Nursing Home Peer-Review Privilege Protects Outside Consultant’s Reports, Court Rules

While there is no federal common-law peer-review privilege, there is a peer-review privilege under the federal Patient Safety and Quality Improvement Act and two subsections of the Nursing Home Reform Act of 1987. The nursing-home peer-review privilege receives relatively little review, so the Kentucky Supreme Court’s recent interpretation deserves attention. The court interpreted the privilege broadly, holding that the privilege protects peer-review reports even if generated by a third-party consultant. Henderson County Health Care Corp. v. Wilson, 612 S.W.3d 811 (Ky. 2020).  You may read the opinion here.

Outside Consultant

Redbanks Skilled Nursing Center in Henderson, Kentucky maintains a Quality Assurance Performance Improvement committee. The QAPI, in turn, contracts with Owensboro-based Wells Health Systems which, as an independent consultant, evaluates Redbanks’ quality of care and provides guidance on improving its provision of care. Wells’ nurse consultants examine the medical charts of Redbanks residents, observe Redbanks’ staff, review statistical data, and provide consultant reports to the QAPI.

After a Redbanks resident passed away, the administrator of her estate sued Redbanks for failing to provide proper care.  During discovery, the administrator sought production of the Wells consultant reports, but Redbanks claimed that a federal statutory peer-review privilege protected them from disclosure.  The trial court rejected the privilege, and Redbanks took the matter to the Kentucky Supreme Court.

Quality Assurance Privilege

The Nursing Home Reform Act of 1987 contains two sections that address discovery of peer-review related materials: 42 USC § 1396r(b)(1)(B) and 42 USC § 1395i-3(b)(1)(B).  These identical statutes require nursing-home facilities like Redbanks to maintain a “quality assessment and assurance committee” to identify issues within the facility and implement appropriate corrective actions where necessary.  As to the discovery of the committee’s work, the statutes say this—

A State or Secretary may not require disclosure of the records of such committee except insofar as such disclosure is related to the compliance of such committee with the requirements [this section].

The pertinent question concerns the scope of the phrase “records of such committee.”  Does it pertain to records compiled by third-party consultants—like Wells—or is it limited to the quality-assurance committee’s internal records.  Court have taken two approaches—a narrow approach and a broad approach, or the so-called Missouri Rule and New York Rule.

Missouri Rule—Narrow Interpretation

The Missouri Rule comes from State ex rel. Boone Retirement Ctr., Inc. v. Hamilton, 946 S.W.2d 740 (Mo. 1997). The Missouri Supreme Court, applying the statute’s plain language, held that “records of such committee” means just that, and “no honest reading” of that language can extend privilege protection to reports submitted to the committee. A Tennessee federal court found the Boone court’s reasoning “persuasive” and adopted it without evaluating the New York Rule. Brown v. Sun Healthcare Group, Inc., 2008 WL 1751675 (E.D. Tenn. Apr. 14, 2008) (available here).

New York Rule–Broad Interpretation

The New York Rule originates in In re Subpoena Duces Tecum to Jane Doe, Esq., 757 N.E.2d 618 (N.Y. 2003).  The court rejected Boone’s narrow interpretation and read “records of such committee” broadly to encompass “any reports generated by or at the behest of a quality assurance committee for quality assurance purposes.” Id. at 621. A Georgia federal court found the New York interpretation to be “the more reasoned view.” U.S. v. Lilburn Geriatric Ctr., Inc., 2003 WL 27381235 (N.D. Ga. Sept. 23, 2003) (available here).

Kentucky’s Interpretation

So, which way would the Commonwealth go? The court, appropriately, engaged in a balancing of discovery and privilege-related interests.  On the one hand, a plaintiff like the administrator here is entitled to all relevant evidence to prove his claim and courts should interpret discovery-blocking privileges narrowly to fulfill that goal.

On the other hand, the court said, public policy–here embodied in a federal statute–should encourage healthcare facilities like Redbanks to engage in self-critical analyses to improve its provision of health care. The peer-review privilege does just that—it encourages providers to speak and evaluate candidly without fear that a plaintiff will one day use their words and evaluations against them.

Weighing these interests, the Kentucky court followed the broader rule and held that the federal peer-review statute for skilled nursing facilities was not limited to a quality-assurance committee’s own records, but rather covered reports generated by third parties for the committee. In doing so, the court stressed that courts should perform future analyses on a case-by-case basis and offered these guidelines.

Guidelines

First, a nursing-home facility cannot use its quality-assurance committee to create a privilege by funneling unprivileged records through it. The privilege will also not cover documents given to the committee—but generated outside of it—that do not relate to the committee’s work.

Second, the privilege covers documents created by a quality-assurance committee or “at the behest of” the committee. In other words, if an outside consultant generates a document or report for the express purpose of aiding the committee in its quality-assurance work, then the privilege protects it from compelled disclosure.

Applying these guidelines, the Kentucky Supreme Court found that the privilege protected the Wells’ nurse-consultant reports. Redbanks proved that it contracted with Wells to evaluate the facility’s quality of care and provide guidance on how to improve that care.

1 Comment

  1. Surveyors in WI are saying that the Mega Rule passed by CMS 2016 directs states and federal surveyors to verify compliance with the regulation, CMS directs state and federal surveyors to determine if the facility:
    • Completed a thorough investigation of the alleged violation
    • Maintained documentation that an alleged violation was thoroughly investigated
    • Prevented further potential abuse, neglect, exploitation, or mistreatment while the investigation of an alleged violation is in progress
    • Took corrective action following an investigation of an alleged violation, if the allegation was verified
    And only way to do that is to have all the information. These cases predate the mega rule, so doesn’t this change your analysis?

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