Despite the many cases acknowledging the right of hospitals to enter into exclusive contracts, there is always the issue of what happens with the existing clinical privileges and medical staff memberships of the physicians who are being replaced, assuming they are not the physicians receiving the exclusive contract.  Defenders of physician rights have typically argued that the clinical privileges and the medical staff rights continue to exist at least until the expiration in the normal course of business, and that they cannot be terminated simply because the hospital has entered into an exclusive contract regardless of the right of the hospital to do so.

In Pacific Radiation Oncology, LLC v. The Queen’s Medical Center, the United States Court of Appeals for the 9th Circuit confirmed the District Court holding granting an injunction to a physician on the following grounds:

  1. Attempted termination of clinical privileges and medical staff membership could violate the constitutional rights established in the Hawaiian case of Silver v. Castle Memorial Hospital, which is cited in the linked opinion.
  2. Attempted termination of the medical staff membership and clinical privileges may violate the Queen’s Hospital medical staff Bylaws.
  3. The physician had established that it was more probable than not that he would prevail on the issues and that the damages to him for allowing termination would be irreparable. 

In addition, in states which recognize medical staff bylaws as contracts between the hospitals and the individual members of the medical staff,  there is also the argument that early termination of medical staff membership and clinical privileges constitute a breach of contract.