Managed Care and the Expanding Scope of Primary Care Physicians' Duties: A Proposal to Redefine Explicitly the Standard of Care

See Brown M. , “Mergers, Networking, and Vertical Integration: Managed Care and Investor-Owned Hospitals,” Health Care Management Review, 21 (1996): 29–37; and Danzon P.M. Boothman L.G. Greenberg P.E. , “Consolidation and Restructuring: The Next Step in Managed Care,” Health Care Management, 2 (1995): 221–35.

See Cooper P.F. Nichols L.M. Taylor A.K. , “Patient Choice of Physician: Do Health Insurance and Physician Characteristics Matter?,” Inquiry, 33 (1996): 237–46; and Mechanic D. , “Changing Medical Organization and the Erosion of Trust,” Milbank Quarterly, 74 (1996): 171–89.

See, for example, Church G.J. , “Backlash Against HMOs,” Time, Apr. 14, 1997, at 32; and Klass P. , “Revolving Door Deliveries,” Parenting, Sept. 1996, at 150–54.

See Retchin S.M. , “Outcome of Stroke Patients in Medicare Fee for Service and Managed Care,” JAMA, 278 (1997): At 121; and Declercq E. Simmes D. , “The Politics of ‘Drive-Through Deliveries’: Putting Early Postpartum Discharge on the Legislative Agenda,” Milbank Quarterly, 75 (1997): 175–202.

See Scutchfield F.D. Lee J. Patton D. , “Managed Care in the United States,” Journal of Public Health Medicine, 19 (1997): 251–54.

See id.

Hand v. Tavera, 864 S.W.2d 678 (Tex. Ct. App. 1993).

See Id.

See, for example, St. John v. Pope, 901 S.W.2d 420 (Tex. 1995); Day v. Harlins, 961 S.W.2d 278 (Tex. Ct. App. 1997); and Ortiz v. Shah, 905 S.W.2d 609 (Tex. Ct. App. 1995).

See Siliciano J.A. , “Wealth, Equity, and the Unitary Medical Malpractice Standard,” Virginia Law Review, 77 (1991): At 441; Morreim E.H. , “Cost Containment and the Standard of Medical Care,” California Law Review, 75 (1987): 1719–63; Hall M.A. , “The Malpractice Standard Under Health Care Cost Containment,” Law, Medicine & Health Care, 17 (1989): 347–55; and Macaulay R.C. Jr. , “Health Care Cost-Containment and Medical Malpractice: On a Collision Course,” Suffolk University Law Review, 21 (1986): 91–118.

See Havighurst C.C. , “Prospective Self-Denial: Can Customers Contract Today to Accept Health Care Rationing Tomorrow?,” University of Pennsylvania Law Review, 140 (1992): At 1779 (“Providers in HMOs … face possible legal liability if they depart from the costly practice standards customary in the insured-fee-for-service sector.”); Lairson A.J. , “Reexamining the Physician's Duty of Care in Response to Medicare's Prospective Payment System,” Washington Law Review, 62 (1987): At 803 (“Health maintenance organizations are an example of a cost containment system in which courts hold physicians to the same standard of care required for physicians in fee-for-service medicine.”); and Bovbjerg R. , “The Medical Malpractice Standard of Care: HMOs and Customary Practice,” Duke Law Journal, 1975 (1975): At 1386 (“The medical malpractice standard of care applied to HMO health care services is the same as that governing medical services generally.”).

See Hirshfeld E.B. , “Should Ethical & Legal Standards for Physicians Be Changed to Accommodate New Models for Rationing Health Care?,” University of Pennsylvania Law Review, 140 (1992): 1809–46; and Lairson , id. at 791–812.

See, for example, Frankel J.J. , “Medical Malpractice Law & Cost Containment,” Yale Law Journal, 103 (1994) 1297–331; Siliciano , supra note 10, at 441; Hall , supra note 10; Morreim , supra note 10; and Macaulay , supra note 10.

See Frankel , id. at 1317–18 (“Courts have not been particularly sensitive to this dilemma.”).

Wickline v. State of California, 239 Cal. Rptr. 810, 820 (Ct. App. 1986).

See Siliciano , supra note 10, at 475.

See, for example, Frankel , supra note 13, at 1323 (“The duty of care has two parts: The set of medical procedures … and the degree of skill with which [the doctor] must perform those procedures. Proposals to vary the standard of care only address the first component—the menu of treatment entitlements.”); and Siliciano , supra note 10, at 476 (“Thus, with respect to the questions of technical competence, retention of a unitary standard seems appropriate.”).

See infra pp. 106–08.

See Note, “Medical Malpractice-Expert Testimony,” Northwestern University Law Review, 60 (1966): At 837.

Small v. Howard, 128 Mass. 131 (1880).

See id. at 132. Although Small v. Howard is the case most frequently cited establishing the concept of the “locality” rule, the rule was first raised in Tefft v. Wilcox, 6 Kan. 46 (1870).

See, for example, Logan v. Greenwich Hospital Association, 191 Conn. 282, 465 A.2d 294 (1983).

Brune v. Belinkoff, 354 Mass. 102, 235 N.E.2d 793 (1968).

Halley v. Birbiglia, 390 Mass. 540, 547, 458 N.E.2d 710, 715 (1983) (“Such a duty may already have become a component of good medical practice among local practitioners, and it had certainly gained sufficient acceptance nationwide to apprise the defendants of its significance.”).

Stepakoff v. Kantar, 393 Mass. 836, 473 N.E.2d 1131 (1985).

See id. at 841.

See Shamburger v. Behrens, 418 N.W.2d 299 (S.D. 1988); Ardoin v. Hartford Accident and Indemnity Co., 360 So. 2d 1331, 1337 (La. 1978); Kronke v. Danielson, 499 P.2d 156 (Ariz. 1972); Simpson v. Davis, 549 P.2d 950 (Kan. 1976); Shilkret v. Annapolis Emergency Hospital Association, 349 A.2d 245 (Md. 1975); Naccarato v. Grob, 180 N.W.2d 788 (Mich. 1970); Christy v. Saliterman, 179 N.W.2d 288 (Minn. 1970); Orcutt v. Miller, 595 P.2d 1191 (Nev. 1979); Wiggins v. Piver, 171 S.E.2d 393 (N.C. 1970); Bruni v. Tatsumi, 346 N.E.2d 673 (Ohio 1976); Freed v. Priore, 372 A.2d 895 (Pa. Super. Ct. 1977); and Shier v. Freedman, 206 N.W.2d 166 (Wis. 1973). See also Note, supra note 19, at 839; and Note, “Medical Specialties and the Locality Rule,” Stanford Law Review, 14 (1962): At 889.

See Drs. Lane, Bryant, Eubanks & Delaney v. Otts, 412 So. 2d 254 (Ala. 1982); and Hundley v. Martinez, 158 S.E.2d 159 (W. Va. 1967).

See, for example, Okla. Stat. Ann. tit. 76, § 20.1 (West 1983).

See West v. Sanders Clinic for Women, 661 So. 2d 714, 720 (Miss. 1995) (“A physician may be held to the standard of care of another specialty other than his own, if the physician assumes the duty of the specialty.”); Simpson, 549 P.2d at 954 (“When the defendant [dentist] undertook to perform the work of a specialist he had the duty to use the skill and care of a specialist.”); Larsen v. Yelle, 246 N.W.2d 841, 845 (Minn. 1976) (“If … the general practitioner … undertakes to treat when he should refer to a specialist, he will be held to that standard of care required of the specialist.”); Lane by Lane v. Skyline Family Medical Center, 363 N.W.2d 318 (Minn. Ct. App. 1985); see also Prager L.O. , “Gatekeepers on Trial,” American Medical News, Feb. 12, 1996, at 1.

See Hirshfeld , supra note 12; Frankel , supra note 13; Chumbler v. McClure, 505 F.2d 489 (6th Cir. 1974); Levine v. Rosen, 616 A.2d 623 (Pa. 1992); and Downer v. Veilleux, 322 A.2d 82 (Me. 1974).

See California Medical Association, CMA Document No. 1043, Jan. 1998, at 7–8; and Prager , supra note 30, at 1.

Personal Communication with Dr. Gifford Boyce Smith, Vice President and General Manager, Cigna Healthcare, Northern California (Mar. 2, 1998).

See id.

See id.

See infra notes 58–63 and accompanying text.

In California, for example, the average primary care physician earns less than the lowest-paid specialist. See Tye L. , “Mixed Reviews, But No Turning Back,” Boston Globe, Feb. 2, 1998, at A1; and Special Report, “Specialists at the Gate,” Medical Utilization Management, 25 (Sept. 25, 1997): 5–8 (reporting that, in 1995, the median salary of a surgeon was $225,000 compared with $124,000 for a family practice physician).

ABC News Nightline (ABC television broadcast, Feb. 13, 1998, Transcript No. 4364).

Id. The degree to which financial incentives may influence a managed care organization (MCO) to limit specialist referrals depends in part on the methods of payment and other remuneration to its physician providers. For example, are the MCO's physicians salaried, do individuals receive bonus payments for limiting referrals, is the system fully or partly capitated, and so forth.

See id.

See California Medical Association, supra note 32, at 7–8; and Prager , supra note 30, at 1.

The common wisdom probably derives from cases such as Wickline, 192 Cal. App. 3d 1630, 1645 (1986) (“[The physician] cannot point to the health care payor as the liability scapegoat when the consequences of his own determinative medical decisions go sour.”) and Wilson v. Blue Cross of Southern California, 271 Cal. Rptr. 876 (Ct. App. 1990). Although the precise holdings in these cases are not beacons of clarity (the Wilson court, for example, felt a need to clarify the Wickline decision), one general principle seems to be that a physician cannot point to his abiding by an MCO's rules for his failure to live up to the standard of care.

Helling v. Carey, 519 P.2d 981 (Wash. 1974).

The T.J. Hooper, 60 F.2d 737 (2d Cir. 1932).

See Gosfield A.G. , “The Legal Subtext of the Managed Care Environment: A Practitioner's Perspective,” Journal of Law, Medicine & Ethics, 23 (1995): 230–35.

See, for example, Schamburger, 418 N.W.2d 299; and Hartford Accident and Indemnity, 360 So. 2d 1331.

See Jacks J.C. Jacks L. , “Chronology of the Birth and Death of a Health Bill,” Journal of Health Care Finance, 21 (1995): 59–67. Some assert that because governments are responsible for such a large percentage of health care spending, we really do not have a free market health care system. Government programs account for approximately 4 percent of national health expenditures. See Levit K.R. , “National Health Expenditures, 1996; Innovations in Fee-For-Service Financing and Delivery,” Health Care Financing Review, 19, no. 1 (Sept. 22, 1997): At 162. Although government may have a disproportionate influence on the health care system, to the extent that it is a purchaser of health care, it is not acting as a regulator. If one were to follow the logic that simply because the government purchases health care we do not have a free market system, then few, if any, markets are truly free. After all, the federal government also purchases large quantities of power, steel, coffee, defense equipment, and so forth, although the purchases probably only rarely rise to the 47 percent level in a particular market.

Depending on one's viewpoint, the standard of care is either lower (reduced) or modified. Although I use the terms lower, reduced, or modified standard of care interchangeably, I prefer the less pejorative word modified.

See Hall , supra note 10.

See Morreim , supra note 10, at 1733.

See, for example, Bovbjerg , supra note 11, at 1400.

See infra pp. 107–08.

There are exceptions to this general principle, none of which is applicable here. See Keeton W.P. , Prosser and Keeton on Torts (St. Paul: West, 5th ed., Lawyer's ed., 1984): § 56.

See id.

Hurley v. Eddingfield, 156 Ind. 416, 59 N.E. 1058 (1901); see also Siliciano , supra note 10, at 441.

156 Ind. 416, 59 N.E. 1058.

See, for example, Weinrib E.J. , “The Case for a Duty to Rescue,” Yale Law Journal, 90 (1980): 247–92; Landes W.M. Posner R.A. , “Finders, Good Samaritans and Other Rescuers: An Economic Study of Law and Altruism,” Journal of Legal Studies, 7 (1978): 83–105; and De Kuiper K.A. , “Stalking the Good Samaritan: Communists, Capitalists, and the Duty to Rescue,” Utah Law Review, 1976 (1976): 529–53.

See Liner R.S. , “Physician Deselection: The Dynamics of a New Threat to the Physician-Patient Relationship,” American Journal of Law & Medicine, XXIII (1997): At 514 (citing H.R. Rep. No. 104–865, pt. 1, at 3 (1996)).

See id.

See Menken M. , “Managed Care and the Practice of Neurology: Implications for Neurology Residents,” Archives of Neurology, 53 (1996): 859–62.

See Liner , supra note 58, at 515.

O'Reilly B. , “Taking on the HMOs Minneapolis Employers, in Revolt, Put Health-Care Choices Back in the Hands of Patients and Doctors. Could This Be a Model for the U.S.?,” Fortune Magazine, Feb. 16, 1998, at 100.

See Terry K. , “Too Many Primary Care Doctors?,” Medical Economics, 74 (July 14, 1997): At 120 (“Already, some primary-care job applicants have found that they can't bargain over salaries, working conditions, or which procedures they'll be allowed to do.”); and Krill E.J. , “Physician Employment Agreements: Negotiating to Improve Practice Relationships,” Health Lawyer, 10 (1998): At 1 (“Major changes to this basic contract [the 'standard form agreement'] are not common.”).

See American Medical Association, “Ethical Issues in Managed Care. Statement of Principles,” in Connecticut Medicine, 59 (1995): At 299 and in Journal of the Arkansas Medical Society, 92 (1995): At 127.

American Medical Association, Code of Medical Ethics (Chicago: American Medical Association, 1994): At xiv (emphasis added).

See Helling, 519 P.2d 981.

See Keeton , supra note 53, at §§ 57–62.

See Gillon R. , “Medical Oaths, Declarations, and Codes,” British Medical Journal (Clin. Res. Ed.), 290 (1985): At 1195.

See Mechanic , supra note 2, at 172.

In a direct control model, a health maintenance organization (HMO) contracts directly with an individual physician to serve its enrollees. The physician may see other HMOs' patients, as well as private pay patients. See Benda C.G. Rozovsky F.A. , Managed Care and the Law. Liability and Risk Management: A Practical Guide (Boston: Little, Brown, 1996): § 2.4.1.

See, for example, Edwards v. Consolidated Rail Corp., 567 F. Supp. 1087, aff'd without opinion, 733 F.2d 966 (App. D.C. 1983). For a detailed discussion on the duty of landowners, see Keeton , supra note 53, at §§ 57–62.

See Settle v. Portland General Electric Co., 81 Or. App. 474, 726 P.2d 389, rev. denied, 302 Or. 460, 730 P.2d 1250 (1986).

See Mitchell v. Ankney, 396 N.W.2d 312 (S.D. 1986).

See Nettles v. Winn-Dixie Louisiana, Inc., 496 So. 2d 1296 (La. Ct. App. 1986); Keller v. Schwegmann Brothers, Inc., 402 So. 2d 724 (La. Ct. App. 1981); and Forcier v. Grand Union Stores, Inc., 264 A.2d 796 (Vt. 1970).

Although some jurisdictions have dispensed with some or all of the distinctions between trespasser, licensee, and invitee, they remain entrenched in the majority of states. See Younce v. Ferguson, 724 P.2d 991 (Wash. 1986); and Keeton , supra note 53, at § 62.

An individual whom the physician has no duty to see, because he is not a patient, might be compared with a trespasser. Although it is somewhat unpalatable to compare individuals seeking health care with trespassers, licensees, and invitees, the comparison serves to illustrate the principle of varying standards under factually similar circumstances.

Observe, for example, the opposition to and the inability of President Clinton to pass legislation instituting universal health care coverage. See Jacks Jacks , supra note 47.

See supra notes 37–40 and accompanying text.

See, for example, Hirshfeld , supra note 12, for a discussion on defining “necessary care.”

See, for example, Wickline, 239 Cal. Rptr. 810; and Wilson, 271 Cal. Rptr. 876.

One such exception is the refusal to provide experimental treatment. Exactly what treatment is experimental is open to challenge from time to time, so this is not always clear.

See, for example, Havighurst , supra note 11, who suggests that persons should be permitted to contract for a lower level of health care services.

Like many others, I believe that courts should modify the method-of-treatment standard of care as well. However, if they are not going to do so, there are at least sufficient distinguishing features to justify a modification of the competency standard.

See Morreim , supra note 10, at 1760–61 (discussing court decisions along these lines).

Wickline, 239 Cal. Rptr. at 819 (“However, the physician who complies without protest with the limitations imposed by a third party payor, when his medical judgment dictates otherwise, cannot avoid his ultimate responsibility for his patient's care.”); Wilson, 271 Cal. Rptr. 876; and Corcoran v. United Healthcare, Inc., 965 F.2d 1321 (5th Cir. 1992), cert. denied, 113 S. Ct. 812 (1993).

See Tye , supra note 37; and Special Report, supra note 37.

See “No-Referral Health Plan Provides Nevadans with Freedom of Choice,” PR Newswire, Feb. 12, 1998.

See, for example, Tye , supra note 37; and Special Report, supra note 37. See also Brodsky M.A. , Special Report, “Specialists at the Gate; Regional Attitudes of Generalists, Specialists and Subspecialists About Management of Atrial Fibrillation,” Archives of Internal Medicine, 156 (1996): 2553–62; and de Guzman M.M. , “Are Specialists Staging a Comeback?,” Health System Leader, 4 (1997): 4–13.

See Anonymous , “Beyond MICRA: New Ideas for Liability Reform. American College of Physicians,” Annals of Internal Medicine, 122 (1995): 466; Sage W.M. Hastings K.E. Berenson R.A. , “Enterprise Liability for Medical Malpractice and Health Care Quality Improvement,” American Journal of Law & Medicine, XX (1994): 1–28; and Galyon J.T. , “Enterprise Liability,” Journal of the Tennessee Medical Association, 86 (1993): 491.

Employee Retirement Income Security Act of 1974, Pub. L. No. 93–406, 88 Stat. 829 (modified as amended at 29. U.S.C. §§ 1001–1461 (1988 & Supp. V. 1993)).

A number of authors have discussed the problems created by Employee Retirement Income Security Act. See, for example, Mariner W.K. , “Liability for Managed Care Decisions: The Employee Retirement Income Security Act (ERISA) and the Uneven Playing Field,” American Journal of Public Health, 86 (1996): 863–69; Blankenau R. , “The Unfriendly Giant. With Reform's Collapse, Will States Ever Get ERISA Off Their Backs?,” Hospitals & Health Networks, 69 (1995): 38–41; Chirba-Martin M.A. Brennan T.A. , “The Critical Role of ERISA in State Health Reform,” Health Affairs, 13, no. 2 (1994): 142; see also “Holding HMOs Accountable,” USA Today, Aug. 6, 1997, at 3A.

I have not addressed the serious issue of the psychological price paid by physicians living through malpractice suits. See Martin C.A. , “Physicians' Psychologic Reactions to Malpractice Litigation,” Southern Medical Journal, 84 (1991): 1300–04; and Polles A. Neral S.M. , “The Effects of Malpractice on Mississippi Physicians,” Journal of the Mississippi State Medical Association, 34 (1993): 77–81.