Freilich v. Upper Chesapeake Health Systems, Inc.

ADKINS, J. In this case we must determine the relevance of, and how to prove, a hospital’s alleged retaliatory animus in refusing to renew a physician’s privileges on the defendants’ motion for summary judgment based on the Health Care Quality Improvement Act of 1986 (“HCQIA”), 42 U.S.C. §§ 11101-11152 (1994). After Harford Memorial Hospital (“Harford”) declined to renew the privileges of Dr. Linda Freilich, 1 she sued ⁶⁹³ for damages. Harford claimed immunity under HCQIA. 2 The Circuit Court for Harford County granted summary judgment to Harford, and the Court of Special Appeals affirmed. We granted certiorari, Freilich v. Upper Chesapeake Health Sys., Inc., 418 Md. 586 , 16 A.3d 977 (2011), to answer the following question as phrased in the petition: In the context of a summary judgment proceeding is the presumption of HCQIA immunity rebutted upon the showing of material facts in dispute regarding the physician’s reporting of substandard medical care and attempts to improve the quality of care in the hospital system?

We shall affirm the Court of Special Appeals. Although we hold that evidence of retaliatory motive on the part of a disciplinary body is relevant when offered to rebut the presumption of HCQIA immunity, special standards must be met in order for such evidence to defeat summary judgment. Evidence of retaliation will not prevent summary judgment on HCQIA immunity unless it can permit a rational trier of fact to conclude that (1) the defendant failed to comply with the standards for immunity set forth in 42 U.S.C. § 11112 (a) or (2) the action was not a “professional review action” under 42 U.S.C. § 11151 (9). We explain this below as we discuss these sections of HCQIA. ⁶⁹⁴ FACTS AND LEGAL PROCEEDINGS Between 1982 and 1997, Petitioner Dr. Freilich practiced medicine at two hospitals in Harford County: Harford Memorial Hospital (“Harford”) and Fallston General Hospital (“Fallston”).

The hospitals were operated by Upper Chesapeake Health System (“Upper Chesapeake”), a nonprofit corporation. 3 She specialized in internal medicine and nephrology. During her time at the hospitals, Dr. Freilich was the subject of numerous complaints. Although some of the complaints addressed her competence as a physician, most of them alleged unprofessional behavior and violations of ethics rules. At least 35 complaints were filed against Dr. Freilich by doctors and members of the hospital staff, and at least 33 complaints were filed by patients.

Dr. Freilich argues generally that the complaints against her were made in retaliation for her legitimate reporting of substandard medical care and efforts to improve the hospitals. But she offers no evidence of retaliatory motive “in detail and with precision,” as required to fend off summary judgment, 4 with regard to any of the following complaints alleged about her: • Dr. Freilich “told [a] patient he was just fat and go on a diet.” • She told a nurse, “We don’t want you here. Get out. I can make life miserable for you.” • Dr. Freilich told a hospital employee, “Every time I am written up, I will write you up ten times.” • When a nurse wanted to give pain medication to an alcoholic with pancreatitis, Dr. Freilich allegedly said, “I want him to be miserable.

He did this to himself.” ⁶⁹⁵ • She told a patient who smokes, “I hate people who smoke.” • She told a patient, “You are a three-time loser and you will be back.” • She publicly humiliated a patient and then told another patient who had observed the incident that “she could avoid that embarrassment if the patient would stop coming to the emergency room in a drunken stupor.” • She was uncooperative with patients’ requests for transfer. • She was “uncooperative numerous times in notifying families of patient deaths.” • In 1997, patients were surveyed about their satisfaction with their attending emergency room doctor. No other physician had more than one person choose “dissatisfied” or “somewhat dissatisfied,” but Dr. Freilich had nine people (out of 22) choose that option. • Thirty-three patients independently complained to the hospital about Dr. Freilich. • After losing privileges at Fallston, she told a patient at Harford, in a semi-public room, “It’s a good thing you are in here because too many people go out of Fallston in boxes.” The patient was “horrified.” • She told a patient’s daughter “in essence that ICU physicians were trying to kill her mother and that she needed to get to the hospital immediately.” This was apparently because of a disagreement between Dr. Freilich and another doctor about how a certain patient should be treated. The daughter reported this incident to three different people at the hospital. • Dr. Freilich “violated the privacy of a 17 year old admitted to the BHU” by releasing information regarding his admission and positive test results to his parents without first discussing it with the attending psychiatrist. (The MEC Subcommittee believed that she may not have been aware of a law regarding the privacy of emancipated minors and mental health records.) ⁶⁹⁶ • She failed to comply with MEC’s recommendation that she seek counseling and follow a treatment plan (if needed) in 1996, resulting in revocation of her privileges in 1997. • She refused to meet about the concerns and complaints against her. • On the application for renewal of privileges at Harford, she made misrepresentations about her loss of privileges at Fallston.

She incorrectly stated that there “were never any quality concerns” with her work, “no witnesses or corroboration of any unprofessional behavior” on her part and “in fact, the only witness, a patient of [hers], completely supported [her] testimony.” Her excuse for making the misstatement about the witnesses was that she “thought witness means something like the witnesses who sign in a will.” • She documented that she had examined patients and put the documentation in their medical records, but patients denied that she had examined them. • She gave “untruthful testimony” before the hearing committee. In particular: • She prepared a binder full of “thousands” of signatures on a petition for her to keep her privileges. She represented to the hearing committee that the signatures were of her patients when, in fact, she had found people who were not her patients and asked them to sign. • Even though she had met numerous times with the committee at both hospitals to discuss her behavior, she testified under oath, “I was never told my behavior was inappropriate.” • She later admitted to having been told that she had behavioral problems at other institutions where she worked, and when the examiner asked her where exactly, she responded, “I really wasn’t thinking of any other institutions.” When pressed about her previous statement, she said, “I didn’t say that.” ⁶⁹⁷ There were fewer instances, according to evidence from Dr. Freilich, in which complaints were made by persons with a retaliatory motive: • Dr. Freilich refused to allow a patient to die because she believed he was no longer terminal, and she followed the statutory procedure for transfer to another doctor. The result, she says, was that she was written up for “not being cooperative.” • Dr. Freilich complained that the Social Service Department was inefficient and was not performing its job properly.

The retaliation, she says, was a complaint filed against her regarding her interaction with a family on the telephone. • A patient who was abusing diuretics and laxatives, which Dr. Freilich said can be consistent with suicidal intentions, was admitted 30 times to Harford without being referred to a psychiatrist. Dr. Freilich discovered this oversight and immediately transferred her to Fallston for a psychiatric evaluation. The ER personnel were not prepared to receive the patient, and the MEC accused Dr. Freilich of having abandoned the patient. • She complained to Pam Aitken, Program Administrator of the Transitional Care Unit (“TCU”) at Harford, 5 regarding a patient with skin problems. According to Dr. Freilich, Aitken wrote a retaliatory letter to the Medical Director of the TCU, Dr. Suresh Dhanjani, setting forth four complaints against Dr. Freilich: • (1) She failed to provide proper treatment to a patient with a necrotic ulcer because she didn’t know it was necrotic, even though there was documentation in the patient’s record showing that she was indeed aware of the condition. • (2) She told the wife of another doctor’s patient that “her husband was dying,” that the Transitional Care ⁶⁹⁸ Unit was an inappropriate place for him, and that he needed to be placed in long-term care.

She said the same thing to other staff members in the nurse’s station, a “very public place ... accessible by family, patients and other staff, resulting in a violation of confidentiality.” This incident led to a “long conversation with the patient’s wife to ‘calm her down,’ and, indeed it appears that arrangements were already in the works to have the patient go home with appropriate home care.” • (3) She performed a consult on a patient before the order for a consult was obtained from the attending physician. • (4) She spoke about patients while in open areas in which staff and patients could hear, including saying that a certain patient was not an appropriate admission to the rehabilitation unit and would not get better or benefit from being there. • An ongoing conflict existed between Dr. Freilich and Dialysis Management of Maryland (“DMM”). Dr. Freilich states that although her “company submitted the low bid” to perform dialysis services at Upper Chesapeake, “the contract was given to an out of county contractor, Dialysis Management of Maryland which began operations in 1995; however the dialysis services did not improve.” As a result, she “continued to complain about quality issues” on the dialysis unit, and in return received what she called “retaliation ... via sham complaints.” On the record before us, at most five of those complaints were in the record considered by the Board: • She said “get the hell out” to a nurse and that she did not want the nurse or her dialysis machines in Harford County. • She stated in front of a patient that “DMM was at [Fallston] because the bosses were white males and ‘good old boys’ and [Fallston] was a country club where patients were brought in to waste time and fill beds.” ⁶⁹⁹ • She complained about “providing incorrect dosages of Epogen, using incorrect sizes of dialyzers and staffing issues,” which led to sham “quality assurance” evaluations of Dr. Freilich by dialysis nurses. • She admonished “two contracted dialysis nurses” for abandoning a patient on dialysis and nearly causing his death. They filed retaliatory complaints against her, with one of the nurses even admitting that Dr. Freilich was the subject of a “witch hunt.” • A dialysis nurse complained “about several incidents with Dr. Freilich, including confrontations in front of patients, Dr. Freilich trying to persuade her to quit [and] change her testimony.” Petitioner points to nothing in the record to show that these retaliatory-based complaints served as the basis for the Board’s decision. Investigations and Hearings After Fallston suspended Dr. Freilich’s privileges on July 9, 1997, citing “unprofessional behavior,” Harford began investigating her as well. 6 Harford’s Medical Executive Committee (“MEC”) convened a subcommittee on December 18, 1997, to investigate her alleged misconduct in the hospital’s psychiatric unit.

In response, Dr. Freilich voluntarily withdrew from the psychiatric unit but continued practicing in other parts of the hospital. The subcommittee met again on February 19, 1998, and recommended that Dr. Freilich “continue to remain off the [psychiatric unit].” 7 ⁷⁰⁰ Incidentally, Dr. Freilich’s appointment at Harford was scheduled to expire on December 31, 1998, which required her to file an application for reappointment with Upper Chesapeake. As we explain later, Dr. Freilich made several incorrect and misleading statements about her suspension at Fallston. In response to Dr. Freilich’s application, Harford’s Credentials Committee proposed a “conditional one year reappointment” during which she would be monitored for professionalism and behavior issues. 8 The MEC agreed and recommended a one year reappointment.

Fourteen physicians and five non-physicians voted on this recommendation. Ultimate authority, however, rested with Harford’s Board of Directors, which decided to reappoint Dr. Freilich for only four months, during which time “management, legal counsel and the Medical Staff’ were to investigate the complaints against her. The Board was to meet at the conclusion of the four months and decide whether to fully reappoint her. 9 During Dr. Freilich’s conditional four-month reappointment, a committee of seven physicians, chaired by Dr. Barry Wohl, investigated her case. Dr. Freilich met personally with the committee and communicated with Dr. Wohl by letter several times.

The committee met three times during Dr. Freilich’s conditional reappointment. Ultimately, Dr. Wohl’s committee recommended that Dr. Freilich be required to complete a communication course. The MEC, however, disagreed and recommended that the Board simply deny Dr. Freilich’s application for reappointment. 10 The Board adopted the MEC’s recommendation on April 13, 1999, deciding not to reappoint Dr. Freilich. The Board provided her with temporary privileges, however, so ⁷⁰¹ that she could appeal and have a hearing as provided under Harford’s bylaws. 11 At Dr. Freilich’s request, Upper Chesapeake convened an Ad Hoc Hearing Committee (“Hearing Committee”), consisting of four physicians and a hearing officer, to hear her objections to the Board’s decision.

The Hearing Committee met several times between September 30, 1999, and January 11, 2000, listening to testimony from Dr. Freilich, members of Dr. Wohl’s committee, and others. On January 27, 2000, the Hearing Committee unanimously recommended a conditional one-year reappointment, as originally proposed by the Credentials Committee. The Board’s Decision The Board met to consider the Hearing Committee’s recommendation on February 8, 2000. Concluding that Dr. Freilich’s behavior was not “remediable,” the Board voted not to change its decision. 12 The next week, Dr. Freilich formally requested appellate review, as provided under Harford’s bylaws.

Harford’s Appellate Review Committee convened on March 16, 2000, hearing testimony from Dr. Freilich, Dr. Margaret Vaughan on behalf of the hospital, and legal counsel for both parties. The committee consisted of three non-physicians and one physician, who served as chairman. On March 30, the committee issued a report affirming the Board’s decision not to reappoint Dr. Freilich. The report indicated that the primary reason for rejecting the MEC’s recommended year of privileges with monitoring was that Dr. Freilich “lacked personal insight or understanding of the fact that she has caused multiple problems, which is a prerequisite to their remediabili ⁷⁰² ty.” The Board .met on April 11, 2000, and voted to affirm its decision.

The four physician members of the Board abstained from this vote. Lawsuit Dr. Freilich filed a complaint in the Circuit Court for Harford County, naming Upper Chesapeake, the Board, and individual members of the Board as defendants. She alleged breach of contract and misapplication of Harford’s bylaws and sought damages and declaratory and injunctive relief. 13 After a hearing, the Circuit Court granted the defense motion for summary judgment on all counts, based on HCQIA immunity. The Circuit Court reasoned that, “when examined in its totality, the entire one year, nine month multi-step fact finding process satisfies the HCQIA’s standard of objective reasonableness.” Thus, it held that the defendants were “immune from any and all claims for money damages.” 14 The Court of Special Appeals affirmed in an unreported opinion, 15 and Dr. Freilich filed a timely petition for certiorari, on the issue of HCQIA immunity, which we granted. ⁷⁰³ DISCUSSION Congress enacted HCQIA to encourage peer review and monitoring of physicians.

See H.R.Rep. No. 99-903, at 2 (1986), reprinted in 1986 U.S.C.C.A.N. 6287, 6384 (observing that HCQIA’s purpose is to “improve the quality of medical care by encouraging physicians to identify and discipline other physicians who are incompetent or who engage in unprofessional behavior”); Bryan v. Holmes Regional Med. Ctr., 33 F.3d 1318, 1321 (11th Cir.1994) (same). Part of Congress’ strategy was to provide qualified immunity for those who discipline ineffective physicians. 16 See 42 U.S.C. § 11111 (a)(1).

Thus, as we observed fifteen years ago, “HCQIA provides participants in peer review activities with qualified immunity from liability for monetary damages in suits brought by the physicians who were the subjects of these review activities.” Goodwich v. Sinai Hosp., 343 Md. 185, 196-97 , 680 A.2d 1067, 1073 (1996). To qualify for immunity, the disciplinary action must have been a “professional review action” that complied with the standards set forth in 42 U.S.C. § 11112 (a). 17 Those standards are that the action was taken ⁷⁰⁴ (1) in the reasonable belief that the action was in the furtherance of quality health care, (2) after a reasonable effort to obtain the facts of the matter, (3) after adequate notice and hearing procedures are afforded to the physician involved or after such other procedures as are fair to the physician under the circumstances, and (4) in the reasonable belief that the action was warranted by the facts known after such reasonable effort to obtain facts and after meeting the requirement of paragraph (3). 42 U.S.C. § 11112 (a)(l)-(4). The burden on the issue of immunity rests with the plaintiff, as immunity is presumed unless the plaintiff rebuts it “by a preponderance of the evidence.” 42 U.S.C. § 11112 (a) (“A professional review action shall be presumed to have met the ... standards necessary for [immunity] unless the presumption is rebutted by a preponderance of the evidence.”). A number of courts have observed that the presumption of immunity creates an “unusual” standard for summary judgment.

As the U.S. Court of Appeals for the Eleventh Circuit observed, [T]he rebuttable presumption ... creates an unusual summary judgment standard that can best be expressed as ⁷⁰⁵ follows: “Might a reasonable jury, viewing the facts in the best light for [the plaintiff], conclude that he has shown, by a preponderance of the evidence, that the defendants’ actions are outside the scope of § 11112(a)?” If not, the court should grant the defendant’s motion. In a sense, the presumption language in HCQIA means that the plaintiff bears the burden of proving that the peer review process was not reasonable. (Citations omitted.) Bryan, 33 F.3d at 1333 ; see also Gordon v. Lewistown Hosp., 423 F.3d 184, 202 (3d Cir.2005) (holding that HCQIA’s “presumption of immunity creates an unusual standard for reviewing summary judgment orders, as the plaintiff bears the burden of proving that the professional review process was not reasonable and thus did not meet the standard for immunity”). We explained this standard in Goodwich : [T]he proper summary judgment standard in [a HCQIA] case is whether [the plaintiff] produced sufficient evidence of the existence of a genuine dispute as to the material fact of whether [the professional reviewer] was entitled to the qualified immunity prescribed by the HCQIA.

Goodwich, 343 Md. at 207 , 680 A.2d at 1078 . Dr. Freilich claims that she has rebutted the presumption of immunity by presenting evidence that Harford retaliated against her for her reports of substandard care and attempts to improve the quality of care at the hospital. In her words, Appellees are not entitled to HCQIA immunity because they failed to meet the HCQIA immunity requirements. Appellees failed to make a reasonable effort to obtain the facts, they did not act with the reasonable belief that their actions were warranted by the known facts, and they did not act with the reasonable belief that their actions were in furtherance of quality health care.

Appellees’ denial of Dr. Freilich’s hospital privileges was in retaliation of Dr. Freilich’s reporting of substandard care. We understand her argument to be that evidence that some people might have complained about her with a retaliatory motive creates a material question of fact regarding whether ⁷⁰⁶ the hospital’s actions met the standards for immunity set forth in HCQIA. Harford responds that a retaliatory “subjective bad faith whistleblower animus [does not] magically generate[ ] a material fact dispute regarding the Hospital’s entitlement to HCQIA immunity.” Instead, Harford asserts, immunity under HCQIA is determined by an “objective reasonableness standard” entirely unrelated to subjective motivation, retaliatory or otherwise. 18 Although we agree with Harford that the plaintiff bears the burden of showing a material fact dispute, we disagree with its theory that retaliatory animus by the hospital is entirely irrelevant to HCQIA immunity. As our cases indicate, the “objective reasonableness test” looks to the “totality of the circumstances” to determine whether a defendant has met the standards for immunity set forth in HCQIA.

Goodwich, 343 Md. at 208, 213 , 680 A.2d at 1079, 1081 . Therefore, any evidence is relevant if it could lead a rational trier of fact to conclude that the immunity standards were not met. This includes evidence that retaliatory animus prevented the defendant from making “a reasonable effort to obtain the facts” or supplanted the required “reasonable belief’ that the professional review action was “warranted by the facts” and “in the furtherance of quality health care.” See 42 U.S.C. § 11112 (a)(1)-(4). It also includes evidence that the action was “primarily based on ... any ... matter that does not relate to the competence or professional conduct of a physician,” including retaliatory animus, because such an action is not a “professional review action” and therefore cannot qualify for immunity.

See 42 U.S.C. § 11151 (9). Yet Dr. Freilich is incorrect to the extent that she argues her reports of substandard care to the hospital are sufficient, without evidence of retaliation, to rebut the pre ⁷⁰⁷ sumption of immunity. Without any evidence of a connection between a professional review action and its allegedly illegitimate basis, courts cannot presume that one exists. See, e.g., Chalal v. Nw.

Med. Ctr., Inc., 147 F.Supp.2d 1160, 1172 (N.D.Ala.2000) (granting summary judgment because there was “no evidence on record to suggest that the Hospital did not act ‘in the reasonable belief that the action was in the furtherance of quality health care[.]’ ” (quoting 42 U.S.C. 11112(a)(1))); Egan v. Athol Mem. Hosp., 971 F.Supp. 37, 42-43 (D.Mass.1997) (granting summary judgment because the “Plaintiff ... presented no evidence that the professional review action ... was motivated by anything other than a reasonable belief that it would further quality health care”). Thus, retaliatory animus is neither the panacea that Dr. Freilich believes it to be nor entirely irrelevant as Harford maintains.

Instead, evidence of retaliation is simply one of several factors to be considered when determining whether, in the totality of the circumstances, the professional review action satisfied the standards for immunity set forth in HCQIA. We next address the primary cases cited by the parties. Dr. Freilich’s Cases Dr. Freilich asserts that the relevant cases stand for the proposition that “material facts in dispute regarding the reporting of substandard medical care” prevent summary judgment on HCQIA immunity. The two cases upon which she principally relies, however, support our interpretation, not hers.

See Clark v. Columbia/HCA Info. Servs., Inc., 117 Nev. 468 , 25 P.3d 215 (2001); Ritten v. Lapeer Reg'l Med. Ctr., 611 F.Supp.2d 696, 720 (E.D.Mich.2009). Clark held that to overcome the presumption of immunity, the plaintiff must present evidence capable of showing “by a preponderance of the evidence that the [professional review action] was not based on a reasonable belief that it was in furtherance of quality health care.” Clark, 25 P.3d at 222 .

Clark did not hold that a physician’s reporting of substandard medical care, without more, staves off summary judgment against her on the immunity issue. Id. ⁷⁰⁸ In Clark , the plaintiff presented evidence showing that “the reason for his dismissal was his apparently good faith reporting of perceived improper hospital conduct to the appropriate outside agencies, or whistleblowing.” Id. Indeed, in Clark , “the only findings the board made in support of its decision [were] related to Clark’s external reporting.” Id. at 223. Such direct evidence of retaliation could certainly have led a rational trier of fact to conclude that the hospital’s action was not based on the furtherance of quality health care.

Here, on the other hand, there is no evidence that the Board’s decision was based on impermissible factors. Dr. Freilich has produced evidence that some doctors and nurses may have filed sham complaints against her because of her reporting, but she has no evidence that those allegedly sham complaints served as the basis for the Board’s decision. In this regard, we agree with the U.S. Court of Appeals for the Sixth Circuit, which held that “conclusory statements attacking individual items of evidence considered by the reviewers” cannot rebut the presumption of immunity under HCQIA. Meyers v. Columbia/HCA Healthcare Corp., 341 F.3d 461, 469 (6th Cir.2003). 19 Dr. Freilich’s other primary case, Ritten , is readily distinguishable as well.

The plaintiff in Ritten had direct evidence of retaliation sufficient to permit a rational trier of fact to conclude that the hospital “did not make [its] decision ‘in the ⁷⁰⁹ reasonable belief that the action was in furtherance of quality health caret.]’ ” Ritten, 611 F.Supp.2d at 720 . As the court observed, [T]he record here features direct evidence of retaliation.... According to Plaintiff, [his supervisor] told him that ‘if you don’t transfer that patient out of here, you may lose your job.’ Roughly three weeks later, [the supervisor] summarily suspended Plaintiffs staff privileges ... thereby terminating his ability to practice at this hospital. (Citations omitted.) Id. at 716-17 .

Here, Dr. Freilich has no such evidence. In short, the cases cited by Dr. Freilich do not support her argument that any evidence of retaliatory complaints is sufficient to rebut the presumption of immunity. Rather, those cases are consistent with our holding that the presumption of immunity is not rebutted unless the plaintiff produces evidence that could lead a rational trier of fact to conclude, in the totality of the circumstances, that the professional review action did not meet the four-part test for immunity set forth in HCQIA. 20 This requires that she prove retaliation by the hospital in making its decision. Harford’s Reliance on Goodwich As we indicated earlier, we do not adopt Harford’s proposed ban on retaliatory motivation evidence.

Harford relies primarily on Goodwich to support its thesis that a hospital’s motivation is irrelevant under HCQIA. It quotes a portion of that case in which we observed: Even if the second opinion requirement was initiated out of fear of litigation, rather than patient care concerns, neither evidence of that fact nor the inferences from such evidence rebuts the presumption of reasonableness the [professional review] action enjoys. This evidence may support an inference of bad faith on [the hospital’s] part; however, as we have already pointed out, what is relevant here is the ⁷¹⁰ objective reasonableness of the hospital’s actions, not its subjective intent or motivation. Goodwich, 343 Md. at 208 , 680 A.2d at 1079 .

Although this