Is A Hospital Financially Responsible For Its Doctors?

Is A Hospital Financially Responsible For Its Doctors?

The short answer to this question is simply “no”. The Florida Supreme Court concluded in a lengthy opinion that “although it may be sound public policy for the legislature to impose an obligation on hospitals to monitor the financial responsibility of physicians who are granted staff privileges, it is outside this Court’s purview to imply a statutory cause of action against hospitals where none was intended by the legislature.When you go to the hospital you are often seen by physicians who you don’t know and you have no relationship with. Often times these are doctors with staff privileges. This means that those doctors work at the hospital and often times have their own private offices and you may think that the hospital would be financially responsible if those doctors are negligent in the care that they provide to you and your family. Think again, unfortunately, financial responsibility is the exception rather than the rule.Therefore, every time you enter the hospital you may be treated by doctors who you later learn were considered independent contractors and/or doctors with staff privileges who the hospital does not accept any financial responsibility for. Unfortunately, this provides many patients with no financial remedy for malpractice committed upon them and their families.

This is not to say there are not financial responsibilities created by the legislature for doctors. However, this legislation has a multitude of weak links in it. Number one, doctors are required to carry a minimal amount of insurance which is $250,000. The physicians are also given alternatives to obtaining medical malpractice insurance, the alternatives include establishing and maintaining an escrow account in the amount of $250,000 or obtaining and maintaining an unexpired irrevocable letter of credit in the amount of $250,000 pursuant to Florida statutes. The reality of this is that doctors working inside the walls of most of the South Florida hospitals have very little checks and balances if they fail to comply with these requirements. It should be noted that these financial responsibility requirements are mandated as a condition to maintaining staff privileges (although often not enforced).

The Supreme Court has determined that there is no duty on the hospital to ensure physician compliance with these financial responsibility laws. The Supreme Court of Florida has stated that there is no recognized common law duty on the part of a hospital to monitor the financial responsibility of physicians and thus no common law cause of action against hospitals for breaching that duty.

Arguments have been to the Supreme Court that hospitals should have a duty to monitor the compliance of their doctors with hospital staff privileges so that patients could be adequately compensated if doctors committed malpractice.

The Supreme Court has struck down this argument when interpreting the medical malpractice statutes and rendered an opinion stating that this was not the intent of the legislature.

The Supreme Court has also declared that a physician who violates the financial responsibility requirements is subject to significant administrative penalties, including the possible revocation of his or her license and other discipline. The prospect of these administrative penalties provides a strong incentive to ensure that the physicians do comply with financial responsibility laws. Nevertheless, we have encountered doctor after doctor who fails to comply with the financial responsibility laws and faced with a lawsuit threaten their patients with bankruptcy and asset protection.

Considering the current legislative scheme and The Supreme Court’s interpretation of the legislation, it seems that the legislature should take another look at the current medical malpractice laws and how they fail in many respects to provide an appropriate remedy despite negligence and harm that may be committed on Florida’s residents.