bias or other disqualification of a presiding or participating employee, the agency shall determine the matter as a part of the record and decision in the case. (c) Subject to published rules of the agency and within its powers, employees presiding at hearings may - (1) administer oaths and affirmations; (2) issue subpoenas authorized by law; (3) rule on offers of proof and receive relevant evidence; (4) take depositions or have depositions taken when the ends of justice would be served; (5) regulate the course of the hearing; (6) hold conferences for the settlement or simplification of the issues by consent of the parties or by the use of alternative means of dispute resolution as provided in subchapter IV of this chapter; (7) inform the parties as to the availability of one or more alternative means of dispute resolution, and encourage use of such methods; (8) require the attendance at any conference held pursuant to paragraph (6) of at least one representative of each party who has authority to negotiate concerning resolution of issues in controversy; (9) dispose of procedural requests or similar matters; (10) make or recommend decisions in accordance with section 557 of this title; and (11) take other action authorized by agency rule consistent with this subchapter. (d) Except as otherwise provided by statute, the proponent of a rule or order has the burden of proof.
Any oral or documentary evidence may be received, but the agency as a matter of policy shall provide for the exclusion of irrelevant, immaterial, or unduly repetitious evidence. A sanction may not be imposed or rule or order issued except on consideration of the whole record or those parts thereof cited by a party and supported by and in accordance with the reliable, probative, and substantial evidence. The agency may, to the extent consistent with the interests of justice and the policy of the underlying statutes administered by the agency, consider a violation of section 557(d) of this title sufficient grounds for a decision adverse to a party who has knowingly committed such violation or knowingly caused such violation to occur. A party is entitled to present his case or defense by oral or documentary evidence, to submit rebuttal evidence, and to conduct such cross-examination as may be required for a full and true disclosure of the facts. In rule making or determining claims for money or benefits or applications for initial licenses an agency may, when a party will not be prejudiced thereby, adopt procedures for the submission of all or part of the evidence in written form. (e) The transcript of testimony and exhibits, together with all papers and requests filed in the proceeding, constitutes the exclusive record for decision in accordance with section 557 of this title and, on payment of lawfully prescribed costs, shall be made available to the parties. When an agency decision rests on official notice of a material fact not appearing in the evidence in the record, a party is entitled, on timely request, to an opportunity to show the contrary.
SHOULD DUE PROCESS BE PART OF HOSPITAL PEER REVIEW?
Medical peer review is the process by which a committee of physicians investigates the medical care rendered by a colleague in order to determine whether accepted standards of care have been met. The professional or personal conduct of a physician may also be investigated. If the committee finds that the physician departed from accepted standards, it may recommend limiting or terminating the physician's privileges at that institution. If the physician's privileges are restricted for more than 30 days, federal law requires the peer review committee to report that fact to the National Practitioner Data Bank.
There is no federal statute that requires peer review committees to observe due process, which the Supreme Court has defined as (1) giving written notice of the actions contemplated, (2) convening a hearing, (3) allowing both sides to present evidence at the hearing, and (4) having an independent adjudicator. Prior to the Health Care Quality Improvement Act of 1986 (HCQIA), the effects of an adverse peer review finding were restricted to the hospital involved. Because the HCQIA mandates the reporting of disciplinary actions of peer review committees to the National Practitioner Data Bank, such a report could harm a physician's career throughout the nation.
Medical peer review is usually based on the screening of medical records, which places physicians with poor record-keeping skills at a disadvantage, and ignores the fact that medical records are often a poor indicator of the quality of care. Additionally, there is no requirement that the physician be given notice and an opportunity to be heard, and there is no requirement that members of the peer review committee be unbiased. The HCQIA recommends that the physicianshould get notice of the allegations, time to prepare for a hearing, a list of witnesses, the right to legal counsel, and an impartial fact finder.
However, the act concludes "A professional review body's failure to meet the conditions described in this subsection shall not, in itself, constitute failure to meet the standards of this act." This failure of the HCQIA to require due process calls into question the fundamental fairness of the medical peer review system.
The reason that due process should be a part of any fact-finding endeavor was stated by Justice Goldberg in SILVER v NEW YORK STOCK EXCHANGE: 'Experience teaches...that the affording of procedural safeguards, which by their nature serve to illuminate the underlying facts, in itself often operates to prevent erroneous decisions on the merits from occurring.' The purpose of requiring due process is to ensure that the actions taken are not arbitrary, capricious, or unreasonable. Where there is no due process, the system invites abuse. Peer review in its current form fails to protect an investigated physician from committee members having an economic or personal bias. Economic bias occurs when a committee member has a financial interest in the outcome. If the challenged physician is a partner or associate, any error that he may have made is likely to be considered to have been unavoidable. On the other hand, peer review has already been used to force a competing physician out of practice. Such economic bias denies due process.
The United States Supreme Court struck down a decision from Ohio's municipal court system in which the judge was partly paid from the fines he assessed. The Court found that the system gave an incentive to rule one way rather than the other. Personal bias is inevitable when coworkers judge each other. Some people are very likable, and others illuminate the room by their absence. Federal law prohibits a federal judge from hearing cases in which his impartiality might reasonably be questioned or in which he has a financial interest. The same standards should apply to member of a peer review committee. The potential for abuse when these suggested procedures are not followed would indicate the need for mandatory due process. Due process, which is designed to limit these abuses, is not required by the Constitution of the United States unless there is government action that affects a liberty or property right.
The case of PAUL v DAVIS illustrates the legal meaning of property rights as applied to employment. The police labeled the plaintiff as a shoplifter and advised local businesses to watch him carefully. The plaintiff sued, claiming that the government was injuring his reputation without due process. The Supreme Court ruled against the plaintiff, but stated that should there be an effect on employment, then such injury would invoke the constitutional protection. The sole reason for reporting the results of peer reviews is to restrict the practices of incompetent physicians. Congress cited the following as the very reason for the act: 'There is a national need to restrict the ability of incompetent physicians to move from state to state without disclosure or discovery of the physicians'...incompetent performance.' The right to practice medicine without a governmental agency erroneously reporting that a physician has been deficient in his actions is a constitutional property right. Rights, even constitutional rights, can be waived by express agreement, or by the failure to assert those rights. State institutions, however, may not make waiver of a constitutional right a condition for employment.
In 1986, New York State enacted a system of physician discipline that includes a hearing presided over by an administrative law judge, to ensure due process. Although this system provides due process, it has the glaring problem of giving control of hospital privileges to lawyers. A far better solution is for peer review committees to be required to observe due process. Lawyers and other non-physicians may have a role as consultants, but should not be voting committee members. The effects of an adverse peer review decision are no longer limited to the relationship between a physician and a hospital. The decision becomes part of the National Practitioner Data Bank. Medical peer review must provide physicians the protections of due process.
Scott E. Segall, JD Judge, El Paso Criminal Law Magistrate Court
William Pearl, MD William Beaumont Army Medical Center