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Introduction to Health Care Law
Professor Edward P. RichardsLSU Law Center
http://biotech.law.lsu.edu/
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Key Issues
Scientific medicine is about 120 years old Technology based medicine is less than 60 years old Doctors are not scientists and many do not practice
scientific medicine. There is no stable model for medical businesses, leading
to constant change and unending legal problems. Health care finance shapes medical care and is a huge
mess
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Critical Dates in Medicine
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1400s
Birth of Hospitals Places where nuns took care of the dying No medical care – against the Church’s teachings No sanitation – assured you would die
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Early 16th Century
Paracelsus Transition From Alchemy
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Mid 16th Century
Andreas Vesalius Accurate Anatomy
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Early 17th Century
William Harvey Blood Circulation – the body is dynamic, not static
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1800
Edward Jenner Smallpox and the notion of vaccination
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1846
William Morton - Ether Anesthesia
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1849
Semmelweis Childbed Fever and sanitation Controlled Studies
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1854
John Snow Proved Cholera Is Waterborne Basis of the public sanitation movement
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1860-1880s
Louis Pasteur Scientific Method Simple Germ Theory Vaccination For Rabies Pasteurization to kill bacteria in milk
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1867-1880
Joseph Lister Antisepsis – surgeons should wash their hands
and everything else, then use disinfectants Listerine
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1880s
Koch Modern Germ Theory
Organic Chemistry Birth of the modern drug business
The real starting point for scientific medicine
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1850s - 1900s
Sanitation Movement - Modern Public Health
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Schools of Practice - Pre-Science (1800s)
Allopathy Opposite Actions Toxic and Nasty
Homeopathy Same Action as the Disease Symptoms Tiny Doses Less Dangerous
Naturopaths, Chiropractors, Osteopaths, and Several Other Schools
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Most Medical Schools are Diploma Mills
No Bar to Entry to Profession Small Number of Urban Physicians are Rich Most Physicians are Poor
Cannot Make Capital Investments Training Medical Equipment and Staff
Physicians Push for State Regulation to create a monopoly
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Legal Consequences
No Testimony Across Schools of Practice Different from Medical Specialties
Surgery, Internal Medicine, Pediatrics All Same School of Practice - Allopathy All Same License Cross-Specialty Testimony Allowed
Still important with the rise of alternative/quack medicine
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Transition to Modern Medicine and Surgery
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The Business of Medicine
Mid to Late 1800s Physicians are Solo Practitioners Most Make Little Money Have Limited Respect
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Surgery Starts to Work in the 1880s
Surgery Can Be Precise - Anesthesia Patients Do Not Get Infected - Antisepsis
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Effect on Licensing and Education
Once there are objective differences (people live) between qualified and unqualified docs, people care You can make more money with better training You can make more money with better equipment and
facilities Effective Medicine Drives Licensing
Licensing Limits Competition Physicians Start to Make Money
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The Tipping Point
About 1910, going to the doctor, and particularly the hospital, shifted from being more dangerous than avoiding them to increasing your chance of survival.
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Bars on Corporate Practice of Medicine - 1920s
Physicians Working for Non-physicians Concerns About Professional Judgment Cases From 1920 Read Like the Headlines Banned In Most States Real Concern Was Laymen Making Money off
Physicians
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Physician Practices
Shaped by Corporate Practice Laws Sole Proprietorships Partnerships Mostly Small
Some Large Groups First Organized As Partnerships Then As Professional Corporations
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Impact of Corporate Bans on Institutional Practice
Physicians Do Not Work for Non-Governmental Hospitals Contracts Governed by Medical Staff Bylaws Sham of “Buying” Practices
Physicians Contract With Most Institutions Charade of Captive Physician Groups
Managed Care Companies Contact With Group Group Enforces Managed Care Company’s Rules Physicians Can Be As Ruthless As Anyone
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Evolution of Hospital Administration
From Nuns to MBAs
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From Hotel to High Tech - The Evolution of Hospitals
Started With Surgery Medical Laboratories
Bacteriology Microanatomy
Radiology Services and Sanitation Attract Patients
Internal Medicine Obstetrics Patients
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Post WW II Technology
Ventilators (Polio) Electronic Monitors Intensive Care Hospitals Shift From Hotel Services to
Technology Oriented Nursing
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Post World War II Medicine
Conquering Microbial Diseases Vaccines Antibiotics
Chronic Diseases Better Drugs Better Studies Childhood Leukemia
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Hospital Liability - Old Days
Charitable Immunity No professional services Physicians provided or supervised professional services
No Independent Liability for Nurses No Liability for Physician malpractice
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Reformation of Hospitals
Paralleled Changes in the Medical Profession Began in the 1880s Shift From Religious to Secular
Began in the Midwest and West Not As Many Established Religious Hospitals
Today, Religious Orders Still Control A Majority of Hospitals
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After Professionalization
Demise of Charitable Immunity Liability for Nursing Staff Negligent Selection and Retention Liability for Medical
Staff
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Hospital Staff Privileges
Physicians are Independent Contractors Hospitals Are Not Vicariously Liable for
Independent Contractor Physicians Hospitals Are Liable for Negligent Credentialing
and Negligent Retention Hospitals Can Be Liable if the Physician is an
Ostensible Agent
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Joint Commission on Accreditation of Hospitals
1950s Now Joint Commission on Accreditation of
Health Care Organizations American College of Surgeons and
American Hospital Association Split The Power In Hospitals
Medical Staff Controls Medical Staff Administrators Control Everything Else
Enforced By Accreditation
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Contemporary Hospital Organization
Classic Corporate Organizations CEO Board of Trustees Has Final Authority Part of Conglomerate
Medical Staff Committees Tied To Corporation by Bylaws Headed by Medical Director
Constant Conflict of Interest/Antitrust Issues
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Medical Staff Bylaws
Contract Between Physicians and Hospital Not Like the Bylaws of a Business Selection Criteria Contractual Due Process For Termination Negotiated Between Medical Staff and Hospital
Board
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Hospital Economics
Old Days More Patients Meant More Money More Docs to Admit Patients Insurance Was So Generous It Cross-subsidized
Indigent Care Now
Hospital beds are being closed to save money DRGS- Insurance and Government Pay is Very Limited
- No Cross-Subsidy Under-Insured or Over-Cared-For Patients Cost Money
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Specialty Hospitals
Complex care is safer when regionalized Specialty hospitals can provide better care at
lower prices Do not need to provide money losing services Do not take uninsured patients
Shift the most valuable patients from community hospitals
Dramatically increase unnecessary surgery
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Bottom-Line
Health care is an industry in transition Key Problems
Access Cost Distributive justice Quality