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Neade v. Portes Decision A Victory for Illinois Physicians |
On October 26, 2000, the Illinois Supreme Court issued a landmark ruling in the case of Neade v. Portes, striking down an Illinois Appellate Court decision that had upheld a plaintiff's right to sue a physician for breach of fiduciary duty. This decision has positive ramifications for Illinois physicians, as it reaffirms that health plans, not doctors, are responsible for informing patients of financial incentives or arrangements they may have with a patient's physician.
The case began when an ISMIE-insured physician was sued for alleged medical malpractice for not authorizing an angiogram for a patient who later died of a myocardial infarction. In the original lawsuit, the physician was sued for one count of alleged negligence, and one count of breach of fiduciary duty. In pre-trial arguments, the defense argued that the count of breach of fiduciary duty should be removed from the lawsuit, since it amounted to a second, separate charge of medical negligence. After the court upheld the appeal, the plaintiff filed an affidavit in Illinois Appellate Court, arguing that the count of breach of fiduciary duty should stand, since it was revealed that the physician had negotiated a financial incentive agreement with the patient's HMO regarding referrals to medical specialists. The plaintiff stated that, had she known about the financial agreement, she would have sought a second opinion from another physician regarding treatment options for her husband.
While the defense sought to strike down the affidavit, the Illinois Appellate Court upheld the plaintiff's right to sue for alleged breach of fiduciary duty by the physician for failing to disclose his financial agreement with the patient's HMO.
The Illinois Supreme Court, however, reversed the decision of the Appellate Court. The court pointed out that the Illinois Managed Care Reform and Patient Rights Act, a new law which went into effect January 1, 2000, with strong backing from the Illinois State Medical Society, provided for health plans to disclose information of this sort to their beneficiaries. This, the court said, indicated a legislative determination that this was the proper party to make disclosure. Additionally, the court agreed with a brief submitted by ISMS that requiring physicians to disclose this information would be inappropriate to the physician/patient relationship and extremely burdensome. The court went on to point out that this would be a new duty imposed upon physicians and would not really benefit patient care.
After the Supreme Court ruled in favor of the defense, the case was remanded to court, with only the first count of alleged malpractice eligible for the trial phase of the lawsuit.
Illinois physicians can breathe a sigh of relief with the Supreme Court's decision based on the Illinois Managed Care Reform and Patient Rights Act. Health plans, not physicians, are responsible for providing information regarding financial arrangements or incentives they may have with a patient's physician. Physicians are thus saved from malpractice "double jeopardy," since allegations of fiduciary negligence essentially amount to a separate count of medical negligence. If the Supreme Court had not struck down the Appellate Court's ruling on fiduciary duty, Illinois physicians and ISMIE policyholders could potentially be exposed to countless new and re-opened malpractice lawsuits.
Of course, physicians must remember the important distinction between disclosure of financial arrangements and the required discussion of medical options with a patient. The language of the Managed Care Reform and Patient Rights Act makes clear the obligation that physicians have to discuss all treatment options with patients - regardless of cost, their ability to pay, or whether their health plan will cover a certain procedure or not. At the same time, the act makes it clear that a physician who makes medical treatment decisions based on a patient's ability to pay will clearly be regarded as negligent.
The Neade v. Portes decision clarifies the language of the Illinois Managed Care Reform and Patient Rights Act by outlining the obligations that physicians and health care plans have regarding the disclosure of medical treatment options and financial arrangements that affect a patient's health coverage. In this case, ISMIE and its policyholders clearly benefited from the legislative efforts of the Illinois State Medical Society in defining the legal and clinical responsibilities of doctors and health plan providers.
To read the Illinois Supreme Court's online transcript of this decision, please visit http://www.state.il.us/court/200/87445.htm.