Health Care Advisory February 22, 2016 Illinois Supreme Court Rules Physician’s Application File and Data Bank Report Information Discoverable in a Negligent Credentialing Lawsuit Klaine v. Southern Illinois Hospital Services (2016 IL 118217) For more information, please contact any of the following members of Katten’s Health Care practice. Michael R. Callahan +1.312.902.5634 michael.callahan@kattenlaw.com Background The plaintiff filed a negligent credentialing medical malpractice lawsuit against a physician and two hospitals where he was a member of the medical staff. Although the hospital produced almost 2,000 pages of information in response to a discovery request, it refused to deliver two groups of documents which contained three of the physicians’ applications submitted in 2009, 2010 and 2011 (Group Exhibit F) and “procedure summaries and case histories” (Group Exhibit J), arguing that they were privileged under the Illinois Medical Studies Act (735 ILCS 5/8-2101), (MSA) and the Health Care Professional Credentials Data Collection Act (410 ILCS 517/1 et seq.) (Credentials Act). The trial court ruled against the hospitals and ordered the production of the requested documents, which included responses to the mandated appointment and reappointment form that the physician was required to complete pursuant to the Credentials Act, as well as information contained in the National Practitioner Data Bank (NPDB, or “Data Bank”) reports that had been included in the application materials but not the actual individual reports. The appellate court affirmed on appeal but ordered that certain references to an external peer review report and any patient identifying information be redacted. The Illinois Supreme Court granted the petition for leave to appeal and affirmed the decision. Credentials Act Information Is Confidential but Not Privileged The hospital argued that the Credentials Act clearly made the application and responses provided by the physician both confidential and privileged from discovery when standing alone and when considered in conjunction with the MSA. The court rejected this argument.

Although the court observed that the Credentials Act did contain language that all “credentials data collected or obtained by the . . .

hospital shall be confidential” (410 ILCS 517/15(h)), the court pointed out that there was no comparable provision to language contained in the MSA, which specifically states that protected information “shall be privileged . . .

and shall be inadmissible as evidence nor discoverable in any action of any kind in any court . . .” (735 ILCS 5/8-2101, 2102).

Citing to rules of statutory construction and other court cases, the court stated that “confidential” information is not the same as statutorily privileged information and therefore could be subject to discovery if found to be relevant to the claim being brought. Because the www.kattenlaw.com . plaintiff was alleging that the hospitals were negligent when granting the physician membership and clinical privileges, it could not see how such a claim could be brought without granting access to the requested documents. Data Bank Information Discoverable The hospital also contended that the Data Bank information provided by the physician in his application is privileged from discovery under the Health Care Quality Improvement Act (42 USC § 11137(b)(1)), although it did not cite any cases that supported this argument. Again, the court noted that while the information is indeed considered confidential and will only be released to a plaintiff’s attorney in a medical malpractice case by the Data Bank if it can be established it failed to query at the time of appointment and reappointment, HCQIA makes no reference to the information also being privileged from discovery. The court specifically stated: “Reading the confidentiality provision in paragraph (b) of Section 11137 of the Health Care Quality Improvement Act in conjunction with the Code of Federal Regulations, we believe it is clear that information reported to the NPDB, though confidential, is not privileged from discovery in stances where, as here, a lawsuit has been filed against the hospital and the hospital’s knowledge of information regarding the physician’s competence is at issue.” Implication and Recommendations 1. Credentials File Versus Quality File Most hospitals have a credentials file and a quality file for each medical staff member that separates the application materials, which generally are not protected, from peer review and other quality information, which usually are privileged from discovery under state and/or federal law. In this case, it appears that there was only one combined file.

Had the Data Bank information been separated out and placed in the quality file, there may have been a different outcome. Hospitals should carefully review their files to make sure they are correctly divided between non-privileged versus privileged materials. 2. Need to Review State Laws and Applicable Case Law In light of the dichotomy between information which is “privileged” versus “confidential,” hospitals should review applicable state statutes and applicable case law to determine what actual information is and is not privileged from discovery and/ or admissibility into evidence in state and/or federal proceedings. The outcome of this review may affect the kinds of questions asked in the appointment/reappointment application and the information requested to determine what language is referenced. Interestingly, the actual Data Bank reports were not requested by the plaintiff and not provided by the defendant. 3. Need to Argue That Information Is Being Used for Protected Peer Review Deliberations and, Therefore, Is Not Discoverable Depending on your statutory language this argument may or may not succeed. A copy of the Klaine opinion is available here. www.kattenlaw.com AUSTIN | CENTURY  CITY | CHARLOTTE | CHICAGO | HOUSTON | IRVING | LONDON | LOS  ANGELES | NEW  YORK | ORANGE  COUNTY | SAN  FRANCISCO  BAY  AREA | SHANGHAI | WASHINGTON,  DC Attorney advertising.

Published as a source of information only. The material contained herein is not to be construed as legal advice or opinion. ©2016 Katten Muchin Rosenman LLP. All rights reserved. Katten refers to Katten Muchin Rosenman LLP and the affiliated partnership as explained at kattenlaw.com/disclaimer. 2 2/24/16 .