1. What type of business association do health care institutions frequently elect, and please identify at least two legal reasons for their selecting this business model?2. What are the committees that a hospital governing board oversees (Remember, hospitals support two major governance frameworks administration and medical staff)?


1.     What type of business association do health care institutions frequently elect, and please identify at least two legal reasons for their selecting this business model?

2.     What are the committees that a hospital governing board oversees (Remember, hospitals support two major governance frameworks administration and medical staff)?

3.     What is credentialing and how does the process apply to a hospital’s medical staff?

4.     What is vicarious liability and how might ostensible agency and respondeat superior apply in hospital setting?

5.     What are legal theories of liability for hospital corporation negligence?

Current Event Commentary (< 300 Words): Please read the following blog piece by Alex Stein, ‘CAVEAT HOSPITIA: Suits Alleging Negligent Credentialing Against Hospitals Get Exemption from Tort Reform,’ Bill of Health, Harvard Law, 10 June 2017, http://blogs.harvard.edu/billofhealth/2017/06/10/caveat-hospitia-suits-alleging-negligent-credentialing-against-hospitals-get-exemption-from-tort-reform/.  The author discusses the legal implications of a 2016 LA case: Billeaudeau v. Opelousas General Hospital Authority, — So.3d —-, 2016 WL 6123862 (La. 2016). This article’s title is a pun on the commercial law doctrine known as caveat emptor or “let the buyer beware.” Caveat emptor is a legal doctrine in commercial transactions that places the onus on a willing buyer to reasonably inspect and take responsibility for existing conditions, especially defects. It applies especially to items not covered by a warranty.

The article’s author discusses the implications of the case’s decision on LA hospitals and their credentialing decisions, especially decisions that result in the hiring of an incompetent healthcare providers who deliver negligent, harmful care. The court’s decision affects the legal application of the damage cap limits in LA’s medical malpractice reform statute. The LA medical malpractice statute is like many medical malpractice reform statutes, including Texas’s CPRC Chap. 4, provides a range of protections to healthcare providers as a way to limit their liability exposures. These statutes often contain damage caps or limits on the monetary awards. Damage caps often contain complicated formulas meant to cap awards. Many public interest and advocacy groups challenge them using the premise cap restrictions limit constitutional access to open courts (not gaining legal traction in most states).

The court’s decision impacts the liability of La hospitals who fail to investigate and detect unsafe healthcare providers they admit their medical staffs could face greater damage awards in negligent credentialing and negligent hiring, especially if the employ their healthcare providers. Why? The court ruled these cases sound in ordinary negligence rather than medical malpractice. Contrast this ruling with Texas Ebola cases, where the courts ruled business damage claims, as pleaded, became healthcare liability claims. Go to Carl L. Ricciardi, ‘Criminal and Civil Liability: A Risk for Healthcare Administrators,’ Becker’s Hospital Review, 15 Nov. 2015, https://www.beckershospitalreview.com/hospital-management-administration/criminal-and-civil-liability-a-risk-for-healthcare-administrators.html. What these pieces show is hospital administrators may be seeing more, not less liability, based on their administrative duties. In cases of credentialing and privileging of a hospital’s staff, members of its administration (e.g. members of an executive board and a credentialing committee)  are making judgments on the information before them. Another reality is these members may have direct control over their decisions, but they may not have direct control of the day-to-day actions of their employees or medical staff members. Under the law, administrative members may become responsible for a variety of wrongful and criminal acts committed by their workforce members.

As future administrator’s, do you agree or disagree with the legal principles and doctrines, such as ostensible agency and respondeat superior or vicarious liability, should serve as legal mechanisms to extend liability from a tortfeasor to  a hospital and its administration?Based on readings in modules 2 and 3, should hospital administrators, as principals for their hospitals, enjoy a legal shield from liability caused by its healthcare professionals, as their agents? Recall from your readings that a healthcare enterprise hires a variety of workers. Hires become either employees or independent contractors based on their contractual arrangements and job duties. Reality is the status of a worker also impacts a hospital’s exposure for liability, where a hospital, as an enterprise, may be more vulnerable to legal claims arising from the acts of its employees than its independent contractors. So, there are legal considerations a hospital must consider when it brings a new member into its work force, and thus principles of contracting matter. Does the threat of personal and/or enterprise liability actually achieve the goals of tort and criminal law by encouraging health care administrators to exercise due diligence and oversight of their hospital and its workforce?

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