Opinion ID: 3010672
Heading Depth: 3
Heading Rank: 1

Heading: Discovery Barred Under The Act

Text: Congress enacted the Medicare program in 1965 to establish a federally funded system of health insurance benefits for the aged and disabled. See Social Security Amendments of 1965, Pub. L. No. 89-97, 79 Stat. 286 (codified as amended at 42 U.S.C. SS 1395 to 1395ccc (1994)). In 1982, Congress amended the Medicare statute by enacting the Peer Review Improvement Act of 1982, Pub. L. No. 97-248, S 143, 96 Stat. 381 (1982), which established a new method of reviewing the quality and appropriateness of the health care provided . . . to Medicare beneficiaries. American Hosp. Ass'n v. Bowen, 834 F.2d 1037, 1041 (D.C. Cir. 1987). The Act requires that the Department of Health and Human Services (HHS) enter into contracts with peer review organization, or PROs, private organizations of doctors that review, inter alia, whether medical services were reasonable and medically necessary and whether the quality of such services meets professionally recognized standards of health care .. . . 42 U.S.C. S 1320c-3(a)(1)(A), (B). In essence, the Act functions as a quality and fiscal check upon the medical services of physicians and institutions which provide health care services under the Medicare and Medicaid programs. Todd v. South Jersey Hosp. Sys., 152 F.R.D. 676, 685 (D.N.J. 1993). PRO NJ is a PRO incorporated in the State of New Jersey. PRO NJ was successful in obtaining the first contract with 11 the Health Care Financing Administration (HCFA) of the HHS and has maintained a contract for Medicare Peer Review in the State of New Jersey since 1984 on a continuous basis. Prior to 1984, the predecessor to PRO NJ, The Southern New Jersey Professional Standards Review Organization, and Area VII Physician's Review Organization, Inc., maintained Medicare peer review contracts with HHS.
PRO NJ has adopted the following procedures to determine whether a quality issue exists with respect to the care of a Medicare beneficiary. At the outset, a nurse employed by the PRO screens a medical record to determine whether a potential or possible quality question might exist. If the nurse determines that such a question exists, the case is referred to a physician-reviewer of the PRO, who then reviews the matter and determines whether there is, in fact, a potential quality issue. If the physician-reviewer determines that there is a potential quality issue, the PRO prepares a quality inquiry and issues it to the physician in question. The PRO also requests a response from the physician. The physician generally responds in writing to the quality inquiry by submitting to the PRO a response on the same notice form. Following receipt of the response form from the physician in question, the matter is once again reviewed by the physician-reviewer, who then determines whether there is a confirmed quality problem. If there is no quality problem, an acceptance notice is issued and no further action is taken. However, if there is a confirmed quality problem, the PRO may request further action on the part of a physician. Such action may include a referral to the Sanction Committee of the PRO, a standing committee of the PRO, for additional review and a determination as to whether or not a preliminary determination should be made that a sanctionable offense has occurred.7 _________________________________________________________________ 7. There are generally two types of sanctionable offenses: a gross and flagrant violation and a substantial violation in a substantial number of cases. The former offense means that a violation of an obligation has 12 In the event that the Sanction Committee makes a preliminary determination that a sanctionable offense occurred, a notice is issued to the physician in question, along with an invitation to meet with the PRO of the New Jersey Sanction Committee (in the case of a gross and flagrant violation) or to respond in writing (in the case of a substantial violation). If a meeting is held with the Sanction Committee, a court reporter is in attendance. Also in attendance is the physician in question, the physician's attorney (if desired), the physician's expert witnesses (if any), and members of the Sanction Committee together with supporting staff. Following the sanction meeting, the Sanction Committee deliberates and reaches a determination as to whether or not the previous preliminary determination should be affirmed, modified, or reversed. In the event that the preliminary determination is affirmed, the physician is given an opportunity to enter into a corrective action plan, assuming that the physician is willing and able to meet his statutory obligations and the matter before the committee is not considered egregious in nature. Communications between the PRO and the physician then follow, at which time the parties will generally agree upon an approved educational plan which is then implemented by the physician. In cases considered egregious, or in cases where there is an established pattern of care, the PRO may refer the matter to the New Jersey Office of Inspector General. In that case, a sanction report is prepared and issued to the Office of Inspector General, which contains all of the information upon which the Sanction Committee relied in reaching its determination. A copy of the sanction report is provided to the physician in question, who has a right to _________________________________________________________________ occurred in one or more instances which presents an imminent danger to health, safety, or well-being of a program patient or places the program patient unnecessarily in high-risk situations. 42 C.F.R. S 1004.1. The latter means a pattern of providing care . . . that is inappropriate, unnecessary, or does not meet recognized professional standards of care, or is not supported by the necessary documentation of care as required by the PRO. Id. 13 respond to the Office of Inspector General within thirty days of receipt. At the conclusion of a quality inquiry with PRO NJ, the physician in question will generally have substantial documentation in his or her file. This documentation may include: (1) the initial quality assurance inquiry; (2) the physician's response; (3) additional correspondence regarding the quality issue; (4) a sanction notice, which includes a quality assurance review sheet, a medical director's committee review sheet, and other information upon which the PRO bases its preliminary determination regarding a sanctionable offense; (5) the physician's written response to the sanction notice; (6) various correspondence related to the sanction process; (7) a determination by the Sanction Committee; (8) correspondence regarding the corrective action plan; and (9) a certification of completion of the corrective action plan.
The Act reflects a strong policy of confidentiality with respect to a PRO's quality review and sanction process. The Act requires a PRO to hold all data and information that it acquires in confidence and, subject to only limited exceptions, prohibits a PRO from disclosing such information. See 42 U.S.C. S 1320c-9(a). Congress has even exempted PROs from the requirements of the Freedom of Information Act. See id. In addition, any person who discloses information in violation of the Act's confidentiality provisions is subject to criminal penalties including a fine and imprisonment of not more than six months. See 42 U.S.C. S 1320c-9(c). Finally, to further protect the confidentiality of PRO-related materials, the Act immunizes many documents from subpoena and discovery proceedings: No patient record in the possession of an organization having a contract with the Secretary under this part shall be subject to subpoena or discovery proceeding in a civil action. No document or other information produced by such an organization in connection with its deliberations in making determinations under 14 section 1320c-3(a)(1)(B) or 1320c-5(a)(2) of this title shall be subject to subpoena or discovery in any administrative or civil proceeding; except that such an organization shall provide, upon request of a practitioner or other person adversely affected by such a determination, a summary of the organization's findings and conclusions in making the determination. 42 U.S.C. S 1320c-9(d). Regulations promulgated pursuant to the Act further buttress these confidentiality provisions. The regulations broadly define confidential information as (1) [i]nformation that explicitly or implicitly identifies an individual patient, practitioner or reviewer[;] (2) [s]anction reports and recommendations[;] (3) [q]uality review studies which identify patients, practitioners or institutions[;] (4) PRO deliberations. 42 C.F.R. S 476.101(b). Furthermore, PRO information includes any information collected, acquired or generated by a PRO in the exercise of its duties and functions . . . . Id. The regulations impose specific requirements to ensure the confidentiality of PRO information. For example, a PRO must provide physical security measures to protect PRO information, including measures necessary to secure computer files. See 42 C.F.R. S 476.115(a). The PRO must furnish confidentiality training and instructions to participants in PRO activities, and must designate an individual responsible for maintaining the system of assuring confidentiality. See 42 C.F.R. S 476.115(a) (c). Only persons who have completed a training program and signed a statement indicating that they understand the penalties for unauthorized disclosure are permitted access to confidential information. See 42 C.F.R. S 476.115(d). In addition, the regulations require a PRO to purge files of personal identifiers as soon as such identifiers are no longer necessary, to destroy hard copies of documents that are no longer needed, and to assure that other organizations providing data services to the PRO have established procedures to maintain confidentiality. See 42 C.F.R. S 476.115(e). Even where the disclosure of information by a PRO is authorized, the regulations establish procedures to protect 15 confidentiality. A disclosure requires an accompanying notice and statement advising the recipient of the limitations on permissible redisclosure. See 42 C.F.R. S 476.104. With certain enumerated exceptions, the regulations prohibit any person who obtains confidential PRO information from redisclosing it. See 42 C.F.R. S 476.107. These extensive provisions reflect a clear congressional policy of protecting the confidentiality of information related to PRO proceedings. This policy is consistent withthe underlying purpose of the federal and state peer review statutes, which is to encourage doctors to evaluate their peers honestly, without fear that the proceedings might later be used in a lawsuit. Todd, 152 F.R.D. at 686 (citing Morse v. Gerity, 520 F. Supp. 470, 471 (D. Conn. 1981)). An assurance of confidentiality is essential to facilitate the open communication necessary for a PRO to perform its duties. The Executive Vice President and Chief Executive Officer of the PRO NJ submitted an affidavit stating that without confidentiality, the organization would have great difficulty functioning and great difficulty obtaining information now volunteered from physicians to whom quality inquiries are advanced. App. at 167. See also General Care Corp. v. Mid-South Foundation for Medical Care, Inc., 778 F. Supp. 405, 417 n.10 (W.D. Tenn. 1991). As the preceding discussion demonstrates, Congress has clearly created a statutory scheme that is highly protective of information related to PRO proceedings.
As noted above, plaintiff contends that this section does not bar discovery of the documents at issue because these documents were not  `produced by' a PRO `in connection with its deliberations.'  Plaintiff 's Br. at 42 (quoting 42 U.S.C. S 1320c-9(d)). Specifically, plaintiff argues that: (1) correspondence from the PRO cannot be said to be in connection with [PRO] deliberations because these documents do not include minutes and deliberations whose protection from discovery is the heart of critical selfanalysis[,] id. at 43; and (2) documents written by a target physician cannot be considered generated by the 16 PRO. Id. at 46. We conclude that plaintiff's reading of the phrase produced by [the PRO] in connection with its deliberations is far too narrow. In passing the 1982 amendments, Congress painted with a broad brush, leaving HHS to fill in many important details of the workings of peer review. Bowen, 834 F.2d at 1043; see id. at 1043 (observing that Congress provided skeletal requirements . . . and left much of the specifics . . . to the inventiveness of the HHS, empowering it to promulgate regulations governing PROs in order to implement the peer review program. (citation omitted)). Two relevant details that HHS filled in are the definitions of PRO deliberations and PRO information. The Secretary defines PRO deliberations as discussions or communications (within a PRO or between a PRO and a PRO subcontractor) including, but not limited to, review notes, minutes of meetings and any other records of discussions and judgments involving review matters regarding PRO review responsibilities and appeals from PRO determinations, in which the opinions of, or judgments about, a particular individual or institution can be discerned. 42 C.F.R. S 476.101(b). PRO information is defined as any data or information collected, acquired or generated by a PRO in the exercise of its duties and functions . . . . Id. When PRO NJ's quality review and sanction process is viewed in light of these broad definitions, it is clear the quality review inquiry sent by the PRO to Dwyer were generated by the PRO in connection with its deliberations. The physician-reviewer sent this inquiry to Dwyer after determining that there was, in fact, a potential quality issue regarding Dwyer's treatment of plaintiff. Moreover, the physician-reviewer asked Dwyer to respond to the inquiry. Once Dwyer responded to the inquiry, the physicianreviewer had to consider whether to end the inquiry and send an acceptance notice to Dwyer or to refer the matter to the Sanction Committee of the PRO. Regardless of which course was ultimately taken in this particular case, the physician-reviewer had to render a judgement on the quality of care Dwyer provided to plaintiff. He thus engaged 17 in the deliberative process within the meaning of the Act, and the inquiry sent to Dwyer was certainly in connection with such deliberations. Moreover, while the status of Dr. Dwyer's responses to the PRO inquiry presents a closer question, we conclude that this information was also generated by the PRO in connection with its deliberations. The physician-reviewer specifically requested that Dwyer assist the PRO by responding to its quality review inquiry. See 42 C.F.R. S 476.101(b) ( `PRO review system' means the PRO and those organizations and individuals who . . . assist the PRO[, and includes] . . . Health care institutions and practitioners whose services are reviewed.). Moreover, Dwyer's responses were generated solely as a result of, and during the course of, the PRO's quality review. As the district court aptly noted, Documents utilized by the PRO in the course of its quality inquiry--medical records for example--are discoverable for [sic] any source other than the PRO that might have them. However, documents generated or created by the PRO are not discoverable from any source. Thus, the documents generated by the PRO are absolutely privileged but documents which are generated for another purpose, but which the PRO review in the course of investigating the doctor are not. Dist. Ct. Op. at 6-7 (citing Todd, 152 F.R.D. at 687, 698). Thus, the PRO generated these responses, which were inextricably linked to the PRO review process and allowed the PRO to perform its responsibilities under the Act. Consequently, Dwyer's responses to the PRO inquiry are not subject to subpoena or discovery. In addition, the fact that plaintiffs sought to compel these documents from Dwyer, rather than the PRO, does not alter this outcome. Congress provided that the documents or information generated by the PRO in the course of its statutory duties is not subject to subpoena or discovery. See 42 U.S.C. S 1320c-9(d). The bar against discovery runs with the documents or information, not with the organization or individuals who happen to possess the documents or information at any given time. But see Todd, 18 152 F.R.D. at 686 (This court finds, therefore, that the Peer Review Protect [sic] Act bars production of documents solely as they exist in the possession of the Peer Review Organization.). Indeed, to hold otherwise would necessarily render the statute's mandate of confidentiality a nullity because a subject physician will have most, if not all, of the materials related to the inquiry within his possession. Thus, the absolute prohibition against discovery of these materials is not destroyed simply because the materials, or copies of the materials, are in the hands of the physician who is the subject of the PRO quality review inquiry and part of the PRO review system. Accordingly, plaintiff's argument must fail.8