Ray v. St. John's Health Care Corp.

582 N.E.2d 464, 1991 Ind. App. LEXIS 2108, 1991 WL 259492
CourtIndiana Court of Appeals
DecidedDecember 12, 1991
Docket27A02-9008-CV-469
StatusPublished
Cited by19 cases

This text of 582 N.E.2d 464 (Ray v. St. John's Health Care Corp.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ray v. St. John's Health Care Corp., 582 N.E.2d 464, 1991 Ind. App. LEXIS 2108, 1991 WL 259492 (Ind. Ct. App. 1991).

Opinion

SULLIVAN, Judge.

Plaintiffs Alan S. Ray (Ray), Gerald 0. Daniel (Daniel), and Warren E. Fischer (Fischer), all Medical Doctors (Doctors), bring an interlocutory appeal challenging an order of the Grant Circuit Court denying their Motion to Compel discovery of documents and sustaining in substantial part defendant’s Motion to Strike an affidavit and related exhibits submitted by Ray on grounds of the Indiana Peer Review Act (The Act).

We vacate and remand.

The Doctors are directors, officers and shareholders of Anderson Radiological Consultants (AnRad), an Indiana Corporation. AnRad had an exclusive contract to practice Radiology at St. John’s Health Care Corporation (Hospital). Aside from being associated with AnRad, Doctors had been individually appointed for successive two year periods to the medical staff of Hospital pursuant to the hospital bylaws. On January 18, 1988, Plaintiff Ray was reappointed to the medical staff for a two year period, effective January 1,1988. The next day, however, Hospital unilaterally terminated the AnRad contract, to be effective May 21, 1988.

Doctors continued to exercise their staff privileges pursuant to their individual appointments notwithstanding Hospital’s action regarding AnRad. On March 10,1988, Hospital’s Board of Trustees adopted a Resolution stating Hospital policy to the effect that it could provide the highest quality patient care and make the most efficient use of its resources by entering into an exclusive services contract with radiologists who would constitute the professional staff of the Hospital’s radiology department. The Resolution authorized Hospital’s C.E.O., James H. Stephens (Stephens), to enter into such a contract and to modify existing contracts in his discretion in order to effectuate the policy.

On May 21, 1988, after the effective termination of the AnRad contract, plaintiff Ray was still attempting to exercise his staff privileges. On May 23, Stephens summarily suspended him pursuant to Section 6.2-1 of the bylaws. In his letter of explanation dated May 24, Stephens wrote that Ray’s continued presence in the Hospital violated an exclusive contract that he had concluded with a new radiology group pursuant to the Board’s March 10 Resolution. Stephens had, on the same date, advised the Hospital’s Medical Executive Committee that the suspension was not a challenge to Ray’s professional skill, competence or services. On June 22, Ray objected to the suspension in writing and demanded that the Medical Executive Committee hold a hearing to review the summary suspension, citing Section 6.2-2. The record does not show whether plaintiffs Daniel and Fischer attempted to exercise their hospital privileges after May 21; however, they did not request internal review.

In his May 24 letter, Stephens requested that the the Medical Executive Committee appoint an Ad Hoc Investigating Committee under Section 6.1-3(b) of the bylaws to determine whether a peer review action against Ray leading to possible corrective action was appropriate. Stephens asserted that Ray’s summary suspension would remain in effect until the ad hoc committee issued its report. Ray objected to this procedure, claiming that his right to proceed under section 6.2 to reverse the summary suspension could not be held in abeyance until the conclusion of the open-ended, Hospital-initiated peer review proceedings un *468 der section 6.1. Nevertheless, Ray’s summary suspension was not lifted.

An ad hoc committee was formed and a report was issued over Ray’s objection. The report recommended that a professional corrective action be initiated against Ray, and that his clinical privileges and medical staff membership be revoked. That report was reviewed by the Medical Executive Committee, pursuant to its authority under sections 6.2-2 and 6.2-3. The Medical Executive Committee recommended that the Board reject the ad hoc committee’s report and terminate the summary suspension. The Board, through its own Executive Committee, rejected the recommendation of the Medical Executive Committee and recommended that Ray’s clinical privileges and Medical Staff membership be revoked, citing section 7.2-1 of the bylaws. In support of its decision, the Board’s Executive Committee cited the fact that Ray no longer had an exclusive contract with Hospital and that his continued presence at the Hospital would violate the March 10 Board Resolution.

Ray exercised his right to a hearing before an ad hoc panel to review the action of the Board’s Executive Committee pursuant to section 7.1-1 of the bylaws. The hearing was held and the panel recommended that Ray’s privileges and staff membership be terminated.

Plaintiffs filed suit in the Madison Superior Court. The case was transferred to the Grant Circuit Court. At the core of Doctors’ theory is the assertion that Hospital’s conclusion of an exclusive services contract with a radiological services corporation consisting of new doctors put Hospital in economic conflict with plaintiffs. Plaintiffs allege that the decision to terminate them was irrevocably made before any of the procedures guaranteed by the bylaws took place, and that the people appointed to hear evidence and make rulings at the hearings, with the exception of the Medical Executive Committee, were all members of the Board interested in protecting Hospital from breaching its newly signed contract.

In late January, 1990, Doctors served a Request for Production of Documents on Hospital. Hospital objected to the request upon multiple grounds, including reference to the privilege provisions of the Indiana Peer Review Statute. Doctors filed a Motion to Compel production of the documents. In support of the Motion, Doctors submitted an affidavit by Ray which included 28 exhibits. The affidavit chronicled Ray’s dealings with Hospital and its committees during the relevant time period and the exhibits consisted of the relevant correspondence between the parties and other related documents. The Motion asked for production of eight items, which are summarized as follows: all minutes of the Board of Trustees, Executive Committee, and subcommittees for a three-year period; all documents relating to the physicians benefiting from the new exclusive contract; calendars, diaries, telephone records and related items of Stephens and three other Board members; minutes of the Medical Executive Committee, Credentials Committee, Medical Care Evaluation Committee, and Radiology Department pertaining to radiological services and personnel; and rules, regulations, procedures and policies relating to operation and management of the radiology department. Hospital, citing the Peer Review Act, responded with a Motion to Strike the Ray affidavit and the accompanying exhibits.

The trial court denied plaintiffs’ Motion to Compel and granted Hospital’s Motion to Strike as to specific paragraphs of the Ray affidavit and corresponding exhibits, and in doing so relied upon the Act. The trial court did not conduct any in camera review of the individual documents to determine whether the privilege applied to each document sought to be protected.

Doctors sought and were granted interlocutory appeal from these orders pursuant to Indiana Appellate Rule 4(B)(6). The issue upon appeal is whether the trial court erred in denying Doctors’ Motion to Compel and granting Hospital’s Motion to Strike based upon the privilege provisions of the Indiana Peer Review Act.

*469

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Bluebook (online)
582 N.E.2d 464, 1991 Ind. App. LEXIS 2108, 1991 WL 259492, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ray-v-st-johns-health-care-corp-indctapp-1991.