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of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto
Volume 46, No. 11 November 1990
DO PHYSICIANS HAVE CIVIL RIGHTS?
The guarantees of due process at both state and federal
levels are under siege on several fronts. This was the recurring
theme of the 47th annual meeting of AAPS in Scottsdale, AZ,
The repeal of the Fourteenth Amendment to the US
Constitution, which extends federal protections to the citizens
of all states, could effectively be accomplished by the judicial
invalidation of the Civil Rights Act of 1871, the grandfather of
all civil rights legislation. The ``anti-Ku Klux Klan Act''
provides that a person who, under any statute, ordinance, or
custom of any state, subjects another person to a deprivation of
rights secured by the Constitution and laws shall be liable to
the injured party in an action at law. This means that he can
sue for damages, injunctive relief, or other proper redress.
Can a physician who is deprived of his privileges in a
public hospital, without being afforded his due process rights,
bring a civil rights action? This was the question raised in
Caine v. Hardy, Mason, et al. (see AAPS News, Sept 1990).
The answer appears to hinge on the interpretation of the Par-
ratt/Hudson Doctrine. This doctrine was first enunciated in
1981, in the case of a prisoner named Parratt, whose $25 hobby
kit was discarded by a guard. The Supreme Court ruled that
Parratt had no cause for a civil rights action because the state
could not have afforded him a predeprivation hearing, and the
action of the guard was ``random and unauthorized.''
Writing the dissenting opinion in the Fifth Circuit court
decision, Edith Jones (the only judge other than David Souter
interviewed for the recent Supreme Court vacancy) argued that the
Parratt/Hudson doctrine applied because state regulations did not
authorize the action taken against Dr. Caine. The state had
appropriate regulations; its employees had simply violated them.
In other words, it was not the state itself, but persons employed
by the state who were responsible for any wrong that might have
In his report of the Limited Legal Consultation Service,
AAPS Counsel Kent Masterson Brown stated that the Caine case will
reach the Supreme Court. If the decision of the Fifth Circuit is
overturned, it essentially means that ``there is no civil rights
cause of action against a State.''
The due process problems involved in Medicare-Medicaid fraud
investigations were discussed by psychiatrist Carol Brown, MD, of
Honolulu and her attorney, R. Steven Geshell. The first problem
is the vagueness of the regulations that physicians agree to
abide by when they sign the contract with the government (usually
without reading it).
``They tell you not to speed, but they won't tell you what
the speed limit is,'' she explained.
Then there are the investigative techniques. Once a physi-
cian is targeted (perhaps because she has spoken out on
politically sensitive issues), the investigators seek evidence.
Dr. Brown stated that 127 of her patients, including the sickest
ones, were interviewed. In return for their testimony against
her, prostitutes and drug dealers were promised reductions in
their own sentences. Before Dr. Brown could even find out what
the accusations were, investigators threatened to break down the
door of her home in order to search for patient records. All
records, even those of private patients who could be severely
harmed by breaches of confidentiality, were subject to scrutiny.
Photographs of Dr. Brown's office were identified as the ``scene
of the [still unspecified] crime.''
In a two-week jury trial, Dr. Brown was acquitted of all
charges. (Conviction could have carried a sentence of 670 years
in prison for ``defrauding'' the government, as by coding visits
in a manner not approved by the regulations.) The judge com-
mented that the case should have been handled administratively,
but that Medicaid had not followed its own rules.
Dr. Brown filed a lawsuit against the State of Hawaii on the
200th anniversary of the ratification of the US Constitution.
Although one count is still pending, the allegation of denial of
civil rights due process has been thrown out.
In addition to the possibility of investigators' disregard
of their agency's own rules, proposed regulations concerning
fraud and abuse sanctions may exceed statutory authority and
violate the US Constitution, according to Astrid Meghrigian,
Legal Counsel to the California Medical Association. Issues
include the following: (1) Subjecting physicians to both
criminal and civil sanctions for the same activity may violate
the double jeopardy clause of the Fifth Amendment to the US
Constitution. (2) Definitions of investigators' rights to ``-
immediate access'' to records upon ``reasonable request''
seriously undercut Fourth Amendment protections from unreasonable
searches and seizures. (3) Physicians proposed for exclusion
from Medicare are in many respects presumed guilty until proved
innocent. (4) Prohibiting the cross-examination of witnesses
and almost all forms of discovery (such as depositions and
interrogatories) violates fundamental concepts of fairness and
Formerly, civil rights ``entailed a limitation of government
power.'' The meaning of the term may now be actually reversed,
implying an expansion of government power (Tom Bethell, The
American Spectator 10/90). While quotas are effectively imposed
for the supposed benefit of ``certified victims,'' another type
of quota exists for certified villains, such as physicians (see
p. 2). And if one class of citizens can be attainted, who shall
Kusserow Named Bureaucrat of the Year;
Resignation Called For
HHS Inspector General Richard Kusserow, recipient of the
AAPS Bureaucrat of the Year Award, was hanged in effigy at the
47th Annual Meeting. The awards ceremony was based on a
tradition begun in 1764 by the Sons of Liberty, who hanged an
effigy of Andrew Oliver from the Liberty Tree. (Oliver was the
bureaucrat responsible for enforcing the Stamp Act.)
Kusserow received all the due process rights that his office
accords to physicians in Medicare sanctions proceedings,
including representation by counsel. His attorney, Vickie Yates
Brown, was gagged after her first motion was denied by the judge.
The jury, unbiased despite previously facing sanctions threats
from HHS, deliberated for several microseconds before returning
the verdict of ``Guilty.''
At the trial, Kusserow was indicted for initiating the
bounty system that awarded merit pay increases to his agents
based on the number of sanctions imposed, as was documented in
the case of Melashenko v. Bowen. According to Carol Brown, MD,
fraud was indeed found in the first few years of investigations.
After that, she stated, agents had to ``find'' fraud where none
existed in order to keep their jobs and justify the annual budget
of $800 million. The 1984-85 performance review for James Patton
(who made initial determinations of physicians' fates) showed
that he needed to assess 10% more sanctions than in the preceding
year in order to gain Level II merit pay-that is 390 sanctions
with dollar penalties amounting to $9 million.
The OIG confirmed that the performance appraisals did say
something like ``must complete X number of sanctions,'' but
``that's not a quota. It's a measure of a person's
effectiveness'' (Psychiatric Times 9/90).
The procedure for meeting these ``targets'' has been
described as ``legalized extortion'':
Investigators routinely consider how to maximize
the physical, emotional, and financial stress brought
to bear on the potential victim....[T]he provider must
engage in a risk analysis which weighs payment of the
investigator's outrageous dollar demands against public
embarrassment and/or the advisability of pleading
guilty to a civil count rather than risking criminal
prosecution (D. Zerendow and H. Fishman, Psychiatric
One high-ranking official in the OIG stated that if a doctor
said he didn't have that kind of money, investigators might reply
``We're willing to accept your mortgage and if you die, we'll
also take your estate'' (ibid.)
In an interview with Psychiatric Times, Donald Zerendow,
former chief of the Medicaid Fraud Control Unit, stated that
Medicaid providers are ``held responsible for protecting the
program from its own confusions, complexities, and ambiguities.
The provider is expected to unravel the mysteries, and then bill
accordingly.'' Vague code descriptions allow them to prosecute
``essentially anyone they want to prosecute.'' ``If providers
really understood all of this, I suspect that many would be
hesitant ever to submit another bill to Medicare or Medicaid,''
Zerendow concluded (Psych Times 10/90).
Abuses by Kusserow and his agents were shown by ABC on Prime
Time Live, September 20. The program was followed by demands for
Kusserow's resignation from several medical organizations,
including AAPS, the AMA, and the Massachusetts Medical Society.
AAPS Endorses NCPA Task Force Report,
Declares Patients' Freedoms
``An Agenda for Solving America's Health Care Crisis,'' a
task force report released by the National Center for Policy
Analysis, has been endorsed by AAPS. This positive program,
backed by careful economic analysis, offers free-enterprise
solutions instead of more of the same. The program was
summarized in the August issue of AAPS News. Copies of
the report for yourself and other community leaders are
available; call headquarters at 1-800-635-1196.
The Assembly approved the statement of patients' freedoms
published in the September issue of AAPS News, with minor
In other business, the Assembly voted the first dues
increase in five years. Regular dues will be $250; introductory
The slate of officers proposed by the Nominating Committee
was elected by acclamation. Claud A. Boyd, Jr., MD, who
practices dermatology in Augusta, GA, assumes the office of
President. John H. Boyles, Jr., MD, ENT specialist from
Centerville, OH, is the new President-Elect. V.L. Goltry, MD, of
Boise, ID; James F. Coy, MD, of DeLand, FL; Nino Camardese, MD,
of Norwalk, OH; and John Dwyer, MD, of Chicago, IL, were elected
to the Board of Directors.
AAPS long-range plans include development of a set of model
rules for binding arbitration in medical staff disputes, which
could be incorporated into medical staff bylaws.
Message from the President
Current trends in medicine reflect the spiritual malaise of
our society. We have embraced what Hayek called the fatal
conceit: the idea that mankind has the ability to shape the world
according to his wishes. At the same time, we still wish to turn
our lives over to someone more powerful, despite confusion about
who that someone might be. When we fail to obtain what we think
is ours, we call for the state to intervene at the expense of
others. This has led to a tremendous proliferation in
governmental power, and marked decrease in our freedom to
contract with one another for mutual benefit....
AAPS continues to teach the same philosophy as it has for
nearly 50 years. The best medical care in this imperfect world
occurs when the physician and patient together decide on a course
of action, without third-party coercion or interference.
excerpted from Dr. Gregory Polito's welcoming remarks
Semmelweis Society Electronic Bulletin
Physicians who experience difficulty in obtaining due
process are not alone. The Semmelweis Society is developing an
electronic bulletin board to disseminate information and advice
that may be helpful. Call AAPS headquarters for details, 1-800-
Independent Doctors of America Joins with AAPS
Members of Independent Doctors of America, an organization
that has promoted the same ideals as AAPS, are being welcomed
into our Association as IDA disbands. Frank Rogers, MD, founder
and president of IDA, has long been a front-line defender of
Blue Cross/Blue Shield of Kentucky Recalculates Fee
In April, 1990, AAPS Director Sidney Steinberg, MD, filed
suit asking the US District court to order the Secretary of HHS
and the Medicare carrier to calculate 1990 fee screens in
accordance with the requirements of the law. The carrier had
previously released fee screens amounting to a 30 to 40% cut
across the board for surgical services, basing them on a 1984
Court decision that had been ignored for years and effectively
overruled by the Omnibus Budget Reconciliation Act of 1989 (see
AAPS News, May, 1990).
In a surprise move on September 7, 1990, the federal
Medicare carrier forwarded amended fee screens to all physicians
in Kentucky. The cover letter stated:
The HCFA has required that we use a different
methodology for calculating 1990 payment screens for
physician services. Specifically, the HCFA is
requiring that we use a different methodology for
converting from ``specialty'' to ``no specialty''
payment screens. You will recall that, effective
4/1/90, we converted to ``no specialty'' payment
screens because of a recent court case....
Beginning September 7, 1990, we will calculate
your payments based on the newly-computed 1990 payment
screens. The effective date of the new payment amounts
is 4/1/90; therefore, we may be making retroactive
adjustments for claims with dates of service 4/1/90 or
The new September fee screens are substantially higher than
the April fee screens; some have been increased by $400 to $500.
Dr. Steinberg regards the letter and the new fee screens as
a complete admission by the Secretary of HHS and the federal
Medicare carrier of the facts as plead in his case. Still, he
does not agree that all the new fee screens actually represent
the proper amounts based upon the OBRA of 1989. It is his
intention to move the federal court to order the Medicare carrier
in Kentucky to apply the proper methodology in the computation of
all fee screens and to make retroactive adjustments on all claims
filed since April 1, 1990.
The hearing in this case, originally scheduled for October
5, has been postponed until November 2.
Laboratory Regulations a Threat to Due Process
HCFA has received 43,000 comments on the proposed rules for
implementing the Clinical Laboratory Improvement Act of 1988
(CLIA). Many have dealt with the cost of compliance, estimated
to be $4 billion, and the effects on access to care. As many as
95% of physician office laboratories performing Level II tests
may be shut down. An even more serious concern is the threat to
physicians' due process rights.
The California Medical Association (CMA) in its comments
states that the rules impermissibly burden physicians' and
laboratories' rights by assessing fees to cover
the costs of follow-up visits, complaint inspections,
sanctions, and administrative hearings if a laboratory appeals a
Given the fact that a ``certificate'' is essential
to the pursuit of a laboratory owner's livelihood, DHHS
is constitutionally required to provide a hearing in
license revocation cases. The Supreme Court has
recognized the importance of these hearings where the
state maintains a monopoly over the issuance of
licenses. For example, in Bell v. Burson, 402 U.S. 535
(1971), the Supreme Court held that a suspension of a
driver's license and vehicle registration without the
notice and opportunity for a hearing before the
termination becomes effective violated the due process
Laws that penalize the exercise of a constitutional right,
as through the assessment of fees to cover the government's costs
of adjudication, are probably unconstitutional. For example, an
Oklahoma requirement that tenured teachers pay half the cost of a
due process hearing was held impermissible by the 10th Circuit
Court in Ranken v. Independent School District 876 F.2d 838
In actuality, a certificate may be essential not only for
the pursuit of a laboratory owner's livelihood but for the
practice of medicine. According to Christopher Shaughnessy of the
AAPS legal consultation service, the Act effectively institutes
federal licensure for physicians. The definition of a
``laboratory'' is all-inclusive:
A ``laboratory''... means a facility for the
biological, microbiological, serological, chemical,
immuno-hematological, hematological, biophysical,
cytological, pathological, or other examination
of materials derived from the human body for the
purpose of providing information for the diagnosis,
prevention, or treatment of any disease or impairment
of, or the assessment of the health of human
Does ``other examination'' include visual inspection of a
discharge of bodily fluids during a physical examination?
Further, the Act states: No person may solicit or accept
materials derived from the human body for laboratory examination
or other procedures unless there is in effect for the laboratory
a certificate issued by the Secretary under this section.
A venipuncture and catheterization for specimen are defined to
be clinical laboratory services by Aetna, the Arizona Medicare
carrier, even if the physician sends the material to the
laboratory for analysis. Does a physician become a laboratory by
drawing blood or even by ordering a blood test?
Or is he responsible for ascertaining that the laboratory has
a valid certificate from the DHHS?
The definition of laboratory is crucial-an issue that also
figures in the decision in AAPS v. Bowen, and one on which the
Sixth Circuit Court declined to comment. (Physicians may decline
Medicare assignment; laboratories may not.)
The penalty for intentional violation of any
requirement of this section or any regulation promulgated
thereunder is a year's imprisonment or a fine or both.
Christopher Shaughnessy of LLCS states that under the
Federal Administrative Procedure Act, federal agencies are
required to respond to every comment that is submitted. If they
fail to do so, regulations are invalid.
A copy of comments submitted by AAPS is available on
From Capitol Hill
Anti-Hassle Bill Gains Strength, Faces Hassles. The
Medicare Physician Regulation Relief Amendments bill (HR 4475),
introduced by Rep. Roy Rowland, MD, (D-GA) has gathered at least
238 cosponsors. The main provisions are: (1) to require HCFA to
release its medical review screening parameters; (2) to allow
``covering'' physicians to bill under the provider number of the
patient's usual physician; (3) to prevent carriers from charging
physicians for information necessary to fill out Medicare claims;
(4) to allow medical societies to represent a class of physicians
in appealing denials; and (5) to establish a physician advisory
group to review Part B policy. Most medical groups have
supported the bill, although it does less to eliminate hassles
than to make information available so that doctors can comply
with the law.
Despite having enough cosponsors to assure passage, the bill
is not expected to reach the floor for a vote because this would
require approval of both the Energy and Commerce and the Ways and
Means Committees. Pete Stark, Chairman of the Ways and Means
Health Subcommittee, has questioned whether he can support the
bill. Proponents hope to add the bill to the Budget Reconcilia-
Kolter Bill Gutted. The bill to repeal the requirement
that physicians file all Medicare claims (HR 4772) will be
amended to provide that patients may file their own claims if
they wish. Rep. Kolter's constituents thought he was ``looking
out more for the doctors than for the patients'' (Part B News
Code-Checker Testing ICD-9 Codes. Carriers are looking
for codes that are unlisted, truncated, or inappropriate for the
patient's age or sex. They are required to give 60 days advance
notice before denying assigned claims because of coding errors.
Georgia Physicians Expect Repayment Demands from Medi-
care. Georgia Medicare carrier Aetna failed to reduce
payments for ``overvalued'' procedures between April and August,
1990, due to a programming error. Physicians will have to pay
back about $2.1 million.
PROs Innocent Until Proved Guilty. Despite employee
allegations that California Medical Review Inc (CMRI) had ``auto-
certed'' 51,094 inpatient claims instead of reviewing them,
CMRI's contract was automatically renewed for the three-year
period beginning April 1, 1989. It was awarded $83 million, the
largest amount ever given a PRO. HCFA apparently would prefer to
settle the case for $1.2 million, with a stipulation that
``mistakes'' were made that did not constitute fraud, as the
``best outcome for both parties'' (Physicians Financial News
AAPS welcomes Drs. Frank J. Bonello of West St. Paul, MN; J.
Hilton Brooks of Middlesboro, KY; Edward W. Davis of West Covina,
CA; Frank A. English of Roswell, NM; Stephen D. Ertischek of
Oxford, NC; R. J. Fisette of Bridge City, TX; Larry B. Fishbaugh
of Paulding, OH; Kenneth Frankel of Pasadena, CA; James Guenther
of Lancaster, OH; Samuel S. Kaplan of Scottsdale, AZ; Keith McCoy
Kimbrell of Crossville, TN; Madhu Mehta of Cleveland, OH; John G.
Morrison of Richmond, VA; Gordon D. Peters of Phoenix, AZ;
Michael Schlitt of Renton, WA; Don K. Snyder of Paulding, OH; and
David V. Young of Washington, DC.
These are the legal actions in which AAPS has been
AAPS vs. Weinberger
AAPS challenged the constitutionality of the act amending
the Social Security Act to create the Professional Standards
Review Organizations (PSRO) in 1972. A three judge panel in the
US District Court for the Northern District of Illinois upheld
the act's constitutionality. Petition for Writ of Certiori was
denied by the US Supreme Court.
McGuffy vs. Hall
AAPS physicians brought a constitutional challenge to the
1976 Kentucky Medical Malpractice Act, which made the purchase of
a minimum amount of malpractice insurance compulsory in the
Commonwealth of Kentucky. Failure to purchase such insurance
would result in loss of licensure. The act also caused the state
to lend its credit for the payment of judgments and settlements.
As a result of the challenge, the 1976 Medical Malpractice Act
was ruled unconstitutional in its entirety by the Supreme Court
of Kentucky. Following this opinion, compulsory malpractice
requirements have also been struck down in Pennsylvania,
Missouri, North Dakota, Alaska, and Hawaii.
Patrick vs. McClure
AAPS physicians intervened in the Franklin Circuit Court to
recover, on behalf of all Kentucky physicians, the monies
collected by the Patient's Compensation Fund created by the
Kentucky Medical Malpractice Act, which had been declared
unconstitutional and void ab initio. As a result, $2.2 million
was recovered and distributed to physicians.
State of North Carolina vs. Califano
AAPS filed a brief amicus curiae in the US Supreme Court
supporting the State of North Carolina in its unsuccessful
challenge to the constitutionality of the National Health
Planning and Resources Development Act, the act that created
Health Systems Agencies (HSA), which served to pass upon the
appropriateness of capital expenditures by health care providers.
That act has since expired.
People of the State of New York vs. Roth
AAPS filed a brief amicus curiae and argued orally in the
Nassau County Court in defense of eight physicians, known as the
``Long Island Eight,'' who had been indicted by the State of New
York for criminal violation of New York State Antitrust laws.
The physicians had been accused of forming a boycott by
encouraging other physicians not to perform nonemergency services
for patients covered under the Worker's Compensation and No Fault
Insurance laws as said reimbursement was unremunerative. AAPS
argued that the New York State Antitrust laws did not apply to
the practice of medicine and that the indictments were unlawful.
The Nassau County Court agreed with AAPS, and the indictments
were dismissed. This decision was upheld on appeal before the
New York Court of Appeals, the highest court in the State.
Liggett vs. Kansas
AAPS filed a brief amicus curiae in the US Supreme Court
supporting the jurisdictional statement of a Kansas physician who
sought to challenge the constitutionality of the Kansas Medical
Union Labor Life vs. Pireno
AAPS filed a brief amicus curiae in the US Supreme Court in
support of a chiropractor who challenged the peer review of
insurance claims as being violative of the Sherman Antitrust Act.
The question was whether insurance claims peer review was
protected under the ``business of insurance'' exemption in the
McCarran-Ferguson Act. The Supreme Court agreed with the AAPS
position and found that insurance peer review was not the
``business of insurance,'' and that Dr. Pireno could proceed with
Jefferson Parish Hospital District #2 vs. Hyde
AAPS filed a brief amicus curiae in the US Supreme Court
supporting Dr. Hyde in his challenge, under the Sherman Antitrust
Act, to an exclusive anesthesiology contract awarded to his
competitor by the Jefferson Parish Hospital District 2 in New
Orleans, LA. The US Supreme Court upheld the exclusive contract,
but made significant -- and generally beneficial -- law with
respect to the determination of market power under the Sherman
Cullum vs. Appalachian Regional Hospitals
AAPS is supporting a challenge by past AAPS President Cullum
to the validity of a hospital requirement to purchase $1 million
in liability insurance as a condition of staff privileging. A
restraining order was obtained, and the case is presently pending
in the Kentucky Court of Appeals on the issue of whether such a
requirement is affordable and reasonable.Whitney vs. Heckler
An action brought by about 200 Atlanta, GA, area physicians,
most of whom were AAPS members, challenged the constitutionality
of the physicians' fee freeze enacted through the Deficit
Reduction Act of 1984. Published opinions were filed by the US
District Court for the Northern District of Georgia and the US
Court of Appeals for the Eleventh Circuit. Though the
constitutionality of the Act was upheld, the large number of
opinions created the most sweeping law to date on Fifth Amendment
challenges to temporary freeze measures enacted by Congress. The
opinion of the Court of Appeals may well stand as a barrier to a
future permanent freeze unless certain measures are taken by
Congress to provide for a reasonable rate of return for the
industry whose fees are in any way restricted. The US Supreme
Court denied a Petition for Writ of Certiori.
Patrick vs. Burget
AAPS filed a brief amicus curiae in the US Supreme Court
supporting a physician's challenge, under the Sherman Act, to a
medical staff peer review decision that restricted his privileges
to practice in an Oregon hospital. The physician won a nearly $2
million jury verdict against the peer review committee, but that
verdict and judgment were reversed by the US Court of Appeals for
the Ninth Circuit on the ground that the State of Oregon, by
simply enacting a peer review statute, made the act taken against
the physician an exempted state activity. The US Supreme Court
agreed with the AAPS position and reversed the Ninth Circuit on
the ground that the state had not intervened to a sufficient
extent to exempt peer review from antitrust action. The case has
vast implications for physicians seeking recourse for actions by
their peers that injure their property rights and deny them the
opportunity to compete. The decision has led to the reversal of
at least two other federal circuit court holdings.
State of New York vs. Bowen
AAPS filed a brief amicus curiae in support of the Secretary
of HHS in the US Court of Appeals for the Second Circuit (in New
York City), arguing that the court should affirm the judgment of
the US District Court for the Southern District of New York and
uphold the constitutionality of federal regulations under Title X
of the Public Health Service Act. These regulations prohibit the
expenditure of public funds for ``counseling concerning the use
of abortion as a method of family planning,'' and require the
``dissemination of information'' to patients that would be
``necessary to protect the health of the mother and unborn
child'' until referred for purposes of appropriate prenatal
and/or social services. The case is pending in the Second
Planned Parenthood Federation of America vs. Bowen
AAPS filed a brief amicus curiae in support of the Secretary
of HHS in the US Court of Appeals for the Tenth Circuit (in
Denver, CO) arguing that the Court should reverse the judgment of
the US District Court for the District of Colorado, and thus
uphold the constitutionality of the same regulations at issue in
State of New York vs. Bowen. The case is pending in the Tenth
West Virginia Association of Community Health Centers, Inc.
AAPS filed a brief amicus curiae in support of the Secretary
of HHS in the US District Court for the Southern District of West
Virginia (in Charleston, WV) arguing that the court should uphold
regulations restricting the use of public funds for abortions
(vide supra). The case is pending.
Association of American Physicians and Surgeons, Inc. vs.
AAPS and its Ohio members filed a lawsuit challenging the
authority of the Secretary of HHS to require``nonparticipating''
physicians to bill for clinical diagnostic laboratory tests only
on an ``assigned'' basis, as such requirement is contrary to the
explicit language of the Medicare Act as most recently amended.
The lawsuit was filed by AAPS in the US District Court for the
Northern District of Ohio (in Toledo, OH). The district court
upheld the position taken by the Secretary. That decision was
appealed to the US Court of Appeals for the Sixth Circuit (in
Cincinnati, OH). The district court's appeal is notable because,
on the basis of Whitney vs. Heckler (vide supra), the court found
that AAPS and its members had standing to bring the action. The
case is now pending.
Coy vs. Florida Birth-Related Neurological Injury
AAPS filed a lawsuit in the Circuit Court in and for Leon
County, Florida (in Tallahassee, FL) challenging the
constitutionality of the Florida Birth-Related Neurological
Injury Compensation Act of 1988. In this act, the Florida
legislature created a scheme whereby actions arising from birth-
related neurological injuries would be heard only by a claims
panel and would relieve physicians practicing obstetrics -- who
chose to be included in the program -- from paying for medical
malpractice insurance. The scheme, however, mandated that every
physician licensed by the State of Florida be required to pay an
annual fee -- which could be raised by the Commissioner of
Insurance to any extent he determines necessary -- or suffer the
potential loss of his or her license to practice medicine. The
case was tried on June 13, 1989, and stands submitted for a
Morand vs. St. Paul Fire & Marine Insurance Co.
AAPS has moved to file a brief amicus curiae in support of
Charles Morand, MD, in the Fifth District Court of Appeals of
Florida (in Daytona Beach, FL) arguing that the appellate court
should reverse a Florida Circuit Court that found a malpractice
insurer did not breach its fiduciary obligation by settling a
case without the policyholder's permission. Discovery revealed
that the physician was not negligent. The decision to settle
such cases, given the reporting of settlements to licensure
boards, government agencies, and hospitals, is of critical
importance to the physician involved. The case is pending.
AAPS legal actions have covered a wide range of issues.
Significant successes have been achieved in advancing the law in
favor of private medicine and in protecting the rights of