Tulare hospital district settles suit with former medical staff

A group of doctors ousted by the former Tulare Local Healthcare District board has reached a settlement with the district. The Tulare Regional Medical Center Medical Staff (TRMCMS) will be restored to its former status under the settlement agreement; the district’s board had previously voted to separate itself from the group in January 2016.

Under the agreement, the district will dissolve the Professional Medical Staff of Tulare Regional Medical Center, the group formed as a replacement, and reinstate the bylaws that had existed before the TRMCMS group was pushed out.

“Doctors make any hospital successful,” district board president Kevin Northcraft said in a press release. “We are especially grateful for the MEC’s willingness to put the past behind us, resolve this matter and move forward with us toward reopening the hospital.”

The district would also agree to pay the group’s legal expenses, estimated at $300,000, and funds collected by the replacement group would be transferred to the former medical staff. $100,000 would become payable four months after the hospital reopens, another $100k eight months after it reopens, and another $100k twelve months after it reopens.

Attorneys for the medical staff group indicate they have also reached a settlement with Healthcare Conglomerate Associates (HCCA), the hospital’s former management company. The group had filed suit against the district, HCCA, and the group of doctors formed as the replacement medical staff.

“[The] settlement is a significant victory in protecting the ability of doctors, individually and through their medical staffs, to care for patients in Tulare County,” California Medical Association (CMA) President Theodore M. Mazer, M.D. said in the press release. “This settlement brings closure to a long legal fight over the improper interference into the physician-patient relationship and the autonomy of a medical staff’s responsibility for medical decision making and peer review. It sends an important message well beyond Tulare, but most importantly, it allows for the Tulare Regional Medical Center to begin the process of reopening its doors to the patients of Tulare County, who have suffered tremendously from its closure.”

The settlement stipulates that the hospital’s actions in disassociating with the former medical staff violated the right to self-governance of the doctors that practiced there.

What Happened?

The settlement, if entered as a judgement by the court, would close a multi-year lawsuit that had snaked through the Tulare County Superior Court. The group filed suit after the district’s former board ousted them in January 2016; former board members had claimed that an inspection by the California Department of Public Health had caused them to believe the hospital would be closed if they didn’t do so.

All involved say Dr. Everett Davis, one of the inspectors, gave scathing remarks during his inspection that led hospital officials to believe the hospital could be closed without taking drastic action.

“I don’t know what he told me. I don’t recall that because he was so insulting. I stopped hearing him. Looks like I was some kind of piece of crap in front of him that he has to dehumanize me,” Dr. Parmod Kumar, a board member at the time, testified. “It was so — I just blocked my mind and looked at 10 or 15 other inspectors in the room, and I said to myself, ‘What is this?’ I don’t know what the hell he was saying to me.”

The relationship between the TRMCMS group and the board had been fractured during the time leading up to the split. John Harwell, an attorney representing the TRMCMS group, said at the time that the move was unprecedented.

“One day, in secret, the elected district board voted to fire the medical staff, all 135 of them, and replaced them with a miraculous new medical staff that included a member of the Board, his wife and someone associated with Dr. (Benny) Benzeevi (CEO of Health Care Conglomerate Associates (HCCA), which operates TRMC),” Harwell said . “(The replacement staff) just sprung out of nowhere and announced they were a new medical staff, that they had bylaws and regulations, which is just astonishing, because bylaws and regulations take months to put together, not hours.”

Hospital officials had charged that peer review and credentialing processes had languished, and that they had been left unresolved for months to years. “Peer review” is a process in which medical staffs can evaluate the work of a fellow doctor and determine if any issues were present.

“The imminent threat created by the old medical staff was communicated to hospital personnel by surveyors from the Center for Medicare and Medicaid Services (CMS),” a statement issued by HCCA during the time of the trial read. “CMS based their threat of closure in large part on the history of dysfunction between the Governing Board and the leaders of the former medical staff, which led to the failure of the medical staff to conduct appropriate credentialing and peer review of physicians.”

Kumar later emerged as a pivotal figure in the switch to a new medical staff — multiple physicians say he had reached out to them to form the new group.

Drs. Ronald Ostrom, Anthony Trujillo, and Rebecca Zulim testified that they had all been contacted by Kumar, who had asked them to join the new staff.

“He said we needed to form a new MEC,” Ostrom said.

The group later met at the home of former Tulare City Councilman Skip Barwick, where they decided to move forward with the creation of new bylaws, utilizing the hospital’s former law firm, BakerHostetler.

“The decision was made at that meeting at Mr. Barwick’s house, we’re going to go forward with the medical staff,” Kumar said during the trial.

Attorneys for the former medical staff had charged that the motivation to disassociate from the former group was, at least in part, due to disciplinary actions the staff’s Medical Executive Committee had lodged against Kumar. He was required to take classes for recordkeeping after it was found that he had backdated certain records, and take anger management classes as well.

Dr. Anthony Vierra said that he had been given a deadline to either complete those classes or face suspension of his privileges to practice at Tulare Regional.

“[It was] necessary for him to keep his privileges. If he didn’t do it,” Dr. Anthony Vierra, a Tulare-based anesthesiologist testified, “he would not have privileges [at TRMC.]”

In a declaration separate from the case, Kumar testified that he later took both the anger management and recordkeeping classes

“I insisted that I take the anger management class, the recordkeeping class, and see a psychiatrist, so to avoid any I claim of bias or impropriety by Dr. Betre or the former MEC in the future. The new MEC agreed, and I presented proof of compliance to the new MEC, which then formally closed the ‘investigation,’” Kumar wrote.

With the lawsuit settled, the physicians that had left Tulare Regional Medical Center after the group’s ouster are able to return — and keep their old positions, if they had them, on the staff’s Medical Executive Committee. The move would significantly ease the hospital’s search for doctors as it looks to reopen under the stewardship of Adventist Health.

“To have a successful reopening, we need our doctors back, and the settlement of the lawsuit with our doctors is a critical step to our reopening. It also reverses one of the horrific mistakes of the former board that led to our hospital’s bankruptcy,” Northcraft said.