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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Brandner v. Providence Health & Services - Washington (11/25/2016) sp-7135

Brandner v. Providence Health & Services - Washington (11/25/2016) sp-7135, 384 P3d 773

           Notice:   This opinion is subject to correction before publication in the P                    ACIFIC  REPORTER.  

           Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,  


           303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email  



                       THE SUPREME COURT OF THE STATE OF ALASKA                                      

MICHAEL  D.  BRANDNER,  M.D.,                                        )  

                                                                     )     Supreme  Court  No.  S-15933  

                                Appellant,                           )  


                                                                     )     Superior Court No. 3AN-13-07697 CI  

           v.                                                        )  


                                                                     )     O P I N I O N  


PROVIDENCE HEALTH &                                                  )  


SERVICES - WASHINGTON,                                                                                                 

                                                                     )     No. 7135 - November 25, 2016  


                                Appellee.                            )  




                        ppeal from the Superior Court of the State of Alaska, Third  


                     Judicial District, Anchorage, Patrick J. McKay, Judge.  


                     Appearances: Richard W. Maki and David H. Shoup, Tindall  


                     Bennett & Shoup, P.C., Anchorage, for Appellant.  Robert J.  


                     Dickson and Peter A. Scully, Atkinson, Conway & Gagnon,  


                     Anchorage, for Appellee.  


                     Before: Stowers, ChiefJustice, Winfree and Bolger, Justices.  


                      [Fabe and Maassen, Justices, not participating.]  


                     WINFREE, Justice.  



                     Providence Alaska Medical Center terminated Dr. Michael Brandner's  


hospital privileges without notice and an opportunity to be heard after determining he  


had violated hospital policy by failing to report an Alaska State Medical Board order  


requiring him to undergo an evaluation of his fitness to practice medicine. Dr. Brandner  

----------------------- Page 2-----------------------


unsuccessfully challenged this action through Providence's internal post-termination  


hearing and appeal procedures.   Dr. Brandner then  sued  in superior court, seeking  


reinstatement and damages for, in relevant part, alleged due process violations both in  


the procedures used and in the substantive standard applied in his termination.   The  


superior court ruled that Dr. Brandner's due process rights were not violated, that he was  


not entitled to reinstatement, and that under federal law Providence was entitled to  


immunity from his damages claims.  


                    Weaffirmthesuperiorcourt's decision concerning thesubstantivestandard  


applied to terminate Dr. Brander; he therefore is not entitled to reinstatement or post- 


termination-hearing damages.  But Dr. Brandner's due process rights were violated by  


the procedures Providence employed because he was not given the required notice and  


a hearing prior to the termination of his hospital privileges; we therefore reverse the  


superior court's decision on the pre-termination notice and hearing claimand its decision  


that Providence had damages immunity from this claim, and we remand for further  





          A.        Facts  


                    Dr. Brandner had hospital privileges as a surgeon at Providence from 1995  


to 2009, when he took a medical leave of absence because of a cardiac condition.  He  


returned  to  work  in  March  2010  and  Providence  reinstated  his  hospital  privileges,  


excepting hand surgery. ProvidencealsogaveDr. Brandnerasix-month exemption from  


emergency call duties.  In November 2010 Providence reinstated Dr. Brandner's hand  


surgery privileges after reviewing his surgical cases and finding himcompetent, but kept  


in place the emergency call exemption.  


                    In October 2010 the Alaska State Medical Board (State Board) ordered  


Dr. Brandner to undergo psychiatric and medical evaluations after receiving a complaint  

                                                               -2-                                                        7135

----------------------- Page 3-----------------------


that he had contacted someone in the Governor's office and made a threat involving a  


gun.  The evaluations were part of the State Board's investigation into Dr. Brandner's  


"ability to practice medicine in a manner consistent with public safety," and he was  


required to complete them within 45 days.  The State Board's order also stated:  


                    Failure to comply with this order will result in the automatic  


                    suspension of [Dr. Brandner's] license to practice medicine  


                    in Alaska and it will remain suspended until such time as the  


                    evaluations are completed and the results of the evaluations  


                    are reviewed  by  the [State] Board,  and the [State]  Board  


                    determines Dr. Brandner is able to practice medicine in a  


                    manner consistent with public safety.  


Dr. Brandner timely complied with the order by undergoing a five-day evaluation in  


early December 2010 at the Menninger Clinic in Texas.  The clinic found no evidence  


indicating he was unfit to practice medicine.  Later in December the State Board closed  


its investigation without imposing any "further investigation or disciplinary action"; it  


sent Dr. Brandner confirmation of its decision in May 2011.  


                    Doctors enjoying Providence hospital privileges are required to comply  


with policies set out in the Providence Code of Conduct and Medical Staff Bylaws.  


Policy MS 980-150(D) requires doctors to report to the chief of staff or the medical staff  


services department manager "any limitations, restrictions[,] or conditions of any sort  


imposed by a state board, health care entity[,] or agency with respect to the practitioner's  


practice . . . no later than thirty (30) days after a final order has been issued." The policy  


states that doctors who violate this reporting requirement "will be subject to an automatic  


termination" of hospital privileges.  Dr. Brandner did not inform Providence's chief of  


staff or medical staff services manager about the State Board order, nor did he disclose  


his December 2010 evaluation at the Menninger Clinic.  


                    Procedures  for  reviewing,  investigating,  and  resolving  concerns  about  


doctors' clinical proficiency and professionalconductaregovernedbyProvidencepolicy  

                                                                -3-                                                         7135

----------------------- Page 4-----------------------


MS 980-100, referred to as the Investigation, Hearing, and Appeals Plan (Fair Hearing  


Plan). Under this policy the Providence Medical Staff Executive Committee (executive  


committee) is responsible for overseeing doctors' conduct.  Concerns about a doctor's  


conduct are first presented to the executive committee; it then has authority to conduct  


peer reviews and make recommendations to theProvidenceAlaskaCommunityMinistry  


Board (Providence Board) on granting, limiting, suspending, or terminating hospital  


privileges. The executivecommittee's recommendationsgenerally do not by themselves  


affect a doctor's hospital privileges; the Providence Board receives the recommendation,  


considers the matter independently, and makes the ultimate decision.  Some hospital  


policies, including the one at issue here, provide for automatic termination of hospital  


privileges  if  a  doctor  engages  in  specified  conduct.                              An  automatic  termination  


recommendation triggers a process under MS 980-100 entitling the doctor to a hearing  


and an appeal.  After the hearing and appeal procedures are exhausted the Providence  


Board's confirmation,modification, or rejectionofthehearingbodies' recommendations  


becomes Providence's final decision.  


                    In January2011 theexecutivecommitteecalled Dr. Brandner to its monthly  


meeting to discuss his emergency call duties.  The executive committee was concerned  


because  Dr. Brandner had listed his name on the emergency call sign-up sheets despite  


not yet being authorized to resume those duties.   During that meeting the executive  


committee  was  alarmed  by  Dr.  Brandner's  "disjointed"  statements.                                      The  executive  


committee invited him to a second meeting in February to decide whether to investigate  


his fitness to practice medicine.  At the February meeting Dr. Brandner's "rambling and  


confused" conduct again raised concerns that he might not be "medically fit," and the  


executive committee ordered him to  undergo  a "fitness for  duty"  evaluation  at the  


Menninger Clinic.  

                                                               -4-                                                         7135

----------------------- Page 5-----------------------


                    Kim   Pakney,   Providence's   medical   staff   services   manager,   called  


Dr. Brandner in March to arrange the evaluation. During this call Dr. Brandner disclosed  


to Pakney that he recently had been evaluated at the clinic.  Pakney told Dr. Brandner  


that he could either undergo another evaluation or allow the executive committee to  


obtain the December 2010 evaluation records.  Dr. Brandner chose to release his 2010  


evaluation.  According to Pakney's later testimony, Dr. Brandner did not mention the  


State Board's order during their conversation and instead indicated he had visited the  


clinic at his cardiac surgeon's suggestion.  Dr. Brandner testified that he told Pakney he  


had gone to the Menninger Clinic "to pursue some things." Only when Pakney received  


Dr. Brandner's clinic records did she realize that he had undergone the evaluation  


pursuant to an order from the State Board.  She immediately notified the Providence  


executive committee.  


                    At  its  next  meeting,  on  June  13  -  without  notice  to  or  presence  by  


Dr.  Brandner  -  the  executive  committee  voted  to  recommend  termination  of  


Dr. Brandner's hospital privileges for failure to report the State Board's order requiring  


him to submit to an evaluation.  The executive committee determined that the order was  


a final order imposing a condition on Dr. Brandner's license, and that his failure to report  


the order to the chief of staff or the medical staff services department manager within 30  


days constituted a violation of Providence policy MS 980-150(D).  


                    In   a   June   17   letter   Providence's   chief   executive   officer   notified  


Dr. Brandner that the executive committee "recommended the automatic termination of  


[his hospital] privileges and staff membership," that he had the right to a hearing, and  


that the Providence Board would "not be bound by the adverse recommendation made  


thus far."  A few days later the Providence Board affirmed the executive committee's  


recommendation terminating Dr. Brandner's hospital privileges.  Dr. Brandner timely  


requested  a  hearing.                 At  oral  argument  before  us  the  parties  confirmed  that  

                                                                -5-                                                         7135

----------------------- Page 6-----------------------

Dr. Brandner's privileges effectively were terminated June 17, before any hearing took  


place, and that after that date he was not allowed to practice at Providence.  


          B.        Proceedings  


                     1.        Providence Fair Hearing Panel proceedings  


                    In November 2011 Dr. Brandner received a one-day hearing before a three- 


doctor panel pursuant to Providence's Fair Hearing Plan. A former superior court judge  


presided as the hearing officer. Dr. Brandner was represented by an attorney, presented  


evidence,  cross-examined  Providence's  witnesses,  and  testified  on  his  own  behalf.  


Providence's  witnesses  testified  about  the  importance  of  physicians  self-reporting  


conditions on their licenses because of the potential impact on patient care. Dr. Brandner  


argued that the State Board's order was not a "condition" on his license within the  


meaning of the Providence reporting policy. He argued instead that the order was a part  


of an "investigation," and stated that he did not believe the policy required reporting  




                    The   panel   decided   that   the   order   did   impose   a   "condition"   on  


Dr. Brandner's license because "[t]he plain language of the . . . [o]rder . . . clearly  


advised Dr. Brandner that the continued viability of his license was conditioned upon his  


timely completion of [] psychiatric and medical evaluations at the Menninger Clinic."  


The  panel  also  found  Dr.  Brandner's  testimony  regarding  his  interpretation  of  the  


hospital  policy  "less  than  credible"  because:                        (1)  he  testified  that  he  attended  the  


Menninger Clinic to "pursue some things"; (2) Pakney testified that Dr. Brandner said  


he attended the clinic because his cardiac surgeon had recommended it; and (3) it was  


undisputed  that  Dr.  Brandner  actually  attended  the  clinic  because  the  State  Board  


required it.  


                    The panel concluded that because the State Board order plainly stated  


Dr.  Brandner's  license  would  be  suspended  if  he  did  not  comply,  a  responsible,  

                                                                -6-                                                         7135

----------------------- Page 7-----------------------


reasonable  doctor  would  have  reported  the  order  or  at  least  asked  Providence  for  


guidance  on  whether  the  order  triggered  Providence's  self-reporting  policy.                                              It  


unanimously upheld the executive committee's recommendation and the Providence  


Board's decision terminating Dr. Brandner's hospital privileges, finding that they were  


"not arbitrary, capricious[,] or unsupported by substantial evidence."  


                    2.        Providence Appellate Review Committee proceedings  


                    Dr.  Brandner  timely  appealed  the  panel's  decision  to  the  Providence  


AppellateReviewCommittee(reviewcommittee)pursuant totheFair Hearing Plan. The  


review committee, comprised of five members - none of whom had participated in the  


earlier proceedings - convened in March 2012.  


                    The review committee upheld the hearing panel's decision by a 4-1 vote.  


In its decision the review committee noted that Dr. Brandner's reading of the hospital  


policy  regarding  the  scope  of  "condition"  was  "plausible"  but  that  the  review  


committee's role was not to substitute its judgment for that of the hearing panel or to re- 


weigh the evidence.  The review committee concluded that the hearing panel's actions  


compliedwith Providence'sFair Hearing Plan,werenot arbitrary or capricious,and were  


supported by substantial evidence.  One review committee member dissented, writing  


that  the  State  Board's  order  was  not  a  "final  order"  imposing  "conditions"  under  


Providence  policy  MS  980-150(D)  and  thus  did  not  trigger  the  self-reporting  


requirement.  The dissent expressed concern that the hospital policy was applied based  


in part on Dr. Brandner's fitness to practice and not just his failure to report the State  


Board order, and it noted that the failure to self-report alone typically would not result  


in automatic termination of privileges.  After the review committee issued its report, the  


committee chair sent the Providence Board a letter recommending clarifying MS 980- 


150(D)'s language by adding some "interpretive guidance to illustrate the types of  


limitations, restrictions, and conditions that are intended to be included."  

                                                               -7-                                                         7135

----------------------- Page 8-----------------------

                                      In   April   2012,   after   considering   the   hearing   panel's   and   the   review  

committee's   decisions   upholding   the   executive   committee's   recommendation,   the  

Providence Board affirmed the termination of Dr. Brandner's hospital privileges.                                                                                                                                                      

                                      3.                Superior court proceedings                    

                                      In June 2013 Dr. Brandner filed suit in superior court against Providence,                                                                                                  

the doctors who made up the hearing panel, and the doctors on the executive committee                                                                                                                                 

who testified at his hearing.                                                         Dr. Brandner alleged breach of contract, due process                                                                                   

violations, defamation, and other contract claims.                                                                                                  He sought both                                  declaratory and   

injunctive   relief   restoring   his  hospital   privileges   and   substantial   money   damages.   

Providence   and   the   doctors   moved   for   summary   judgment,   asserting  peer   review  



immunity under both Alaska law                                                                 and the federal Health Care Quality Improvement Act  

                             2      Dr. Brandner opposed and cross-moved for partial summary judgment,  


arguing that Providence and the doctors were not entitled to immunity under either state  


or federal law and that his due process rights were violated.   In February 2014 the  


superior court granted summary judgment in favor of the individual doctors, concluding  


that  AS  18.23.020  immunized  them  from  suit.3                                                                                                The  court  also  granted  summary  


                   1                 See  AS 18.23.020 (limiting review proceedings participants' liability for                                                                                                                            

damages or other relief if their review actions were not motivated by malice, were taken                                                                                                                                            

after reasonable efforts to ascertain the facts, and were taken with the reasonable belief                                                                                                                                         

that they were warranted).                

                   2                  42 U.S.C.  11101-11152 (2012).  Congress passed HCQIA in an effort  


to "restrict the ability of incompetent physicians to move from State to State without  


disclosure  or   discovery   of  the  physician's  previous  damaging  or  incompetent  


performance"  by  encouraging  physicians  to  engage  in  "effective  professional  peer  


review."   42 U.S.C.  11101.   In pursuit of this aim the HCQIA limits damages on  


professional review actions.  42 U.S.C.  11111.  


                   3                 We later affirmed this decision in Brandner v. Bateman,  concluding that  



                                                                                                                      -8-                                                                                                            7135

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judgment in Providence's favor on Dr. Brandner's contract claims.                                                                                                                                                                                                                                                                 The court denied                                  

 Dr. Brandner's cross-motion for summary judgment on his due process claims against                                                                                                                                                                                                                        


                                                               Dr. Brandner's due process claims were tried without a jury. The superior                                                                                                                                                                                                                                      

 court found that Dr. Brandner intentionally misled Providence by consciously hiding the                                                                                                                                                                                                                                                                                                               

  State Board order that he undergo an evaluation, and that his "blatant dishonesty" and  

 "lack of candor" raised substantial patient care issues.                                                                                                                                                                                                          The court also concluded that                                                                                                  

 when a hospital policy requires self-reporting a condition placed on a physician's state                                                                                                                                                                                                                                                                                                      

 license, due process does not require a pre-termination hearing for failure to report in                                                                                                                                                                                                                                                                                                                 

 violation of that policy.                                                                                         Finally, the court concluded that Providence was entitled to                                                                                                                                                                                                                           

 immunity under HCQIA.                                                                                                   

                                                               Dr. Brandner appeals, arguing that:                                                                                                                                       (1) Providence's termination of his                                                                                                                          

 hospital privileges without pre-termination notice or hearing is a due process violation;                                                                                                                                                                                                                                                                             

 (2)   the   post-hearing   termination   violated   due   process   because   it  was   based   on   an  

 ambiguous policy applied arbitrarily and capriciously; and (3) Providence is not entitled                                                                                                                                                                                                                                                                                        

 to HCQIA immunity from his due process claims.                                                                                                                                                                                                 Providence responds that:                                                                                                        (1) the   

 automatic   termination  of   Dr.   Brandner's   hospital   privileges   is   not   a   due   process  

 violation; (2) its hospital policy is not unduly ambiguous; and (3) under HCQIA it is                                                                                                                                                                                                                                                                                                                      

 immune from damages even if Dr. Brandner succeeds in his due process claims.                                                                                                                                                                                                                                                                         

                                3                               (...continued)  


 "the executive committee and hearing panel reasonably interpreted the policy" and  


 "enforced the sanction explicitly indicated in the policy."  349 P.3d 1068, 1076 (Alaska  


                                                                                                                                                                                                     -9-                                                                                                                                                                                      7135

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III.	        STANDARD OF REVIEW                  

                         We review due process claims de novo, "adopting the rule of law most                                                             


persuasive in light of precedent, reason, and policy."                                                                                         

                                                                                                      Whether the HCQIA immunizes  


Providence from Dr. Brandner's due process claims is a question of law that we also  



review de novo. 

IV.	         DISCUSSION  


             A.	         Dr. Brandner's Due Process Rights Were Violated When His Hospital  


                         Privileges  Were  Terminated  Without  Pre-Termination  Notice  Or  



                         Although the parties dispute what process was due at certain points in the  


termination process, they agree that Dr. Brandner's admitting privileges trigger some  



form of due process protection. 


                         1.	          Dr.  Brandner  did  not  waive  his  right  to  a  pre-termination  



                         Providence argues that Dr. Brandner waived his right to a pre-termination  


hearing by agreeing to be bound by MS 980-150, triggering an "automatic termination"  


without providing for a pre-termination hearing. The right to a pre-termination hearing,  


Providence argues, may be waived if a sufficient post-termination grievance procedure  

             4           Alyeska Pipeline Serv. Co. v. State, Dep't of Envtl. Conservation                                                       , 145 P.3d     

561, 564 (Alaska 2006).            

             5           Bryan v. James E. Holmes Reg'l Med. Ctr., 33 F.3d 1318, 1332 & n.24  


(11th  Cir.  1994);  see  also  Maness  v.  Daily,  307  P.3d  894,  900  (Alaska  2013)  


(articulating the de novo standard of review in the federal qualified immunity context).  


             6           See Storrs v. Lutheran Hosps. &Homes Soc'y of Am., Inc., 609 P.2d 24, 28  


(Alaska 1980) (holding quasi-public hospitals cannot violate due process standards in  


denying staff privileges).  


                                                                              -10-	                                                                       7135

----------------------- Page 11-----------------------


is afforded.           We previously have held that a waiver of constitutional rights must be                                                 

knowing and voluntary, and even in civil cases "courts must indulge every reasonable                                  

                                                           8   And although constitutional rights are subject to  

presumption against their waiver."                                                                                                             

                                                                                9   Courts have found clear waiver, for  

contractual waiver, such waiver must be clear.                                                                                               


example, in collective bargaining agreements   representing "a reciprocal negotiation  


between  forces  with  strengths  on  both  sides,  reflecting  the  reconciled  interests  of  


employer and employees, voluntarily entered into."10                                         But here Dr. Brandner had not  


entered into a reciprocal negotiation with Providence for his hospital privileges; the  


requirement of abiding by the hospital's policy to obtain privileges is more akin to a  


contract of adhesion.  


                      Providencecites Whitakerv. Houston CountyHospital Authority to support  


its proposition that a doctor can waive the right to a pre-termination hearing and, if  


waived, the automatic termination of hospital privileges would not violate the doctor's  


                              11   But in Whitaker the doctor "expressly waive[d] any procedural due  

due process right.                                                                                                                          


           7          See  Storrs   v.  Municipality   of  Anchorage ,   721   P.2d   1146, 1150   (Alaska  

 1986)  (providing  collective  bargaining  agreement  may  alter  covered  employees'  pre- 

termination  rights in limited circumstances);  Antinore v. State ,  371  N.Y.S.2d  213,  217  

(N.Y.  App.  Div.  1975)  (finding  collective  bargaining  agreements  made  by  "a  reciprocal  

negotiation   between   forces   with   strengths   on   both   sides,   reflecting   the   reconciled  

interests o      f  employer  and  employees,  voluntarily  entered  into"  can  waive  due  process  


           8          Lynden Transp. v. State, 532 P.2d 700, 717 (Alaska 1975).  


           9          Bowen v. N.C. Dep't of Human Res., 710 F.2d 1015, 1018 (4th Cir. 1983).  


           10         Antinore , 371 N.Y.S.2d at 217.  


           11          613 S.E.2d 664, 671-72 (Ga. App. 2005).  


                                                                     -11-                                                                7135

----------------------- Page 12-----------------------


process rights" through a contract entered into directly with the hospital.                                                                                                                                                                                                                    Here neither   

Providence policy MS 980-150 nor the document Dr. Brandner signed for his 2009                                                                                                                                                                                                                                              

reinstatement at the hospital specifically mentioned waiving due process rights.                                                                                                                                                                                                                                          Thus  

there is no evidence of a "conspicuous and unequivocal" intent by Dr. Brandner to waive                                                                                                                                                                                                                                   

his right to a pre-termination hearing.                                                                                                             The superior court rejected Providence's waiver                                                                                                                   

 argument,finding"nolanguagein [Dr. Brandner'sapplication                                                                                                                                                                                    forprivileges]referencing                                

 a general right to due process or dealing specifically with a physician's right to . . . a pre-                                                                                                                                                                                                                       

termination hearing in professional review actions."                                                                                                                                                         

                                                    Like the superior court, we conclude that Dr. Brandner did not knowingly                                                                                                                                                                           

 and clearly waive his due process rights merely by signing his reappointment application                                                                                                                                                                                                             

 for hospital privileges.                                                                  Thus Dr. Brandner maintained a protected property interest in                                                                                                              

his hospital privileges subject to due process if terminated.                                                                                                                            

                                                    2.	                       Due process required that Dr. Brandner receive notice and an                                                                                                                                                                                            

                                                                              opportunity to be heard prior to the termination of his hospital                                                                                                                                                                  


                                                    Dr.  Brandner   contends   that   due   process   requires   a   hearing   before  

 deprivation of a constitutionally protected property interest in employment.13  


                                                                                                                                                                                                                                                                                                           "We have  


 consistently held that before the state may deprive a person of a protected property  



interest there must be a hearing . . . ."                                                                                                                            The only exceptions to this pre-termination  


hearing requirement are in emergency situations or when "public health, safety, or  

                           12                       Id.  at  667.  

                           13                       See  City  of  N.  Pole  v.  Zabek,  934  P.2d   1292,   1297  (Alaska   1997).  

                           14                        Graham  v.  State,  633  P.2d  211,  216  (Alaska   1981)  (first  citing  Etheredge  

v. Bradley, 502 P.2d 146 (Alaska 1972); then citing  Frontier Saloon, Inc. v.  Alcoholic  

Beverage  Control  Bd.,  524  P.2d  657  (Alaska   1974)).   

                                                                                                                                                                 -12-	                                                                                                                                                        7135

----------------------- Page 13-----------------------


welfare   require[s]   summary   action."                                     Other   courts   have   agreed   that   medical   staff  

privileges are a valuable property interest and that notice and hearing should precede                                                                 

termination   of   these   privileges   absent   an   "extraordinary   situation   where   a   valid  

government or medical interest is at stake."                                       16  

                          Providence argues that Dr. Brandner was not entitled to a pre-termination  


hearing because the Providence policy contains explicit language that a violation of  


MS 980-150(D) results in "an automatic termination" and because of "Providence's  


compelling interest" in ensuring patient safety and the highest quality in medical care.  


Providence contends that Dr. Brandner received all the process to which he was entitled  


because:  (1) he had full and fair opportunity to make his arguments to a neutral hearing  


panel; (2) he had full and fair opportunity to appeal the hearing panel recommendation  


to a separate, neutral review committee and to the Providence Board, and both upheld  


the hearing panel's decision; and (3) Providence followed the policies and procedures  


Dr. Brandner had agreed to abide by.  But Providence's procedures after terminating a  


doctor's privileges do not remedy its failure to provide procedures before termination.  


                          We previously confirmed the importance of a hearing before suspending  


or terminating a doctor's staff privileges because summary action amounts to "a stigma  


of  medical  incompetence"  affecting  the  doctor's  ability  to  maintain  income  and  


reputation, both during the period between the deprivation of privileges and a hearing  


as well as after the hearing.17                              This stigma is compounded because federal law now  


             15          Id.  (quoting  Frontier Saloon                         , 524 P.2d at 661).                  

             16          Ne. Ga. Radiological Assocs., P.C. v. Tidwell                                          , 670 F.2d 507, 511 (5th Cir.                  

Unit B 1982);               accord Shahewy v. Harrison                             , 875 F.2d 1529, 1533-34 (11th Cir. 1989);                            

Osuagwu v. Gila Reg'l Med. Ctr., 850 F. Supp. 2d 1216, 1223 (D.N.M. 2012).  


             17          McMillan v. Anchorage Cmty. Hosp., 646 P.2d 857, 864 (Alaska 1982).  


                                                                               -13-                                                                         7135

----------------------- Page 14-----------------------


requires that all terminations be reported to a national data bank.                                                                                             Acknowledging the   

competing interests between a doctor's capacity to maintain employment and a health                                                                                                             

care entity's interest in maintaining safe and qualified patient care, we have previously                                                                                              

held that terminating hospital privileges before a hearing is "justified only where there                                                                                                           

is evidence that a physician's conduct poses a realistic or recognizable threat to patient                                                                                                      

care which would require immediate action by the hospital."                                                                                       19  

                                Providence contends that Dr. Brandner's deceitfulness posed a realistic or  


recognizable threat to patient care; when a physician is dishonest and actively conceals  


licensing conditions, a hospital cannot address the undisclosed problems because it  


"simply does not know what it does not know" and thus cannot assess whether there  


might be a "realistic and recognizable threat" to patient care.  Providence maintains, as  


a patient safety matter, that physicians must comply with Providence's self-reporting  


policy and that failure to do so is "cause for deep concern."  


                                Providence has a policy expressly authorizing an immediately effective  


"precautionary suspension" when a doctor presents an imminent danger to the health or  


safety of an individual or to the hospital's orderly operations, but this was not the policy  


followedwhenterminating Dr. Brandner's privileges. As Pakney noted at theNovember  


2011 hearing,therewasnoprecautionary suspension becausetherewas no determination  


that Dr. Brandner was an imminent danger to health or public safety.  The executive  


committee was aware that the Menninger Clinic had evaluated Dr. Brandner and found  


he was fit to practice.  Although this evaluation might not have considered other factors  


bearing on whether Dr. Brandner was an imminent threat to patient care, it is relevant to  


whether Providence actually terminated Dr. Brandner because it found that he posed a  


                18              42  U.S.C.     11133,   11136;  45  C.F.R.    60.1  (2013).  

                19              McMillan,  646  P.2d  at  866.  

                                                                                                   -14-                                                                                                      7135  

----------------------- Page 15-----------------------

threat to patient care.                                                                 And the June 17, 2011 letter notifying                                                                                                                          Dr.  Brandner of the                                              

executive   committee's   recommendation   that   his   privileges   be   terminated   made   no  

mention of patient safety concerns.                                                                                                    

                                                   It is possible, as Providence argues, that a physician's dishonesty might in                                                                                                                                                                                                 

 some   circumstances   be   sufficient   cause   for   emergency   termination.     But   here   this  

 speculative possibility - raised as a post hoc rationalization rather than a demonstrated                                                                                                                                                                                       

contemporaneous concern in Dr. Brandner's case - does not rise to the level of a                                                                                                                                                                                                                                                  

"realistic   or   recognizable   threat"   requiring   an   emergency   termination   of   hospital  

privileges.   We therefore disagree with the superior court and conclude that Providence                                                                                                                                                                                                     

violated   Dr.   Brandner's   right   to  due   process   by   terminating   his   hospital   privileges  

without pre-termination notice and hearing.                                                                                                                            

                         B.	                       Dr.   Brandner's   Due   Process  Rights   Were   Not   Violated   Through  

                                                   Arbitrary And Capricious Application Of An Ambiguous Hospital                                                                                                                                                                                    


                                                   Dr.  Brandner  further  claims  that  his  due  process  rights  were  violated  


becauseProvidencepolicyMS980-150(D) is vagueand ambiguous, andthatProvidence                                                                                                                                                                                                                 

terminated his privileges in an arbitrary and capricious manner without regard to his                                                                                                                                                                                                                                      

reasonable policy interpretation or to whether terminating his hospital privileges was                                                                                                                                                                                                                                  

commensurate with the harm caused by breaching the policy.                                                                                                                                                                                 

                                                   Although we do not interfere with hospital policy determining the medical                                                                                                                                                                              

training and experiencenecessarytoqualifyforhospital                                                                                                                                                          privileges,courtsmay determine                                                      

whether a hospital has followed its own policies and whether a decision regarding                                                                                                                                                                                                                

hospital privileges was made in accordance with basic principles of fairness and due                                                                                                                                                                                                                                     

                                                          20         These principles require that:  (1) the procedures employed are fair;  

process of law.                                                                                                                                                                                                                                                                                                        

(2) the standards are reasonable; and (3) the standards have not been applied in an  


                         20                       Kiester v. Humana Hosp. Alaska, Inc., 843 P.2d 1219, 1223 (Alaska 1992).  


                                                                                                                                                            -15-                                                                                                                                                                     7135  

----------------------- Page 16-----------------------


arbitrary and capricious manner.                                 Due process further requires that "criteria established                       

for granting or denying privileges not be vague and ambiguous, and that as established,                                                      

                                                     22   "A statute, rule, or policy may be deemed impermissibly  

they be applied objectively."                                                                                                           

vague  for  either  of  two  discrete  reasons:                                        It  fails  to  provide  people  of  ordinary  


intelligence  a  reasonable  opportunity  or  fair  notice  to  understand  what  conduct  it  


prohibits; or, it authorizes or encourages arbitrary and discriminatory enforcement."23  


Accordingly the inquiry before us is not whose policy interpretation is more reasonable,  


but whether the policy itself is so vague or ambiguous that it is susceptible to an arbitrary  


and capricious application.  


                         1.           The policy's application was clear.  


                         The superior court concluded that Providence policy MS 980-150 is "clear  


enough." Dr. Brandner nonetheless contends that he found it ambiguous because its key  


terms could be interpreted differently by reference to state law. MS 980-150's operative  


provision  requires  doctors  to  report  to  Providence  "any  limitations,  restrictions,  or  


conditions of any sort imposed by a state board, health care entity or agency with respect  


to the practitioner's practice."  Dr. Brandner argues that state law does not construe the  


State Board's order as a "disciplinary action" or a "condition," because such actions  


would have required that the State Board hold a hearing and none occurred in his case.24  


             21          Id.  

             22          Id.  at   1225.  

             23          Roberts  v.  Titus  Cty.  Mem'l  Hosp.,   129  Fed.  Appx.  82,  86  (5th  Cir.  2005)  

(citing  Chicago  v.  Morales,  527  U.S.  41,  56-57  (1999)).  

             24          See   AS   08.64.326(a)   (requiring   a   hearing   before   imposing   sanctions);  

AS 08.64.331(a)(6) (describing sanctions  State Board  may impose, including "limitations  

or  conditions  on  the  practice  of  a  licensee").   Dr.  Brandner's  argument  rests  on  the  theory  


                                                                             -16-                                                                        7135

----------------------- Page 17-----------------------

 Thus Dr. Brandner argues that under state law his practice was never limited in any way                                                                                         

and that he cannot be faulted for his interpretation, especially when the State Board                                                                                       

investigator   had   confirmed   in   his   case's   proceedings   that   his   license   "was   not  

conditioned, limited, or restricted by the [State] Board."                                                                

                             Surviving a vagueness challenge requires "fair notice" of what is and what                                                                        

                                    25    And here the superior court found that Dr. Brandner had more than  

is not prohibited.                                                                                                                                                              

"fair notice" of what MS 980-150 required; he had actual knowledge that the policy  


required him to report the conditions the State Board placed on his license. The superior  


court found that Dr. Brandner knewtheself-reporting policy applied to his circumstances  


and knew he had an obligation to report the conditions placed on his license, and thus he  


knowingly violated the policy.   Dr. Brandner does not challenge that finding.   We  


therefore affirmthe superior court's determination that the policy's application was clear  


to Dr. Brandner.  


              24             (...continued)  


that Providence must interpret the word "conditions" in MS 980-150 exactly, and only,  


as the word is used by the State Board in AS 08.64.331(a).   We find this argument  


unpersuasive  -  "limitations"  and  "conditions"  do  not  necessarily  have  the  same  


meaning  under  MS  980-150,  a  Providence  hospital  policy,  as  they  do  under  


AS 08.64.331(a)(6), astatute setting out State Board procedures. And the hospital policy  


does not mention the statute.  

              25            Roberts, 129 Fed. Appx. at 86; see Gottschalk v. State, 575 P.2d 289, 290  


(Alaska 1978).  


                                                                                        -17-                                                                                  7135

----------------------- Page 18-----------------------

                          2.            The policy was not applied arbitrarily or capriciously.                                                           26  


                          When  concerns  are  raised  about  a  hospital  policy  giving  enforcing  


authorities excessive discretion, the policy should not be found impermissibly vague  


                                                                                                          And on the facts of this case, the                          

absent evidence that it has been arbitrarily applied. 

hospital policy was not arbitrarily or capriciously applied.  Dr. Brandner suggests that  


the  ambiguity  of  the  policy  allowed  Providence  to  enforce  it  in  an  arbitrary  and  

capricious manner. As                        evidencethat               Providencehad                  impermissibly broadened the scope  

of   the   policy   and   enforced   it  in  an  arbitrary   and   capricious   manner,   he   points   to  


testimony before the hearing panel from an executive committee member who took the  

view that the policy required reporting "investigations."                                                        Dr. Brandner's argument has     


no merit.  The executive committee member's testimony did not persuade the hearing  


panel to conclude that investigations, as well as limitations, restrictions, and conditions,  


must be reported.   The hearing panel in fact concluded that Dr. Brandner's hospital  


privileges were terminated because of his failure to report a "condition" the State Board  


imposed on his license, not because of his failure to report an investigation.  


                          Dr. Brandner also points to the superior court's consideration of his other  


conduct violations as evidence that MS 980-150 is ambiguous about what constitutes a  


"condition," arguing that the policy's fundamental ambiguity allowed it to be applied  


arbitrarily. Specifically, Dr. Brandner argues that it was improper for the superior court  


to consider the fact that he signed up for emergency call duty when he was restricted  

             26           See   Roberts,   129   Fed.   Appx.   at  86  (holding   a   rule   may   be   deemed  

impermissibly   vague   if   "it   authorizes   or   encourages   arbitrary   and   discriminatory  

enforcement" (citing                      Chicago v. Morales                    , 527 U.S. 41, 56-57(1999)));                            see also Morales                 ,  

527   U.S.   at   60   (defining   an   arbitrary   and   discriminatory  application   as   one   that  

"necessarily entrusts lawmaking to the moment-to-moment judgment" of the enforcer).                                                                     

             27           See Stock v. State, 526 P.2d 3, 8, 12 (Alaska 1974).  


                                                                                  -18-                                                                           7135

----------------------- Page 19-----------------------

from doing so. But the superior court stated that Dr. Brandner's alleged misconduct was                                                                                                                                                                                    

not  the basis for the Providence executive committee's recommendation to terminate his                                                                                                                                                                                       

privileges and that the hearing panel gave the misconduct evidence "no weight" in                                                                                                                                                                                               

upholding the decision.                                                      We therefore affirm the superior court's determination that the                                                                                                                                 

policy was not applied arbitrarily or capriciously.                                                                   

                                           3.                    There is no history of arbitrary and capricious application.                                                                                                      

                                           In the context of due process challenges to statutes and regulations, we will                                                                                                                                                   

not   invalidate   a   statute   for   vagueness   absent   "a   history   or   pattern   of   arbitrary  



                                                     Although we do not need to consider whether this standard is applicable  


beyond that context, we nevertheless note that Dr. Brandner failed to identify a pattern  


ofProvidence arbitrarily enforcing MS 980-150. And the Providence reviewcommittee,  


in its letter to the Providence Board recommending review of the policy, wrote that the  


review committee had no reason to believe Providence had interpreted MS 980-150(D)  


differently for different physicians in the past or was likely to do so in the future.  

                                           4.                    Summary  

                                           Because Providence policy MS 980-150 was not vague or ambiguous with  


respect to Dr. Brandner or on its face, and because it was not applied in an arbitrary and  


capricious manner to Dr. Brandner or historically, we cannot conclude that Providence  


applying the policy in terminating Dr. Brandner's hospital privileges violated his due  


process  rights.                                          Dr.  Brandner  therefore  is  not  entitled  to  reinstatement  or  post- 


termination-hearing damages.  


                      28                   Storrs v. State Med. Bd.                                                        , 664 P.2d 547, 552 (Alaska 1983) (refusing to                                                                                                       

invalidate a statute when the defendant physician could not identify any instances of                                                                                                                                                                                           

arbitrary enforcement by the State Board);                                                                                                  see also Stock                                 , 526 P.2d at 12 ("While we                                                       

may   be   able   to  conceive of instances in                                                                                            which   the statute could                                                         be arbitrarily                                and  

capriciously enforced, we cannot on the basis of such mere hypothesis, in the absence   

of any history of actual arbitrary application, invalidate the statute.").                                                                                                                      

                                                                                                                                     -19-                                                                                                                              7135

----------------------- Page 20-----------------------

             C.	          Providence Does Not Qualify For HCQIA Immunity With Respect To                                                                          

                          The Termination Of Dr. Brandner's Privileges Without Notice And A                                                                          


                          Congress enacted HCQIA to improve the quality of health care and reduce                                                          

the number of incompetent physicians.                                      29  


                                                                                Congress determined that both goals could be  



attained through "effective professional peer review."                                                    Accordingly HCQIAeliminates  


some  deterrents  to  effective  professional  peer  review  of  physician  competence  by  


providing immunity from damages to "professional review bodies" and individuals  



acting in support of those bodies.                                                                                                                                

                                                                        Immunity under the act covers only liability for  


damages; it does not shield covered defendants from lawsuit or from other forms of  



                          For  HCQIA  to  immunize  Providence  from  damages  resulting  from  a  


professional  review  action,  the  hospital  must  satisfy  all  four  elements  set  forth  in  


42 U.S.C.  11112(a), providing:  


                          For purposes of the protection set forth in section 11111(a) of  


                          this title, a professional review action must be taken -  


                                       (1) in the reasonable belief that the action was in the  


                                       furtherance of quality health care,  

             29           See  42  U.S.C.     11101.  

             30           Id.  

             31           See   id.      11111(a)(1)-(2);   see   also   42   U.S.C.      11151(11)   (defining  

"professional review body" as  "health  care entity"),   11151(4)(A)  (defining  "health  care  

entity" as licensed hospital);  Decker v. IHC  Hosps.,  Inc., 982 F.2d  433,  436 (10th Cir.  

 1992)  (exploring  scope  of  immunity  provided  by     11111(a)).  

             32           42 U.S.C.  11111(a)(1) (specifying immunity from damages only and not  


mentioning other relief); Singh v. Blue Cross/Blue Shield of Mass., Inc., 308 F.3d 25, 35  


(1st Cir. 2002).  


                                                                                -20-	                                                                         7135

----------------------- Page 21-----------------------

                                                            (2)  after a reasonable effort to obtain the facts of the                                                                                            


                                                            (3)  after adequate notice and hearing procedures are                                                                                                

                                                            afforded to the physician involved or after such other                                                                                         

                                                            procedures   as   are   fair   to   the   physician   under   the  

                                                            circumstances, and   

                                                            (4)   in   the   reasonable   belief   that  the   action   was  

                                                            warranted by the facts known after such reasonable                                                                           

                                                            effort to obtain facts and after meeting the requirement                                                                   

                                                            of paragraph (3).                       

                                        A professional review action shall be presumed to have met                                                                                                             

                                        the preceding standards necessary for the protection set out                                                                                                            

                                        in section 11111(a) of this title unless the presumption is                                                                                                                 

                                        rebutted by a preponderance of the evidence.                                                                                          [33]  

Federalcourts havegranted hospitals immunity under theAct whentheyclearlyestablish  


that "a full and fair peer review process was used" in connection with denying hospital  


privileges to a physician.34                                                           Under HCQIA "a professional review body (including a  


hospital), its members, its staff, and others under contract with it are immune from  


damages liability with respect to the body's actions."35                                                                                                                   Here there is no dispute that  


Providence  is  a  "health  care  entity"  contemplated  by  HCQIA,36                                                                                                                                        and  its  claim  for  


protection  arose  from  a  peer  review  process  for  the  purpose  of  furthering  quality  


                    33                  42 U.S.C.  11112(a).             

                    34                  Ezekwo v. Am. Bd. of Internal Med.                                                                          , 18 F. Supp. 2d 271, 277 (S.D.N.Y.                                            

 1998),  aff'd   174 F.3d 844 (2d Cir. 1999).                                                           

                    35                  Sobel v. United States, 571 F. Supp. 2d 1222, 1229 (D. Kan. 2008); see also  


Rodgers v. Columbia/HCA of Cent. La., Inc., 971 F. Supp. 229, 233 (W.D. La. 1997)  


(finding the hospital immune because it is a health care entity engaged in a professional  


review activity).  


                    36                  See 42 U.S.C.  11151(4)(A)(ii) (using the term "health care entity" to  


describe an organization like Providence).  


                                                                                                                           -21-                                                                                                                    7135

----------------------- Page 22-----------------------

healthcare.    Dr. Brandner argues that Providence did not satisfy the notice and hearing                                                  

prerequisite   for   immunity   because   he   was   not   given  notice   or   hearing   prior   to   his  




                       Dr. Brandner's rebuttal of Providence's HCQIA immunity presumption  


focuses on  11112(a)(3), requiring that a professional review action be taken "after  


adequate notice and hearing procedures are afforded to the physician involved or after  


such other procedures as are fair to the physician under the circumstances." The superior  


court found Providence met  11112(a)(3)'s requirement by providing Dr. Brandner  


"post-suspension,  but  pre-termination"  fair  hearing.                                            But  Dr.  Brandner  contends  


Providence did not provide him "adequate notice and hearing procedures" prior  to  


terminating  his  hospital  privileges,  and  thus  HCQIA  immunity  cannot  attach  to  


Providence's initial termination action.  


                       Providence claims that prior to its terminating Dr. Brandner's hospital  


privileges he had waived his right to notice and hearing because he had agreed to be  


bound  by  hospital  bylaws.                          But  waivers  cannot  release  a  hospital  from  HCQIA  


requirements to achieve immunity. A Colorado Court of Appeals case is instructive.  In  


Peper v. St. Mary's Hospital & Medical Center a hospital took final action adverse to a  



doctor without providing notice that his conduct was under review.                                                      The hospital gave  


"no opportunity to be heard before revoking his privileges and reporting him to the state  


medical board and the national data bank," and it never claimed any health emergency  

                                                                                           39  The hospital argued that because  


requiring the immediate suspension of his privileges. 

the doctor had agreed to be bound by its bylaws and because the bylaws did not provide  


            37         See id.       11112(a)(3), (b).         

            38         207 P.3d 881, 888 (Colo. App. 2008).                     

            39         Id.  

                                                                        -22-                                                                   7135

----------------------- Page 23-----------------------

for notice and hearing prior to a final decision, the hospital had adequately met HCQIA's                                                         


notice and hearing requirement.                                                                                                                  

                                                                    But the court disagreed, holding that a hospital's  


compliance with its bylaws may nonetheless be insufficient as a matter of law to meet  

                                                               41    Immunity attaches when the professional review  



HCQIA immunity requirements. 

action satisfies HCQIA requirements, regardless of the hospital's own procedures.42  


Signing hospital bylaws did not waive the doctor's right to adequate notice and hearing  


under HCQIA statutory provisions.43                                       The court concluded that the hospital failed to  


provide the doctor adequate notice and hearing under  11112(a)(3), and thus it denied  


the hospital HCQIA immunity from the doctor's claims.44  


                         The facts here are similar.  Providence did not provide notice and hearing  


to  Dr.  Brandner  before  the  executive  committee  considered  and  recommended  


terminating his hospital privileges at its June 13, 2011 committee meeting.  Although  


notice, a hearing, and an appeal took place after  the actual June 17 termination of  


Dr. Brandner's privileges, these procedures are insufficient to satisfy  11112(a)(3)'s  


requirement  that  adequate  notice  and  hearing  procedures  must  be  afforded  to  the  


physician  before  the  professional  review  action  is  taken.                                                      Providence  could  have  


provided some kind of notice and an opportunity for Dr. Brandner to be heard before  


June 17, 2011, but it did not.  


             40          Id.  at 884, 888.     

             41          Id.  at 888.   

             42          Id.  at 889.   

             43          Id.  at 888.   

             44          Id.  at 886-89.   

                                                                              -23-                                                                        7135

----------------------- Page 24-----------------------

                         Providence asserts that it nevertheless met  11112(a)(3)'s requirements                                          

because   Dr.   Brandner   was   afforded   "other   procedures   as   are   fair"   under   the  

circumstances when he received a hearing and an appeal after the termination of his                                                                           

privileges.   But HCQIA specifies that a professional review action must be taken "                                                                       after  

                                                                                                                                                     45     The  

such other procedures as are fair to the physician under the circumstances."                                                                               

professional review action at issue is the June 17, 2011 termination of Dr. Brandner's  


hospital privileges.   This action took place  before the hearing panel and the review  


committee proceedings.   As in Peper, Dr. Brandner did not   waive his right to the  


adequate notice and hearing required under HCQIA.46                                                     Thus the hearing and the appeal  


provided  after  the  termination  cannot  be  construed  as  "other  .  .  .  fair"  procedures  


satisfying  11112(a)(3)'s notice and hearing requirement.  And Providence conceded  

at oral argument that if it had violated Dr. Brandner's due process rights in this context  


it  was  not  entitled  to  HCQIA  immunity.                                         Accordingly,  Dr.  Brandner  rebutted  the  


presumption that this element of the four statutory requirements was met.  


                         Wethereforereversethesuperior court's conclusion that HCQIAimmunity  


applies to the due process violation arising from terminating Dr. Brandner's hospital  


privileges without proper notice and opportunity to be heard.47                                                         We remand for further  


proceedings on Dr. Brandner's claim for damages with respect  to this due process  



             45          42  U.S.C.     11112(a)(3)  (emphasis  added).  

             46          See  Peper,  207  P.3d  at  889.  

             47          Because  of  this  decision  we  do  not  need  to  address other HCQIA  issues  

Dr.  Brandner  raised  on  appeal.   

             48          See  City  of  N.  Pole  v.  Zabek,  934  P.2d  1292,  1299  (Alaska  1997)  (awarding  

damages   for   period   between   wrongful   termination  and  curative   post-termination  


                                                                              -24-                                                                        7135

----------------------- Page 25-----------------------


                  We  AFFIRM  the  superior  court's  termination   claim  decision;  we  


REVERSEthepre-termination noticeclaimdecision andREMANDto thesuperior court  


for further proceedings consistent with this decision.  


         48       (...continued)  


                                                       -25-                                                     7135  

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