Issue # 4:6, June 2016

The Continuous Debate Over the “Continuous Treatment” Rule

Cefaratti v. Aranow, — A.3d — 321 Conn. 637 (Conn. 2016)

The “continuous treatment” rule is generally understood to allow an aggrieved patient to toll the limitations period upon showing that “(1) she had an identified medical condition that required ongoing treatment or monitoring; (2) that the defendant provided ongoing treatment or monitoring of that medical condition after the allegedly negligent conduct, or that the [patient] reasonably could have anticipated that the defendant would do so; and (3) that the plaintiff brought the action within the appropriate statutory period after the date that treatment terminated.” Grey v. Stamford Health System, Inc., 924 A.2d 831 (2007). What constitutes an “ongoing treatment,” however, is often a matter of fierce contestation.

In the case at bar, the plaintiff underwent open gastric bypass surgery in an attempt to cure her morbid obesity. Her follow-up treatment and monitoring took place between 2004 and the summer of 2009. All these procedures have been carried out by the same surgeon at a hospital in which he had attending privileges as an independent contractor. According to the plaintiff, on each of her post-operative visits she told the surgeon that she was experiencing abdominal pain. In August 2009, after being diagnosed with breast cancer by another physician, the plaintiff had a CT scan of her chest, abdomen, and pelvis, which revealed the presence of a foreign object in her abdominal cavity. This object was a surgical sponge that the surgeon left when he operated the plaintiff in 2003. Following that discovery, the plaintiff filed a malpractice suit against the surgeon and the hospital.

Based on these facts, the plaintiff argued that she is entitled to toll the statute of limitations pursuant to the continuous treatment rule. The defendants disagreed. According to them, the continuous treatment rule only applies when the entire course of the plaintiff’s treatment was negligent. A single act of negligence, they argued, will not do.

This argument conflated the “continuous treatment” rule with the “continuous negligence” doctrine that often allows plaintiffs to circumvent both the limitations statute and the statute of repose. See Pitt-Hart v. Sanford USD Med. Ctr., 878 N.W.2d 406 (S.D. 2016), and my discussion of this important decision here. The defendants’ argument also ran against the social purpose of the “continuous treatment” rule. This rule is premised on the belief that “the most efficacious medical care will be obtained when the attending physician remains on a case from onset to cure.” Grey, id. at 837; Blanchette v. Barrett, 640 A.2d 74, 85 (Conn. 1994); Ewing v. Beck, 520 A.2d 653, 659–60 (Del.1987). Guided by this belief, the rule avoids creating “a dilemma for the patient, who must choose between silently accepting continued corrective treatment from the offending physician, with the risk that his claim will be time-barred or promptly instituting an action, with the risk that the physician-patient relationship will be destroyed.” Rizk v. Cohen, 535 N.E.2d 282, 285 (N.Y. 1989).

Unsurprisingly, the Connecticut Supreme Court rejected the defendants’ argument. Cefaratti v. Aranow, — A.3d —- 321 Conn. 637, 653-54 (Conn. 2016). Importantly, the Court also clarified that “To the extent that the defendants contend that routine appointments can never constitute a continuing course of treatment for purposes of the doctrine, we again disagree. Rather, we conclude that routine postoperative appointments for the purpose of tracking the progress of the plaintiff’s condition and postoperative complications, if any, constitute continuing treatment for any identified medical condition that was caused by the surgery.” Id. at 655.

 

Hospitals’ Liability for Malpractice of Physicians Working as Independent Contractors with Attending Privileges

Cefaratti v. Aranow, — A.3d —, 321 Conn. 593 (2016)

In its recent decision, Cefaratti v. Aranow, — A.3d —-, 321 Conn. 593 (2016), the Connecticut Supreme Court delineated the scope of the apparent authority doctrine as applied to hospitals. Specifically, the Court determined the extent to which a hospital can be held responsible for medical mistakes of physicians who treat patients at the hospital as independent contractors with attending privileges.

The case at bar featured a plaintiff who underwent open gastric bypass surgery in an attempt to cure her morbid obesity. Her follow-up treatment and monitoring took place between 2004 and the summer of 2009. All these procedures have been carried out by the same surgeon at a hospital in which he had attending privileges as an independent contractor. According to the plaintiff, on each of her post-operative visits she told the surgeon that she was experiencing abdominal pain. In August 2009, after being diagnosed with breast cancer by another physician, the plaintiff had a CT scan of her chest, abdomen, and pelvis, which revealed the presence of a foreign object in her abdominal cavity. This object was a surgical sponge that the surgeon left when he operated the plaintiff in 2003. Following that shocking discovery, the plaintiff filed a malpractice suit against the surgeon and the hospital.

The hospital moved for the suit’s dismissal based on the fact that the surgeon was an independent contractor, rather than an employee of the hospital. Evidence showed that the plaintiff initially saw the surgeon at his clinic and then followed the surgeon’s proposal to operate her at the hospital. The plaintiff also attended informational sessions at the hospital where she received from the surgeon’s staff the hospital’s pamphlet stating that “The team will go over every aspect of your stay with us. We will discuss what you should do at home before your operation, what to bring with you, and events on the day of surgery.” According to the plaintiff, this pamphlet made her believe that the surgeon was an employee of the hospital.

The hospital argued that even when this evidence is interpreted most favorably to the plaintiff, it still fails to show that the surgeon had any authorization to make representations on the hospital’s behalf, which precludes the application of the apparent authority doctrine. The hospital also contended that Connecticut law does not recognize the doctrine of apparent agency that makes parties liable for misrepresentations coming from an actor to whom they gave no authority whatsoever. Finally, the hospital argued that since the plaintiff failed to show detrimental reliance – by adducing evidence indicating that she would have declined the proposed procedure had she known that the hospital did not employ the surgeon – her suit is doomed anyway.

The Connecticut Supreme Court rejected those claims. First, the court declined to recognize the distinction between “apparent authority” and “apparent agency.” “As in many other jurisdictions,” it explained, “it has been the rule in this state for courts to use the terms apparent agency and apparent authority interchangeably.” The court also relied on the Restatement (Third) of Agency § 2.03 that “sets forth a single doctrine that expressly applies both to actual agents and to apparent agents.”

The court subsequently ruled that

“[A]lthough their doctrinal underpinnings are not entirely clear, we ultimately are persuaded by the cases that have concluded that, under certain circumstances, proof of detrimental reliance is not required to establish an apparent agency in tort actions. [M]any courts, especially in cases seeking to hold a hospital vicariously liable for a physician’s malpractice, have concluded that an apparent agency is established when the plaintiff proves that he or she looked to the principal to provide services and the principal, not the plaintiff, selected the specific person who actually provided the services and caused the plaintiff’s injury. These courts have not required the plaintiff to establish detrimental reliance on the principal’s representations that the tortfeasor was the principal’s agent or employee, i.e., that the plaintiff would not have accepted the tortfeasor’s services if the plaintiff had known that the tortfeasor was not the principal’s agent. Indeed, many cases have held that the plaintiff is not even required to present affirmative evidence that he or she actually and reasonably believed that the tortfeasor was the principal’s agent or employee. Rather, the cases appear to hold that such belief may be presumed from the fact that the plaintiff chose the principal and the principal chose the specific person who provided the services, and the fact the principal was the actual cause of the relationship between the plaintiff and the tortfeasor that resulted in injury is sufficient justification to apply the doctrine.” [citations omitted]

The court went on to explain this ruling by saying that

“[W]hen an entity has held itself out as providing certain services to the public—and, indeed, may have made great efforts to persuade members of the public to avail themselves of those services, and benefited from doing so—and has selected the specific individual who will provide those services to particular members of the public, we do not believe that it is unfair to hold that entity liable for the individual’s negligence. …. [H]olding principals liable under these circumstances is consistent with the fundamental purposes of the tort compensation system of deterring wrongful conduct and shifting the blame to the party who is in the best position to prevent the injury.”

Importantly, the court limited this broad liability principle to cases in which the hospital selects the treatment provider for the patient. Cases in which the patient selects his or her physician that practices medicine at a hospital are different.

In the court’s words,

“[W]hen the plaintiff selected the specific person who provided the services and caused the injury on the basis of the plaintiff’s knowledge of the person’s skills and reputation, the plaintiff must demonstrate an actual and reasonable belief in the principal’s representations that the person was its agent, and also detrimental reliance on those representations to establish apparent agency.”

As a corollary, the court formulated two alternative standards for establishing apparent agency in tort cases:

“First, the plaintiff may establish apparent agency by proving that: (1) the principal held itself out as providing certain services; (2) the plaintiff selected the principal on the basis of its representations; and (3) the plaintiff relied on the principal to select the specific person who performed the services that resulted in the harm complained of by the plaintiff.

Second, the plaintiff may establish apparent agency in a tort action by proving the traditional elements of the doctrine of apparent agency, as set forth in our cases involving contract claims, plus detrimental reliance. Specifically, the plaintiff may prevail by establishing that: (1) the principal held the apparent agent or employee out to the public as possessing the authority to engage in the conduct at issue, or knowingly permitted the apparent agent or employee to act as having such authority; (2) the plaintiff knew of these acts by the principal, and actually and reasonably believed that the agent or employee or apparent agent or employee possessed the necessary authority.”

To sum up, Connecticut law now requires plaintiffs to show detrimental reliance when they base their suit against the hospital (or another principal) on the apparent authority doctrine. Plaintiffs relying on the apparent agency doctrine must show detrimental reliance.

Records compiled by a hospital’s risk-management specialist held discoverable

Frankfort Reg. Med. Ctr. v. Shepherd, 2016 WL 3376030 (Ky. 2016)

In Frankfort Reg. Med. Ctr. v. Shepherd, 2016 WL 3376030 (Ky. 2016), the Kentucky Supreme Court held that the attorney-client privilege and its work-product extension do not protect records compiled by a hospital’s risk-management specialist. Records that the Court held to be discoverable contained information pertaining to a baby delivery that went badly. The risk-management specialist gathered that information with an eye on a possible medical malpractice suit, but her primary goal was risk management (which presumably precluded the applicability of the “subsequent remedial measures” privilege).

The Court’s decision relied on the familiar “dominant purpose” test under which the attorney-client privilege only covers documents compiled primarily in preparation to litigation. Understandable as it may be from a purely doctrinal viewpoint, this decision makes no economic sense. All it does is create a trap for the unwary and an opportunity for hospitals familiar with the law to protect their risk-management information against disclosure. To obtain the needed protection, all that a hospital needs to do is ask its in-house counsel or outside attorney to control the risk-management procedures and decisions, so that risk-management becomes part of the attorney’s work as a protector of the hospital’s legal interests. Doing so isn’t difficult but is slightly costlier than simply relying on a risk-management consultant.

 

Sovereign Immunity Protects State-Owned Hospitals and Medical Personnel Against Malpractice Suits

Pike v. Hagaman, — S.E.2d — 2016 WL 3097727 (Va. 2016)

Pike v. Hagaman, — S.E.2d —- 2016 WL 3097727 (Va. 2016), is a must-read for anyone interested in medical malpractice and health law. This new decision of the Virginia Supreme Court grants state-owned hospitals and their personnel categorical sovereign-immunity protection against medical malpractice suits.

After an unsuccessful surgery at a state-owned hospital, the patient filed a suit against one of the hospital’s nurses accusing her of malpractice. The nurse invoked the sovereign immunity. The trial court agreed with the nurse and decided that the sovereign immunity bars the suit.

On appeal, the Virginia Supreme Court affirmed that decision after finding that:

(1) the nurse’s conduct was essential to carrying out the state’s interest in the provision of high quality medical care.

(2) the nurse’s conduct involved use of judgment and discretion; and, finally, that

(3) the state had high level of control and direction over nurse.

The Court’s determination that individual patient care at a state-owned hospital satisfies this three-prong test for sovereign immunity is at odds with the prior precedent, James v. Jane, 282 S.E.2d 864 (Va. 1980). In James v. Jane, the Court ruled that “The state’s interest and the state’s involvement, in its sovereign capacity, in the treatment of a specific patient by an attending physician in the University Hospital are slight; equally slight is the control exercised by the state over the physician in the treatment accorded that patient. This interest and involvement is not of such moment and value to the Commonwealth as to entitle [the defendants] to the immunity enjoyed by the state. … While there may have been a time when a physician was attracted to teach in a state medical school, and to serve as an attending physician on the staff of its hospital, because of the cloak of immunity afforded him as an employee of the sovereign state, we think that time is past. We cannot conceive of any physician, regardless of his status, practicing medicine in this era without the protection of liability insurance, which he purchases for himself or which is provided for him by his employer. Realistically, the only interest the state has in affording immunity to the physicians practicing in state hospitals is the probability of an increase in the cost of medical malpractice insurance if such immunity is denied. We do not find this to be such a compelling state interest as to justify the denial of a patient the right to assert a claim against a physician for negligent treatment.” Id. at 870.

The new interpretation of Virginia’s sovereign immunity fends off essentially every medical malpractice suit against state-owned hospitals and their personnel. Whether this massive and unprecedented expansion of the immunity was intended and will become entrenched in Virginia’s law remains to be seen.