RM says she was fired for reporting EMTALA violation

Suing the hospital after dismissal on day CMS investigators arrived

An experienced risk manager says she was fired by her hospital for reporting an Emergency Medical Treatment and Active Labor Act (EMTALA) violation after hospital executives discouraged reporting it for fear of a large penalty. She is now suing the hospital, which denies her allegations.

Margaret O'Connor, RN, was the risk manager at Jordan Hospital in Plymouth, MA, until her firing on May 19, 2010. She had been employed by Jordan Hospital for 38 years, working in various positions related to quality control before becoming risk manager, according to the complaint filed in the U.S. District Court, District of Massachusetts. The claim indicates that O'Connor received an exemplary performance review from her supervisor on November 10, 2009. She reported to Harvey Kowaloff, MD, head of clinical reliability.

O'Connor claims in her lawsuit that she was fired for her actions after an incident at the hospital on March 26, 2010, involving a patient in labor who was transferred to another hospital. Soon after the transfer, O'Connor received a call from the other facility's risk manager, who expressed surprise that the patient had been sent over in active labor and suggested that Jordan Hospital had violated EMTALA, O'Connor says in her lawsuit. The hospital had never before reported an EMTALA violation or been investigated for one.

O'Connor responded by conducting a full investigation and concluding that Jordan Hospital had violated EMTALA, the claim says. When she reported her findings to senior management, she indicated that she planned to notify CMS immediately, because the law required her to do so and because the hospital would fare better if it self-reported, rather than risking that the other facility would report the incident. According to O'Connor, her boss, Kowaloff, discouraged reporting.

She reported the EMTALA violation to CMS, which prompted an investigation of the hospital. The investigators concluded that Jordan Hospital had violated EMTALA four times in addition to the one reported by O'Connor. The potential penalty was a total of $250,000.

O'Connor informed hospital management that she intended to notify the patient of the EMTALA violation once the hospital completed a validation survey required by CMS, an extensive process that threatened to find more problems that could lead to more penalties, the claim states. On May 19, 2010, 12 CMS regulators arrived to survey the hospital, and O'Connor was fired the same day. Kowaloff told her the reason was "regulatory," according to O'Connor.

O'Connor referred all questions to her attorney, Jared Burke, JD, of Needham, MA.

Christopher Smalley, director of strategic marketing and communications at Jordan Hospital, tells Healthcare Risk Management that the hospital flatly denies O'Connor's claims. She was not fired for reporting the EMTALA violation, but the hospital cannot discuss the true reason for her firing because of the ongoing litigation, Smalley says.

"The allegation is false," Smalley says. "I can't get into why she was fired, but as it relates to the allegation of whistleblowing, it had nothing to do with that."

EMTALA specifically prohibits adverse action against whistleblowers. Subsection (i), "Whistleblower protections," states a hospital "may not penalize or take adverse action against a qualified medical person described in subsection (c)(1)(A)(iii) or against any hospital employee because the employee reports a violation of a requirement of this section." CMS did send investigators to the hospital on September 1 to conduct a complaint survey prompted by O'Connor's claim of retribution, but Smalley says they sided with Jordan Hospital.

On September 9, Jordan Hospital received a letter from CMS, which stated that it had investigated allegations of violation of subsection (i) regarding adverse action against a whistleblower and the hospital had been found to be in compliance, Smalley says. Jordan Hospital considers that firm evidence that O'Connor was not fired for whistleblowing, he says.

However, Burke says the CMS investigators did not speak with O'Connor to hear her side of the story. They asked to, he said, but Burke declined their request to speak with his client, because he "didn't know their motivation or what they were seeking."

No coincidence, lawyer says

O'Connor's attorney says there was no other reason to fire the risk manager.

"It's our viewpoint that there was a direct correlation with the timing of her firing and the investigators from CMS coming in. It seems a little too coincidental," Burke says. "She worked there for 38 years, and if you go through her file, she has, I think, one citation. For 38 years, there's nothing, and then to have this happen on the same day investigators come in, obviously there's some animus and retaliatory action."

Burke says neither he nor O'Connor knows what Kowaloff meant when he said the cause of her firing was "regulatory." O'Connor is currently unemployed and seeking another position.

If O'Connor's claims are true and the hospital did fire her for reporting the violation, the hospital could be in for far more trouble than it was already in, says Matthew Curley, JD, and attorney with Bass, Berry & Sims in Nashville, TN, who represents clients involved with government investigations.

"The allegations are certainly startling, on the face of the complaint," Curley says. "The law goes to great lengths to protect whistleblowers. The Jordan Hospital case certainly serves as an important reminder to providers to avoid retaliating against employees who report EMTALA violations."

In addition to any settlement or award to O'Connor, Jordan Hospital faces damage to its reputation in the community, Curley notes.

There are generally two key issues in fraud and abuse whistleblower lawsuits, Curley says. First, courts will ask whether there was an underlying violation of the law reported by the whistleblower. Second, courts will examine whether the employer can show that the employment decision at issue was independent of the whistleblower's reporting of the issue.

Disputing the underlying violation of the law would be exceedingly difficult, because CMS determined there had been a violation, Curley notes. That leaves the hospital's only avenue of defense to be claiming that O'Connor was fired for something unrelated to reporting the EMTALA violation, he says. Any documentation showing the fired employee had previous or ongoing problems with work quality would help the hospital, but lacking that, simply saying there was a legitimate reason for the dismissal probably won't be received well, he says.

"If we assume the facts in this complaint, the hospital will certainly have a challenge in defending this lawsuit," Curley says.


• Jared Burke, JD, Law Offices of Timothy M. Burke, Needham, MA. Telephone: (781) 455-0707. E-mail: burkejared@gmail.com.

• Matthew Curley, JD, Bass, Berry & Sims, Nashville, TN. Telephone: (615) 742-7790. E-mail: mcurley@bassberry.com.