Tenet: When is a physician an independent contractor?

Tenet Healthcare Corporation’s claim that it considers Redding, CA, physicians as independent contractors, as opposed to hospital employees, will do nothing to lessen the company’s exposure from a rapidly growing list of lawsuits filed by former cardiac surgery patients at Tenet’s two Redding-area hospitals, according to one of the nation’s leading mass torts attorneys.

Michael Hackard, JD, who recently filed suit on behalf of a former patient of Chae Moon, MD, says California law holds hospitals accountable for the conduct of physicians practicing in their facilities, regardless of whether those physicians bill patients on their own, or through the hospital. He made his comments in light of Tenet Chairman and Chief Executive Jeffery C. Barbakow’s efforts to reassure Tenet shareholders while confirming that the Securities and Exchange Commission had launched an informal investigation. The investigation will focus on allegations that two Tenet hospitals in Redding where Moon and Fidel Realyvasquez, MD, performed surgeries allowed the physicians to push patients into unnecessary cardiac bypass operations, resulting in excessive charges to the Medicare system.

"If Mr. Barbakow truly wants to promptly resolve issues, he might start with the current state of California law. California law is clear and settled — a hospital owes a general duty to insure the competency of its medical staff and to evaluate the quality of medical treatment rendered on its premises," Hackard says. "If Tenet had been providing the same kind of oversight to its medical staff and quality of medical treatment that it paid to its bottom line, a lot of Tenet patients wouldn’t have had unnecessary surgery and all the potentially lethal complications that go with it."

He says it is not relevant that Moon and Realyvasquez billed for their own services and weren’t designated employees of the hospital. What is relevant is that the two doctors practiced in Tenet hospitals, where according to an FBI affidavit, as many as half of the heart surgeries and tests performed by the pair were "unnecessary by commonly held medical standards." The same affidavit also contains allegations that an estimated 25% of these procedures were performed on patients who had no serious heart problems. Hackard filed the case on behalf of Carl L. Roberts, a 75-year old northern California man treated by Moon. Despite the results of a stress test that showed Roberts was healthy, Hackard says, Moon informed him that he needed a four-way bypass, which he performed the same day at Tenet’s Redding Medical Center.

"Tenet’s woes won’t be overcome by an independent contractor theory," Hackard says. "California law, patients’ expectations, and ethical practice demand a more reasoned approach. Tenet is liable for negligent conduct of independent physicians and surgeons who, as members of the hospital staff, avail themselves of the hospital facilities, but who are neither employees nor agents of the hospital."