Healthcare News & Insights

Physician whistleblowers can sue hospitals without exhausting administrative remedies

An appeals court ruling in California that gives physicians the right to sue hospitals without having to exhaust administrative processes may have far-reaching effects. 

The decision stems from a dispute between Dr. Mark Fahlen, a nephrologist, and Memorial Medical Center in Modesto, CA.

According to the court, between 2004 and 2008 Dr. Fahlen complained to hospital authorities that some of the nurses he worked with at Memorial failed to follow his instructions. And in a few instances, he claimed the nurses endangered patients lives.

Complaints made

For example, in one case Dr. Fahlen confronted a hospital nurse who refused to use a defibrillator to resuscitate a kidney dialysis patient in her 70s. The nurse insisted Dr. Fahlen first sedate the patient. Dr. Fahlen refused, stating the medication would have lowered the patient’s blood pressure and reduced her chances of survival. Another nurse stepped in and revived the patient.

In another case, hospital staff refused to follow Dr. Fahlen’s orders to admit a patient to the intensive care unit. The patient’s condition worsened and he had to be transferred to the University of California At San Francisco Medical Center.

Dr. Fahlen, however, wasn’t the only person with complaints. According to court documents, some of the exchanges between Dr. Fahlen and the nurses got heated, and the nurses at Memorial filed complaints about his behavior, too. This lead to an investigation and to Dr. Fahlen being fired. The hospital also refused to renew his staff privileges.

A peer review committee of six physicians, however, found no professional incompetence on Dr. Fahlen’s part and reversed the hospital’s decision. But the hospital’s board overturned the reversal, stating that Dr. Fahlen’s conduct wasn’t acceptable and was “directly related to the quality of medical care at the hospital.”

Whistleblower retaliation

Instead of seeking judicial review to get his privileges reinstated, Dr. Fahlen evoked the whistleblower retaliation claim and sued the hospital.

Under California’s Health and Safety Code Section 1278.5, a physician who reports patient safety concerns and experiences  retaliation can sue the hospital for damages and reinstatement of privileges.

The hospital, however, objected to this stating Dr. Fahlen had to file an administrative petition before he could be reinstated.

The California Court of Appeal rejected the hospital’s argument.

According to court documents, “The Legislature’s intent in enacting section 1278.5 is clear: Medical personnel must be protected from retaliation when they report conditions that endanger patients. This policy of putting patients first would be undermined if retaliation victims had to pursue writ review before seeking the statute‟s protection.

“This case illustrates why this is true… If we accepted the hospital‟s argument in this case, Fahlen could have to spend years pursuing writ relief before being able even to assert his whistleblower claim in court. This type of delay is incompatible with the Legislature‟s goals.”

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