MICHAEL D. BRANDNER, M.D., Appellant,
v.
PROVIDENCE HEALTH & SERVICES WASHINGTON, Appellee.
Appeal
from the Superior Court No. 3AN-13-07697 CI of the State of
Alaska, Third Judicial District, Anchorage, Patrick J. McKay,
Judge.
Appearances: Richard W. Maki and David H. Shoup, Tindall
Bennett & Shoup, P.C., Anchorage, for Appellant.
Robert
J. Dickson and Peter A. Scully, Atkinson, Conway &
Gagnon, Anchorage, for Appellee.
Before: Stowers, Chief Justice, Winfree and Bolger, Justices.
[Fabe and Maassen, Justices, not participating.]
OPINION ON REHEARING.
WINFREE, Justice.
I.
INTRODUCTION
Providence
Alaska Medical Center terminated Dr. Michael Brandner's
hospital privileges without an opportunity to be heard after
determining he had violated hospital policy by failing to
report an Alaska State Medical Board order requiring him to
undergo an evaluation of his fitness to practice medicine.
Dr. Brandner unsuccessfully challenged this action through
Providence's internal post-termination hearing and appeal
procedures. Dr. Brandner then sued in superior court, seeking
reinstatement and damages for, in relevant part, alleged due
process violations both in the procedures used and in the
substantive standard applied in his termination. The superior
court ruled that Dr. Brandner's due process rights were
not violated, that he was not entitled to reinstatement, and
that under federal law Providence was entitled to immunity
from his damages claims.
We
affirm the superior court's decision concerning the
substantive standard applied to terminate Dr. Brander; he
therefore is not entitled to reinstatement or
post-termination-hearing damages. But Dr. Brandner's due
process rights were violated by the procedures Providence
employed because he was not given any opportunity to be heard
prior to the termination of his hospital privileges; we
therefore reverse the superior court's decision on the
pre-termination hearing claim and its decision that
Providence had damages immunity from this claim, and we
remand for further proceedings.
II.
FACTS AND PROCEEDINGS
A.
Facts
Dr.
Brandner had hospital privileges as a surgeon at Providence
from 1995 to 2009, when he took a medical leave of absence
because of a cardiac condition. He returned to work in March
2010 and Providence reinstated his hospital privileges,
excepting hand surgery. Providence also gave Dr. Brandner a
six-month exemption from emergency call duties. In November
2010 Providence reinstated Dr. Brandner's hand surgery
privileges after reviewing his surgical cases and finding him
competent, but kept in place the emergency call exemption.
In
October 2010 the Alaska State Medical Board (State Board)
ordered Dr. Brandner to undergo psychiatric and medical
evaluations after receiving a complaint that he had contacted
someone in the Governor's office and made a threat
involving a gun. The evaluations were part of the State
Board's investigation into Dr. Brandner's
"ability to practice medicine in a manner consistent
with public safety, " and he was required to complete
them within 45 days. The State Board's order also stated:
Failure to comply with this order will result in the
automatic suspension of [Dr. Brandner's] license to
practice medicine in Alaska and it will remain suspended
until such time as the evaluations are completed and the
results of the evaluations are reviewed by the [State] Board,
and the [State] Board determines Dr. Brandner is able to
practice medicine in a manner consistent with public safety.
Dr.
Brandner timely complied with the order by undergoing a
five-day evaluation in early December 2010 at the Menninger
Clinic in Texas. The clinic found no evidence indicating he
was unfit to practice medicine. Later in December the State
Board closed its investigation without imposing any
"further investigation or disciplinary action"; it
sent Dr. Brandner confirmation of its decision in May 2011.
Doctors
enjoying Providence hospital privileges are required to
comply with policies set out in the Providence Code of
Conduct and Medical Staff Bylaws. Policy MS 980-150(D)
requires doctors to report to the chief of staff or the
medical staff services department manager "any
limitations, restrictions [, ] or conditions of any sort
imposed by a state board, health care entity [, ] or agency
with respect to the practitioner's practice... no later
than thirty (30) days after a final order has been
issued." The policy states that doctors who violate this
reporting requirement "will be subject to an automatic
termination" of hospital privileges. Dr. Brandner did
not inform Providence's chief of staff or medical staff
services manager about the State Board order, nor did he
disclose his December 2010 evaluation at the Menninger
Clinic.
Procedures
for reviewing, investigating, and resolving concerns about
doctors' clinical proficiency and professional conduct
are governed by Providence policy MS 980-100, referred to as
the Investigation, Hearing, and Appeals Plan (Fair Hearing
Plan). Under this policy the Providence Medical Staff
Executive Committee (executive committee) is responsible for
overseeing doctors' conduct. Concerns about a
doctor's conduct are first presented to the executive
committee; it then has authority to conduct peer reviews and
make recommendations to the Providence Alaska Community
Ministry Board (Providence Board) on granting, limiting,
suspending, or terminating hospital privileges. The executive
committee's recommendations generally do not by
themselves affect a doctor's hospital privileges; the
Providence Board receives the recommendation, considers the
matter independently, and makes the ultimate decision. Some
hospital policies, including the one at issue here, provide
for automatic termination of hospital privileges if a doctor
engages in specified conduct. An automatic termination
recommendation triggers a process under MS 980-100 entitling
the doctor to a hearing and an appeal. After the hearing and
appeal procedures are exhausted the Providence Board's
confirmation, modification, or rejection of the hearing
bodies' recommendations becomes Providence's final
decision.
In
January 2011 the executive committee called Dr. Brandner to
its monthly meeting to discuss his emergency call duties. The
executive committee was concerned because Dr. Brandner had
listed his name on the emergency call sign-up sheets despite
not yet being authorized to resume those duties. During that
meeting the executive committee was alarmed by Dr.
Brandner's "disjointed" statements. The
executive committee invited him to a second meeting in
February to decide whether to investigate his fitness to
practice medicine. At the February meeting Dr. Brandner's
"rambling and confused" conduct again raised
concerns that he might not be "medically fit, " and
the executive committee ordered him to undergo a
"fitness for duty" evaluation at the Menninger
Clinic.
Kim
Pakney, Providence's medical staff services manager,
called Dr. Brandner in March to arrange the evaluation.
During this call Dr. Brandner disclosed to Pakney that he
recently had been evaluated at the clinic. Pakney told Dr.
Brandner that he could either undergo another evaluation or
allow the executive committee to obtain the December 2010
evaluation records. Dr. Brandner chose to release his 2010
evaluation. According to Pakney's later testimony, Dr.
Brandner did not mention the State Board's order during
their conversation and instead indicated he had visited the
clinic at his cardiac surgeon's suggestion. Dr. Brandner
later testified that he told Pakney he had gone to the
Menninger Clinic "to pursue some things." Only when
Pakney received Dr. Brandner's clinic records did she
realize that he had undergone the evaluation pursuant to an
order from the State Board. She immediately notified the
Providence executive committee.
At its
next meeting, on June 13 - without notice to or presence by
Dr. Brandner - the executive committee voted to recommend
termination of Dr. Brandner's hospital privileges for
failure to report the State Board's order requiring him
to submit to an evaluation. The executive committee
determined that the order was a final order imposing a
condition on Dr. Brandner's license, and that his failure
to report the order to the chief of staff or the medical
staff services department manager within 30 days constituted
a violation of Providence policy MS 980-150(D).
In a
June 17 letter Providence's chief executive officer
notified Dr. Brandner that the executive committee
"recommended the automatic termination of [his hospital]
privileges and staff membership, " that he had the right
to a hearing, and that the Providence Board would "not
be bound by the adverse recommendation made thus far." A
few days later the Providence Board affirmed the executive
committee's recommendation terminating Dr. Brandner's
hospital privileges. Dr. Brandner timely requested a hearing.
At oral argument before us the parties confirmed that as of
June 17, before any hearing took place, Dr. Brandner was not
allowed to practice at Providence.
B.
Proceedings
1.
Providence Fair Hearing Panel proceedings
In
November 2011 Dr. Brandner received a one-day hearing before
a three-doctor panel pursuant to Providence's Fair
Hearing Plan. A former superior court judge presided as the
hearing officer. Dr. Brandner was represented by an attorney,
presented evidence, cross-examined Providence's
witnesses, and testified on his own behalf. Providence's
witnesses testified about the importance of physicians
self-reporting conditions on their licenses because of the
potential impact on patient care. Dr. Brandner argued that
the State Board's order was not a "condition"
on his license within the meaning of the Providence reporting
policy. He argued instead that the order was a part of an
"investigation, " and stated that he did not
believe the policy required reporting investigations.
The
panel decided that the order did impose a
"condition" on Dr. Brandner's license because
"[t]he plain language of the . . . [o]rder . . . clearly
advised Dr. Brandner that the continued viability of his
license was conditioned upon his timely completion of []
psychiatric and medical evaluations at the Menninger
Clinic." The panel also found Dr. Brandner's
testimony regarding his interpretation of the hospital policy
"less than credible" because: (1) he testified that
he attended the Menninger Clinic to "pursue some
things"; (2) Pakney testified that Dr. Brandner said he
attended the clinic because his cardiac surgeon had
recommended it; and (3) it was undisputed that Dr. Brandner
actually attended the clinic because the State Board required
it.
The
panel concluded that because the State Board order plainly
stated Dr. Brandner's license would be suspended if he
did not comply, a responsible, reasonable doctor would have
reported the order or at least asked Providence for guidance
on whether the order triggered Providence's
self-reporting policy. It unanimously upheld the executive
committee's June 2011 recommendation and the Providence
Board's June 2011 decision terminating Dr. Brandner's
hospital privileges, finding that they were "not
arbitrary, capricious[, ] or unsupported by substantial
evidence."
2.
Providence Appellate Review Committee proceedings
Dr.
Brandner timely appealed the panel's decision to the
Providence Appellate Review Committee (review committee)
pursuant to the Fair Hearing Plan. The review committee,
comprised of five members-none of whom had participated in
the earlier proceedings - convened in March 2012.
The
review committee upheld the hearing panel's decision by a
4-1 vote. In its decision the review committee noted that Dr.
Brandner's reading of the hospital policy regarding the
scope of "condition" was "plausible" but
that the review committee's role was not to substitute
its judgment for that of the hearing panel or to re-weigh the
evidence. The review committee concluded that the hearing
panel's actions complied with Providence's Fair
Hearing Plan, were not arbitrary or capricious, and were
supported by substantial evidence. It recommended that the
Providence Board "confirm" the executive
committee's June 2011 recommendation that Dr.
Brandner's privileges be terminated. One review committee
member dissented, writing that the State Board's order
was not a "final order" imposing
"conditions" under Providence policy MS 980-150(D)
and thus did not trigger the self-reporting requirement. The
dissent expressed concern that the hospital policy was
applied based in part on Dr. Brandner's fitness to
practice and not just his failure to report the State Board
order, and it noted that the failure to self-report alone
typically would not result in automatic termination of
privileges. And after the review committee issued its report,
the committee chair sent the Providence Board a letter
recommending clarifying MS 980-150(D)'s language by
adding some "interpretive guidance to illustrate the
types of limitations, restrictions, and conditions that are
intended to be included."
In
April 2012, after considering the hearing panel's and the
review committee's decisions upholding the executive
committee's recommendation, the Providence Board affirmed
the termination of Dr. Brandner's hospital privileges.
3.
Superior court proceedings
In June
2013 Dr. Brandner filed suit in superior court against
Providence, the doctors who made up the hearing panel, and
the doctors on the executive committee who testified at his
hearing. Dr. Brandner alleged breach of contract, due process
violations, defamation, and other contract claims. He sought
both declaratory and injunctive relief restoring his hospital
privileges and substantial money damages. Providence and the
doctors moved for summary judgment, asserting peer review
immunity under both Alaska law[1] and the federal Health Care
Quality Improvement Act (HCQIA).[2] Dr. Brandner opposed and
cross-moved for partial summary judgment, arguing that
Providence and the doctors were not entitled to immunity
under either state or federal law and that his due process
rights were violated. In February 2014 the superior court
granted summary judgment in favor of the individual doctors,
concluding that AS 18.23.020 immunized them from
suit.[3] The court also granted summary judgment in
Providence's favor on Dr. Brandner's contract claims.
The court denied Dr. Brandner's cross-motion for summary
judgment on his due process claims against Providence.
Dr.
Brandner's due process claims were tried without a jury.
The superior court found that Dr. Brandner intentionally
misled Providence by consciously hiding the State Board order
that he undergo an evaluation, and that his "blatant
dishonesty" and "lack of candor" raised
substantial patient care issues. The court also concluded
that when a hospital policy requires self-reporting a
condition placed on a physician's state license, due
process does not require a pre-termination hearing for
failure to report in violation of that policy. Finally, the
court concluded that Providence was entitled to immunity
under HCQIA.
Dr.
Brandner appeals, arguing that: (1) Providence's
termination of his hospital privileges without a
pre-termination opportunity to be heard is a due process
violation; (2) the post-hearing termination confirmation
violated due process because it was based on an ambiguous
policy applied arbitrarily and capriciously; and (3)
Providence is not entitled to HCQIA immunity from his due
process claims. Providence responds that: (1) the automatic
termination of Dr. Brandner's hospital privileges is not
a due process violation; (2) its hospital policy is not
unduly ambiguous; and (3) under HCQIA it is immune from
damages even if Dr. Brandner succeeds in his due process
claims.
III.
STANDARD OF REVIEW
We
review due process claims de novo, "adopting the rule of
law most persuasive in light of precedent, reason, and
policy."[4] Whether the HCQIA immunizes Providence
from Dr. Brandner's due process claims is a question of
law that we also review de novo.[5]
IV.
DISCUSSION
A.
Dr. Brandner's Procedural Due Process Rights Were
Violated When His Hospital Privileges Were Terminated Without
A Pre-Termination Opportunity To Be Heard.
Although
the parties dispute what process was due at certain points in
the termination process, they agree that Dr. Brandner's
admitting privileges trigger some form of due process
protection.[6] The specific issue presented involves the
due process right to an opportunity to be heard prior to
terminating hospital privileges. Although the parties
consistently describe this as "pretermination
hearing" and we use that language throughout our
opinion, we do not mean to suggest that the opportunity to be
heard necessarily involves a formal hearing like that set
forth in Providence's Fair Hearing Plan and made
available to Dr. Brandner after his hospital privileges were
terminated. This dispute does not raise the question of what
kind of pretermination hearing - more specifically what kind
of opportunity to be heard - must be provided to meet due
process concerns.
1.
Dr. Brandner did not waive his right to a pre-termination
opportunity to be heard.
Providence
argues that Dr. Brandner waived his right to a
pre-termination hearing by agreeing to be bound by MS
980-150, triggering an "automatic termination"
without providing for a pre-termination hearing. The right to
a pre-termination hearing, Providence argues, may be waived
if a sufficient post-termination grievance procedure is
afforded.[7] We previously have held that a waiver of
constitutional rights must be knowing and voluntary, and even
in civil cases "courts must indulge every reasonable
presumption against their waiver."[8] And although
constitutional rights are subject to contractual waiver, such
waiver must be clear.[9] Courts have found clear waiver, for
example, in collective bargaining agreements representing
"a reciprocal negotiation between forces with strengths
on both sides, reflecting the reconciled interests of
employer and employees, voluntarily entered
into."[10] But here Dr. Brandner had not entered
into a reciprocal negotiation with Providence for his
hospital privileges; the requirement of abiding by the
hospital's policy to obtain privileges is more akin to a
contract of adhesion.
Providence
cites Whitaker v. Houston County Hospital Authority
to support its proposition that a doctor can waive the
right to a pre-termination hearing and, if waived, the
automatic termination of hospital privileges would not
violate the doctor's due process right.[11] But in
Whitaker the doctor "expressly waive[d] any
procedural due process rights" through a contract
entered into directly with the hospital.[12] Here neither
Providence policy MS 980-150 nor the document Dr. Brandner
signed for his 2009 reinstatement at the hospital
specifically mentioned waiving due process rights. Thus there
is no evidence of a "conspicuous and unequivocal"
intent by Dr. Brandner to waive his right to a
pre-termination hearing. The superior court rejected
Providence's waiver argument, finding "no language
in [Dr. Brandner's application for privileges]
referencing a general right to due process or dealing
specifically with a physician's right to... a
pre-termination hearing in professional review actions."
Like
the superior court, we conclude that Dr. Brandner did not
knowingly and clearly waive his due process rights merely by
signing his reappointment application for hospital
privileges. Thus Dr. Brandner maintained a protected property
interest in his hospital privileges subject to due process if
terminated.
2.
Due process required that Dr. Brandner receive an opportunity
to be heard prior to the termination of his hospital
privileges.
Dr.
Brandner contends that due process requires a hearing before
deprivation of a constitutionally protected property interest
in employment.[13] "We have consistently held that
before the state may deprive a person of a protected property
interest there must be a hearing . . ., "[14] The only
exceptions to this pre-termination hearing requirement are in
emergency situations or when "public health, safety, or
welfare require[s] summary action."[15] Other courts
have agreed that medical staff privileges are a valuable
property interest and that notice and hearing should precede
termination of these privileges absent an "extraordinary
situation where a valid government or medical interest is at
stake."[16]
Providence
argues that Dr. Brandner was not entitled to a
pre-termination hearing because the Providence policy
contains explicit language that a violation of MS 980-150(D)
results in "an automatic termination" and because
of "Providence's compelling interest" in
ensuring patient safety and the highest quality in medical
care. Providence contends that Dr. Brandner received all the
process to which he was entitled because: (1) he had full and
fair opportunity to make his arguments to a neutral hearing
panel; (2) he had full and fair opportunity to appeal the
hearing panel recommendation to a separate, neutral review
committee and to the Providence Board, and both upheld the
hearing panel's decision; and (3) Providence followed the
policies and procedures Dr. Brandner had agreed to abide by.
But Providence's procedures after terminating a
doctor's privileges do not remedy its failure to provide
procedures before termination.
We
previously confirmed the importance of a hearing before
suspending or terminating a doctor's staff privileges
because summary action amounts to "a stigma of medical
incompetence" affecting the doctor's ability to
maintain income and reputation, both during the period
between the deprivation of privileges and a hearing as well
as after the hearing.[17] This stigma is compounded because
federal law now requires that all terminations be reported to
a national data bank.[18] Acknowledging the competing interests
between a doctor's capacity to maintain employment and a
health care entity's interest in maintaining safe and
high quality patient care, we have previously held that
terminating hospital privileges before a hearing is
"justified only where there is evidence that a
physician's conduct poses a realistic or recognizable
threat to patient care which would require immediate action
by the hospital."[19]
Providence
contends that Dr. Brandner's deceitfulness posed a
realistic or recognizable threat to patient care; when a
physician is dishonest and actively conceals licensing
conditions, a hospital cannot address the undisclosed
problems because it "simply does not know what it does
not know" and thus cannot assess whether there might be
a "realistic and recognizable threat" to patient
care. Providence maintains, as a patient safety matter, that
physicians must comply with Providence's self-reporting
policy and that failure to do so is "cause for deep
concern."
Providence
has a policy expressly authorizing an immediately effective
"precautionary suspension" when a doctor presents
an imminent danger to the health or safety of an individual
or to the hospital's orderly operations, but this was not
the policy followed when terminating Dr. Brandner's
privileges.[20] As Pakney noted at the November 2011
hearing, there was no precautionary suspension because there
was no determination that Dr. Brandner was an imminent danger
to health or public safety. The executive committee was aware
that the Menninger Clinic had evaluated Dr. Brandner and
found he was fit to practice. Although this evaluation might
not have considered other factors bearing on whether Dr.
Brandner was an imminent threat to patient care, it is
relevant to whether Providence actually terminated Dr.
Brandner because it found that he posed a threat to patient
care. And the June 17, 2011 letter notifying Dr. Brandner of
the executive committee's recommendation that his
privileges be terminated made no mention of patient safety
concerns.
It is
possible, as Providence argues, that a physician's
dishonesty might in some circumstances be sufficient cause
for emergency termination. But here this speculative
possibility-raised as a post hoc rationalization rather than
a demonstrated contemporaneous concern in Dr. Brandner's
case - does not rise to the level of a "realistic or
recognizable threat" requiring an emergency termination
of hospital privileges. We therefore disagree with the
superior court's determination that the connection
between Dr. Brandner's "dishonesty" and patient
safety was sufficient to override Dr. Brandner's due
process right, and we conclude that Providence violated Dr.
Brandner's right to due process by terminating his
hospital privileges without a pre-termination opportunity to
be heard.
B.
Dr. Brandner's Substantive Due Process Rights Were Not
Violated Through Arbitrary And Capricious Application Of An
Ambiguous Hospital Policy.
Dr.
Brandner further claims that his substantive due process
rights were violated because Providence policy MS 980-150(D)
is vague and ambiguous, and that Providence terminated his
privileges in an arbitrary and capricious manner without
regard to his reasonable policy interpretation or to whether
terminating his hospital privileges was commensurate with the
harm caused by breaching the policy.
Although
we do not interfere with hospital policy determining the
medical training and experience necessary to qualify for
hospital privileges, courts may determine whether a hospital
has followed its own policies and whether a decision
regarding hospital privileges was made in accordance with
basic principles of fairness and due process of
law.[21] These principles require that: (1) the
procedures employed are fair; (2) the standards are
reasonable; and (3) the standards have not been applied in an
arbitrary and capricious manner.[22] Due process further
requires that "criteria established for granting or
denying privileges not be vague and ambiguous, and that as
established, they be applied objectively."[23] "A
statute, rule, or policy may be deemed impermissibly vague
for either of two discrete reasons: It fails to provide
people of ordinary intelligence a reasonable opportunity or
fair notice to understand what conduct it prohibits; or, it
authorizes or encourages arbitrary and discriminatory
enforcement."[24]Accordingly the inquiry before us is not
whose policy interpretation is more reasonable, but whether
the policy itself is so vague or ambiguous that it is
susceptible to an arbitrary and capricious application.
1.
The policy's application was clear.
The
superior court concluded that Providence policy MS 980-150 is
"clear enough." Dr. Brandner nonetheless contends
that he found it ambiguous because its key terms could be
interpreted differently by reference to state law. MS
980-150' s operative provision requires doctors to report
to Providence "any limitations, restrictions, or
conditions of any sort imposed by a state board, health care
entity or agency with respect to the practitioner's
practice." Dr. Brandner argues that state law does not
construe the State Board's order as a "disciplinary
action" or a "condition, " because such
actions would have required that the State Board hold a
hearing and none occurred in his case.[25]Thus Dr.
Brandner argues that under state law his practice was never
limited in any way and that he cannot be faulted for his
interpretation, especially when the State Board investigator
had confirmed in his case's proceedings that his license
"was not conditioned, limited, or restricted by the
[State] Board."
Surviving
a vagueness challenge requires "fair notice" of
what is and what is not prohibited.[26] And here the superior
court found that Dr. Brandner had more than "fair
notice" of what MS 980-150 required; it found he had
actual knowledge that the policy required him to report the
conditions the State Board placed on his license. The
superior court found that Dr. Brandner knew the
self-reporting policy applied to his circumstances and knew
he had an obligation to report the conditions placed on his
license, and thus he knowingly violated the policy. Dr.
Brandner does not ...