New EMTALA rules: What you don’t know can hurt you

Feds get tough on patient dumping

Now may be a good time to launch a new series of inservices to educate your staff and physicians about changes in case law and federal regulations, according to speakers at the recent annual meeting of the American Society for Healthcare Risk Management (ASHRM) in New Orleans. There are plenty of new risks looming that should scare the dickens out of even the most blasé health care providers, they say.

Some of the most important lessons concern the Emergency Medical Treatment and Active Labor Act (EMTALA), the federal rule that prohibits patient dumping and requires facilities to stabilize patients before transferring them to another facility. EMTALA has long been a minefield for risk managers, but Mark Kadzielski, JD, says traversing that minefield is going to be even trickier from now on. Kadzielski is head of the West Coast health practice for the law firm of Akin Gump in Chicago. He says risk managers must study changes in the EMTALA rule that went into effect in October.

"The heat is building on EMTALA," Kadzielski says. "I expect to see more violations and penalties in the near future. They’re looking for it."

Another ASHRM speaker agreed with Kadzielski that the coming months may include some tough challenges for risk managers. Recent changes in case law have upped the ante on some risks, according to John West, JD, MHA, DFASHRM, senior health care consultant with AIG Consultants in Atlanta.

"You may want to have an inservice to educate your staff and physicians about some of these developments," he says. "Some of these things can be very effective in scaring people to death so you get their attention."

Definitions clearer, but scope broadened

Much of the increased risk from EMTALA stems from changes and clarifications in the rule that went into effect on Oct. 10, 2000. Originally proposed in 1998, the Final Outpatient PPS Rule for hospitals, 64 Fed Reg 18434 (April 7, 2000), answered some questions that health care providers had asked about how to comply with the rule. Unfortunately, some of the answers aren’t what anyone was hoping for.

For instance, the EMTALA rule now applies to any person up to 250 yards away from the hospital. Kadzielski says this clarification was made in response to a recent case that gained widespread media attention, in which employees and staff of a major hospital refused to aid a gunshot victim who was lying just beyond the hospital property. Now the federal government has made clear that all the requirements of EMTALA apply not just in the emergency room or just in the hospital building itself.

"No one knows exactly where you’re supposed to measure that 250 yards from, but it’s safe to say that you should measure from the edge of your campus, not the front door," he says. "The idea is that they want you to be responsible for anyone who is, in their opinion, close enough to be considered your responsibility even if they’re not on your property."

That interpretation could be particularly troublesome for smaller hospitals in rural areas, Kadzielski says.

"In some towns, 250 yards might cover 90% of the town," he says. "That raises interesting questions about your obligations when someone passes out at the liquor store."

Beware of transfers

The EMTALA clarification also makes clear that the rule is limited to those areas of the hospital that are determined to be departments of the hospital by the Health Care Financing Administration (HCFA). That means transferring a patient to that department, even within the same hospital building, could constitute an EMTALA violation.

Similarly, HCFA now says that freestanding facilities are not considered part of the hospital for the purposes of EMTALA. If a patient shows up at a health system’s urgent care facility or clinic, transferring that patient to the main hospital could violate EMTALA.

"You can now dump a patient by sending them to your own ER," he says. "Don’t let your business people declare all of your related off-site property as part of the hospital. They usually want to do that and call every little office a satellite hospital with all the signage and logos, but that basically gives the government permission to hit you with an EMTALA violation."

HCFA also has addressed the current trend of hospitals to open clinics and urgent care centers within a competing hospital’s traditional operating area. Hospitals have found such facilities to be an effective way to encroach on the other hospital’s turf and try to steal away patients, Kadzielski says. But as far as EMTALA is concerned, HCFA says those offices must be willing to send patients to the competing hospital if the parent hospital is too far away.

Not only must the off-site facility transfer the patient to the nearby competitor when a trip to the parent hospital would take too long, but HCFA says the off-site facility must have a transfer agreement in place in advance. It is not sufficient to decide the patient must go to the competitor and then figure out how to get him or her there.

"This is the first time that HCFA has specifically required transfer agreements be in place prior to an accident," Kadzielski says. "Apparently it requires preplanning so that a simple phone call to one prearranged phone number would be sufficient to confirm transfer in a matter of a very short time. Your business people won’t like you sending patients to the competition, but EMTALA requires it."

West also explains that recent case law has clarified that a family history of a medical condition is not sufficient to trigger the requirements of EMTALA. The patient must actually have symptoms at the time the facility treats him or her in order for there to be an obligation. In the past, plaintiffs have alleged that a facility could be held liable if they discharged or transferred a patient with knowledge that a family history made the patient susceptible to a problem, which then manifested after the discharge or transfer.

West updated ASHRM attendees on recent changes in case law that can affect health care providers, and says there are a number of developments that should prompt risk managers to take action. In one case, Colbert v. Rolls, a Florida appeals court ruled that a doctor’s unusual religious beliefs were relevant to a malpractice case and discoverable. The patient had consulted the doctor for epigastric pain, but the doctor did not order an EKG. It turned out the man was having a heart attack.

The patient later testified that the doctor told him he did not order an EKG because a "spirit" had not told him to. He further discussed his beliefs in spiritual healing and his admiration for a televangelist known for "healing" the sick. The doctor denied that was the reason he did not order an EKG, but the appeals court eventually ruled that his religious beliefs were discoverable.

"The lesson is to figure out if your doctors have odd beliefs, and if so, you may want to consider counseling them on those practices," West says. "In professional liability actions, those beliefs could be a real problem."

Who’s to judge?

It is not acceptable to simply quiz each physician about his religion upon hiring or granting privileges, because that could lead to discrimination charges. But West says risk managers should be alert for any signs that the doctor’s treatment is unorthodox. The key is to judge the doctor on his or her actions, or lack thereof, not just on his or her religious beliefs.

"If you determine that a physician is basing his or medical judgments on spiritual inspiration, observations made during astral projections, voices within their heads, tea leaves, Tarot cards, or such other less than commonly accepted medical practices or sources of information, you certainly would be within your rights to investigate further and take such action as necessary to ensure the quality of patient care," he says.

In another recent case, Dunkley v. Shoemate, the North Carolina Supreme Court determined that a health care provider cannot mount a defense for a third party without that party’s consent. The case involved a woman who was admitted to a residency program at a major hospital and subsequently sued, along with the hospital, for malpractice. The patient alleged that a "doctor" forced her to have sex with him and threatened to commit her to an institution if she refused. When the case arose, it was revealed that the doctor was not actually a doctor at all and apparently had no verifiable medical training. The man fled as soon as the suit was filed and has not been heard from since.

The hospital’s insurer wanted to mount a defense for the man to avoid a default judgment, since the court had refused the argument that his deception meant he was not really an employee of the hospital. The Supreme Court of North Carolina decided that the hospital’s insurer could not defend the man without his consent.

"This is a pretty scary case, and I don’t know how to get around it," West says. "I don’t know if you could get residents to agree to a defense before a suit is filed against them, or if that would hold up later. The lessons are that you should keep track of residents as much as you can after they leave your facility, and always check the credentials. Always."

West also drew attention to a recent Virginia case involving the alteration of medical records. In Stevenson v. Virginia, a physician was seeking preauthorization from an insurance company so that a patient could be placed on a list of patients requiring a kidney transplant. The insurance company required proof that the patient had passed a cardiac evaluation recently, but the doc-tor had not performed one recently. He altered the date on one from earlier in the patient’s treatment.

The doctor eventually was convicted of forgery but the penalty was a fine of only $1. Nevertheless, the doctor appealed the conviction because the felony was reportable to regulatory bodies, and it was generally unappealing for a doctor to have such a record. The forgery conviction was upheld and then taken to the Virginia Supreme Court. The Supreme Court noted that Virginia law requires a forgery to prejudice, or have the potential to prejudice, the rights of another. In other words, simply creating a false document is not enough; someone has to be hurt by it.

Testimony revealed that the falsified date was not crucial to the insurer’s decision. Since the insurer’s approval process was such that it would have approved the procedure even without the fraud, the court ruled that the company’s rights were not compromised. On that basis, the court overturned the conviction.

West says the doctor "barely wiggled out of this conviction," and did not know at the time of his forgery that the date was not so important. If he had not overcome the conviction, he would have been left with a criminal record that could hamper his licensure and his ability to participate in managed care programs appropriately," West says. "How many inservices do you have on documentation and it never sinks in? This is one case that I think everyone should incorporate into their inservices on documentation, to scare them into complying or at least not committing outright forgery."

West notes that had the doctor done the same thing with a Medicare document instead of a private insurer, the doctor would be guilty of filing a false claim.

A case in Maryland also should get the attention of wayward physicians. In Board of Physician Quality Assurance v. Banks, a physician was accused of sexually harassing several female co-workers and took a leave of absence from the hospital. When he reapplied for privileges, he was refused. When the medical licensing board received notice of the denial of privileges, it investigated and brought charges against him under state law that prohibits "immoral or unprofessional conduct in the practice of medicine." The doctor’s defense was that he was not practicing medicine at the time of the alleged incidents. They all took place during his down time between seeing patients, much of it during the long periods when he was on call at the hospital but not actively working.

"The court ruled that if you’re employed as a physician, working as a physician in a health care facility, you’re practicing medicine no matter what you’re doing at the moment. If you’re just waiting to make copies or getting coffee, you’re still practicing medicine," West says. "This is a good one to include in sex harassment inservices to scare people, especially if you can get the attention of your physicians."

Not all of the case law developments were detrimental to health care providers. In one recent case, Pegram v. Herdrich, the U.S. Supreme Court determined that managed care organizations do not have a fiduciary responsibility to their subscribers. This was an important decision, West says, because a fiduciary responsibility essentially trumps any other responsibility. The plaintiff in the case had sued because she thought her managed care provider had put cost-cutting efforts ahead of her own best welfare, arguing that the company had a fiduciary responsibility to provide the best care possible no matter what it meant to the company’s bottom line. The woman’s appendicitis was misdiagnosed, an error she blamed on the managed care group’s cost-cutting protocols.

"The Supreme Court said it’s not possible for a managed care organization to act in the best interest of each individual participant without going bankrupt, especially involving utilization decisions," West says. "The ruling could mean that providers won’t automatically be held liable if they admit they were trying to save money and that inadvertently led to a problem with a patient."