Licensing Acts

a. Generally i. SOC ii. License suspension/revocation iii. Criminal offense for unlicensed practice iv. Board of Medicine -> medical professionals b. Professionals i. Scope of Practice Statutes 1. Can delegate as long as a. Physician supervises and retains ultimate resp b. Delegate does not purport to be practicing medicine c. Facilities i. Cert of Need -> STATE 1. Statewide v. Humana -> State health plan maps regions with hospitals with the Health Planning Agency, which helps decide whether to issue certificate a. Holding: speculative population growth is too speculative to issue certificate ii. Licensing for facility -> STATE 1. Mandatory iii. Accreditation -> FED -> JCAHO 1. Private, voluntary, but mandatory if you want to receive Medicare/Medicaid 2. Try to get designation of quality of care 3. Cospito v. Heckler -> hospital loses, JCAHO accreditation, patients sue because they were involuntarily committed a. Holding: patients have no protectable property interest in obtaining treatment at a PARTIC facility, and loss of benefits was INDIRECTLY caused by decertification

Treatment Relationship
2. Duty to treat a. General: Doctor Patient Relationship i. Consensual relationship. Doc may generally refuse to accept patient for any reason w/in limits: 1. Emergencies/active labor until stabilized or transferred (EMTALA) 2. Refuse for discriminatory reasons (race, sex, HIV) 3. Once treatment starts, may not terminate w/out proper arrangements being made 4. Providers may not impose unreasonable conditions on their agreement to treat. 5. In re Baby K: Harder to deny treatment due to futility b. Private individual physicians i. No Duty Rule (Hurley v. Eddingfield) (1901): no duty to treat if 1. did not agree to treat 2. treatment relationship has not begun 3. prior treatment does not establish relationship b/c law considers treatment relationships to coincide w/ spells of illness -> NOT FOR HMOs 4. exception: on-call physicians (emergencies) -> undertakes hospitals greater duty of care

ii. No duty to treat, even in emergencies, if no existing dr/patient relationship, except on call physicians (not expected to have ER staff available at all times) c. Facilities or large scale providers i. Common law duty to treat emergency patients regardless of payment, but only in sever emergencies ii. Common law and regulatory duties to treat all patients who can pay, but iii. No enforceable duty to treat non-emergency or mid emergency patients who cant pay iv. EMTALA -> federal patient dumping statute 1. Duty to treat triggered when patient arrives at hospital 2. SCREENING - Ends if determined patient does not have emergency medical condition or active labor 3. If there is medical condition, then hospital must stabilize patient 4. Stabilization exceptions -> Transfers a. Patient requests transfer b. Physician certifies that medical benefit of transfer outweighs medical risk c. MUST have appropriate medical support for transfer i. Burditt v. US HHS 5. Baby K: hospital doctor liable for refusal under EMTALA d. Government i. Negative Liberty Principle: constitution become relevant to health care only when government bans treatment, but not when government declines to assist in obtaining treatment 1. Exception: state custody (involuntary committed, prisoners) ii. DeShaney v. Winnebago (1989) 1. the due process clauses generally confer no affirmative right to govt aid & that state had not assumed a special relationship w/ child by virtue of having made some ineffectual efforts to protect him since agency did nothing to make him more vulnerable; iii. Hill-Burton Act: non-profits get tax exemption in return for free treatment for some patients, but service is owed to public, not individuals, and no real private cause of action for denial 3. Wrongful reasons to reject patients a. Rule: Duty to Treat Hospital doctors may refuse to treat most patient for good reasons such as inability to pay, but not for bad reasons such as b. Discrimination i. Disability: 1. Rehabilitation Act: applies to any federally funded programs/services 2. Americans with Disabilities Act: applies to all non-fed providers of HC, public and private a. Disability: threshold factor, if medications or medical services can alleviate the disability symptoms, then person is not disabled w/I meaning of ADA/Rehab Act 3. Glanz/University Hospital: disability can be a relevant favor in access to HC if the disability can be a factor in deciding how to treat the patient. ii. Infectious Patients 1. Bragdon -> outright denial of care based on HIV status unlawful, but freedom to deny care depends on a. Infection affects patients ability to benefit from Tx; and b. Risk to Doc of becoming affected

4. Structure a. When physician/patient relationship formed i. When scheduled appointment with specific purpose w/I prof competence (Lyons v. Grether) ii. Not when telephone calls from prospective patient (Clanton) iii. Not when consultation by treating doctors (Reynolds v. Decatur) 1. When treating doc informally consults a colleague iv. Employment/insurance physicals: RULE: no when doc examines P at request of/benefit of 3p 1. Exceptions: a. May have duty to take reasonable steps to make info available timely to examine if any finding that post an imminent danger to examinees physical or mental well being b. Relationship may be created if doc affirmatively advise P on how to be treated c. Duty to do no harm (Armstrong v. Morgan) i. Dr. misreported health condition related to exam for promotion d. 3p who requires exam and chooses the doctor may have duty of care (Domak v. LaFayette Gen Hospital) i. employer liable for failing to disclose TB diagnosed during preemployment exam v. Duties to 3p: Rule: some duty of non-neg to 3p, but cts differ on extend of duty b. Limiting the scope of relationship Tunkl v. Regents of the Univ. of CA (1963) i. P sues for personal injuries from tx by 2 docs at hospital. P signed waiver stating he released hosp from any and all liabl for neg/wrong conduct, if hopstial took due care in hiring employees. P was sedated and in pain when signed the release ii. HOLDING: waiver of liability not valid, against public policy 1. P in no position to bargain 2. P cant reject treatment b/c he needs it immediately iii. LIMITED APPLICATION: CA case c. Termination i. Public Service Enterprise: public hospital providing scarce med resource needed to preserve life cannot without services arbitrarily or without reasonable cause 1. Collective Responsibility: providers may have collective responsibility to share burden of difficult patients over time ii. Rule: relationship exists as long as P needs tx for condition that brought him to doctor. Once need is satisfied, relationship ends 1. Other Ways a. P unilaterally chooses to dispense b. Mutual agreement c. Doc can terminate as long as choice is given to P such they have sufficient opportunity to secure care from another doc (Patton -> crackhead/Ricks v Budge -> finger infection) iii. Abandonment Liability v. Liability for Mistakenly Ceasing Tx due to Medical Error 1. Abandonment is breach of contract, NOT medmal iv. Lack of payment rule: failure to pay does not allow termination of care before satisfying usual requirements for termination (notice, opportunity) BUT doc can take ability to pay into acct when deciding whether or not to initiate relationship, AND non-payment is an acceptable basis for termination as long as termination is accomplished properly. 5. Confidentiality

a. Fiduciary Nature of Tx Relationship i. Policy concerns: patient vulnerability necessitates to i) confidentiality of medical info, ii) informed consent, iii) vigilance for conflicts ii. Doc/Pat relationship is fiduciary relationship w/ heightened duty of loyalty/care b. Must maintain i. Rule: duty to maintain confidentiality includes obligation to have in place policies and procedures designed to reduce risk of accidental or intentional discolsures ii. HIPPA: fed statute, obligation to maintain identifiable health info on certain covered entities (including health plans, HC clearinghouses and providers who transmit health info electronically iii. Exceptions: i) when patients consents, and ii) disclosure is necessary to protect patient or 3p iv. Cases: 1. Doe v. Marselle -> nurse discloses HIV, violated state statute 2. Doe v. City of NY -> constitutional right of confide in med recs. a. government interest -> substantial balancing test -> is interest substantial enough to overweigh privacy interest 3. Whalen v. Rose -> informational privacy right a. ct upholds state program that stores names of individuals who have been prescribed certain controlled substances v. Causes of Action from Breach 1. K breach, mal, fid duty breach, fraud/misrep, civil statute w/ damage award, prof discipline c. Must breach i. Rule: In limited cases, providers have authority/DUTY to breach and failure can lead to crim/civil liab. Nonfeasance does NOT equal negligence, except special relationship. 1. HIV, FL statute requiring reporting of elder abuse, child abuse, gunshot/knife wounds, dangerous psych 2. If special relationship, what is the scope? a. Nature of risk and b. Doc ability to reasonably reduce the risk 3. HIPAA: Duty if a. necessary to prevent or lessen a serious and imminent threat to health/safety of a person or the public; and b. disclosure is to a person/entity reasonably able to prevent/lessen the treat (target of threat) ii. Areas 1. Contagious diseases: liable to non-P when i) doc fails to diagnose, ii) doc fails to warn others a. Bradshaw v. Daniel (rocky mtn spotted fever, wife) 2. Genetic conditions: some courts find duty to warn 3. Mental Illness (Tarasoff v. Regents of CA) a. Dr liable for failure to exercise reasonable care to protect 3p where D knew/should have known patient presented a serious danger of violence to 3p (prof std of care) b. Specific risk to foreseeable & identifiable 3p 4. Driving impairments: where state statutes require, doc can be liable for injury to 3p 6. Informed Consent

a. Disclosure Standards i. Canterbury v. Spence 1. Material Risk Standard: a risk such that a RP would likely attach significance to that risk in deciding whether or nor to have the proposed treatment (objective standard) a. Topics Requiring Disclosure i. Inherent/potential risks ii. Alternatives iii. Likely results of non-treatment ii. Culberton v. Mernitz 1. AMA Standard/ Reasonably prudent physician standard = prof SOC: doc obligation is to present medical facts accurately to patient and to make rec for mgmt. in accordane w/ good medical practice 2. Doc has ethical obligation to help patient make choices from alternatives consistent with good medical pratice b. Duties to disclose material information i. Majority Rule: professional standard (reasonably prudent physician under SSC) 1. Standard medical convention determins whether type of info must be disclosed to P -> protects doctors if they follow this. ii. Expert testimony: reqd to determine whether doc met SOC where prof. disclosure standard is used. iii. Limitations: IC claims restricted to HC professionals, not institutions 1. Battery is rejected, bc patient consented to touching iv. Elements of a non-disclosure IC claim 1. Medical procedure carried specific risk that was not disclosed 2. Doc violated SOC (duty) 3. Undisclosed risk at issue materialized (harm) 4. Failure to disclose caused injury (causation) a. P required to show that Reasonable patient would not have undergone treatment if risk had been disclosed c. Limits of liab for failure to disclose i. Rizzo v. Schiller -> no informed consent because authorization form was too general to waive liability for undisclosed procedure, and causation was established by expert testimony ii. Limits of duty to inform 1. Common knowledge - average sophistication standard 2. Patient knowledge 3. Emergencies when patient is incompetent and immediate treatment is required to prevent more serious harm and no substitute decision maker is available 4. Therapeutic priv no duty when disclosure process would foreclose rational decision or pose psych damage to patient 5. Waiver iii. Informed consent form -> written document of Ps assumption of disclosed risks, P not recommended and performed iv. Malpractice 1. Where there are alt standards of care/courses of tx, IC may help doc defence in showing doc complied with a respectable minority of providers 2. IC form helps affirmative defense of assumption of risk or contrib neg. v. Brown v. Dibell -> P has duty to disclose in response to Doc inquiries and failure to disclose may be contributory neg.

7. Whether duty to disclose/CoI/Fiduciary duties a. Rule: in order to satisfy fiduciary duty, Doc who seeks Ps consent must disclose personal interests unrelated to Ps health, including research or econ interests that may affect medical judgment (COI must be disclosed) -> Moore v. Regents of Univ of CA i. Opens door to use IC and fid theory to protect patients from risks created by providers financial arrangement with 3p b. Rule: Institutional orgs, under common law, dont have disclosure duty like doctors

MEDMAL
1. Elements of a MedMal Case a. Applicable SOC b. Breach of SOC by doc c. Injury d. Proximate causation between alleged breach and injury e. Affirmative Defenses f. Damages 2. Std of Care a. Custom-Based SOC: ordinary carefully and prudent doctor in SSC, as determined by jury b. Variations i. Respectable minority rule: Jones v. Chidester 1. complete defense to med mal a. if considerable # of drs, reputable and respected, prescribe to a school of though, even if another group would disagree ii. Chapel v. Allison -> rural 1. non-certified GP is held to a standard of care of a reasonably competent GP acting in the same or similar community in US under SSC a. abandons strict locality rule b. applies only to GPs, not board certified specialists/GPS iii. Error in Judgment -> Doc no liable when making educated choice amount 2 or more reasonable paths iv. Experimentation: standard of reasonable experimentation v. Unorthodox medicine: cts split on whether reasonable minority rule protects c. Locality Rules in SOC: who qualifies as expert witness? i. Maj Rule: expert doesnt need to practice in particular specialty or locational category that defines SOC, just needs to be familiar with it d. Qualification and Exam of Expert Witnesses i. Rule: witness may qualify as expert based on knowledge, skill, experience, training, education or combo (Thompson v. Carter) ii. Rule: ok to ask about expert witness annual earnings for expert testimony (Trower v. Jones) iii. Physican experts: MAJ RULE dont have to practice in exactly same area/specialty iv. Other documents/etc. 1. Treatises: modern says ok, but not physical evidence 2. Practice guidelines: MAJ: can only be referred to and receited by expert

3. Phy report cards/profiles: irrelevant 4. Blah 3. Alternative Theories of Liab -> centered on what jury thinks is reasonable, not what doctor did a. Res Ipsa and Neg Per Se i. Elements of Res Ipsa 1. Event must be of kind which ordinarily does not occur in absence of neg 2. Event caused my agency or instrumentality w/I exclusive control of D 3. Event must not have been due to coluntary action or contrib by D 4. Evidence of true explanation of even must be more readily available to D than P 5. NO EXPERT TESTIMONY ii. Res Ipsa allows jury to fill in gaps iii. Neg Per Se 1. Finding of neg w/o expert testimony; judge can direct verdict as matter of law; no statutory violation required b. Ordinary Neg i. Helling v. Carey -> glaucoma cast 1. Court took med neg away from jury and rules, w/o expert testimony, that a customary practice to give glaucoma test was neg as a matter of law. 2. Neg as a matter of law 3. Outlier case 4. Rejection of customary standards is valid ii. Technological Imperative 1. Doctors are compelled to use all available tech, regardless of costs, and reinforced by threat of threat of liability 2. Washington v. Washington Hosp Center a. P gets verdict b/c hospital didnt update to latest technology 3. Early adopters risk clinical cascade of more costs/tests iii. Judge Learned Hand Formula 1. If ProbXInjury is greater than Burden c. Breach of Contract -> Sullivan v. OConnor (nose job promise) i. Rare, higher standard for proving contractual breach CCE and lower damages reliance, not expectation 1. CCE CASES a. Ferlito v. Cecola -> dentist promise to make teeth pretty NO b. Anglin v. Kleeman -> surgery would strengthen knee is opinion (NO) c. Doerr v. Villate -> sterilization prevents surgert (YES) 2. Beneficial to P a. Raises SOC and avoids need for expert med testimony b. Longer SOL c. Avoids med mal reform statutes (damage caps) d. Avoids docs of sovereign immunity/charitable immunity ii. Advertising 1. More common with HMOs and other managed care insurance a. Deliberate denial of treatment b. Poorly performed treatment iii. Abandonment and Switching Doctors

iv. Fraud -> typically situations where Doc made fraudulent statements or intentionally misrepped results 1. Most: unethical practices and crim activities by unlicensed doctors 2. People v. Phillips -> faith healther d. Vicarious Liab. i. RULE: employer is liable for employees actions if within scope of employment ii. Captain of the Ship Doctrine Franklin v. Gupta 1. Liab imposed for neg acts of surgeon b/c status and without any showing of actual control by surgeon -> surgeon duty to control what is going on in operating room iii. Borrowed Servant Rule 1. Where evidence shows that surgeon had or exercised right to control details of another persons work/conduct OR other elements of rule are satisfied a. i.e. Special employer liability for borrowed servant when taken out of normal scope of employment, duty iv. Effect on Hospital Liab -> MAJ: hosp jointly liab unless doc instructs nurse to do something not within general scope of duty v. Prof Corps: individual physicians not liable for neg committed by colleagues but partnership is liable vi. LLCs: only liable if they supervise doc who is at fault vii. Indemnification viii. Charitable Immunity: in past, charitable institutions were not liable for doc actions -> public policy, but is changing along with nature of hospitals as place for docs to practice e. Strict Liability: imposed when conduct can be defined precisely to insure application of SL wont produce bad outcomes, and serves in compensatory function when D, through insurance, is financially more responsible person (OUT OF EQUITY) i. Trend: restriction of SL even to med products. Works like govt workers comp, tables, figures, numbers ii. Pros: simple, reduction of stigma to well-meaning profs, increased social justice of covering serious injury despite behavior that caused it iii. Cons: poor deterrent effect -> random lawsuits, med mal insurance is widespread and not experience-rated (ppl pay for no wrongdoing) f. Products Liability see lengthy outline 4. Causation a. Loss of Chance Doctrine: Ds conduct deprived decedent of significant chance to survive/recover Herskovits v. Group Health i. Not for wrongdoes, after the fact to say result was inevitable ii. Hamil v. Bashline, once P shows the Ds conduct increased risk of harm, basis for jury to make determination whether increased risk was substantial factor in resulting harm iii. Damages: no full damages, but damages discounted by portion of chance that was lost b. Loss of less than even chance of survival/cure P establishes prima facie issue of prox cause if produces testimony that D probably caused substantial reduction in Ps chance of survival c. Traditional Test: More likely than not test: reasonable probability or reasonable medical certainty d. Causation vs. Breach of Duty i. Causation does NOT bring liability -> still have to shop breach of duty under more reasonable than not standard

ii. Testimony that if procedure or test had been done, patient chance would have improve NOT proof that treatment is required by SOC e. Present Medical Injury Fein v. Permanete Medical Group i. Allowed recovery for econ costs associated with shortened life expectancy and increased risk for disease f. P can recover for emotional distress for future death/disease 5. Statute of Limitations a. RULE: 4 years b. Cunningham Decision -> IUD fuck up/non-detection i. Statute of repose begins once neg treatment ends, regardless of whether P discovers it ii. Must be continuing course of neg treatment iii. EXCEPTION: doctor fraudlent concealment -> 5 years to due iv. Continuing negligent treatment applies directly to clinic where multiple physicians conducted negligent treatment c. Continuous course of Tx Doctrine: tolled running SoL until end of patient relationship, so long as there was continuous treatment whether it was negligent or not for a condition occasioned by a prior neg act. d. Tolling Rules: 3 doctrines i. Continuing treatment 1. RULE ONE: applies even to single act, and statue doesnt start running until tx for same condition is completed 2. RULE TWO: applies only where it is continuing negligence ii. Fraudulent concealment iii. Discovery rule e. Changes -> Tort Reform i. Baseline limitations to 1-2 years, outer limitations to 3-5 6. Affirmative Defenses a. Most Common: i. 1) release from liablility, 1. Cov Not to Sue: may limit liability but needs to be clear and unequivocal -> Schneider v. Recivi 2. Waiver of liability a. GENERAL RULE: signed at time of treatment is not enforceable, BUT, if signed after harm occurs, OK b. Distinction btw cov not to sue (beforehand) and waiver (after) i. Important bc, at common law, release of 1 joint feasor is released, than all other joint feasors are released ii. 2) contrib neg/fault, 1. Can patients be found at fault for behavior before leading up to their condition? a. RULE: NO. doctors take patients as they find them 2. Mitigation of damages: patients dont have to submit to risky surgery or medication to correct a neg injury, even if medically adviced 3. Good Samaritan immunity statutes: encourages doctors to aid injured strangers by reducing SOC to gross neg or recklessness when respond to emergency 4. Hospital Immunity: a. Charitable i. Exceptions:

1. Paying v. nonpaying patients 2. Patients v strangers 3. Administrative v. professional acts b. Governmental for state/muni facilities -> State Statute i. Fed govt has limited immunity by statute ii. Psych: substantial immunity iii. Military duty -> full immunity iv. VA -> strick liab, w.o regard to neg iii. 3) assumption of risk 1. not a total bar to recovery, simply diminished amount of recoverable damages 2. BUT express assumption of risk is a complete defense 7. Damages/Settlement 8. Hospital Liab a. Most common: duty to credential/negligent selection b. Most common: Duty to supervise/negligent supervision c. Vicarious -> based on physicians relationship with hospital d. Direct -> wrongdoing by mgmt. with respect to physician competence and patient care e. Schloendorff vs. Society of NY Hospital (OLD) i. Implied waiver by accepting charity services ii. Docs are independent contractors -> no master/servant iii. Nurses are servants of doctors -> no hosp liability for acts from nurses f. Adamski v. Tacoma General -> ostensible agency theory i. If looks like doc is acting as agent and patient reliance ii. TEST: Facts and Circumstances test 1. Modern: ER docs are ostensible agents regardless of arrangement 2. Office Based Physicians: most courts say not applicable to specialists who would out of offices and hospitals g. Modern Forms of Hospital Liability i. Brown Formula 1. Hospital liable under respondat superior b/c P didnt go to see specific doctor, went to hospital, and hospital pays doc salary ii. Significant relationship Rule 1. Where P presents himself @ hosp for tx and is referred to Doc who is not a salaried employee of hospital, courts look to all circumstances to find significant relationship a. E.g. doctor employed for a long time, performing inherent function of the hospital w/o which the hospital could not serve its purpose iii. Enterprise liability 1. Non-delegable duty to the public -> if it happened on your presmises and someone was neg, whether he was your ostensible or actual agent or not, you are liabile iv. Holding out/ Ostensible Agent Theory 1. Hospital can still be responsible for Doc mal prac even if he is not an agent, if patient relies on his apparent agency. 2. Does not require an affirmative misrep of Docs status v. Direct Institutional Liability -> Darling v. Charleston 1. falls between vicarious liab for some docs and enterprise liability for others

2. THEORY: hosp liab even for acts of indep docs, but ONLY IF hosp mgmt. reached a duty of care owed directly to patients w/ respect to selecting/supervising Doc h. More i. Hospital Control 1. Corporate practice of medicine doctrine: illegal for corp to subject docs to control of lay mgmt. b/c would constitute =unlicensed practice of medicine a. can find respondat superior w/o actual control, but merely neg acts occurred w.i course and scope of employment ii. Captain of the Ship iii. Indemnification Agents: parties can reallocate liability thorough indemnification/contribution from others -> important for waiver/cov distinction -> waiver = one joint feasor excused, everyone is 9. Managed Care Liability (MCOs) a. Managed Care, Generally i. Wide variety of arrangements that restrict generosity of traditional insurance ii. Restricts choice of docs through networks and gate keepers iii. Alters discrete treatment decisions through utilization review and prior authorization reqs iv. Creates cost constrained financial incentives through capitation payments and risk sharing pools b. Types of HMOs i. Independent Practice Assoc. (IPA) -> MOST COMMON 1. Large contractual network of docs who maintain practices in the ir own offices and see patients with many types of insurance ii. Staff/Group Model 1. Smaller number of docs work exclusively for single HMO in gentralized clinic 2. Easier to establish agency relationship iii. Vicarious Liability 1. Attemps to avoid attribution of agency and vicarious liability 2. Chase v. Indep. Prac. Assn -> HMO not VL for where HMO said IPA only arranged for services but did not provide services directly 3. Jones v. US Healthcare -> HMO not VL for malpractice where materials given to P indicate that physicians are indep Ks 4. Petrovic v. Share Health Plan -> exculpatory lang in insurance docs does not control if patient didnt actually read/understand the docs c. Direct Liability i. Boyd v. Albert Einstein Medical Center -> HMO, breast lump, death 1. RULE: Ostensible agency theory is applicable to HMOs a. HMO had cov in advertisement that competent care b. HMO provided limited selection of PCP c. PCPs screened by HMO and must comply with HMO regs d. P could not see specialist w.o PCP referral and had no choice which specialist to see 2. Theory: P looked to HMO and not physician for care ii. Wickline v. State 1. Rule: P can sue 3p payors of health services for medically inappropriate decisions resulting from defects in design/implementation of cost containment mechs a. Docs who complies w/o protest w. limitations when med judgment says otherwise, cant avoid ultimate responsibility for patient care

Financial incentives to economize -> direct liablity Breach of Contract Employer Liability Exclusive Enterprise Liab 1. THEORY: network exclusively liabile at highest institutional level for any medical midstake that occurs lower down the chain vii. Class Action 1. Members -> misrepresentation and failure to disclose utilization review and methods of doc pmts 2. Doc -> economic injury under contract d. ERISA: i. Fed statute that regulates employer sponsored pension plans and other fringe benefits (incl. health ins) to make sure employers keep promises and funds are administered fairly 1. Created to help multi-state employers negotiate various state laws ii. Preempts any state law that relates to employer-sponsored plan 1. Exceptions (mostly contract theory) a. To recover benefits due under terms of plan b. To enforce rights under terms of plan c. Clarify rights to future benefits under plan Notes: ERISA Preemption: 1. Damages under ERISA: Restricts damages available to plaintiffs in cases against insurers Corcoran: damages limited to order for treatment or compensation for treatment costs but patients had already died; No damages for: pain & suffering wrongful death punitive damages more severe restriction of damages than in ordinary contract law

iii. iv. v. vi.

2. ERISA terminology is obscure & confusing; Routes around preemption: Argue that ERISA preempts only suits against employers for failing to provide insurance but not suits against insurers for failing to provide benefits covered by insurance; State statutes that impose liability on health insurers for injuries caused by wrongful denial of coverage (unclear) Clear rule: ERISA preempts where employer pays for health care directly out of its own funds (selfinsures)

3. Preemption of Various Claims: ERISAs effect on malpractice claims depends on how claim arises (Dukes); Claim against Dr for medical mistake unaffected by health in

Claim where plaintiff attempts to hold insurer responsible for med mistake b/c it exercised unclear:

Dukes: no preemption: quality v. quantity of care quantity: preempted; quality cases not preempted; 3rd Circuit cases majority position: claims Rationale: b/c ERISA doesnt preempt negligence claim against indiv dr, should not preempt purely derivative claim against insurer based solely on vicarious liab; direct negligence by insurer implicates how plan is administered & is sufficiently related to invoke ERISA jurisd Insurance coverage decisions v. medical treatment decisions; not a bright line test (like quantity v. quality distinction) b/c coverage usu defined in terms of med concepts (medically necessary or experimental) Pegram v. Herdrich: Ct held that HMOs can be sued under ERISA for breach of fid duties only when they make eligibility decisions but not when they make mixed eligibility & treatment decisions (more appropriately addressed by state med mal laws)

10. Tort Reform a. MICRA (Medical Injury Compensation Reform Act) i. Sec 3333.2 -> limited non-economic damages to $250k ii. Sec 3333.1 -> modified traditional collateral source rule b. Fein v. Permanente Medical Group i. P claims 3333.2 denies due process b/c limits potential recovery of med mal claimants w/o providing them adequate quid pro quo 1. Court rejects -> provision was rationally related to legitimate state interest (insurance crisis) 2. Provision doesnt preclude pecuniary damages

Financing
a. Problems i. Access ii. Private Health Insurance 1. Preexisting conditions 2. Cherry pickers 3. 80/20 rule 4. Insurer reinsurance for high risk members -> drives up costs and premiums 5. HIPAA a. Limits denial period for preexisting conditions b. Medical Savings Accounts c. Portability -> makes it harder for second employer to deny coverage -> 12mos max.

iii. Cost iv. Quality b. Purchasing private insurance

d. Availability -> requires insurers offering small group insurance (<50 ppl) accept every small employer or indiv who applies for coverage e. Insurers selling in individual market must generally offer coverage to any individual who was previously covered by group insurance for at least 18 months f. COBRA

c. Changes from ACA v. Subsidies vi. Premium tax credits -> applies to cost of insurance premium 1. Eligibility a. Eligible for people who buy insurance through exchanges b. People not on Medicaid whose incomes fall below 400% of poverty line c. People who cant get insurance through employer i. Exception: employer insurance is more than 9.5% of MAGI d. US citizens and non-citizens here for 5 years 2. How much? a. Whatever is less of i. Monthly premium, OR ii. Monthly premium of 2SP (70% paid by govt) less 1/12th(%)MAGI iii. 8% of MAGI is statutory definition of affordable vii. Cost share reduction -> applies to co-pay, co-ins, deductible 1. If 200% FPL -> max amount is reduced, fed gov pays balance directly to insurer 2. Must qualify for silver plans viii. Mandate 1. Anybody who can buy affordable health care -> lowest cost bronze plan that will cost less than 8% of income after applying tax credits 2. No denial for pre existing conditions 3. EXCEPT: 1) religion 2) natives 3) incarcerated 4) undoc immigrants 4. Penalties for failure to comply do not have teeth (IRS) ix. Exchanges 1. Jan 1, 2014 deadline for states to create their own, otherwise managed by fed govt 2. Has to offer qualified health plans (QHPs) a. FURROW p. 151 3. Insurers must not lump all individuals in the individual market into a single risk pool a. Prevents adverse selection, high cost users and spreads risk better d. Medicare/Medicaid x. Chart xi. Medicare 1. Part A -> hospital insurance 2. Part B -> supplemental (voluntary)

a. Doesnt cover routine exams, preventative care, or services not related to injury of treatment b. Pays 80% of approved amount (according to fee schedule) 3. Part C -> Allows full Medicare coverage under A and B by electing from several financing options (HMOs) a. Payments to private health plans are increased to be the same as Medicare fee-forservice costs 4. Part D -> Prescriptions a. $275 deductible and pays for 75% of drug costs up to $2250 a year b. doughnut hole -> coverage ceases until it hits $3600, then it pays 95% 5. How encourages doctors to accept assignment (80% fee schedule amount) a. 5% higher for participating physicians b. Paid faster c. Free publication as Medicare provider 6. Medicaid a. Title XIX of Social Security Act b. State/Fed program, and feds reimburse states only if they comport with strict minimum federal requirements c. Who is eligible? i. Children and their caretakers ii. Pregnant women iii. Elderly iv. People with disabilities d. <133% of federal poverty level e. Whats covered? i. In/out patient, physician services, lab, xray, nurse-midwife, home health (if qualified) f. Programs i. Long term care for people with disabiling and chronic health needs and elderly ii. MEDIGAP for elderly and disabiled individuals who cannot afford Medicare cost sharing iii. Childrens health iv. Provider support program for low-income serving providers xii. ACA changes -> MEDICARE 1. Value-based purchasing program: changes payment methods and ties hospital payments to performance with specific regard to high-cost conditions 2. Hospital readmission reduction program: reduces payments to hospitals when they exceed readmission rates for specific conditions 3. Preventative Services: provides parts that werent covered in Medicare B 4. Rate Freeze for Medicare C 5. Closes Part D doughnut hole 6. IPAB: independent payment advisory board a. Panel designed to reduce spending and improve quality 7. Bundled Payment Pilot Program: bundle payments to hospitals (A nd B) for episodes of care (hospital stay plus 30 days.) xiii. ACA Changes: MEDICAID

1. Change in eligibility requirement: 133% of pov line 2. FMAP: enhanced federal payment of newly-elligible members because Feds are forcing states to pay for new people 3. Simplified enrollment -> use of navigators through the exchanges 4. Rate match -> from govt to provider for Medicaid will match Medicare 5. Smaller, community based settings e. Regulating insurance/ERISA xiv. Broad business of insurance, basically, if the state law has to do with the business of managing the insurance, then it is NOT preempted 1. Savings clause -> when state law has to do with BUSINESS of insurance -> NOT PREMPTED 2. ERISA will pretty much preempt all state laws which deal with an employee benefit (including insurance) {able to regulate anything relating to employee benefits} with the exception of the things which fall into the "savings" provision - these laws which deal with the business of insurance. a. Then if is regulating the business of insurance, then the deemer clause comes in. {is it really regulating the business of insurance, like is it a noninsurer that is being deemed an insurer for the purposes of avoiding ERISA} b. 3. No broad anti-discrimination provision in ERISA, but Title VII and ADA are incorporated by reference a. No private action under ERISA xv. ERISA and ACA 1. No real change to ERISA, but there are essential health benefits for all plans offered in individual or small group markets, regardless of plans offered in exchanges a. Ambulatory care, prenatal, postnatal, lab services, Rx, Peds and annual check up. b. Whatever is required by the Feds is the floor, and states can go beyond these essential services so long as it is directed at insurers. i. If they do, state responsible for paying for it over and above what the Fed considers an essential health benefit f. Regulting HMOs a. Types i. HMOs 1. Staff Model and group practice model a. Capitation payments 2. IPA model -> HMO contracts with IPA, IPA contracts out with doctors a. Fee for service/fixed schedule 3. Network/Joint Venture -> like IPA except with hospitals (PHOs) 4. HMOA -> 1973 -> encourages HMOs a. 1998 allowed for hybrid between community and experience rating, allowing qualified providers to offer non-qualified plans ii. PPOs iii. POSs g. Rationing/discrimination in delivery of healthcare/availability of coverage Alexander v. Choate, 469 US 287 (1985)

Tenn facing serious budget issues with their state Medicaid plan - decided to cut the number of inpatient hospital days from 21 to 14. Before took effect, a class of Medicaid recipients, alleging that the 14 day limit would have a discriminatory impact on the handicap. o The percentage of handicap individuals who required more than 14 days of hospital stay was significantly higher than those who were not handicap. Offer an alternative Then asks, must there be an intention to discriminate, or can there simply be discrimination as an effect, rather an design

Mount Sinai Hospital v. Zorek, {fat woman - starved to lose weight} This regime was considered a minority approach to treating the her weight issue Only the treating physician may determine what is "medically necessary" o That decision can be subject to review at a potential variety of levels - and this review will establish a standard of care o But just because it is a minority view does not mean that it was not considered un medically necessary Also, figuring out what is covered and what is not is all about reading and parcing the contract between the individual and the insurance provider. o Based on the K - the insurers should have paid for this. ERISA was enacted about 10 years after this was decided - therefore there could have been a different case Bechtold v. Physicians Health Plan of northern Indiana: Woman treated for Breast Cancer, with a bone marrow transplant - this has not been proven to be an effective treatment The K does not allow for an experimental treatment, therefore the insurance company does not have to allow this treatment for the breast cancer However under Medicare / Medicaid - if you are to allow a treatment for one type of condition, you cannot exclude another individual from that treatment as based upon their diagnosis. Rush v. Moran: Removed to fed courts because of ERISA Independent review regarding medical necessity - just getting a second opinion on the treatment option for the individual. This was not preempted - this independent review is really about determining medical necessity and thus is more part of the business of insurance But what about potential recovery? h. Medical necessity i. Coverage disputes xvi. Methods depending on who payer is xvii. Medicare/Medicaid complicated due to statutory, regulatory, and common law provisions xviii. Basic eligibility or coverage disputes. xix. Fiscal intermediaries -> insurers under contract with CMS -> THEN administrative review by CMS -> then judicial review j. Insurance reform