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Medical Practice: Vicarious Liability

VICARIOUS LIABILITY: POTENTIAL IMPLICATIONS FOR YOUR MEDICAL PRACTICE

Presented to California Radiological Society, September 18, 2005

by

Martin P. Weniz, Esq.
Law Offices of Martin P. Weniz
11755 Wilshire Boulevard, Suite 1300
Los Angeles, CA 90025
Tel. 310 268-5555
Fax. 310 268-5557
marty@wenizlaw.com

Physicians may be liable for committing their own negligent acts. They may also be liable for negligent acts committed by others. When the negligence of one person is imputed or placed upon another, the other person is set to be vicariously liable.

The most common type of vicarious liability is known as respondat superior, the term which means “let the superior respond.” Typically, this is an employer-employee relationship. It may also apply to a relationship between a physician and a nurse.

Respondiat supeior is based on a premise that all persons are responsible for the consequences of both their own actions and the actions of those persons for whom they are answerable.

Historically, vicarious liability did not apply to a relationship between hospitals and the doctors who work within the hospital. Slowly this concept has eroded. Courts initially limited the vicarious liability of hospitals to negligent acts committed only by physicians and nursing staff employed by the hospital. Hospitals were not  considered responsible for actions of non-employed medical staff or hospital-based physicians, who were considered independent contractors.

More recently, Courts in various states have started a trend that has imposed upon hospitals vicarious liability for the acts, the negligent acts of independently contracting physicians. This extension of hospital liability to hospital-based radiologist has significant ramifications for radiologic practice.

Reasoning that hospitals have encouraged the public to believe that hospital-based physicians such as radiologist, pathologist, anesthesiologist, and emergency department physicians are hospital employees or agents, even if these physicians are, technically, independent contractors, Courts have generally set forth two factors that are relevant in determining whether a hospital is liable for negligent acts committed by these physicians. These factors are whether the patient looks to the institution, rather than to the individual physician, for medical care, and whether the hospital told holds out that the physician is its employee.

In effect, the Courts were sustaining that hospitals held certain duties that are so fundamentally important that they cannot be delegated to others. These non-delegable duties are so important to society that no entity should be permitted to escape liability by transferring responsibility to another.

Why should radiologists be concerned about whether Courts impose upon hospitals vicarious liability for independently contracting physicians? If radiologist are sole employees of the hospital in which they practice, the additional burden of vicarious liability will probably little, if any, effect, because employers are clearly legally responsible for actions of their employees.

If radiologists are practicing and billing separately from the hospitals from which they practiced, Court expansion of vicarious liability may have significant ramifications. Hospital management is given legal responsibility for actions of radiologist practicing within the facility and may well want to increase the control exerted upon those radiologists.

The Joint Commission on Accreditation of Health Organizations (JCAHO) has for many years imposed requirements on hospitals to ensure the quality of hospital services such as the diagnostic radiology, nuclear medicine, and radiation oncology. Couple with the trend of the Courts to enforce liability on hospitals, provide hospitals for a persuasive argument to exercise tighter control in maintaining the quality of these services rather than to delegate responsibility to their independently contracting radiologists.

Summary

What impacts will the concept of ostensible agency on the hospital-based radiologists?

  • Hospital-based none salary radiologists who bill independently can minimized the likelihood of being consider legal agents of the hospital in which they practice by informing their patients in a diplomatic but none-threatening manner that they are not hospital employees. One way in this can be done is by placing signs in strategic locations throughout the Radiology Department that indicate that radiologists are in private fee-for-service practice and by including similar information on billing forms.
  •  Hospital-based none salary radiologists who don’t independently and are questioned by colleagues on their medical staff, other hospital employees, will patience as to whether they are hospital employees should stay clearly and firmly that they are not. Radiologist should not misrepresent their status or otherwise mislead in any way patients or other physicians of their actual professional and financial relationship to the hospital.
  • Hospital-based none salary radiologists practicing in states that have ruled that hospitals are vicariously liable for negligent acts and independent contracting physicians should not be surprised if hospital management attempts to institute tighter controls on the manner in which they practice. In many cases the concerns expressed by hospital management may be legitimate, and radiologists must deal with these issues realistically. Radiologists should seek legal advise from their own attorneys concerning these issues.

Apparent Agency

Under the doctrine of apparent agency, a principal may held liable for the conduct of an independent contractor if the principal conducts its business in such a way as to give the impression to others that the contractor is acting on the principal’s behalf. Most States have applied this rule to hold hospitals liable for negligence of independent contractor-physicians. California applied this rule in the case of Mejia v. Community Hospital of San Bernardino.

A hospital may be held liable under the doctrine of apparent agency for the negligence of independent medical practitioners practicing in the hospital if it holds itself out to the public as a provider of medical services and in absence of notice and knowledge to the contrary, the patient looks to the hospital, as opposed to the individual practitioner to provide competent medical care. Unless the patient merely viewed the hospital as the place where her physician would treat her, she had a right to assume and expect that the treatment was being rendered through hospital employees and that any negligence associated therewith would render the hospital liable. Clark v. South View Hospital.

Courts have not ruled out the possibility that hospitals can avoid liability by notifying the patient that the physicians treating the patient are independent contractors. Commonly, hospital admission forms contain provisions which state that the physicians working within the hospital are independent contractors. Most instances these provisions will be upheld, unless it is difficult or impossible for the patient to have received such notice, as in the case where patient is brought into an emergency room comatose.

More recently, the California Court of Appeals held that a hospital could be held vicariously liable for the negligence of a non-employee radiologist. In the California case, a woman went to the emergency room after hearing something poop in her neck. X-rays were taken and reported as normal by an independent contractor radiologist. As a result, patient was discharged home. After experiencing continuing problems, the plaintiff went to a different hospital were she was diagnosed with a fracture neck.

The plaintiff sued the hospital, the radiologist, and the emergency room physician. The trial court dismissed the plaintiff’s vicarious liability claims against the hospital at closed of her case. The jury concluded that the radiologist was negligent and that the emergency room physician was not. On appeal, the Court of Appeal reversed the trial judge’s dismissal of the plaintiff’s claim that the hospital was vicariously liable for the radiologist’s negligence.

After surveying the case law from other states, the Court observed that overwhelming majority of jurisdictions employed ostensible or apparent agency to impose liability on hospitals for the negligence of independent contractors physicians. Summarizing the requirements employed by the other states, the California Court, wrote that the hospital must hold itself out to the public as a provider of health care and the plaintiff must have looked at the hospital for services, rather than any particular physician. The Court continued on to explain that “there is really only one relevant factual issue” whether the patient had reason to know that the physician was not an agent of the hospital. This is so, according to the Court, because hospitals are generally deemed to have held themselves out as a provider of services unless they gave the patient contrary notice, and the patient is generally presumed to have looked at the hospital for care unless he or she was treated by his or her personal physician. Thus, unless the patient had some reason to know of the truly true relationship between the hospital and the physician-i.e., because the hospital gave the patient actual notice or because the patient was treated by his or her personal physician-ostensible agency is rarely inferred.

The Court admitted that “it appears difficult if not impossible for the hospital to ever obtain a non-suit base on the lack of ostensible agency” because all the patient needs to show is that he or she sought treatment of the hospital. Unless, the evidence conclusively indicates that the patient should have known that the treating physician was not the hospital’s agent, such as when the patient is treated by his or her own personal physician, the issue of ostensible agency must be left to the trier fact.

None Delegable Duty