Introduction to Health Care Law

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Introduction to Health Care Law

• Professor Edward P. RichardsLSU Law
  Centerhttp//biotech.law.lsu.edu/

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Key Issues

• Scientific medicine is about 120 years old
• Technology based medicine is less than 60 years
  old
• Doctors are not scientists and many do not
  practice scientific medicine.
• There is no stable model for medical businesses,
  leading to constant change and unending legal
  problems.
• Health care finance shapes medical care and is a
  huge mess

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Critical Dates in Medicine
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1400s

• Birth of Hospitals
• Places where nuns took care of the dying
• No medical care against the Churchs teachings
• No sanitation assured you would die

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Early 16th Century

• Paracelsus
• Transition From Alchemy

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Mid 16th Century

• Andreas Vesalius
• Accurate Anatomy

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Early 17th Century

• William Harvey
• Blood Circulation the body is dynamic, not
  static

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1800

• Edward Jenner
• Smallpox and the notion of vaccination

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1846

• William Morton - Ether Anesthesia

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1849

• Semmelweis
• Childbed Fever and sanitation
• Controlled Studies

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1854

• John Snow
• Proved Cholera Is Waterborne
• Basis of the public sanitation movement

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1860-1880s

• Louis Pasteur
• Scientific Method
• Simple Germ Theory
• Vaccination For Rabies
• Pasteurization to kill bacteria in milk

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1867-1880

• Joseph Lister
• Antisepsis surgeons should wash their hands and
  everything else, then use disinfectants
• Listerine

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1880s

• Koch
• Modern Germ Theory
• Organic Chemistry
• Birth of the modern drug business
• The real starting point for scientific medicine

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1850s - 1900s

• Sanitation Movement - Modern Public Health

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Schools of Practice - Pre-Science (1800s)

• Allopathy
• Opposite Actions
• Toxic and Nasty
• Homeopathy
• Same Action as the Disease Symptoms
• Tiny Doses
• Less Dangerous
• Naturopaths, Chiropractors, Osteopaths, and
  Several Other Schools

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Most Medical Schools are Diploma Mills

• No Bar to Entry to Profession
• Small Number of Urban Physicians are Rich
• Most Physicians are Poor
• Cannot Make Capital Investments
• Training
• Medical Equipment and Staff
• Physicians Push for State Regulation to create a
  monopoly

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Legal Consequences

• No Testimony Across Schools of Practice
• Different from Medical Specialties
• Surgery, Internal Medicine, Pediatrics
• All Same School of Practice - Allopathy
• All Same License
• Cross-Specialty Testimony Allowed
• Still important with the rise of
  alternative/quack medicine

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Transition to Modern Medicine and Surgery
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Surgery Starts to Work in the 1880s

• Surgery Can Be Precise - Anesthesia
• Patients Do Not Get Infected - Antisepsis

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Licensing and Education

• Once there are objective differences (people
  live) between qualified and unqualified docs,
  people care
• You can make more money with better training
• You can make more money with better equipment and
  facilities
• Licensing starts to make sense when there is a
  reason to differentiate between practitioners

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The Business of Medicine

• Mid to Late 1800s
• Physicians are Solo Practitioners
• Most Make Little Money
• Have Limited Respect
• Effective Medicine Drives Licensing
• Licensing Limits Competition
• Physicians Start to Make Money

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Hospital-Based Medicine

• Started With Surgery
• Medical Laboratories
• Bacteriology
• Microanatomy
• Radiology
• Services and Sanitation Attract Patients
• Internal Medicine
• Obstetrics Patients

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The Tipping Point

• About 1910, going to the doctor and particularly
  the hospital shifted from being more dangerous
  than avoiding them to increasing your chance of
  survival.

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Corporate Practice of Medicine - 1920s

• Physicians Working for Non-physicians
• Concerns About Professional Judgment
• Cases From 1920 Read Like the Headlines
• Banned In Most States
• Real Concern Was Laymen Making Money off
  Physicians

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Physician Practices

• Shaped by Corporate Practice Laws
• Sole Proprietorships
• Partnerships
• Mostly Small
• Some Large Groups
• First Organized As Partnerships
• Then As Professional Corporations

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Impact of Corporate Bans

• Physicians Do Not Work for Non-Governmental
  Hospitals
• Contracts Governed by Medical Staff Bylaws
• Sham of Buying Practices
• Physicians Contract With Most Institutions
• Charade of Captive Physician Groups
• Managed Care Companies Contact With Group
• Group Enforces Managed Care Companys Rules
• Physicians Can Be As Ruthless As Anyone

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Post WW II Technology

• Ventilators (Polio)
• Electronic Monitors
• Intensive Care
• Hospitals Shift From Hotel Services to Technology
  Oriented Nursing

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Post World War II Medicine

• Conquering Microbial Diseases
• Vaccines
• Antibiotics
• Chronic Diseases
• Better Drugs
• Better Studies
• Childhood Leukemia

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The Evolution of Hospitals

• From Nuns to MBAs

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Old Days

• Charitable Immunity
• No Independent Liability for Nurses
• No Liability for Physician malpractice

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Reformation of Hospitals

• Paralleled Changes in the Medical Profession
• Began in the 1880s
• Shift From Religious to Secular
• Began in the Midwest and West
• Not As Many Established Religious Hospitals
• Today, Religious Orders Still Control A Majority
  of Hospitals

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After Professionalization

• Demise of Charitable Immunity
• Liability for Nursing Staff
• Negligent Selection and Retention Liability for
  Medical Staff

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Hospital Staff Privileges

• Physicians are Independent Contractors
• Hospitals Are Not Vicariously Liable for
  Independent Contractor Physicians
• Hospitals Are Liable for Negligent Credentialing
  and Negligent Retention
• Hospitals Can Be Liable if the Physician is an
  Ostensible Agent

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Joint Commission on Accreditation of Hospitals

• 1950s
• Now Joint Commission on Accreditation of Health
  Care Organizations
• American College of Surgeons and American
  Hospital Association
• Split The Power In Hospitals
• Medical Staff Controls Medical Staff
• Administrators Control Everything Else
• Enforced By Accreditation

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Contemporary Hospital Organization

• Classic Corporate Organizations
• CEO
• Board of Trustees Has Final Authority
• Part of Conglomerate
• Medical Staff Committees
• Tied To Corporation by Bylaws
• Headed by Medical Director
• Constant Conflict of Interest/Antitrust Issues

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Medical Staff Bylaws

• Contract Between Physicians and Hospital
• Not Like the Bylaws of a Business
• Selection Criteria
• Contractual Due Process For Termination
• Negotiated Between Medical Staff and Hospital
  Board

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Hospital Economics

• Old Days
• More Patients Meant More Money
• More Docs to Admit Patients
• Insurance Was So Generous It Cross-subsidized
  Indigent Care
• Now
• Hospital beds were closed to save money
• Insurance and Government Pay is Very Limited - No
  Cross-Subsidy
• Under-Insured or Over-Cared-For Patients Cost
  Money

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Specialty Hospitals

• Complex care is safer when regionalized
• Specialty hospitals can provide better care at
  lower prices
• Do not need to provide money losing services
• Do not take uninsured patients
• Shift the most valuable patients from community
  hospitals
• Dramatically increase unnecessary surgery

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Managed Care Pressures on Docs

• When is Denying Care Cheaper?
• What is the Timeframe Issue?
• Insurers Now Control the Patients
• Employee Model
• Contractor Model
• De-selection
• Financial Death
• No Due Process