The Denial of the Peer Review Privilege to HMOs

Venosh v. Henzes, — A.3d — (Pa. 2015) 2015 WL 4712604

This recent decision of the Pennsylvania Supreme Court has narrowed the scope of the state’s peer review privilege that protects against disclosure “proceedings and records of … any committee engaging in peer review.” Pennsylvania statute defines “peer review” as “a procedure for evaluation by professional health care providers” of the quality and efficiency of services ordered or performed by other “professional health care providers.” 63 P.S. §§ 425.2 & 425.4.

The Court decided that HMOs (unlike hospitals) are not “professional healthcare providers” because they do not deliver medical services. As a result, HMOs (such as Blue Cross Blue Shield) must disclose peer reviews of the affiliated doctors’ performance.

The Court also mentioned that “a review committee is operating as such only when its goal is “to gather and review information relating to the care and treatment of patients for the purposes of (i) evaluating and improving the quality of health care rendered; (ii) reducing morbidity or mortality; or (iii) establishing and enforcing guidelines designed to keep within reasonable bounds the cost of health care.” 63 P.S. § 425.2 This goal, according to the Court, wasn’t present in the case at bar because “Herein, Blue Cross was deciding whether to keep [the reviewed physicians] as contracting health care service providers. None of the above stated purposes was present in its quality-of-care review.”

This decision is open to criticism. First, I question the Court’s distinction between the direct provision of medical care and a care’s provision through financing. HMOs implement financing models to provide medical care to people who otherwise could not afford it. This role turns HMOs into professional healthcare providers. HMOs also work to secure the quality of medical care for their plan members. An HMO’s decision to expel a physician from its network therefore may well be directed towards “improving the quality of health care rendered.” Finally, the Court’s decision not to grant the peer review privilege to HMOs committees is bound to distort those committees’ work. Physicians participating in those committees will now be less inclined to provide candid assessments of other doctors’ performance.