Bill Summary: S.B. 150 – Negligent Credentialing (Adams)

Final update: S.B. 150 was passed by the legislature.

S.B. 150, Negligent Credentialing
Sponsor: Sen. J. Stuart Adams

This bill is short and sweet and probably won’t get a lot of coverage, but it has an interesting origin that I wanted to take the opportunity to comment on. This bill is designed to overrule the Utah Supreme Court’s recent opinion in the case of Archuleta v. St. Marks Hospital, 2010 UT 36, 238 P.2d 1044.

First, let me step back a little bit and explain what a cause of action for negligent credentialing is. When a healthcare provider (such as a hospital) authorizes a doctor to use its facilities, it “credentials” that doctor and arguably makes a representation to its patrons about that physician’s competency to practice medicine. A claim for negligent credentialing is a claim brought by an injured person who argues that the hospital is partially responsible for his injuries – not because the hospital or its employees did anything to directly hurt the person, but because the hospital negligently allowed an incompetent doctor to practice using its facilities.

In the Archuleta v. St. Marks Hospital case, the plaintiff was treated by a doctor credentialed by St. Marks Hospital. Her treatment did not go well, and she suffered severe physical injuries as a result. The plaintiff sued the hospital, arguing that the hospital was negligent in credentialing the physician who performed her surgery because medical malpractice complaints in his past should have resulted in a denial of his request for credentials.

The hospital defended against her claims on the ground that the Utah legislature had immunized hospitals against negligent credentialing claims by enacting Utah Code Ann. 58-13-5(7), which says:

An individual who is a member of a hospital administration, board, committee, department, medical staff, or professional organization of health care providers is, and any hospital, other health care entity, or professional organization conducting or sponsoring the review, immune from liability arising from participation in a review of a health care provider’s professional ethics, medical competence, moral turpitude, or substance abuse.

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By its plain language, this statutory provision would appear to confer immunity on hospitals for negligence in credentialing doctors, leaving plaintiffs with their only remedy to sue the doctor himself (and his medical malpractice insurer). But the Utah Supreme Court saw the statute differently.

Reading the statute in light of other similar provisions of the Utah Code, the Court, in a divided 3-2 opinion, determined that the statute’s purpose was not to prevent claims against any entity that negligently credentialed a physician by an injured person, but was, instead, designed to prevent a doctor from suing fellow doctors (or anyone else) that spoke against him in a credentialing review: ”[T]he immunity contemplated under the statue operates between a doctor whose credentials are under review and the suppliers of information and decision makers; it does not contemplate immunity between a patient and a hospital.” Archuleta, 2010 UT 36, ¶ 10.

So S.B. 150 bill is a direct effort to overrule the Utah Supreme Court’s Archuleta decision by statute. If S.B. 150 passes, it will prevent injured patients from suing hospitals for the negligent credentialing of physicians who are allowed to practice using hospital facilities. Just to be clear, the passage of S.B. 150 would not prevent an injured patient from suing his doctor directly, and it would not prevent a patient from suing a hospital in the event the hospital was negligent in ways beyond just credentialing an incompetent physician.

I have no idea whether S.B. 150 is likely to pass. Either way, by the end of this legislative session we will finally have a good idea of the legislative intent with regarding immunity for credentialing reviews. If you have (or think you have) a negligent credentialing claim, watch developments closely. Stay tuned.

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