EXECUTIVE SUMMARY

The EP’s and hospital’s interests as joint defendants in malpractice litigation sometimes conflict, necessitating separate counsel for the EP.

  • Sometimes, the source of the fault isn’t apparent until discovery has been completed.
  • In most states, hospitals can be held liable for the negligence of independent contractors through the doctrine of apparent agency.
  • Attorneys are prohibited ethically from representing both the hospital and EP if their positions conflict.

An ED nurse receives an appropriate medication order from an EP, but administers the wrong dosage, harming the patient. If the ED nurse and EP are both named in the resulting malpractice lawsuit, “the interests of the hospital and the physician will not be aligned,” says Susan Martin, Esq., executive vice president of litigation management and loss control in the Plano, TX, office of AMS Management Group.

The EP must testify as to why the medication order was reasonable and safe, and that the ED nurse gave an incorrect dose. “The EP likely respects the nurses in the ED, and does not want to be critical,” Martin explains. However, as a defendant in a malpractice lawsuit, EPs must look out for their own interests. This means defending the medication order and preparing for difficult questions at deposition. “Even in these days of hospitals employing physician groups, clearly the physician should have his own counsel to represent him,” Martin advises.

Both the nurse’s attorney and the physician’s attorney can work together to defend the lawsuit. “But the EP should not have to be concerned that any settlement will be against him or the ED group in a case of clear liability against an ED nurse,” Martin adds.

David L. Rogers, JD, founding shareholder of Michigan-based Rogers & Associates, has seen the interests of hospitals and EPs conflict in litigation several times. At the beginning of a case, the EP is aware there was a bad event and the patient was harmed ­— but often doesn’t know initially how it happened.

“Without vigilance on behalf of the EP, it’s possible that no one will figure out what really happened — or that whoever figures it out won’t tell the EP,” Rogers says.

Sometimes, the source of the fault isn’t apparent until considerable discovery — depositions, document production, and expert analysis — is complete. “If there is any possibility that the EP is not at fault but the hospital is, the EP should immediately request a separate attorney,” Rogers advises.

Liable for EP’s Actions?

Most state laws require hospitals to provide appropriate facilities and a full range of emergency and ancillary care, “but many attempt to insulate themselves from liability,” says Kenneth T. Lumb, JD, an attorney with Corboy & Demetrio in Chicago. For instance, hospitals protect themselves legally by contracting with individuals or corporate entities to provide EPs.

However, in most states, the hospital still can be held liable for the negligence of independent contractors through the doctrine of apparent agency. This applies when a hospital holds itself out as providing a full range of services, with patients relying on the hospital to provide them — without realizing the EP caring for them is an independent contractor.

“Even when apparent agency doesn’t apply, however, the hospital is often left without a chair when the music stops,” Lumb notes. “There is almost always an inherent conflict between an EP’s interests and a hospital’s.”

A plaintiff attorney always can plausibly allege that an EP’s medical error was caused or enabled by a system deficiency, for instance, such as a lack of appropriate policies.

The only foolproof solution to avoid these conflicts is for a hospital to hire its EPs, Lumb says. “These facilities never have to worry about the ethical or practical issues of conflicting interests, and can always present a unified defense.”

Separate Attorney for EP

Are an EP and hospital blaming each other for a patient’s bad outcome? The governing state ethical provisions likely prohibit an attorney from representing both parties, says David S. Waxman, JD, an attorney in the Chicago office of Arnstein & Lehr.

He gives this example: An EP claims no one told her about a critical lab value, but an ED nurse testifies otherwise. “Those theories are entirely in conflict,” Waxman says. “Unless that conflict has somehow been explicitly and effectively waived, then one of those defenses should be spun off to a different lawyer.” Faced with this scenario, he recommends EPs request appointment of separate counsel.

Often, the EP is an independent contractor of the hospital with independent counsel, and the EP’s defense conflicts with the narrative of a hospital employee. For example, an employed hospitalist claims a diagnosis was delayed because the EP failed to communicate pertinent history, but the EP disputes this account.

“The options here are rather limited,” Waxman says. If the EP points a finger at the hospital, it could undermine the business relationship between the EP’s employer and the hospital with which it contracts.

“It is certainly not uncommon in litigation for punches to be pulled because the underlying business relationship is much more important than the potential damage resulting from a particular lawsuit,” Waxman says.

Some EP defendants try to find common ground with the hospital. For instance, the EP can soften testimony regarding conversations that would prove a hospital employee was at fault. However, the tradeoff for diminishing the EP’s otherwise effective defense might be a National Practitioner Data Bank (NPDB) report. “Many EPs would find that unacceptable, and prefer to fight it out with the hospital,” Waxman notes.

The effect of an NPDB report and the EP’s business relationships are two important factors for defense attorneys to consider. “This allows the EP to make well-informed strategic decisions,” Waxman explains.

Problems can arise if the EP believes the malpractice event was the fault of a hospital employee or faulty hospital equipment, but the hospital disagrees. Rogers adds, “Sometimes, the hospital’s position on this can depend on the physician’s status in the hospital — favored or not favored, liked or disliked.”

If the hospital provides the EP’s coverage, the usual practice is for the insurer to provide one defense attorney for both parties. Rogers says, “The physician is often far better off if the insurance provides a separate attorney for him or her. But that’s an expensive proposition for the insurance company — or hospital, if self-insured — and not always necessary.” Here are some important considerations:

  • If an attorney representing both the hospital and EP believes that their positions conflict, the attorney is prohibited ethically from representing both.

“Depending on the conflict, the attorney may be prohibited from representing either of them if the case has progressed substantially before the conflict is discovered or recognized,” Rogers says.

  • If the hospital and EP retain separate attorneys from the beginning, the EP should consider carefully whether to assert claims that the hospital is at fault.

“If it’s true and provable, the EP’s attorney will probably want to discuss the matter with the hospital’s attorney,” Rogers says. “Hospitals are often amenable to protecting their physicians from unfounded allegations.”

  • Damage from a serious malpractice lawsuit usually is much worse for an EP’s career than for a hospital’s operations.

“In general, I think the EP should assert a well-founded, supportable position against the hospital, to protect himself or herself,” Rogers adds.

ED groups might not want to engage in a conflict with a hospital. But for the individual EP who is a defendant in the case, receiving an adverse medical malpractice case settlement or judgment could be devastating.

“It’s easier to get another job than another career,” Rogers says. If the individual EP did not commit malpractice but there was fault on the part of the hospital, he continues, “the individual EP should not roll over for the benefit of the group’s relationship with the hospital, which amounts to taking one for the team.”

SOURCES

  • Kenneth T. Lumb, JD, Corboy & Demetrio, Chicago. Phone: (312) 346-3191. Email: ktl@corboydemetrio.com.
  • Susan Martin, Esq., Executive Vice President, Litigation Management/Loss Control, AMS Management Group, Fort Lauderdale, FL. Phone: (866) 520-6896. Fax: (817) 704-4291. Email: smartin@amsmanagementgroup.com.
  • David L. Rogers, JD, Rogers & Associates, Farmington Hills, MI. Phone: (248) 702-6350 (Ext. 104). Fax: (248) 246-2280. Email: drogers@healthlex.com.
  • David S. Waxman, JD, Arnstein & Lehr, Chicago. Phone: (312) 876-7867. Email: DSWaxman@arnstein.com.