THE LAW OF HEALTHCARE ADMINISTRATION FIFTH EDITION pdf

e Law of Healthcare Administration Fifth Edition J. Stuart Showalter Showalter e Law of Healthcare Administration Fifth Edition Health Law for Healthcare Managers Now in its fifth edition, The Law of Healthcare Administration continues to examine the legal aspects of healthcare from a management perspective. Using plain language, the book is a comprehensive treatment of health law in the United States, addressing topics from the basic structure of the court system to the general legal responsibilities of healthcare organizations to the specific liabilities inherent in the provision of care. Legal concepts in the book are supported by examples from actual court decisions. This edition features: • Discussionofrecentlegaldevelopmentsinhigh-proleareassuchas  HIPAA,abortion,andwithholdinglife-sustainingtreatment • Revisiontothecorporate-compliancechapterthatbetteremphasizes fraud and abuse issues • Additionofsidebarsthatprovideextrainformation,real-life examples, and interesting insights about the concepts explored • Inclusionofobjectives,summaries,anddiscussionquestionsto highlight important points in each chapter • IntroductionofaGlossaryandSuggestedReadingstosupplement understanding and to encourage further learning About the Author J. Stuart Showalter,J.D.,M.F.S.,hasspentmostofhiscareerdealingwith healthlawissues.From1972through1980,heservedintheU.S.Navyin variouspositions,includingasin-housecounsel,malpractice-claimsdefense attorney,andcounseltotheU.S.NavySurgeonGeneral.From1980to1996, Mr.Showalterwasvicepresidentandin-housecounseltotheCatholicHealth Association of the United States. In addition, he has been a hospital system’s director of compliance and a law professor. THE LAW OF HEALTHCARE ADMINISTRATION FIFTH EDITION THE LAW OF HEALTHCARE ADMINISTRATION FIFTH EDITION J. Stuart Showalter Your board, staff, or clients may also benefit from this book’s insight. For more informa- t ion on quantity discounts, contact the Health Administration Press Marketing Manager at (312) 424–9470. T his publication is intended to provide accurate and authoritative information in regard to the subject matter covered. It is sold, or otherwise provided, with the understanding that the publisher is not engaged in rendering professional services. If professional advice o r other expert assistance is required, the services of a competent professional should be sought. The statements and opinions contained in this book are strictly those of the author(s) and do not represent the official positions of the American College of Healthcare Executives or of the Foundation of the American College of Healthcare Executives. Copyright © 2008 by the Foundation of the American College of Healthcare Executives. Printed in the United States of America. All rights reserved. This book or parts thereof may not be reproduced in any form without written permission of the publisher. 13 12 11 10 09 5 4 3 2 1 LLiibbrraarryy ooff CCoonnggrreessss CCaattaallooggiinngg iinn PPuubblliiccaattiioonn DDaattaa Showalter, J. Stuart. The law of healthcare administration / J. Stuart Showalter. —5th ed. p. cm. Includes index. ISBN 978-1-56793-957-6 (alk. paper) 1. Medical care—Law and legislation—United States. 2. Hospitals—Law and legis- lation—United States. 3. Medical laws and legislation—United States. I. Title. KF3825.S65 2007 344.7303'21—dc22 2007015059 The paper used in this publication meets the minimum requirements of American National Standard for Information Sciences—Permanence of Paper for Printed Library Materials, ANSI Z39.48-1984. ∞ Acquisitions editor: Janet Davis; Project manager: Jane Calayag; Cover designer and layout editor: Chris Underdown Health Administration Press A division of the Foundation of the American College of Healthcare Executives One North Franklin Street Suite 1700 Chicago, IL 60606 (312) 424–2800 BRIEF CONTENTS Preface 1. THE ANGLO-AMERICAN LEGAL SYSTEM 2. CONTRACTS AND INTENTIONAL TORTS 3. NEGLIGENCE 4. THE ORGANIZATION AND MANAGEMENT OF A CORPORATE HEALTHCARE INSTITUTION 5. LIABILITY OF THE HEALTHCARE INSTITUTION 6. ADMISSION AND DISCHARGE 7. MEDICAL STAFF APPOINTMENTS AND PRIVILEGES 8. EMERGENCY CARE 9. CONSENT FOR TREATMENT AND WITHHOLDING CONSENT 10. TAXATION OF HEALTHCARE INSTITUTIONS 11. ANTITRUST LAW 12. FRAUD, ABUSE, AND CORPORATE COMPLIANCE PROGRAMS 13. ISSUES OF REPRODUCTION 14. HEALTH INFORMATION MANAGEMENT Glossary Suggested Readings Case Index Index About the Author xi 1 23 47 89 127 159 187 221 243 293 319 357 385 423 471 477 479 497 511 The Law of Healthcare Administration vi DETAILED CONTENTS Preface 1. THE ANGLO-AMERICAN LEGAL SYSTEM Sources of Law The Court System Legal Procedure The Court Decides Jackson v. Metropolitan Edison Co. Planned Parenthood of S.E. Pennsylvania v. Casey 2. CONTRACTS AND INTENTIONAL TORTS Elements of a Contract The Physician–Patient Relationship Liability for Breach of Contract Liability for Breach of Warranty Liability for Intentional Tort The Court Decides Stowers v. Wolodzko 3. NEGLIGENCE Standard of Care Proving the Standard of Care and Breach of the Standard Injury and Causation Defenses Liability for Acts of Others: Vicarious Liability Distinctions Among Causes of Action Countersuits by Physicians Reforming the Tort System Alternatives to the Tort System xi 1 3 8 14 20 20 22 23 24 25 33 33 35 44 44 47 47 53 60 62 67 68 71 72 73 The Court Decides Helling v. Carey Perin v. Hayne 4. THE ORGANIZATION AND MANAGEMENT OF A CORPORATE HEALTHCARE INSTITUTION Formation and Nature of a Corporation The Governing Board of a Healthcare Institution Responsibilities of Management The Independent Hospital and Reasons for Change Piercing the Corporate Veil Alternative Strategies: Sale, Consolidation, and Merger Joint Ventures with Physicians The Court Decides Charlotte Hungerford Hospital v. Attorney General Stern v. Lucy Webb Hayes National Training School for Deaconesses and Missionaries Woodyard, Insurance Commissioner v. Arkansas Diversified Insurance Co. 5. LIABILITY OF THE HEALTHCARE INSTITUTION Respondeat Superior Versus Independent Contractor Status Erosion of Independent Contractor Status Doctrine of Apparent Agency Erosion of Captain-of-the-Ship and Borrowed-Servant Doctrines Doctrine of Corporate Liability The Court Decides Norton v. Argonaut Insurance Co. Johnson v. Misericordia Community Hospital 6. ADMISSION AND DISCHARGE Access to Healthcare and Voluntary Admission Admission and Treatment of Mentally Ill Patients Discharge from the Hospital Utilization Review, Peer-Review Organizations, and Managed Care vii Detailed Contents 83 83 84 89 90 97 104 105 109 111 112 120 120 121 125 127 128 130 132 134 136 149 149 153 159 159 167 171 175 The Court Decides Hill v. Ohio County 7. MEDICAL STAFF APPOINTMENTS AND PRIVILEGES Duty to Use Reasonable Care in Appointment of Medical Staff Due Process and Equal Protection Requirements Standards for Medical Staff Appointments Discipline of Professional Staff Exclusive Contracts with Physicians Economic Credentialing Peer Review of Professional Practice The Court Decides Moore v. Board of Trustees of Carson–Tahoe Hospital. Leach v. Jefferson Parish Hospital District No. 2 8. EMERGENCY CARE Necessity for Emergency Care Facilities Duty to Treat and Aid Duty to Exercise Reasonable Care Staffing the Emergency Department Good Samaritan Statutes 9. CONSENT FOR TREATMENT AND WITHHOLDING CONSENT Types of Consent and Recommended Procedures The Healthcare Institution’s Role in Consent Cases How “Informed” Must Informed Consent Be? Consent of a Spouse or Relative Refusal of the Patient to Consent Consent for Treatment of Incompetent Adults Consent and Refusal of Treatment for Minors The Court Decides Cobbs v. Grant Bush v. Schiavo 10. TAXATION OF HEALTHCARE INSTITUTIONS Nature of a Charitable Corporation Detailed Contents viii 184 184 187 188 190 192 196 202 204 206 216 216 217 221 222 222 232 235 237 243 244 249 250 255 256 260 269 286 286 291 293 293 Detailed Contents i x Federal Tax Issues State Taxation of Real Estate The Court Decides Utah County v. Intermountain Health Care, Inc. Greater Anchorage Area Borough v. Sisters of Charity Barnes Hospital v. Collector of Revenue 11. ANTITRUST LAW The Sherman Act The Clayton Act The Federal Trade Commission Act Interstate Commerce Exemptions from Antitrust Legislation Sanctions and Enforcement of Antitrust Statutes Rule-of-Reason Analysis and Per Se Violations Applications to Healthcare Other Considerations The Court Decides Copperweld Corp. v. Independence Tube Corp. 12. FRAUD, ABUSE, AND CORPORATE COMPLIANCE PROGRAMS Enforcement Climate False Claims Act Antikickback Statute “Stark” Self-Referral Laws Corporate Compliance Programs The Court Decides United States v. Greber United States v. McClatchey 13. ISSUES OF REPRODUCTION Abortion Sterilization Hospital’s Role in Reproductive Issues Wrongful Birth and Wrongful Life 296 302 310 310 315 316 319 319 322 325 325 326 332 333 334 343 350 350 357 358 360 365 369 373 380 380 382 385 386 396 401 403 [...]... prevented uniformity in the administration of the law of the state And finally, the Court concluded: Except in matters governed by the Federal Constitution or by acts of Congress, the law to be applied in any case is the law of the state And whether the law of the state shall be declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern There is no federal... earlier, the judge also has the power to take the case away from the jury by means of a directed verdict or a judgment notwithstanding the verdict The role of the jury is thus limited to deciding the facts and determining whether the plaintiff has proved the allegations by a preponderance of the evidence Because the jury’s role is to decide the facts, it is of utmost importance that the members of the jury... that of the State for purposes of the Fourteenth Amendment Nor does the fact that the regulation is extensive and detailed, as in the case of most public utilities, do so [T]he inquiry must be whether there is a sufficiently close nexus between the State and the challenged action of the regulated entity so that the action of the latter may be fairly treated as that of the State itself The true nature of. .. federal court as a matter of “general law. ” At issue here was the interpretation of a section of the Federal Judiciary Act, which states: The laws of the several States, except where the Constitution, treaties, or statutes of the United States otherwise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply.4 C h a... Substantive law is the type of law that creates and defines rights and duties Most of this book is devoted to the substantive law as it relates to healthcare providers Procedural law, as the name implies, provides the specific processes for enforcing and protecting rights granted by the substantive law The branch of procedural law discussed in this section is the law relating to trial of a case Commencement of. .. courts reverse the order of the names when the case is appealed (see Figure 1.4) The appellate court limits itself to a review of the law applied in the case; it will accept the facts as determined by the trier of fact In its review, the appellate court may affirm the trial court decision, modify or reverse the decision, or reverse it and remand the case for a new trial The final stage of the litigation... subject of a separate statute Whatever the source of the rules, it is generally agreed that the rules are designed to help one ascertain the intent of the legislature For example, common rules of construction include the following: 6 The Law of Healthcare Administration 1 to interpret a statute’s meaning consistent with the intent of the legislature; 2 to interpret it to give effect to all of its provisions;... earlier editions and/or their review of the manuscript of this edition Among these people are David V Kraus at the University of California San Diego Medical Center; Pre f a c e Clifford Mills of Seattle, Washington; Jeffrey Poster of Arlington, Texas; and Tadd Pullin of Houston, Texas I also want to thank the staff of Health Administration Press for their patience and professional support during the long... rights enjoyed under the unwritten “general law vary according to whether enforcement was sought in the state or in the federal court; and the privilege of selecting the court in which the right should be determined was conferred upon the noncitizen Thus the doctrine rendered impossible equal protection of the law In attempting to promote uniformity of law throughout the United States, the doctrine had... volume 1 of the “second series,” for example C h a p t e r 1 : T h e A n g l o - A m e r i c a n Le g a l Sy s t e m Chapter Discussion Questions 1 What are the four sources of law in the United States? 2 Describe the three branches of government and the role of each, including the system of checks and balances 3 What is the hierarchy among the sources of law in the federal government? 4 What is the system . a hospital system’s director of compliance and a law professor. THE LAW OF HEALTHCARE ADMINISTRATION FIFTH EDITION THE LAW OF HEALTHCARE ADMINISTRATION FIFTH EDITION J. Stuart Showalter Your. e Law of Healthcare Administration Fifth Edition J. Stuart Showalter Showalter e Law of Healthcare Administration Fifth Edition Health Law for Healthcare Managers Now in its fifth edition, . Executives or of the Foundation of the American College of Healthcare Executives. Copyright © 2008 by the Foundation of the American College of Healthcare Executives. Printed in the United States of America.