By Bob Drake
As we recently reported, employees have been encouraged by a host of local, state and federal laws and regulations and regulatory agencies to “blow the whistle” on hospitals and other healthcare providers for perceived wrong-doing or noncompliance, resulting in skyrocketing claims and often huge recoveries for government agencies and whistleblowers. Nearly all of these laws and regulations also contain provisions for the protection of “whistleblowers” from subsequent retaliation and these laws and regulations have been amended to greatly expand the universe of who can obtain whistleblower protection. As a result, in addition to defending against the underlying claims of alleged wrongdoing or noncompliance, healthcare employers are also increasingly facing claims of retaliation by employees and others with whom they do business who have “blown the whistle” on conduct perceived as improper.
In just the past few months, a number of cases have been filed against hospitals and other health care employers by whistleblowers at all organizational levels alleging they were retaliated against for complaining about or reporting issues. Most recently, for instance, the U.S. Department of Labor filed suit on behalf of a receptionist against a medical clinic that allegedly fired her because she had complained to the Occupational Safety and Health Administration (OSHA) about unsafe working conditions at the clinic.
In another recent case, Zawislak v. Memorial Hermann Hospital System, a federal district court denied a hospital’s motion to dismiss a lawsuit by a physician who claimed his medical staff privileges were revoked in retaliation for submitting reports to the Emergency Department Medical Director and the Root Cause Analysis Committee that on-call physicians at the hospital transferred patients before providing stabilizing treatment. Most strikingly, the court rejected the hospital’s argument that the federal Health Care Quality Improvement Act (HCQIA) shielded it from liability for its decision, which was reached pursuant to its professional review process. The court found that the physician’s allegations that his privileges were terminated in retaliation for his reports were sufficient to suggest that he could rebut the presumption that “the review committee had a reasonable belief that terminating his privileges was warranted by the facts known.” Such reasonable belief is a required element for immunity under the HCQIA.
Notably, however, many of the whistleblower retaliation cases against healthcare employers assert claims for retaliation other than termination of employment or staff privileges. For example, a neurosurgeon at New York’s Upstate Medical University filed a lawsuit claiming he and his wife were harassed and intimidated by his employer after it learned he had spoken to several newspaper reporters to express his concerns about medical practices at Upstate. According to the lawsuit the doctor and his wife were confronted by two hospital investigators waiting in a parked car outside their home, and the next day the investigators telephoned his wife, telling her that her husband was in “big trouble” and asking her to cooperate with them against him.
Similarly, a physician and director of Hi-Desert Memorial Health Care District filed suit against the hospital district for intimidation and harassment allegedly in retaliation for complaining about poor patient care. He claimed he was “cut off and intimidated” from communicating with the Medical Executive Committee members or staff administrators, that the Committee reported him to the California Medical Board “with the intention to seek a revocation of [his] medical license,” he was subjected to “unreasonable restrictions” that kept him from performing some procedures, and his emergency room surgical coverage schedule was cut, resulting in financial hardship.
A breast cancer surgeon filed suit against the University of New Mexico (UNM) claiming that after six years at UNM’s Cancer Research and Treatment Center, where she headed a subcommittee that reviewed treatment and served on an internal “breast tumor board,” she was demoted and her salary was cut 15 percent after she allegedly complained of poor patient care. When she refused to renew her contract on these terms, she was terminated.
Whistleblower retaliation cases may be costly in terms of the expense of resolving them as well as the adverse publicity they engender. For instance, the Winkler County Memorial Hospital, a small county owned hospital in Winkler, Texas, generated a story in newspapers across the country, including the New York Times, when it paid $750,000 to two nurses who were fired and criminally prosecuted for harassment after filing medical ethics complaints against a hospital physician with the state’s medical board. The nurses had filed the medical board complaint anonymously, but the physician and a complicit hospital administrator identified them as the whistleblowers with assistance from the County Sheriff. The sheriff, who was the physician’s friend and a patient, used his authority as a law enforcement official to pierce the confidentiality of the medical board complaint. The sheriff, physician and hospital administrator then influenced the Winkler County Prosecutor to wrongfully initiate criminal prosecution of the whistleblowing nurses. In addition to the civil whistleblower retaliation claims settled by the hospital, the physician and the hospital administrator, as well as the sheriff and the county prosecutor, were charged and prosecuted on a variety of criminal charges stemming from the retaliatory actions taken against the nurses. The hospital administrator was fined and sentenced to serve time in jail, and just this month the physician plead guilty and lost his medical license in addition to being fined and serving time in jail. The nurses, for their part, were quickly acquitted and/or had the harassment charges against them withdrawn.
Regardless of the merits of the underlying claims, these types of cases are often time consuming and costly to defend. There is often a great deal of factual and legal dispute about what constitutes “protected activity” under the whistleblower statutes and regulations, and whether there was a causal connection between the “protected activity” and the allegedly adverse employment action, not to mention the factual disputes regarding whether any of the alleged adverse action actually occurred. Particularly during economic downturns, changes in compensation, employment status, or the work environment create fertile ground for retaliation lawsuits.
What can healthcare employers do to reduce the risk of such claims? First and foremost, managers at all levels, from top leadership on down, should understand that retaliation against whistleblowers can take many forms – not just termination – and is strictly forbidden. This message can be delivered not only by a clearly worded policy, but also by specific and targeted training that is periodically reinforced.
Second, employees and others who work or do business with a health care provider should be encouraged to report issues internally. To this end, health care employers should consider establishing a well-publicized, user-friendly internal reporting system. After all, it is far better to learn of problems internally first so they can be investigated, addressed and remedied, if necessary, rather than learning of them through a government agency. Also, evidence that an easily accessible complaint system was available, but no internal complaint was made by the alleged whistleblower may serve as a defense in the event of a whistleblower retaliation case. When complaints are filed they should be taken seriously, and investigated by trained compliance officers, HR personnel or legal counsel in a manner appropriate to the nature of the complaint. The complaint, the investigation, and any remedial action should be carefully documented, with supporting evidence and steps taken to maintain appropriate confidentiality and privilege. If no problems are found this evidence may be useful to prove that the whistleblower’s allegations were taken seriously, and that the health care company had no reason or motive to retaliate. In addition, in the event of an outside investigation by a government regulatory or law enforcement agency, the thoroughness and independence of the health care company’s internal investigation, and the effectiveness of its self-critical analysis, will be given substantial weight by government agencies in assessing corporate culpability. If problems are uncovered, evidence of quick and effective remedial measures taken will also be very helpful.
Third, managers should be trained to conduct performance evaluations objectively and to apply discipline consistently, and the basis for employment decisions ought to be carefully and accurately documented. Among other things such documentation can be used to refute allegations of retaliatory motive or intent in the event of a claim or lawsuit. Health care employers should also consider requiring managers to review all significant employment decisions with HR before taking action.
In light of the recent proliferation of whistleblower retaliation claims against health care employers, it is wise for employers to consider reviewing their policies, procedures and training programs now to reduce the likelihood of claims later.
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