News & Insights

Hospital Exposure Capped for Claims Involving Selection, Purchase and Implementation of a Medical Device

October 09, 2019

Crystal E. Domreis, Attorney, and Bradley R. Belsome, Partner, Bradley Murchison Kelly & Shea LLC


Hospital Exposure Capped for Claims Involving Selection, Purchase and Implementation of a Medical Device

Plaintiffs frequently test the boundaries of the Louisiana Medical Malpractice Act (LMMA) by arguing the defendant healthcare provider’s alleged negligent act or omission at issue is not related to medical treatment and thus does not come under the LMMA’s definition of “malpractice.” Why continually test the waters? The LMMA, and its limitation of liability of $100,000 plus judicial interest per individual qualified healthcare provider with a $500,000 aggregate limitation on total recoverable general damages, applies strictly to claims arising from medical malpractice. Successfully argue a claim falls outside the purview of the LMMA and neither the limitation of liability, nor the mandatory pre-suit medical review panel process, applies.

This scenario most commonly arises in facility-based care settings. In the context of hospital and nursing home care, not all services provided neatly fit the LMMA’s definition of “malpractice” due to custodial and administrative components inherent in those settings. To constitute malpractice, the alleged negligent act must be related to professional services rendered to a patient or based on “healthcare” as defined by the LMMA. Judicial determination of what is, and is not, “malpractice” or “healthcare” requires a case by case evaluation of the facts underlying the allegations raised by the plaintiff. Courts often encounter “close calls” in applying factors that can be artfully argued either way. For instance, a hospital administrator’s failure to adopt a handoff policy for transfer of a patient, and a fall out of a third-story window by an assisted living facility resident who suffered from dementia both fall within the confines of the LMMA. In contrast, failure by a hospital to provide an adequately-sized bed and claims against a hospital for negligent credentialing do not. Due to the fact-intensive nature of this analysis, each determination by a Louisiana Court, especially at either the Appellate or Supreme Court level, that a particular claim falls under malpractice brings further clarity.

Recently, the Louisiana First Circuit Court of Appeal in Arrington v. St. Tammany Parish Hospital Service District No. 1, 2018-0215 (La. App. 1 Cir. 10/31/18); 267 So.3d 618, provided such guidance. The claim was brought against the Hospital by Gregory Arrington following successful lumbar surgery. Alternating leg pressure devices were ordered and applied by Hospital staff as post-surgical DVT prophylaxis. The Arringtons claimed the device malfunctioned, causing an over-compression of Mr. Arrington’s left lower extremity ultimately leading to the development of a DVT and non-specific lower limb neurological injuries. The Arringtons filed a proposed complaint of medical malpractice against the Hospital as well as a lawsuit against both the Hospital and the manufacturer of the device, which was not qualified for panel review. Both actions essentially asserted the same allegations against the Hospital. In an attempt to plead outside of the MMA’s confines, plaintiffs couched their lawsuit against the Hospital as one of negligent maintenance, selection and implementation of the device. The allegations against the manufacturer were traditional Louisiana Products Liability Act claims for an alleged device malfunction.

The malpractice complaint was ultimately dismissed by the Patient’s Compensation Fund for plaintiffs’ failure to timely pay the required filing fee. Once dismissed, only the lawsuit remained as a potential avenue for plaintiffs to seek recovery of damages. In response to the lawsuit, the Hospital raised an exception of prematurity arguing that plaintiffs’ allegations, which despite attempted creativity in pleading, truly centered on the actual use of a medical device by its staff. As these allegations addressed the use of a medical device ordered by the patient’s treating physician for a specific medical purpose, the allegations were treatment-related. As a result, the claim was related to “healthcare” and fell squarely under the MMA’s definition of “malpractice.” The district court agreed, maintained the exception, and dismissed the Hospital from the lawsuit. 

Plaintiffs appealed, arguing that their claims were against the Hospital in its administrative capacity and thus not subject to the LMMA. The First Circuit disagreed, holding that under the plain language of the LMMA, “the selection, purchase and implementation” of the device are acts performed by a qualified healthcare provider, for, to and, on behalf of a patient during his postoperative recovery to avoid DVT, a risk for which he was assessed by his doctor. Thus, such allegations constitute “healthcare” and squarely fall within the LMMA’s definition of “malpractice.” The Court also analyzed the factual scenario under a six-factor test set forth by the Louisiana Supreme Court in Coleman v. Deno and reached the same conclusion. The Court’s analysis centered on the fact that selection, purchase and implementation of the medical device used in compliance with a physician order was interconnected with Mr. Arrington’s particular medical picture as opposed to, for instance, the selection and purchase of a bed, which is generally distributed to patients regardless of condition and which can also pose a risk to the visiting public.

Arrington is an important ruling as no Louisiana court had previously determined whether the selection, purchase, and implementation of a medical device by a hospital constituted healthcare and thus fell within the confines of the LMMA. This legal issue was decided for the first time in the context of the Arrington appeal.  

For more information about uncapped exposure and claims that fall outside of the LMMA, read “Recent Developments in the Medical Professional Liability Case Law and the Importance of Higher Liability Limits.” 


 

Do you see the distinction between a hospital providing an adequately-sized bed and the selection, purchase and implementation of a medical device by a hospital? Louisiana courts have, and found one instance covered by the medical malpractice cap and the other not. In light of often fine distinctions such as these between what is covered by the cap and what is not, it is important for providers and hospitals to assess potential risks associated with the care they provide and consider the need for higher limits of medical malpractice insurance coverage. Healthcare providers, hospitals and facilities can protect themselves from liability for uncapped claims (other than those that are uncapped due to failing to be PCF qualified) by purchasing limits of liability above $100,000/$300,000. The additional cost for higher liability limits is minimal as the frequency of uncapped claims is low. However, when these claims occur, the potential for damages can be significant because there is no cap on the damages. Contact a LAMMICO Marketing representative at 800.452.2120 to find a solution that meets the needs of your hospital or practice. 

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