By David A. Zarett, Esq. & Seth A. Nadel, Esq.
Weiss Zarett Brofman Sonnenklar & Levy, P.C.
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The National Practitioner Data Bank (“NPDB”) was created by Congress to serve as a repository of information regarding adverse actions taken against medical professionals. Brought about with the stated goal of increasing the quality of healthcare, as well as curbing healthcare fraud and abuse, the NPDB created a national resource to be used as a credentialing reference by various health-related organizations, consolidating a body of information that was previously fragmented among disparate state and federal sources. Information compiled in the NPDB is not available to the general public, but can be accessed by a number of registered entities, including hospitals, state licensing agencies, medical malpractice insurers, professional associations and managed care organizations. These entities routinely use the NPDB to guide their licensing, hiring and credentialing decisions. According to the NPDB, the database receives over 570,000 “queries” per month.

The information found in the NPDB takes the form of mandatory reports filed by various organizations. Some of the more notable events which necessitate a report to the NPDB are medical malpractice judgments and medical licensure discipline. Practitioners are permitted, in turn, to submit statements to the NPDB to be appended to reports, wherein they can explain or elaborate upon the surrounding facts and circumstances in an attempt to cast themselves in a more favorable light.

Typically, a hospital’s professional-review action which has an adverse effect on clinical privileges is also reportable to the NPDB. At times, those adverse actions are the result of the quality review process at a hospital. Other times, however, the loss of privileges is the result of a termination of a physician’s employment agreement, which at times will trigger an automatic loss of privileges.

Given this dichotomy, the NPDB has recently published new guidance clarifying when it is appropriate for a hospital to submit a report to the Data Bank in the event of a practitioner’s loss of professional privileges.[*] According to the NPDB, it is not a reportable event when clinical privileges are lost solely as a result of the hospital’s employment-termination procedure, rather than through a professional-review process. The hospital in the hypothetical contained in the NPDB’s new guidance had an employment-termination procedure distinct from its professional-review (quality assurance/peer-review) process. Although revocation of a practitioner’s privileges at a hospital necessarily followed from the termination of employment, the NPDB noted that there was no formal action through the professional-review process. Thus, the revocation was not grounds for a report to the Data Bank.

The NPDB’s guidance is particularly relevant given the recent trend of hospital acquisitions of medical practices, and the employment by the hospital of the practices’ physicians. If a hospital-based physician employment agreement has a truncated employment termination process, which triggers a loss of privileges as well, a Data Bank report would not be warranted. Needless to say, this could make a substantial difference for a physician with respect to his/her future employment and professional affiliation prospects.

Weiss Zarett Brofman Sonnenklar & Levy, P.C. is a Long Island law firm providing a wide array of legal services to the members of the health care industry, including corporate and transactional matters, civil and administrative litigation, healthcare regulatory issues, bankruptcy and creditors' rights, and commercial real estate transactions.

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[*] The recent NPDB guidance can be found at https://www.npdb.hrsa.gov/guidebook/EClinicalPrivilegesQA2.jsp.