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HEALTH CARE QUALITY IMPROVEMENT ACT OF 1986

 

OVERVIEW OF ISSUE:

During the 1970s and 1980s, medical malpractice suits were increasing in frequency.  A contributing factor to this increase was the ability of physicians to relocate to other states without disclosure of past medical malpractice payments or adverse actions. The Healthcare Quality Improvement Act of 1986 (“HCQIA”) is a federal law that was  enacted to create a national tracking system of physicians with a history of medical malpractice payments or adverse actions. This system is known as the  National Practicioner Data Bank.  One of the reasons that malpractice actions were on the rise was because physicians were reluctant to engage in peer review activities.  In order to foster and promote peer review HCQIA  provided immunity from civil money damages to encourage physician involvement in such review actions.  (see; 42 U.S.C. Section 11101 et seq. (1986) Healthcare Quality Improvement Act of 1986).          

 

POLICY:

There was a national need to restrict the ability of incompetent physicians to move from state to state without disclosure or discovery of the physician’s previous damaging or incompetent performance. The Federal Government has attempted to remedy this problem  through effective peer review which provides immunity from civil money damages who participate in peer review.  The government additionally developed the National Practicioner Data Bank to track physicians with a history of adverse actions and help stem the relocation of offending physicians. (see;  http://hcqia.net/history.htm).

 

AUTHORITY:

HCQIA provides immunity from civil money damages for participants in professional review actions (peer review), except for damages relating to civil rights actions. In addition, immunity from damages shall not be available to any one who knowingly provides false information to a professional review body. The Secretary of Health and Human Services is authorized by HCQIA to create a nationwide reporting system for certain adverse actions concerning a physician’s competency and professional conduct.  (see; 42 U.S.C. Sections  11111(a)(1) (a)(2) and 11134.)   

 

What is a Professional Review Action under HCQIA?

A “professional review action” means an action or recommendation by a professional review body which is taken or made during a professional review activity. The action or recommendation must be based on the (i) competence or (ii) professional conduct of an individual physician and (iii) which affects (or may affect) adversely the physician’s clinical privileges or membership in a professional society.   A professional review action includes a formal decision to not take  action or make a recommendation.

  

The professional conduct of the physician in question must affect or could affect adversely the health or welfare of a patient or patients.  It is important to note that actions based primarily on the physician’s: (i) lack of  membership in a professional society or association; (ii) fees or advertising; (iii) participation in a prepaid group health plans, salaried employment or other manner for delivering health services; (iv) association with a private group practice of a particular class of health care practitioners; or (v) any other matter that does not relate to the competence or professional conduct of a physician are not considered to be professional review actions based on the competence or professional conduct of the physician. (see; 42 U.S.C. Section 11151(9))

 

What is a Professional Review Body under HCQIA?

A professional review body means a health care entity, governing body, any health care entity committee which conducts professional review actions, and any medical staff committee when it assists the governing body in a professional review activity. (see: 42 U.S.C. Section 11151(11)).

 

What is a Professional Review Activity under HCQIA?  

 A professional review activity means an activity of a health care entity with respect to an individual physician:

1. to determine whether the physician may have clinical privileges or membership;

2. to determine the scope or conditions of such privileges or membership; or

3. to change or modify such privileges or membership.  (see: 42 U.S.C. Section 11151(10)).

 

How Does A Professional Review Action Qualify for Immunity under HCQIA? 

A professional review action must meet the standards set forth in the Act in order to qualify for immunity.  The professional review action must be taken:

1.  in the reasonable belief that the action was in furtherance of quality health care;

2.  after a reasonable effort to obtain the facts of the matter;

3. after adequate notice and hearing procedures afforded to physician or other such procedures that are fair to the physician; and

4.   in the reasonable belief that the action was warranted by the facts known after the reasonable effort to obtain the facts and adequate notice and hearing procedures have been afforded to the physician.

 

A professional review action shall be presumed to have met the HCQIA standards unless the presumption is rebutted by a preponderance of the evidence. (see: 42 U.S.C. 11112(a)). 

 

What are Adequate Notice and Hearing Procedures under HCQIA?

There are two notice provisions provided for under HCQIA: (i) notice of the proposed action (such as a recommendation to terminate privileges)  and (ii) notice of the hearing.

 

Notice of Proposed Action: This notice must state:

1. that a professional review action has been proposed to be taken against the physician;

2. the reasons for the proposed action;

3. the physician has a right to request a hearing;

4. any time limits to request a hearing (not less than 30 days); and

5. a summary of the physician’s hearing rights that comply with HCQIA. (see: 42 U.S.C. Section 11112(b)(1)).

 

Notice of Hearing: If the physician timely requests a hearing, he must be given a notice stating:

1. the place, time and date of the hearing, which shall not be less than 30 days after the date of the notice; and

2. the list of witnesses (if any) expected to testify on behalf of the professional review body. (see: 42 U.S.C. Section 11112(b)(2)).

 

Hearing Requirements: If a hearing is timely requested by the physician:

1. the health care entity shall decide whether the hearing shall be heard before:

            i. a mutually acceptable arbitrator;

            ii. a hearing officer appointed by the health care entity who in not in direct             economic competition with the physician; or

            iii. a panel of individuals who are appointed by the health care entity and are not   in direct economic competition with the physician.

2.  the physician may forfeit his right to a hearing if he fails without good cause to appear.

3. In the hearing, the physician has the right to:

            i. representation by an attorney or other person of his choice;

            ii. have a record of the proceeding made (copies of which may be obtained by        the physician upon payment of reasonable charges);

            iii. call, examine and cross-examine witnesses;

            iv. present evidence deemed relevant by the hearing officer, regardless of   whether such evidence would be admissible in a court of law; and

            v. submit a written statement at the end of the proceedings.

4. Upon the conclusion of the proceedings, the physician has the right to receive:

            i. a written decision, with a statement of the basis of the recommendation; and

            ii. a written decision of the heath care entity, including a statement of the basis of the decision.  (see: 42 U.S.C. Section 11112(b)(3)).

 

The above notice and hearing procedures are not required in situations where no adverse professional review action was taken or if a physician’s clinical privileges are suspended or restricted for 14 days or less, during which time an investigation must be conducted to determine whether a professional review action is needed.  (see: 42 U.S.C. Section 11112(c)(1)).  

 

What if there is an emergency situation under HCQIA?

A health care entity may take a professional review action which results in an immediate suspension or restriction of a physician’s clinical privileges without prior notice or hearing where failure to act may result in imminent danger to the health of any individual. After the emergency action is taken, the physician must be given subsequent notice and hearing or other adequate procedures. (see 42 U.S.C. 11112(c)(2)) 

 

Are attorney’s fees available under HCQIA?

A health care entity or other defendant shall be awarded reasonable attorney’s fees and costs if: (i) the defendant met the standards for professional review actions in the Act (ii) substantially prevails at trial, and (iii) the plaintiff’s claim was frivolous, unreasonable, without foundation or in bad faith. A defendant shall not be considered to have substantially prevailed when the plaintiff obtains an award for damages or declaratory relief (permanent or injunctive).  (see: 42 U.S.C. Sections 11112(a) and 11113).        

  

What are the medical malpractice reporting requirements under HCQIA?

Any entity (including health insurance companies) which makes a medical malpractice  payment: (i) under a policy of insurance; (ii) self insurance; or (iii) otherwise in (a) settlement (or partial settlement) of or (b) in satisfaction of a judgment shall report the payment to the National Practitioner Data Bank and appropriate state licensure board.  This requirement applies to medical malpractice payments for physicians and other licensed health care practitioners.  (see: 42 U.S.C. Section 11131(a)).

 

What Must Be Reported to the National Practitioner Data Bank under HCQIA? 

The following information must be reported:

1. name of physician or licensed health care practitioner;

2. amount of payment;

3. name (if known) of any hospital with which the physician/practitioner is affiliated;

4. description of the acts or omissions and injuries or illnesses upon which the action or claim was based; and

5. other information as required by the Secretary of HHS. (see: 42 U.S.C. Section 11131(b)).  

 

What happens if there is a failure to report information to the National Practitioner Data Bank?

There is a civil money penalty of not more than $10,000 for each medical malpractice payment not reported.  (see: 42 U.S.C. Section 11131(b)).

 

Are Board of Medical Examiners required to report sanctions?

Each Board of Medical Examiners shall report to the National Practitioner Data Bank the (i) revocation or suspension (or other restriction) of a physician’s license (ii) censure; (iii) reprimand; or (iv) probation of a physician, for reasons relating to profession competence or professional conduct; or (v) the surrender of a physician’s license.  (see: 42 U.S.C. Section 11132(a)(1)).  

 

The following must be reported:

1. name of physician involved;

2. description of acts or omissions or other reasons (if known) for the revocation, suspension or surrender of the license; and

3. such other information respecting the circumstances of the action or surrender as the Secretary deems appropriate.   (see: 42 U.S.C. Section 11132(a)(2)).   

 

What happens if a Board of Medical Examiners fails to report to the National Practitioner Data Bank?

If, after notice of noncompliance and providing opportunity to correct noncompliance, the Secretary determines that a Board of Medical Examiners has failed to report information, the Secretary shall designate another qualified entity to make the required reports to the National Practitioner Data Bank.  (see: 42 U.S.C. Section 11132(b)).   

 

What actions must be reported to the Boards of Medical Examiners by health care entities?

Each health care entity shall report to the appropriate Board of Medical Examiners:

1. A professional review action that adversely affects the clinical privileges of a physician for longer than 30 days;

2. The acceptance of the surrender of clinical privileges of a physician –

            i. while the physician is under an investigatin relating to possible incompetence or improper conduct or

            ii.  in return for not condicting such an investigation or proceeding or

3. if the entity is a professional society, a professional review action which adversely affects the physician’s membership in the society.

 

These reports by a health care entity are required in the case of a physician and permissive in the case of other licensed heatlh care practitoners.  (see: 42 U.S.C. Section 11133(a)(1) and 11133(a)(2)).

 

The following must additionally be reported:

1. The name of the physician/practitioner involved;

2. description of the acts or omissions or other reasons of the action or, if known, the surrender; and

3. such other information respecting the circumstances of the action or surrender as the Secretary deems appropriate.   42 U.S.C. Section 11132(a)(2).

 

What happens if a health care entity fails to report actions to the Board of Medical Examiners?

The health care entity shall lose its civil money damages immunity if the Secretary publishes the name of the entity in the Federal Register, after notice and opportunity to cure its failure to report, and the entity fails to do so.  (see. 42 U.S.C. Section 11133(c)(1)).   

 

What duties do hospitals have to obtain information?

Each hospital is required to obtain information (also known as a “query”) from the National Practitioner Data Bank:

1. at the time a physician or licensed health care practitioner applies to be on the medical staff (courtesy or otherwise) or for clinical privileges and

2. once every two years.  (see: 42 U.S.C. Section 11135(a)).

 

Is information reported to peer review committees always confidential?

Information reported pursuant HCQIA shall be considered confidential and not to be disclosed (other than to the physician or practitioner in question) except with respect to professional review activity, as necessary to carry out queries to the National Practitioner Data Bank, or in accordance with federal regulations or state law.  Information which does not contain identifiable information of any particular health care entity, physician, practitioner or patient shall not be considered confidential. There is a civil money penalty of not more than $10,000 for each violation of confidentiality. (see: 42 U.S.C. Section 11137(b)(1) and 11137(b)(2)).               

    

Relevant provisions under the Code of Federal Regulations

 

National Practitioner Data Bank.

The National Practitioner Data Bank is established to collect and release certain information relating to the professional competence and conduct of physicians, dentists and other health care practitioners.  (see: 45 C.F.R. Section 60.1). 

 

Time Frames for Reporting to the National Practitioner Data Bank.

  • Malpractice Payments.  The entity making the payment must submit information to the Data Bank within 30 days from date payment is made. If required under Section 60.7, the information must be submitted simultaneously to the appropriate state licensing board.  (see: 45 C.F.R. Section 60.5(a)).
  • Licensure Actions.  The Board of Medical Examiners must submit information to the Data Bank within 30 days from date action was taken.  (see: 45 C.F.R. Section 60.5(b)).
  • Health Care Entity Adverse Action.  A health care entity must report an adverse action to the Board of Medical Examiners within 15 days from the date the adverse action was taken. The Board of Medical Examiners must submit the information received from the health care entity within 15 days from the date it received the information.   (see 45 C.F.R. Section 60.5(c)).

 

Disputing the Accuracy of a Report. 

A physician, dentist or other health care practitioner may dispute the accuracy of information in the Data Bank concerning himself or herself.  The Secretary will routinely mail a copy of the report to the subject individual.  The subject individual has 60 days from the date on which the Secretary mails the report in which to dispute the accuracy.  (see 45 C.F.R. Section 60.14(a)).  

  

 

AGENCY GUIDANCE:

The Department of Health and Human Services publishes a resource guide for users of the National Practitioner Data Bank entitled, The National Practitioner Data Bank Guidebook.  The Guidebook can be found at: www.npdb-hipdb.com>Publications>NPDB Guidebook, and contains the entire range of NPDB polices and operations.    

 

FUTURE GUIDANCE:

Familiarity with HCQIA’s notice, hearing and reporting requirements will become increasingly important as governmental and accreditation organizations continue to focus on quality and costs savings in the delivery of health care.

 

COMMON AREAS OF CONCERN:

The two primary governmental entities that are concerned with HCQIA are state licensure boards and the Department of Health and Human Services.  In order to comply with HCQIA, health care entities, insurance companies and Boards of Medicine should ensure they submit reportable actions to the National Practitioner Data Bank within the time requirements, after applicable notice and hearing procedures have been afforded to the physicians/licensed health care practitioners. In addition, health care entities that are accredited should ensure they comply with any hearing procedure requirements in their accreditation standards.   The increased scrutiny on quality will continue to permeate all areas of health care

 

CONCLUSION:

HCQIA is a valuable tool to help ensure the quality of care provided in the community.  HCQIA is a very technical law and attorneys should be familiar with its definitions, reporting requirements and time frames. The National Practitioner Data Bank Guidebook is a resource for interpreting this statute and often presents the information in manageable formats, such as a chart with reporting timeframes. 

 

Acknowledgements

AHLA would like to thank _____ for the initial draft of this article and Shannon Reed of Baker & Daniels LLP for her editorial assistance.