FLORIDA FEDERAL COURT RULES DECLARATORY JUDGMENT ACTION AGAINST HHS REGARDING THE PSQIA CAN PROCEED — Hancock Daniel
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FLORIDA FEDERAL COURT RULES DECLARATORY JUDGMENT ACTION AGAINST HHS REGARDING THE PSQIA CAN PROCEED

July 25, 2018

A Florida federal district court has held that Tampa General Hospital’s declaratory judgment action against the Secretary of the Department of Health and Human Services can proceed.  The decision follows a motion by the Secretary advocating that the Hospital’s claims were not ripe for adjudication and that the federal agency had immunity from such claims.  This will allow the federal court to weigh in on the interpretation of the Patient Safety and Quality Improvement Act of 2005 (PSQIA)[1] and associated interaction with both Article X, Section 25 of the Florida Constitution (Amendment 7) and the Florida Supreme Court’s decisions in Charles v. Southern Baptist Hospital and Edwards v. Thomas.[2]

REQUEST FOR DECLARATORY RELIEF

Tampa General filed the request for declaratory relief following discovery requests it received in an underlying medical malpractice action filed by former patient Lawrence Brawley.[3]  The discovery requests were broad, seeking all root cause analyses or records relating to any adverse medical incident at the Hospital without limitation.  The Hospital has identified 248 documents that are responsive to the request, but because they are confidential and privileged Patient Safety Work Product (PSWP) and reported to the Hospital’s contracted Patient Safety Organization (PSO), PSO Florida, they are protected from disclosure by the PSQIA.  The Hospital objected to production based on the PSQIA’s statutory privilege and strict prohibition on any use for civil litigation.

The Hospital filed the declaratory judgment action, seeking clarification of its rights and obligations under federal law as to the documents it has collected, created, and maintained as PSWP.  The Hospital advocates that it cannot simultaneously comply with the PSQIA and the Florida Supreme Court’s holding in Charles.  Tampa General asks the Court to hold that PSWP in its possession is privileged and confidential and not subject to disclosure in discovery. It explains that if it produces the PSWP in compliance with the underlying plaintiff’s request, it will be subject to monetary penalties for violating the nondisclosure requirements of the PSQIA.

HHS MOTION TO DISMISS

HHS filed a motion to dismiss, advocating that there was no current controversy ripe for adjudication, in addition to sovereign immunity arguments.  HHS advocated that it had no actual evidence that Tampa General had violated the PSQIA, and even if the hospital disclosed the documents at issue, “that fact alone would not necessarily trigger an enforcement action by the Secretary.”[4]  The Secretary suggested that Tampa General only alleged that HHS “could” enforce the PSQIA by penalizing the hospital, which “has not happened (and may never happen).”[5]  HHS advocated there is no standing because there is no actual injury at this time and asked that the action be dismissed.

On the preemption piece, HHS explained that if Amendment 7 required disclosure of true PSWP, “[t]he PSQIA would plainly preempt Florida law in that instance,” citing the preemption language of the statute.  “Thus, Congress, in enacting the PSQIA explicitly preempted state law – including any possible contrary Florida Constitutional Law.”[6]

HHS cited its 2016 guidance regarding the PSQIA and echoed the Florida Supreme Court’s reliance on the same in Charles.  HHS explained that because the records sought by the Charles plaintiff were required to be maintained under Florida law, the records were not privileged and confidential PSWP.  As non-PSWP, they were not protected from disclosure in discovery.[7]   HHS repeated that if Tampa General had actual PSWP, and if a trial court ordered the hospital to produce the PSWP, the issue would be whether the PSQIA preempts any Florida law that would otherwise require the production.  HHS says that the PSQIA would undoubtedly preempt Florida law in that instance, but notes that “this is just a hypothetical since the Charles decision does not require the production of any PSWP.”[8]  This comment appears to have been directed at the internal adverse incident reports at issue in Charles.

The Hospital responded, advocating that because of the threat of penalty prosecution for improper release of PSWP, an injury was imminent and established, and therefore ripe for adjudication.  Tampa General explained that the Secretary’s response implied that any penalty under the PSQIA is optional, when the statute and regulations provide the penalty “shall” be imposed in the event of an improper disclosure.[9]  The Hospital advocated that the question must be settled as it relates to documents beyond the incident reports at issue in Charles.

HHS was granted permission to file a reply to the Hospital’s response, where it advocated that no penalty can be “imminent” without confirmation that the documents at issue are true PSWP.  HHS also argued that the Hospital has not alleged how either Charles or Edwards differ from HHS’s interpretation of the PSQIA.  This signaled the Secretary’s approval of the holding that documents required to be maintained under state law, even if not externally reported, are not PSWP.

DENIAL OF MOTION AND PSO INTERVENTION

The Middle District of Florida has rejected HHS’s arguments and will allow the declaratory judgment action to proceed against HHS. The Court explained that the injury to the Hospital is imminent enough to establish ripeness.  “[The Hospital] is stuck between a rock and a hard place because its production of those documents would then subject it to penalties from HHS for knowingly disclosing PSWP in violation of the Federal Act.”[10]

Not only will the case proceed against HHS, but PSO Florida has also joined as an intervenor plaintiff.  The PSO filed a motion to intervene, advocating it too has a legal, pecuniary, and substantial interest in the outcome of the litigation.  HHS opposed the motion, arguing the PSO’s interests were adequately represented by Tampa General, but this too was denied by the Court.  The PSO has since filed its own Complaint for Declaratory Relief.

The Court has denied a motion for reconsideration by HHS.  In the interim between the order denying the motion to dismiss and the motion for reconsideration, the Hospital has been ordered by the state court to produce the documents it claims are PSWP.  The Court explained that the Hospital’s injury is even more imminent now, and that if it complies with the state court order, the Hospital will be subjected to the mandatory penalty provisions of the PSQIA.[11]

NEXT STEPS

This case is one to monitor not only for the ultimate decision, but also for continued statements from HHS regarding interpretation of Charles and potential prosecution of penalties in the event of any unauthorized disclosures.  The case has already attracted national attention and could prompt additional intervenors or amicus curiae participants.

If you have specific questions about how the Florida federal litigation impacts your facility’s PSO participation or other aspects of PSO development, strategy, implementation, or policies, please contact a member of Hancock Daniel’s Patient Safety and PSOs Team.

 

The information contained in this advisory is for general educational purposes only. It is presented with the understanding that neither the author nor Hancock, Daniel & Johnson, P.C., is offering any legal or other professional services. Since the law in many areas is complex and can change rapidly, this information may not apply to a given factual situation and can become outdated. Individuals desiring legal advice should consult legal counsel for up-to-date and fact-specific advice. Under no circumstances will the author or Hancock, Daniel & Johnson, P.C. be liable for any direct, indirect, or consequential damages resulting from the use of this material.

 

[1] 42 U.S.C. § 299b-21, et seq.

[2] Edwards v. Thomas, 229 So. 3d 277 (Fla. 2017); Charles v. S. Baptist Hosp. 209 So. 3d 1199 (Fla. 2017).  For more information on Charles, see February 7, 2017 Client Advisory.

[3] Fla. Health Sci. Center, Inc., d/b/a Tampa Gen. Hosp. v. Alex Azar, Sec’y of Dep’t of Health & Human Serv., et al., Case No. 8:18-cv-00238-30CPT (M.D. Fla. 2018).

[4] Secretary’s Motion to Dismiss Amended Complaint and Incorporated Memorandum of Law at 12, Tampa Gen. (Doc No. 20, filed May 4, 2018).

[5] Id. at 12.

[6] Id. at 15.

[7] Id.

[8] Id.

[9] Tampa General Hospital’s Response in Opposition to Defendant’s Motion to Dismiss and Incorporated Memorandum of Law at 8, Tampa Gen., (Doc. 21, filed May 18, 2018).

[10] Order at 9, Tampa Gen., (Doc. 32, filed June 22, 2018).

[11] Order at 3, Tampa Gen. (Doc. 43, filed July 23, 2018).