Florida Case Scenario:

The North Florida Women's Center (the "Center") is a nonprofit organi- zation that provides counseling and assistance to women in Tallahassee and nearby areas of Florida and Georgia. Last year, the Center's board of directors decided to expand its services by providing healthcare services to women, including obstetric and gynecological (OB/GYN) services, family planning, contraception, and abortion. The Center will provide these services on a sliding-fee scale, depending on the patient's income and health insurance. The Center has a written contract with Mary Ellen Stuart, M.D., who is licensed to practice medicine in the state of Florida and is board certi- fied in OB/GYN. Dr. Stuart will care for a large number of patients, some of whom will have no health insurance and limited financial resources. Therefore, both the Center and Dr. Stuart intend to make extensive use of nonphysician providers, such as physician assistants, family nurse practitioners, and midwives. They also want their patients to have a choice in childbirth. Therefore, patients will be able to choose between home birth with only a midwife or hospital birth with Dr. Stuart. Dr. Stu- art does not intend to use midwives at the hospital. In October 2012, Dr. Stuart applied for medical staff membership and clinical privileges at Tallahassee General Hospital ("General"), which is owned and operated by the county and is one of seven hos- pitals in the county.

Because General is close to the Georgia state line, General and its physicians treat a substantial number of patients from Georgia and Florida. On November 15, 2012, while her application was pending, the 50 current members of General's OB/GYN staff held a meeting, which was called for the purpose of reviewing Dr. Stuart's application. At the meeting, several doctors expressed their concerns about Dr. Stuart, the Center's new healthcare program, the issue of home birth, and the use of midwives. They were worried about having to take care of the Center's home-birth patients in an emergency. For example, if a home- birth patient had a medical emergency during home delivery, the patient would be rushed to General, where she would be cared for by the OB/ GYN physician on call, even though she was not the patient of that phy- sician and that physician had never seen the patient before the emer- gency. The physicians indicated that the potential malpractice liability under those circumstances was problematic. At the same meeting, a few doctors expressed their concern for the possible loss of business they would suffer with the opening of the Center's health services program.

Although they did not want to care for indigent patients, they were concerned that they would lose some paying patients because the Center will offer more choices in childbirth and a sliding-fee scale. The administrator of General was present at the meeting and said that the hospital would lose obstetric business if the Center and Dr. Stuart gave women the option of delivering their babies at home. Dr. Samuel Jackson, chief of the OB/GYN department at General, reported that he had reviewed a sample of medical records for patients treated by Dr. Stuart at another hospital, and it was his professional opinion that Dr. Stuart did not provide good-quality care. In addition, he said Dr. Stuart had been sued for medical malpractice two years ago, and her malpractice carrier had settled the case before trial by paying the plaintiff $500,000. After hearing this information at the meeting, the OB/GYN physicians voted to recommend denial of Dr. Stuart's applica- tion for medical staff membership and clinical privileges on the grounds that she had failed to demonstrate her professional competence. The next day, the hospital administrator notified Dr. Stuart in writ- ing of the action taken at the meeting to recommend denial of her application for medical staff membership and clinical privileges. The administrator advised her that she had the right to a hearing on her application before the credentials committee of the medical staff.

Dr. Stuart exercised her right to that hearing, at which she testified and was represented by legal counsel. At the hearing before the credentials committee, the chief of the OB/GYN department, Dr. Jackson, testified that on the basis of his review of medical records, Dr. Stuart did not provide good-quality care. He also told the credentials committee about Dr. Stuart's malpractice settlement. In response, Dr. Stuart testified that her care of patients was appropriate and told her side of the story with regard to the mal- practice case. After hearing the evidence, the credentials committee recommended that her application for medical staff membership and clinical privileges be denied, and that recommendation was adopted by the board of trustees of General on December 28, 2012. The next day, the hospital administrator notified Dr. Stuart of the decision and also reported the decision to the Florida State Board of Medical Examiners as required by state law. One month later, Dr. Jackson and another member of General's OB/ GYN staff, Dr. George Alexander, met with a representative of Happy Family Health Plan. The administrator of General was also present at that meeting.

The two physicians told the representative of Happy Family that they were concerned about the unsafe practices at the Center's new healthcare program. The two physicians also stated that they hoped Happy Family would not accept the Center and Dr. Stuart as participating providers with eligibility to receive payment from Happy Family. In fact, the doctors said that they were so concerned about the Center's unsafe practices that if Happy Family agreed to pay the Center and Dr. Stuart for services rendered to Happy Family patients, all of the other members of the OB/GYN staff at General would feel ethically bound to stop treating Happy Family patients. The representative of Happy Family asked the two physicians whether all of the other OB/GYN physicians at General felt the same way. The doctors responded that all of the physicians at the meeting on November 15 had agreed that Dr. Jackson and Dr. Alexander should speak to Happy Family on their behalf. In addition, the administrator of General stated that General might have to reevaluate its contractual arrangement with Happy Family the next time that General's provider contract with Happy Family came up for renewal.

One week later, Happy Family wrote to the Center and Dr. Stuart to state that Happy Family would not accept them as participating providers and therefore would not pay the Center or Dr. Stuart for services rendered to Happy Family patients. Under these facts, what claims could Dr. Stuart assert against the other physicians, and what defenses could the other physicians raise? Be sure to discuss the elements of each potential claim and defense, as well as your evaluation of the likelihood of success on each claim or defense.