BELL v. SHARP CABRILLO HOSPITAL

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Court of Appeal, Fourth District, Division 1, California.

Bonnie BELL et al., Plaintiffs and Appellants, v. SHARP CABRILLO HOSPITAL et al., Defendants and Respondents.

No. D006504.

Decided: June 29, 1989

Miller, Boyko and Bell, Terry D. Harper and Raymond Pepper, San Diego, for plaintiffs and appellants. McInnis, Fitzgerald, Rees, Sharkey & McIntyre, Escondido, William Bailey, Fred Cohen, Horvitz & Levy, S. Thomas Todd, Sharon Swanson and Lisa Perrochet, Encino, for defendants and respondents.

After 16 year-old Timothy Burbank died because of surgery negligently performed at Sharp Cabrillo Hospital (Hospital), his mother, Bonnie Bell, sued the hospital for having previously renewed the surgical staff privileges of Dr. Samuel E. Rosenzweig, the negligent surgeon.   She asserts the hospital breached its duty to exercise reasonable care in reviewing Rosenzweig's competence when he applied for renewal of his staff privileges.   Although she recovered both economic and noneconomic compensatory damages for the death of her son, she contends the trial court erred in refusing to instruct the jury on punitive damages and in reducing the award of noneconomic damages to $250,000 under Civil Code 2 section 3333.2.   As we shall explain, we conclude neither contention has merit and affirm the judgment.

I

FACTUAL AND PROCEDURAL BACKGROUND

Burbank was taken to the Hospital's emergency room complaining of generalized abdominal pain.   Within hours, Rosenzweig, on-call for emergency duty at that time, performed exploratory surgery resulting in complications from which Burbank died 12 days later.3  Bell's wrongful death and survival action against the Hospital alleged it consciously disregarded the safety of its patients by granting staff privileges to Rosenzweig without investigating warnings of his possible incompetence.   At the end of Bell's case-in-chief, the trial court stated it would not instruct the jury on punitive damages for lack of evidence that the Hospital consciously disregarded the safety of others when reviewing Rosenzweig's application for renewal of staff privileges more than a year before this tragic event.   The jury's special verdict found the Hospital's negligence in evaluating and reviewing Rosenzweig's staff privileges was a legal cause of Burbank's death and awarded $100,000 economic damages and $500,000 noneconomic damages.   The trial court reduced Bell's recovery for noneconomic damages to $250,000 pursuant to section 3333.2 and also the total award by $40,000, as an offset for monies received from Rosenzweig's estate.

II

THE TRIAL COURT PROPERLY REDUCED THE AWARD OF NONECONOMIC DAMAGES TO $250,000

Bell contends the Medical Injury Compensation Reform Act of 1975 (MICRA) and more specifically section 3333.2, limiting a recovery for noneconomic losses to $250,000 in any action for injury against a health care provider based on professional negligence, does not apply to an action for a breach of a hospital's duty to exercise reasonable care in reviewing the competence of its medical staff.  (See Elam v. College Park Hospital (1982) 132 Cal.App.3d 332, 183 Cal.Rptr. 156.)   She argues a hospital's breach of its duty to exercise reasonable care in selecting and reviewing the competency of its staff physicians is not “professional negligence” within the meaning of section 3333.2, subdivision (c)(2).

“Professional negligence” is defined within section 3333.2, subdivision (c)(2) as “a negligent act or omission to act by a health care provider in the rendering of professional services, which act or omission is the proximate cause of a personal injury or wrongful death, provided that such services are within the scope of services for which the provider is licensed and which are not within any restriction imposed by the licensing agency or licensed hospital.”   Bell limits her attack solely to the issue of whether the Hospital's failure here to ensure the competence of the medical staff through a careful and complete peer review constitutes a negligent act or omission “in the rendering of professional services ․ provided that such services are within the scope of services for which the provider is licensed․”

Language in Hedlund v. Superior Court (1983) 34 Cal.3d 695, 194 Cal.Rptr. 805, 669 P.2d 41, offers guidance regarding the scope of the “professional negligence” language of MICRA.   There the court considered whether the MICRA statute of limitations (Code Civ.Proc., § 340.5) applied to an action against a psychiatrist sued for failing to warn a potential victim of the dangerous proclivities of a patient, in breach of the duty of care recognized in Tarasoff v. Regents of University of California (1976) 17 Cal.3d 425, 131 Cal.Rptr. 14, 551 P.2d 334.   Similar to section 3333.2, the statute of limitations there applies only to actions based on a health care provider's alleged “professional negligence.”   The essence of the defendant's argument in Hedlund was that the action did not fall within that category because a psychiatrist's failure to protect potential victims of his patient was ordinary negligence not involving failure to render professional services.   The Supreme Court concluded the duty to warn was “inextricably interwoven” with the psychiatrist's professional and diagnostic responsibilities.  (Hedlund v. Superior Court, supra, 34 Cal.3d at pp. 703–704, 194 Cal.Rptr. 805, 669 P.2d 41.)   Noting first that diagnosis of psychological, emotional and mental disorders is a professional service for which a psychologist is licensed as well as the decision to warn and the manner in which that warning is given involved matters of professional judgment (id. at p. 703, 194 Cal.Rptr. 805, 669 P.2d 41), the court explained:

“Tarasoff recognizes a right to expect that a licensed psychotherapist will realize when a patient poses a serious danger to another and, if that potential victim is identifiable, will act reasonably to protect the victim.   The diagnosis and the appropriate steps necessary to protect the victim are not separate or severable, but together constitute the duty giving rise to the cause of action.”  (Id. at p. 704, 194 Cal.Rptr. 805, 669 P.2d 41.)

Consequently, “Hedlund does demonstrate that MICRA's reference to actions based on ‘professional negligence’ is not strictly limited to classic sponge-in-the-patient medical malpractice actions․”  (Waters v. Bourhis (1985) 40 Cal.3d 424, 432–433, 220 Cal.Rptr. 666, 709 P.2d 469.)

Further, in Murillo v. Good Samaritan Hospital (1979) 99 Cal.App.3d 50, 160 Cal.Rptr. 33, the court addressed the issue of what constitutes “professional negligence” within the meaning of Code of Civil Procedure section 340.5 where the health care provider is a hospital.   The court held an action for a hospital's negligence in leaving the bed rails lowered during the night while plaintiff was asleep and drugged was one for professional negligence governed by the statute of limitations set forth in Code of Civil Procedure section 340.5.   The court noted the professional duty of a hospital “is primarily to provide a safe environment within which diagnosis, treatment, and recovery can be carried out.   Thus if an unsafe condition of the hospital's premises causes injury to a patient, as a result of the hospital's negligence, there is a breach of the hospital's duty qua hospital.”  (Murillo v. Good Samaritan Hospital, supra, 99 Cal.App.3d at pp. 56–57, 160 Cal.Rptr. 33.)   The court further expounded on the meaning of the same definition of professional negligence we have here as follows:

“[T]he test is not whether the situation calls for a high or a low level of skill, or whether a high or low level of skill was actually employed, but rather the test is whether the negligent act occurred in the rendering of services for which the health care provider is licensed.”  (Id. at p. 57, 160 Cal.Rptr. 33.)

(See also Taylor v. U.S. (9th Cir.1987) 821 F.2d 1428, 1432, echoing the Murillo standard and holding the hospital “had a professional duty to prevent Taylor's husband from becoming separated from his ventilator, regardless of whether separation was caused by the ill-considered decision of a physician or the accidental bump of a janitor's broom.”)

The decision in Elam v. College Park Hospital, supra, 132 Cal.App.3d at p. 346, 183 Cal.Rptr. 156, imposing a general duty of care to “hold a hospital ․ accountable for negligently screening the competency of its medical staff to insure the adequacy of medical care rendered to patients at its facility” was predicated upon judicial and legislative recognition that a hospital has a professional responsibility to insure the competence of its medical staff through careful selection and orchestrated periodic review.   Although once established the medical staff may well be self-governing, it is the hospital which is responsible for organizing and implementing procedures to select and reappoint staff.   Thus, we conclude the competent selection and review of medical staff is precisely the type of professional service a hospital is licensed and expected to provide, for it is in the business of providing medical care to patients and protecting them from an unreasonable risk of harm while receiving medical treatment.   Employing the terminology in Hedlund, the competent performance of this responsibility is “inextricably interwoven” with delivering competent quality medical care to hospital patients.

Of special pertinence here where Burbank was an emergency room admittee relegated to the care of on-call staff, is our recognition in Elam that the public's perception of a contemporary hospital is one which is “a multifaceted, health-care facility responsible for the quality of medical care and treatment rendered.”  (Elam v. College Park Hospital, supra, 132 Cal.App.3d at p. 344, 183 Cal.Rptr. 156.)   Recognizing the patient's reliance upon the effectiveness of this highly integrated health care provider, we further explained:

“ ‘[t]he concept that a hospital does not undertake to treat patients, does not undertake to act through its doctors and nurses, but only procures them to act solely upon their own responsibility, no longer reflects the fact.   The complex manner of operation of the modern-day medical institution clearly demonstrates that they furnish far more than mere facilities for treatment.   They appoint physicians and surgeons to their medical staffs, as well as regularly employing on a salary basis resident physicians and surgeons, nurses, administrative and manual workers and they charge patients for medical diagnosis, care, treatment and therapy, receiving payment for such services through privately financed medical insurance policies and government financed programs known as Medicare and Medicade.   Certainly, the person who avails himself of our modern “hospital facilities” (frequently a medical teaching institution) expects that the hospital staff will do all it reasonably can to cure him and does not anticipate that its nurses, doctors and other employees will be acting solely on their own responsibility.’ ”  (Id. at pp. 344–345, 183 Cal.Rptr. 156, quoting Johnson v. Misericordia Community Hospital (1981) 99 Wis.2d 708, 301 N.W.2d 156, 164.)

Because a hospital's effectiveness in selecting and periodically reviewing the competency of its medical staff is a necessary predicate to delivering quality health care, its inadequate fulfillment of that responsibility constitutes “professional negligence” involving conduct necessary to the rendering of professional services within the scope of the services a hospital is licensed to provide.

Bell asserts that to allow a hospital to shield itself from liability for all noneconomic damages it causes by applying the MICRA limitations will reduce the impact of the Elam duty by frustrating its encouragement of hospitals to carefully screen the competency of their medical staff.   This policy concern is irrelevant in light of our finding our construction of the term “professional negligence” is entirely consistent with and furthers the legislative intent underlying MICRA.  (See Hedlund v. Superior Court, supra, 34 Cal.3d at p. 704, 194 Cal.Rptr. 805, 669 P.2d 41.)   As we recognized in Elam:

“[I]mposing hospital-corporate liability does not interfere with the Legislature's comprehensive efforts to ameliorate the integrity and quality of the health care system (see, e.g., Stats.1975, 2d Ex. Sess., ch. 2, pp. 3978–4007), but rather supplements the efforts by encouraging hospitals to actively oversee the competence of their medical staff and the quality of the medical treatment rendered on their premises, while providing victims with an additional avenue for relief.   Simply stated, the Legislature has not attempted to immunize the hospital from liability arising from its negligence.   Instead, the underlying statutory intent of the cited legislative campaign is the protection and furtherance of the health care interest of the patient.”  (Id. 132 Cal.App.3d at p. 347, 183 Cal.Rptr. 156.)

We echo this declaration today, mindful the legislative stratagem in MICRA was first to reduce the number and severity of medical malpractice injuries by erecting a framework to assure medical quality affording governmental oversight of the education, licensing and discipline of physicians and health care providers;  second to reduce the cost and enhance the efficiency of medical malpractice litigation by revising legal rules applicable to such litigation;  and third to curtail unwarranted malpractice insurance premium increases by establishing procedures to review substantial rate increases and authorizing alternative insurance coverage programs.  (American Bank & Trust Co. v. Community Hospital (1984) 36 Cal.3d 359, 363–364, 204 Cal.Rptr. 671, 683 P.2d 670;  Barme v. Wood (1984) 37 Cal.3d 174, 179, 207 Cal.Rptr. 816, 689 P.2d 446;  7 Pacific L.J. (1975) 544, 545.)   In light of the comprehensive legislative scheme regulating the quality of health care provided by contemporary hospitals, the ability of a plaintiff to recover all economic, pecuniary damages resulting from the injury in section 3333.2 (see Fein v. Permanente Medical Group (1985) 38 Cal.3d 137, 159, 211 Cal.Rptr. 368, 695 P.2d 665), and other social and economic pressures on hospitals to remain competitive in the health-care marketplace, we are confident our hospitals will not be less responsible in monitoring the competency of their medical staff to ensure the adequacy of medical care rendered to patients at their facilities because of our holding.

III–IV *

DISPOSITION

The judgment is affirmed.

FOOTNOTES

FN2. All statutory references are to the Civil Code unless otherwise specified..  FN2. All statutory references are to the Civil Code unless otherwise specified.

3.   In light of the nature of the legal issues posed by this appeal, it is unnecessary to summarize the circumstances and facts surrounding Burbank's treatment at the Hospital highlighted by the tragic level of Rosenzweig's incompetence.

FOOTNOTE.   See footnote 1, ante.

WORK, Associate Justice.

BENKE, J., concurs. WIENER, Acting Presiding Justice, concurring:*

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