Pennsylvania’s “Benevolent Gesture” Legislation Meets Opposition in Senate

by Mark Bauman | May 6, 2023 | Legal News, Medical Malpractice

One year after obtaining approval in the Pennsylvania House of Representatives, Senate Bill 379, otherwise known as Pennsylvania’s “Benevolent Gesture” law, has been tabled by the Senate, subject to being called to a vote. 

Released from the House of Representatives in March 2011, the Bill deemed any admission of fault, or other “benevolent gesture” by a healthcare provider, made prior to the filing of a medical professional liability action, to be inadmissible as evidence of liability in a subsequent professional liability lawsuit. 

Upon its introduction in the Senate, the Bill came under multiple criticisms which kept it in the Senate until the end of the 2012 legislative session.  First, in addition to its focus on healthcare providers’ “benevolent gestures,” the Bill sought to address certain apportionments of health insurance to children ineligible for medical assistance.  By addressing this “second issue,” opponents argued that the Bill violated a state constitutional mandate requiring legislation to have no more than one subject per bill.  The Bill also drew criticism for its public policy implications, as its provisions barring the admissibility of “pre-suit” statements of fault had the effect of preventing not only the admission of pertinent statements regarding a patient’s discomfort, pain, injury, or death, but also statements in which a clear degree of fault or egregious violation could be implicated.  In this regard, opponents of the Bill cited an example of a physician who apologized to a patient for missing a call to the hospital “because he or she was out golfing.” 

Notwithstanding these criticisms, the Bill has been hailed as one encouraging benevolent gestures by healthcare providers, and in turn, It has also been argued that the Bill supports and furthers the standards of professional conduct applicable to healthcare providers, as medical ethics codes generally require a provider to disclose all facts which are necessary for a patient’s full understanding of what has occurred with regard to their condition and treatment.  With a benevolent gesture law in place, proponents claim that providers would be able to make such disclosures without fear of these statements being used against them in subsequent litigation. 

While legislators expect a hearing on Senate Bill 357 sometime this spring, no specific timetable has been set. 

Northumberland County Judge Holds Settlement Agreement Discoverable Pending Jury Determination of Liability

by Mark Bauman | May 5, 2023 | Legal News, Medical Malpractice

In an issue of first impression, Northumberland County Judge Charles H. Saylor has ruled that a physician being sued for malpractice may see the confidential settlement agreement between a plaintiff and a defendant hospital, if the physician is ultimately found liable to the plaintiff as a joint tortfeasor.  As a joint tortfeasor, Judge Saylor held that the physician may be entitled to a set-off of any amount the plaintiff had already recovered in the settlement with the hospital.

In the underlying case, plaintiff’s decedent was treated by the defendant physician at the defendant hospital.  According to plaintiff’s complaint, the physician allegedly failed to diagnose an infection which ultimately contributed to the decedent’s death.  The administratrix of the decedent’s estate then brought suit against the hospital and subsequently against the physician.  In June 2011, the hospital settled with the estate.  Thereafter, disclosure of the settlement agreement was requested by the physician, apparently to assist the physician’s counsel and insurer in evaluating a settlement offer on behalf of the physician.

To address the physician’s request, Judge Saylor first took account of how similar requests had been handled in other jurisdictions.  Noting these approaches to range from full disclosure of settlement agreements “as of right” to a per se denial of discoverability, Saylor opted for the middle ground, holding that the discoverability of the agreement would be determined by balancing the interests of all parties involved, i.e. the physician, the hospital, and the estate.

As part of this balancing test, Judge Saylor sought guidance from the Uniform Contribution Among Tortfeasors Act, 42 Pa.C.S.A. 8321-8327, which addresses the effects of a tortfeasor’s release, along with the method for determining a set-off.  According to Judge Saylor, the UCATA “put the wording of the agreement between [the estate] and [the hospital] in issue.”  While noting that the language and terms of the settlement agreement could ultimately be discoverable under the UCATA, Judge Saylor nonetheless stated that first, “a jury must find [the defendant physician] liable before the wording of the confidential settlement agreement becomes significant for the purposes of [the statute].”  Prior to this determination of the physician’s liability, Judge Saylor opined that any interest on the part of the physician in assessing the value of plaintiff’s case (based on the settlement agreement struck with the hospital) would “not [be] sufficient to override the privacy interest embodied in the confidential settlement agreement involving a third party.” 

Third Circuit Certifies to N.J. Supreme Court Questions Regarding Applicability of Affidavit of Merit Statute

by Mark Bauman | May 4, 2023 | Legal News, Medical Malpractice

In an opinion issued on August 16, 2012, the United States Court of Appeals for the Third Circuit certified two questions to the Supreme Court of New Jersey pertaining to the state’s Affidavit of Merit Statute. Specifically, the court requested clarification on 1) whether the law applies to “property damages” claims, and 2) whether the law applies to intentional torts, specifically, fraud.

The underlying case of Nuveen Municipal Trust v. WithumSmith+Brown, et al. involved a loan transaction between Nuveen and Bayonne Medical Center. In connection with the transaction, Bayonne provided Nuveen with an audit report authored by Withum, its accounting firm, as well as an opinion letter authored by its counsel, Lindabury McCormick Estabrook & Cooper. While both documents attested to the financial solvency of Bayonne, six months after the loan was executed, Bayonne filed for Chapter 11 bankruptcy. According to Nuveen, both the audit report and the opinion letter concealed problematic issues with regard to Bayonne’s financial condition, and as such, it would not have entered into the loan had it known otherwise.

Nuveen filed suit against Withum alleging fraud and against Lindabury alleging malpractice. Ultimately, the District Court of New Jersey dismissed Nuveen’s action with prejudice, holding that it had failed to timely file affidavits of merit attesting to the viability of its claims directed against each of the “professional” defendants. Under New Jersey law, such an affidavit must be filed in any action “for damages for personal injury, wrongful death, or property damage resulting from an alleged act of malpractice of negligence by a licensed professional.”

On appeal, Nuveen offered several choice-of-law arguments, claiming that the New Jersey statute which required the affidavit of merit was a procedural pleading requirement, which notably conflicted with the pleading provisions contained with Federal Rule 8. The Third Circuit rejected this argument, holding that the affidavit was neither a pleading nor a pleading requirement, and thus was inapplicable to Rule 8. Moreover, it stated that the purpose of the affidavit is not to apprise the defendant of the claims against it (as encompassed by the scope of Federal Rule 8), but rather to give some modicum of validation to professional malpractice claims.

The Third Circuit also rejected Nuveen’s arguments that it was denied various protections under New Jersey law which were intended to protect claimants from the harshness of the affidavit of merit requirement. Specifically, these protections included the New Jersey civil Case Information Sheet and the accelerated case management conference, both of which served as operative “reminders” with regard to the affidavit of merit requirement. As stated by the Third Circuit, the absence of these reminders would not preclude dismissal, as “plaintiffs (and their attorneys) are required to know the law.”

New Jersey law allows the affidavit of merit requirement to be extended or even forgiven if the plaintiff can show, among other things, “substantial compliance” with the requirement, or alternatively, some “extraordinary circumstances” warranting equitable relief. While the Third Circuit found neither of these with regard to Nuveen’s case, it was ultimately unable to determine whether the affidavit of merit requirement could be applied at all. In this regard, the Third Circuit sought to determine whether Nuveen’s action was for “damages for personal injuries, wrongful death, or property damage,” thereby requiring an analysis of the “nature of the injuries” under New Jersey law. In addition, the Third Circuit also sought to determine whether Nuveen’s claims for fraud could be regarded as those sounding in “malpractice or negligence.” Here, the Third Circuit noted that proof of malpractice was not an element of fraud, and as a result, Nuveen’s claim required a similar analysis of the operative “cause of action” under New Jersey law.

As the Third Circuit was reluctant to decide how the New Jersey Supreme Court would rule on either issue, both were certified to the Court for review.

Supreme Court Grants Appeal to Consider “Error in Judgment” Defense in Medical Malpractice Cases

by Mark Bauman | May 3, 2023 | Legal News, Medical Malpractice

On May 23, 2012, the Supreme Court of Pennsylvania granted petitions for allowance of appeal filed on behalf of a defendant physician and her practice group, to address the Superior Court’s analysis of the “error in judgment” defense in the underlying case of Passarello v. Grumbine, M.D., et al., 29 A.3d 1158 (Pa. Super. 2011).

In Passarello, a two-month old baby boy was treated several times by the defendant physician in 2001, for what was believed by the physician to be symptoms of gastroesophageal reflux. When the boy’s symptoms persisted after multiple visits, his parents brought him to a nearby emergency room, where he was ultimately determined to be in severe respiratory distress characterized by an extremely low heart rate. Despite intervention on the part of the hospital staff, the boy died from what was revealed on autopsy to be a viral infection of the heart muscle known as diffuse viral myocarditis.

Eventually, the parent plaintiffs filed suit against the defendant physician and her practice group on July 28, 2003. On April 29, 2009, the jury delivered a verdict on behalf of the defendants. Notably, during the jury charge, the trial judge instructed the jury on not only the objective standard of professional negligence, but also what amounted to the “error in judgment defense” on behalf of the defendant physician. Prior to these instructions, defense counsel had also emphasized the error in judgment doctrine in her closing argument, pointing out the physician’s state of mind and her desire to treat the patient in the manner she believed best.

Following post-trial motions, plaintiffs filed an appeal to the Superior Court, claiming that the trial court erred in charging the jury on the “error in judgment” rule, and that accordingly, the award of a new trial was warranted. Relying on the Superior Court’s holding in Pringle v. Rapaport, 908 A.2d 159 (Pa. Super. 2009), which effectively eliminated the “error in judgment” defense in medical malpractice cases, plaintiffs asserted that such an instruction “wrongly inject[ed] a subjective element into the jury’s deliberations when the standard of care for physicians is objective in nature.”

Notwithstanding the fact that the Pringle case had been filed almost six years following the complaint in Passarello, the Superior Court held that Pringle, and its effective denouncement of the “error in judgment” defense, could be retroactively applied to Passarello because the final verdict in Passarello had not been entered until after the date on which Pringle was filed.

Under the application of the Pringle case, the Superior Court determined that the award of a new trial was “imperative.” Notably, the court held that, as in Pringle, the trial court’s instruction in Passarello “gave every indication that a physician may avoid liability for otherwise negligent acts if at the time in question he had done the best he could.” Id. at 1166. Furthermore, because defense counsel gave particular focus to the defendant physician’s state of mind, the court noted that such a tactic improperly shifted the focus of the argument to the physician’s professional character, as opposed to the objective standard of care at issue. Given that counsel’s arguments effectively exploited the erroneous instruction by the trial court, the Superior Court held that the court’s error could not be minimized, and as such, a new trial was warranted.

Pursuant to its allowance of defendants’ appeal, the Court will now consider whether the Superior Court’s retroactive application of Pringle was consistent with previous rulings on retroactive application. In addition, according to the physician’s petition, the Court will examine whether the award of a new trial violated prior precedent when plaintiffs failed to object to the “error in judgment” instruction at trial, and whether, under the circumstances, the error of the trial court was truly incurable.

Supreme Court Holds that Praecipe for Writ of Summons Not Sufficient to Establish Notice of a “Claim” Under MCARE Section 517

by Mark Bauman | May 2, 2023 | Legal News, Medical Malpractice

In an opinion issued May 30, 2012, the Supreme Court of Pennsylvania held that in the absence of other notice or communication of a demand, the filing of a praecipe for a writ of summons does not suffice to establish a “claim” pursuant to Section 715 of the MCARE Act.

In the underlying case of Ziv v. Yussen, M.D., et al., the patient plaintiff filed a praecipe for a writ of summons naming her physician, along with other medical providers, as defendants, on June 4, 2007. On August 2, 2007, a complaint was filed, wherein the patient plaintiff alleged medical negligence, which had apparently occurred up to July 7, 2003.

Notably, the defendant physician’s primary insurer did not receive notice of the plaintiff’s writ of summons until July 23, 2007. As such, upon receipt the insurer issued a request to the State Department of Insurance that the claim be given Section 715 status under the MCARE Act. The provisions of Section 715 require the Insurance Department, through the MCARE Fund, to “assume central obligations to the primary insurer,” if a medical negligence “claim” is made more than four years after the treatment at issue. As noted by our Supreme Court,

See Pa. Med. Soc’y Liab. Ins. Co. v. Commonwealth, 577 Pa. 87, 90 n.2 (2005).

Ultimately, the Department denied the insurer’s request, stating that under Section 715, the claim had been made less than four years after the alleged malpractice. In this regard, the Department pinpointed the operative date of the “claim” to the date on which the plaintiff’s praecipe for writ of summons was filed, June 4, 2007. The insurer subsequently challenged the Department’s decision and an administrative hearing was held. However, before the Insurance Commissioner could issue a decision, the case was transferred to the Commonwealth Court and a new hearing examiner was appointed.

Following arguments, the examiner recommended that the Department’s denial of Section 715 status be reversed. According to the examiner, while the terms “claim” and “made” were ambiguous within the statutory language of Section 715, the legislative purpose of the statute, as enumerated by the Supreme Court in Pa. Med. Soc’y, could not be achieved without the appropriate notice. While the examiner further supported his position with analysis of legislative history, statutory construction, and recent adjudications by the Insurance Commissioner, the Commonwealth Court ultimately disagreed and upheld the denial of Section 715 status, holding that under the same adjudication referenced by the examiner, the position of the Insurance Commissioner was that a claim was effectively “made” on the date a writ of summons is filed.

On appeal, the Supreme Court similarly found ambiguity in the operative terms of Section 715, and like the Commonwealth Court examiner, turned its focus to principles of statutory construction and legislative history. Noting the purpose of Section 715 to afford insurers greater certainty in calculating reserves, the Court found such a purpose to be “most consonant” with a construction “encompassing some notice to the insured.” Accordingly, the Court held that a “claim” under Section 715 of the MCARE Act could not be established simply by the filing of a praecipe for a writ of summons, and that some form of notice or communication, e.g. a demand letter forwarded by defense counsel or the insured themselves, would be required before the operative time period could be established.

To read the full opinion, CLICK HERE.