Defending the practice of medicine
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DEFENDING THE PRACTICE OF MEDICINE. Moderator. Robert B. Blasio Division President Western Litigation Specialists, Inc. One BriarLake Plaza, Suite 1900 2000 West Sam Houston Parkway South Houston, Texas 77042. Panelists. Expanding Hospital Liability: Non-Delegable Duty

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Robert B. Blasio

Division PresidentWestern Litigation Specialists, Inc.One BriarLake Plaza, Suite 19002000 West Sam Houston Parkway SouthHouston, Texas 77042


Expanding Hospital Liability:

Non-Delegable Duty

Peter W. Mosseau, Esq.


Nelson, Kinder, Mosseau & Saturley, PC

The Power of Apology in Medicine

Steve Woodward Day, Jr., Esq.


Marshall, Dennehey, Warner, Coleman & Goggin

Optimizing the Clinical Operational and Financial Value of a Medical Liability Captive

Craig E. Samitt, MD

Chief Operating Officer

Fallon Clinic

Expanding Hospital Liability:

Non-Delegable Duty

PLUS Conference

Boston, Massachusetts

November 15, 2004

Peter W. Mosseau, Esq.

99 Middle Street

Manchester, NH 03101

(603) 647-1800

45 Milk Street

Boston, MA 02109

(617) 778-7500

Smithville Almshouse

Hospital on 5th Floor

No Suits Against Hospitals

Charitable Immunity

Respondeat Superior/Master & Servant

  • Hospital Employed

  • Hospital Liable

Apparent Agency: Elements

  • Hospital liable for acts of independent contractors if it is established that:

  • The hospital held out the physician as a hospital employee;

  • The patient relied on the hospital’s representation; and

  • 3.The patient was injured.

Apparent Agency: Representations


Welcome to Acme Hospital Women’s Pavilion

Acme Hospital Women’s Pavilion is the most technically sophisticated birthplace in the region. AHWP offers instant access to specialized equipment and facilities, as well as to physician specialists in every area of pediatric medicine and surgery. Every maternity patient has a private room and the full availability of a special anesthesiology team, experienced and dedicated solely to OB patients. They are immediately available within the unit 24 hours a day and are experts in administering epidural anesthesia.

Welcome to our Emergency Department and Trauma Center. We understand that visiting an emergency department, or ED, can be stressful. Our physicians, physician assistants, registered nurses and ED technicians are experts in emergency and trauma care. They understand your concerns and fears. They will do everything they can to make your visit as comfortable as possible. We hope that we can make your experience a better one by explaining what you can expect while you are here.

Apparent Agency: Representations

Excerpt from the Plaintiff’s Appellate Brief in McCorry v. Evangelical Hospitals Corp.,

331 Ill. App. 668, 771 N.E.2d 1067 (2002).

Apparent Agency: Reliance

  • Smithville Hospital

  • Anesthesia Department

  • John Smith, M.D.

  • Jane Doe, M.D.

Patient Selection

Apparent Agency:No First-Hand Reliance

Southview Hospital

Emergency Room

Sycamore Hospital

Emergency Room

Clark v. Southview Hosp. and Family Ctr., 628 N.E.2d 46 (Ohio 1993).

Apparent Agency: Reliance

As to the meaning and importance of reliance in this specific context, we agree with the cases that hold the hospital has failed to give meaningful notice, if the patient had no special knowledge regarding the arrangement the hospital has made with its physicians, and if there is no reason the patient should have known of these employment relationships, then reliance is presumed.

Sword v. NKC Hospitals, Inc., 714 N.E.2d 142, 152 (Ind. 1999).

Reliance Rebutted

The physicians practicing in this Emergency Room are not employees of Tuomey Regional Medical Center. They are independent physicians, as are all physicians practicing in the hospital.

Non-Delegable Duty: Standard

  • Even if Physician is an Independent Contractor, Hospital is Liable Because Certain Duties Cannot be Delegated.

  • Duties May be Delegable, but Not Liability

Non-Delegable Duty: Defenses

  • Physicians Must Carry Liability Insurance

    “… liability encourages exercise of due care.”

  • Hospitals Do Not Practice Medicine

    “… innumerable decisions” regarding equipment, staffing and facilities.

Non-Delegable Duty: Defenses

  • Patients Don’t Care About the Employment Status of Physicians

    • selection is “often” based on reputation of hospital and not individual physician.

  • Duty Should be Imposed by Legislature and Not Judiciary.

    • courts created and eliminated charitable immunity.

Non-Delegable Duty: Defenses

  • Physician, not hospital, has duty to practice safe medicine.

    • duty is not delegable to emergency room physicians.

Non-Delegable Duty: Rationale

We are persuaded that the circumstances under which emergency room care is provided in a modern hospital mandates the rule we adopt today. Not only is this role consonant with the public perception of the hospital as a multi-faceted health-care facility responsible for the quality of medical care and treatment rendered, it also treats tort liability in the medical arena in a manner that is consistent with the commercialization of American medicine. We simply cannot fathom why liability should depend upon the technical employment status of the emergency room physician who treats the patient. It is the Hospital’s duty to provide the physician, which it may do through any means at its disposal. The means employed, however, will not change the fact that the hospital will be responsible for the care rendered by physicians it has a duty to provide.

Jackson v. Power, 743 P.2d1376, 1385 (Alaska 1987).

Non-Delegable Duty: Rationale

Today, hospitals compete aggressively in providing the latest medical technology and the best facilities, as well as in attracting patients and physicians who will funnel patients to them. Hospitals not only strive to be a source of pride in the local community, but they also seek to avoid operating at a financial loss. Regardless of whether they are profit-seeking enterprises, they are run much like any large corporation and they must operate in a fiscally responsible manner. Like any business dependent upon attracting individual people as customers, hospitals in the aggregate spend billions to advertise their facilities and services in a variety of media, from newspapers and billboards to television and the internet. Among them any forces that have caused this sea change are the commercialization of the practice of medicine, the public’s demand for access to modern medical technology, the prevalence and impact of government-funded programs such as Medicare and Medicaid, and the rise of managed care in the private sector.

Simmons v. Tuomey, 533 S.E.2d 312, 316 (S.C. 2000).

Jurisdiction AnalysisApparent Agency/Non-Delegable Duty

  • Twelve states have either not addressed the issue or have rejected the analysis.

  • Where does your State stand?


  • Find out whether your jurisdiction has adopted the apparent agency and non-delegable duty theories.

  • Determine whether any statutes or pending legislation may impact this issue.

  • Analyze content of physician contracts.

  • Review advertising.

  • Analyze the attire worn by physicians in your hospital, as well as the signage, bills, and consent forms utilized.

Expanding Hospital Liability:

Non-Delegable Duty

The End

Thank You.

99 Middle Street

Manchester, NH 03101

(603) 647-1800

45 Milk Street

Boston, MA 02109

(617) 778-7500

The Power of Apology in Medicine


Steve Woodard Day, Jr., Esq.

Marshall, Dennehey, Warner, Coleman & Goggin

620 Freedom Business Center, Suite 300

King of Prussia, Pennsylvania 19406

Defending the Practice of Medicine:Optimizing the Clinical, Operational and Financial Value of a Medical Liability Captive

Craig E. Samitt, MD, MBA

Chief Operating Officer, Fallon Clinic, Inc.

PLUS International Conference

November 15, 2005


  • Introduction to Fallon Clinic and Central Massachusetts Indemnity Company (CMIC)

  • The drivers leading to CMIC’s development

    • The Massachusetts Malpractice Landscape

  • The challenges faced during CMIC’s development

    • Developing a workable structure for a for-profit MD group.

    • Managing physician expectations in converting to a Captive.

  • Realizing the full potential of CMIC

    • Intensive Claims and PCE trend analysis, and Defect Management

    • Implementing Risk Management Interventions

Fallon Clinic and Central Massachusetts Indemnity Company (CMIC)

  • Fallon Clinic

    • Largest private (for-profit) multi-specialty group practice in Massachusetts, in 26 locations.

    • 240 physicians and 1700 staff. 150,000 patient base.

    • A national leader in clinical quality.

    • A passion to revolutionize the healthcare delivery business, with a vision to become the gold standard of clinical quality and service.

    • Previously insured via ProMutual through an MD occurrence policy and an entity claims-made policy.

  • Central Massachusetts Indemnity Company

    • Cayman Island Corporation.

    • Incorporated in June, 2003.

    • $20M in reserves as of September, 2005.

  • The Malpractice Dilemma Fallon Clinic Leadership faced:

    In conjunction with stagnant financial performance


    In the setting of a bleak future in the commercial marketplace

    • Rapidly rising premiums, and risk of adverse selection if remaining in commercial market.

    • Intensive risk management efforts without benefit to FC.

    • Diminishing claim frequency.

    • Plans for implementing EMR and other risk mitigation tools.

    • Prospect of future policyholder dividends.

    By all measures, the Captive has been extremely successful

    Fallon Clinic Malpractice PremiumsOur Captive (CMIC) vs. Commercial Market

    Premium Cost in Millions

    With a comparable improvement (driven by many things) in our financial performance

    FY05 Target

    We’re achieved our initial goal but….we have much more we want to do…..

    • First dollars coverage necessitating intensive risk and claims management.

      • Open claims and PCE analysis

      • Corrective Action Plan development

  • We have a vision to become the first defect- free health care organization

    • Development of a defect score that reflects global FC defects.

    • Intensive Root Cause Analysis to operationally mitigate risk

  • Top Contributing Factors linked to Fallon Clinic open claims

    Open claim and PCE corrective action plans

    • Intensive MD education

      • Monthly risk management education.

      • 4 D’s educational conferences:

        • Demeanor, Documentation, Diagnosis, Disclosure

  • Customer Satisfaction Focus

    • Pre-employment and behavioral screening of MDs

    • Training

    • Linkage of customer satisfaction to compensation

  • Operational and Programmatic improvement

    • Diagnostic Registries and failsafe reminder systems

    • Electronic Health Record and other technological implementation

    • Policy and Procedure development, implementation and auditing.

  • Questions?

    Contact Information

    Craig E. Samitt, MD, MBA

    Fallon Clinic, Inc.

    100 Front Street

    Worcester, MA 01608

    Tel: 508-368-5480


    Panel Discussion

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