Georgia Peer Review Decision Exhibits Rare Common Sense
Finally, there seems to be a peer review decision that exhibits common sense. In Madonna v. Satilla Health Services, Inc., and LeFever vs. Satilla Health Services, Inc., the Georgia Court of Appeals handed a peer review decision in a case pitting exclusive contract rights against individual peer review privileges which makes common sense. Since this is the second in a series of cases involving Satilla Regional Medical Center, perhaps the courts are finally understanding the issues.
Satilla Regional Medical Center sought an exclusive cardiology agreement with Baptist Specialty Physicians, Inc., a Georgia Professional Corporation. In entering into the exclusive cardiology agreement, the hospital sought to terminate the cardiology clinical privileges of other individual physicians, one of whom had existing clinical privileges and one of whom sought medical staff membership and clinical privileges.
The court addressed three issues which are commonly presented in these situations, and appear to have the correct answers on all three.
First the court ruled that both public and private hospitals are required to follow their bylaws. The court avoided the contract analysis that seems to be popular these days and the arcane issues of consideration, privity, and preexisting statutory duty. Instead, the court reasoned that, since hospitals are required to adopt bylaws in accordance to state hospital licensing regulations, they should be required to follow them once adopted.
Second, the court held that bylaws apply as equally to existing staff members as they do to physicians submitting initial applications, unless of course the bylaws specifically provide otherwise. In Satilla, one of the physicians had lost his medical staff membership and clinical privileges when his cardiology contract was terminated, because the contract specifically provided that medical staff membership and clinical privileges were contingent upon the existence of the contract. The physician then applied for new medical staff membership and clinical privileges, and the hospital refused to process the application because of the exclusive services agreement.
Finally, the court acknowledged that hospitals can certainly enter into exclusive service agreements. However, the authority to enter into such agreements is tempered by any restrictions in the bylaws and preexisting medical staff and clinical privilege relationships. Thankfully, the court did not get mired in the ridiculous argument that clinical privileges do not necessarily give physicians with those privileges the right to use hospital equipment intrinsically necessary to exercise those privileges, which issue was discussed in the Levy v. Clinton Memorial Hospital case posted on the MedLaw Blog on February 5, 2008.