|||IN THE SUPREME COURT OF THE STATE OF ILLINOIS
|||Docket No. 86830
|||May 18, 2000
|||SHEILA JONES, INDIV. AND AS MOTHER AND NEXT FRIEND OF SHAWNDALE JONES,
A MINOR, APPELLANT, V. CHICAGO HMO LTD. OF ILLINOIS, APPELLEE.
|||The opinion of the court was delivered by: Justice Bilandic
|||Agenda 15-November 1999.
|||This appeal asks whether a health maintenance organization (HMO) may be
held liable for institutional negligence. We answer in the affirmative.
|||The plaintiff, Sheila Jones (Jones), individually and as the mother of
the minor, Shawndale Jones, brought this medical malpractice action against
the defendants, Chicago HMO Ltd. of Illinois (Chicago HMO), Dr. Robert A.
Jordan and another party. The Joneses were members of Chicago HMO, an HMO.
Dr. Jordan was a contract physician of Chicago HMO and the primary care
physician of Shawndale.
|||The circuit court of Cook County awarded summary judgment in favor of
Chicago HMO on all three counts of Jones' second amended complaint. Count
I charges Chicago HMO with institutional negligence. Count II charges Chicago
HMO with vicarious liability for Dr. Jordan's alleged negligence under the
doctrine of apparent authority. Count III charges Chicago HMO with breach
of contract. The circuit court also entered a finding pursuant to Supreme
Court Rule 304(a) (155 Ill. 2d R. 304(a)). On appeal, the appellate court
affirmed the grant of summary judgment as to counts I and III, but reversed
the grant of summary judgment as to count II, remanding that claim for further
proceedings. 301 Ill. App. 3d 103. We allowed Jones' petition for leave
to appeal (177 Ill. 2d R. 315). Because Chicago HMO does not challenge the
appellate court's reversal of count II, only counts I and III are at issue
in this appeal.
|||Two organizations filed amicus curiae briefs with the permission of this
court. See 155 Ill. 2d R. 345. The Illinois Association of Health Maintenance
Organizations filed a brief in support of Chicago HMO. The Illinois Trial
Lawyers Association filed a brief in support of Jones. For the reasons explained
below, we affirm the summary judgment as to count III, breach of contract,
but we reverse the summary judgment as to count I, institutional negligence,
and remand that claim for further proceedings.
|||In reviewing an award of summary judgment, we must view the facts in the
light most favorable to the nonmoving party. Petrovich v. Share Health Plan
of Illinois, Inc., 188 Ill. 2d 17, 30-31 (1999). The following facts thus
|||On January 18, 1991, Jones' three-month-old daughter Shawndale was ill.
Jones called Dr. Jordan's office, as she had been instructed to do by Chicago
HMO. Jones related Shawndale's symptoms, specifically that she was sick,
was constipated, was crying a lot and felt very warm. An assistant advised
Jones to give Shawndale some castor oil. When Jones insisted on speaking
with Dr. Jordan, the assistant stated that Dr. Jordan was not available
but would return her call. Dr. Jordan returned Jones' call late that evening.
After Jones described the same symptoms to Dr. Jordan, he also advised Jones
to give castor oil to Shawndale.
|||On January 19, 1991, Jones took Shawndale to a hospital emergency room
because her condition had not improved. Chicago HMO authorized Shawndale's
admission. Shawndale was diagnosed with bacterial meningitis, secondary
to bilateral otitis media, an ear infection. As a result of the meningitis,
Shawndale is permanently disabled.
|||The medical expert for the plaintiff, Dr. Richard Pawl, stated in his
affidavit and deposition testimony that Dr. Jordan had deviated from the
standard of care. In Dr. Pawl's opinion, upon being advised of a three-
month-old infant who is warm, irritable and constipated, the standard of
care requires a physician to schedule an immediate appointment to see the
infant or, alternatively, to instruct the parent to obtain immediate medical
care for the infant through another physician. Dr. Pawl gave no opinion
regarding whether Chicago HMO was negligent.
|||Although Jones filed this action against Chicago HMO, Dr. Jordan and another
party, this appeal concerns only counts I and III of Jones' second amended
complaint, which are directed against Chicago HMO. Count I charges Chicago
HMO with institutional negligence for, inter alia, (1) negligently assigning
Dr. Jordan as Shawndale's primary care physician while he was serving an
overloaded patient population, and (2) negligently adopting procedures that
required Jones to call first for an appointment before visiting the doctor's
office or obtaining emergency care. Count III charges Chicago HMO with breach
of contract and is based solely on Chicago HMO's contract with the Department
of Public Aid. Chicago HMO moved for summary judgment on both counts. Jones
and Chicago HMO submitted various depositions, affidavits and exhibits in
support of their positions.
|||Chicago HMO is a for-profit corporation. During all pertinent times, Chicago
HMO was organized as an independent practice association model HMO under
the Illinois Health Maintenance Organization Act (Ill. Rev. Stat. 1991,
ch. 111½, par. 1401 et seq.).
|||In her deposition testimony, Jones described how she first enrolled in
Chicago HMO while living in Park Forest. A Chicago HMO representative visited
her home. According to Jones, he "was telling me what it was all about,
that HMO is better than a regular medical card and everything so I am just
listening to him and signing my name and stuff on the papers. *** I asked
him what kind of benefits you get out of it and stuff, and he was telling
me that it is better than a regular card."
|||The "HMO ENROLLMENT UNDERSTANDING" form signed by Jones in 1987
stated: "I understand that all my medical care will be provided through
the Health Plan once my application becomes effective." Jones remembered
that, at the time she signed this form, the Chicago HMO representative told
her "you have got to call your doctor and stuff before you see your
doctor; and before you go to the hospital, you have got to call."
|||Jones testified that when she later moved to Chicago Heights another Chicago
HMO representative visited her home. This meeting was not arranged in advance.
It occurred because the representative was "in the building knocking
from door to door." Jones informed the representative that she was
already a member.
|||When Jones moved to Chicago Heights, she did not select Dr. Jordan as
Shawndale's primary care physician. Rather, Chicago HMO assigned Dr. Jordan
to her. Jones explained:
|||"They gave me *** Dr. Jordan. They didn't ask me if I wanted a doctor.
They gave me him.
|||*** They told me that he was a good doctor *** for the kids because I
didn't know what doctor to take my kids to because I was staying in Chicago
Heights so they gave me him so I started taking my kids there to him."
|||Dr. Mitchell J. Trubitt, Chicago HMO's medical director, testified at
his deposition that Dr. Jordan was under contract with Chicago HMO for two
sites, Homewood and Chicago Heights. The service agreement for the Homewood
site was first entered into on May 5, 1987. The service agreement for the
Chicago Heights site was first entered into on February 1, 1990. Dr. Jordan
was serving both patient populations in January of 1991 when Shawndale became
|||Dr. Trubitt stated that, before Chicago HMO and Dr. Jordan executed the
Chicago Heights service agreement, another physician serviced that area.
Chicago HMO terminated that physician for failing to provide covered immunizations.
At the time that Chicago HMO terminated that physician, Dr. Jordan agreed
"to go into the [Chicago Heights] area and serve the patients."
Chicago HMO then assigned to Dr. Jordan all of the patients of that physician.
Dr. Trubitt explained:
|||"Q. So then with the elimination of [the other physician], Dr.
|||Jordan then-were the members notified that Dr. Jordan would be
|||their [primary care physician] from that point on?
|||Q. They weren't given a choice?
|||A. At that point in the area there was no choice.
|||Q. So they weren't given a choice?
|||A. They were directed to Dr. Jordan."
|||Dr. Trubitt also explained that Dr. Jordan was Chicago HMO's only physician
who was willing to serve the public aid membership in Chicago Heights. Dr.
Trubitt characterized this lack of physicians as "a problem" for
|||Dr. Jordan testified at his deposition that, in January of 1991, he was
a solo practitioner. He divided his time equally between his offices in
Homewood and Chicago Heights. Dr. Jordan was under contract with Chicago
HMO for both sites. In addition, Dr. Jordan was under contract with 20 other
HMOs, and he maintained his own private practice of non- HMO patients. Dr.
Jordan estimated that he was designated the primary care physician of 3,000
Chicago HMO members and 1,500 members of other HMOs. In contrast to Dr.
Jordan's estimate, Chicago HMO's own "Provider Capitation Summary Reports"
listed Dr. Jordan as being the primary care provider of 4,527 Chicago HMO
patients as of December 1, 1990.
|||Jones' legal counsel and Dr. Trubitt engaged in the following colloquy
concerning patient load:
|||"Q. In entering into an agreement with a provider, is any
|||consideration given to the number of patients to be designated as
|||the primary provider for?
|||A. Yes, there is consideration given to that element in terms of
|||volume of patients that he is capable of handling.
|||Q. And who determines the volume of patients he is capable of
|||handling? The Chicago HMO or the provider or-
|||A. There is some guidelines that HCFA provides.
|||Q. Who provides?
|||A. HCFA. The Health [Care Finance Administration], the
|||governmental health and welfare.
|||Q. Do you happen to know what those limits are with respect to
|||A. I am going to say I believe they are 3,500 patients to a
|||primary care physician. The number can be expanded depending on
|||the number of physicians in the office and the number of hours of
|||Q. So you can't tell me whether or not if Dr. Jordan had 6,000 or
|||6,500 that would be an unusually large number?
|||A. If he himself had it.
|||Q. It would be unusually large?
|||A. It would.
|||Q. And that would be of some concern to the Chicago HMO, right?
|||A. Well, yes, if he had those."
|||In January of 1991, Dr. Jordan employed four part-time physicians, in
addition to himself. This included an obstetrician/gynecologist, an internist,
a family practitioner and a pediatrician. Dr. Jordan, however, did not explain
in what capacities these physicians served. The record contains no further
information regarding these physicians.
|||The record also contains evidence concerning Chicago HMO procedures for
obtaining health care. Chicago HMO's "Member Handbook" told members
in need of medical care to "Call your Chicago HMO doctor first when
you experience an emergency or begin to feel sick." (Emphasis in original.)
Also, Chicago HMO gave its contract physicians a "Provider Manual."
The manual contains certain provisions with which the providers are expected
to comply. The manual contains a section entitled, "The Appointment
System/Afterhours Care," which states that all HMO sites are statutorily
required to maintain an appointment system for their patients.
|||Dr. Trubitt testified that Chicago HMO encouraged its providers to maintain
an appointment system and also "to retain open spaces on their schedules
so that patients who came in as walk-ins could be seen." Retaining
space on the schedule for walk-ins was recommended because it offers quicker
access to care, keeping patients out of the emergency room with its increased
costs, and because, historically, the Medicaid patient population often
did not make or keep appointments.
|||Dr. Jordan related that his office worked on an appointment system and
had its own written procedures and forms for handling patient calls and
appointments. When a patient called and Dr. Jordan was not in the office,
written forms were used by his staff or his answering service to relay the
information to him. If Dr. Jordan was in the office, the procedure was as
|||"Q. *** [I]f it was a routine appointment for the purpose of having
a routine shot or checkup, [the office staff] could make the appointment
|||Q. But if the caller calls and says there is some problem, then they would
take the temperature and find out the complaints and refer that call to
you; is that correct?
|||A. That's correct.
|||Q. And you were the one who would make the determination as to whether
or not to schedule an appointment, is that correct?
|||A. Medical decision, yes.
|||Q. Medical decision. And I assume there were times when people would call
and after you reviewed the information and talked to them that you decided
that they didn't need the appointment; is that correct?
|||A. Of course.
|||Q. In other words, you would perform some type of triage over the telephone;
is that correct?
|||Three agreements appear in the record. First, Chicago HMO and the Department
of Public Aid entered into a 1990 "AGREEMENT FOR FURNISHING HEALTH
SERVICES." This agreement was "for the delivery of medical services
to Medicaid recipients on a prepaid capitation basis." Jones and her
children, Medicaid recipients, fall within the agreement's definition of
|||The preamble to the agreement stated that Chicago HMO "is organized
primarily for the purpose of providing health care services." It continued:
"[Chicago HMO] warrants that it is able to provide the medical care
and services required under this Agreement in accordance with prevailing
community standards, and is able to provide these services promptly, efficiently,
|||Article V of the agreement described various duties of Chicago HMO, as
follows. Chicago HMO "shall provide or arrange to have provided all
covered services to all Beneficiaries under this Agreement." Chicago
HMO "shall provide all Beneficiaries with medical care consistent with
prevailing community standards." In addition, a section entitled "Choice
of Physicians" provided in relevant part:
|||"[Chicago HMO] shall afford to each Beneficiary a health professional
who will supervise and coordinate his care, and, to the extent feasible
within appropriate limits established by [Chicago HMO] and approved by the
Department, shall afford the Beneficiary a choice of a physician.
|||There shall be at least one full-time equivalent, board eligible physician
to every 1,200 enrollees, including one full-time equivalent, board certified
primary care physician for each 2,000 enrollees. *** There shall be ***
one pediatrician for each 2,000 enrollees under age 17."
|||Another article V duty stated that, although Chicago HMO may furnish the
services required by the agreement by means of subcontractors, Chicago HMO
"shall remain responsible for the performance of the subcontractors."
|||Regarding appointments, this agreement stated that Chicago HMO "shall
encourage members to be seen by appointment, except in emergencies."
The agreement also stated that "[m]embers with more serious or urgent
problems not deemed emergencies shall be triaged and provided same day service,
if necessary," and that "emergency treatment shall be available
on an immediate basis, seven days a week, 24-hours a day." Finally,
the agreement directed that Chicago HMO "shall have an established
policy that scheduled patients shall not routinely wait for more than one
hour to be seen by a provider and no more than six appointments shall be
made for each primary care physician per hour."
|||The record also contains a second agreement, a 1990 "MEDICAL GROUP
SERVICE AGREEMENT" between Chicago HMO and Dr. Jordan, that lists a
Chicago Heights office address for Dr. Jordan. This agreement described
numerous duties of Dr. Jordan. Pertinent here, Dr. Jordan would provide
to Chicago HMO subscribers specified medical services "of good quality
and in accordance with accepted medical and hospital standards of the community."
Pursuant to a "PUBLIC AID AMENDMENT TO THE MEDICAL GROUP SERVICE AGREEMENT,"
Dr. Jordan agreed to "abide by any conditions imposed by [Chicago HMO]
as part of [Chicago HMO's] agreement with [the Department]."
|||The third agreement appearing of record is a second "MEDICAL GROUP
SERVICE AGREEMENT" between Chicago HMO and Dr. Jordan. This agreement
was entered into in 1987 and lists a Homewood office address for Dr. Jordan.
|||Both agreements between Chicago HMO and Dr. Jordan provided for a capitation
method of compensation. Under capitation, Chicago HMO paid Dr. Jordan a
fixed amount of money for each member who selected Dr. Jordan as the member's
primary care provider. In exchange, Dr. Jordan agreed to render health care
to his enrolled Chicago HMO members in accordance with the Chicago HMO health
plan. Dr. Jordan was paid the same monthly capitation fee per member regardless
of the services he rendered. For example, for each female patient under
two years old, Chicago HMO paid Dr. Jordan $34.19 per month regardless of
whether he treated that patient. In addition, Chicago HMO utilized an incentive
fund for Dr. Jordan. Certain costs such as inpatient hospital costs were
paid from this fund. Chicago HMO would then pay Dr. Jordan 60% of any remaining,
unused balance of the fund at the end of each year.
|||As earlier noted, the appellate court affirmed the circuit court's grant
of summary judgment in favor of Chicago HMO as to count I, institutional
negligence, and as to count III, breach of contract. 301 Ill. App. 3d 103.
We are asked to decide whether Chicago HMO was properly awarded summary
judgment on these two counts.
|||We conduct de novo review of an award of summary judgment. Olson v. Etheridge,
177 Ill. 2d 396, 404 (1997). Summary judgment is proper where the pleadings,
depositions, admissions, affidavits and exhibits on file, when viewed in
the light most favorable to the nonmoving party, show that there is no genuine
issue as to any material fact and that the moving party is entitled to judgment
as a matter of law. Busch v. Graphic Color Corp., 169 Ill. 2d 325, 333 (1996).
Summary judgment is a drastic remedy and should be allowed only when the
right of the moving party is clear and free from doubt. Colvin v. Hobart
Brothers, 156 Ill. 2d 166, 169-70 (1993).
|||This court first addressed a question of whether an HMO could be held
liable for medical malpractice in Petrovich v. Share Health Plan of Illinois,
Inc., 188 Ill. 2d 17, 29 (1999). Petrovich, however, involved different
legal theories of liability than those presented here. Petrovich held that
an HMO may be held vicariously liable for the medical malpractice of its
independent-contractor physicians under both the doctrines of apparent authority
and implied authority. Petrovich, 188 Ill. 2d 17. In contrast, this appeal
focuses on whether an HMO may be held liable under the theory of institutional
|||I. Institutional Negligence
|||Institutional negligence is also known as direct corporate negligence.
Since the landmark decision of Darling v. Charleston Community Memorial
Hospital, 33 Ill. 2d 326 (1965), Illinois has recognized that hospitals
may be held liable for institutional negligence. Darling acknowledged an
independent duty of hospitals to assume responsibility for the care of their
patients. Ordinarily, this duty is administrative or managerial in character.
Advincula v. United Blood Services, 176 Ill. 2d 1, 28 (1996) (and authorities
cited therein). To fulfill this duty, a hospital must act as would a "reasonably
careful hospital" under the circumstances. Advincula, 176 Ill. 2d at
29. Liability is predicated on the hospital's own negligence, not the negligence
of the physician.
|||Underlying the tort of institutional negligence is a recognition of the
comprehensive nature of hospital operations today. The hospital's expanded
role in providing health care services to patients brings with it increased
corporate responsibilities. As Darling explained: "Presentday hospitals,
as their manner of operation plainly demonstrates, do far more than furnish
facilities for treatment. They regularly employ on a salary basis a large
staff of physicians, nurses and internes, as well as administrative and
manual workers, and they charge patients for medical care and treatment,
collecting for such services, if necessary, by legal action." Darling,
33 Ill. 2d at 332. Expounding on the point, this court later stated: "[A]
modern hospital *** is an amalgam of many individuals not all of whom are
licensed medical practitioners. Moreover, it is clear that at times a hospital
functions far beyond the narrow sphere of medical practice." Greenberg
v. Michael Reese Hospital, 83 Ill. 2d 282, 293 (1980). Thus, in recognizing
hospital institutional negligence as a cause of action, Darling merely applied
principles of common law negligence to hospitals in a manner that comports
with the true scope of their operations. See Darling, 33 Ill. 2d at 331
(noting that the duty in negligence cases is always the same, to conform
to the legal standard of reasonable conduct in light of the apparent risk).
|||In accordance with the preceding rationale, we now hold that the doctrine
of institutional negligence may be applied to HMOs. This court in Petrovich
acknowledged the potential for applying this theory to HMOs. See Petrovich,
188 Ill. 2d at 30 (and authorities cited therein). A court in another jurisdiction
has likewise extended the theory of hospital institutional negligence to
HMOs. Shannon v. McNulty, 718 A.2d 828 (Pa. Super. Ct. 1998). It did so
out of a recognition that HMOs, like hospitals, consist of an amalgam of
many individuals who play various roles in order to provide comprehensive
health care services to their members. Shannon, 718 A.2d at 835-36. Moreover,
because HMOs undertake an expansive role in arranging for and providing
health care services to their members, they have corresponding corporate
responsibilities as well. Shannon, 718 A.2d at 835-36; see Petrovich, 188
Ill. 2d at 28, 33-40 (recognizing that HMOs act as health care providers
and attempt to contain the costs of health care); 215 ILCS 125/1-2(9) (West
1998) (defining an HMO as "any organization formed *** to provide or
arrange for one or more health care plans under a system which causes any
part of the risk of health care delivery to be borne by the organization
or its providers"); Official Lists Current Amicus Briefs of Labor Department
on Medical Malpractice, 68 U.S.L.W. 2249-50 (November 2, 1999) (noting that,
according to the United States Department of Labor, HMOs wear "three
different hats," one of which is "medical provider"). Our
nationwide research has revealed no decision expressing a contrary view,
and Chicago HMO makes no argument against extending the doctrine of institutional
negligence to HMOs. Hence, we conclude that the law imposes a duty upon
HMOs to conform to the legal standard of reasonable conduct in light of
the apparent risk. See Darling, 33 Ill. 2d at 331. To fulfill this duty,
an HMO must act as would a "reasonably careful" HMO under the
circumstances. See Advincula, 176 Ill. 2d at 29.
|||Having determined that institutional negligence is a valid claim against
HMOs, we turn to the parties' arguments in this case. Jones contends that
Chicago HMO is not entitled to summary judgment on her claim of institutional
negligence. She asserts that genuine issues of material fact exist as to
whether Chicago HMO (1) negligently assigned more enrollees to Dr. Jordan
than he was capable of serving, and (2) negligently adopted procedures requiring
Jones to call first for an appointment before visiting the doctor's office.
|||Chicago HMO argues that Jones' claim of institutional negligence cannot
proceed because she failed to provide sufficient evidence delineating the
standard of care required of an HMO in these circumstances. In particular,
Chicago HMO contends that Jones should have presented expert testimony on
the standard of care required of an HMO.
|||Jones responds that she has provided sufficient evidence showing the standard
of care required of an HMO in these circumstances. She argues further that
her claim does not require expert testimony on this point. In support, Jones
relies on Darling, where a claim of institutional negligence was allowed
against a hospital without expert testimony because other evidence established
the hospital's standard of care. Darling, 33 Ill. 2d 326.
|||Given that the parties' dispute centers on standard of care evidence and
the need for expert testimony, we briefly review the roles of the standard
of care and expert testimony in negligence cases. We then discuss Darling
and its progeny.
|||The elements of a negligence cause of action are a duty owed by the defendant
to the plaintiff, a breach of that duty, and an injury proximately caused
by the breach. Cunis v. Brennan, 56 Ill. 2d 372, 374 (1974). The standard
of care, also known as the standard of conduct, falls within the duty element.
Dean Prosser has explained:
|||"It is better to reserve `duty' for the problem of the relation between
individuals which imposes upon one a legal obligation for the benefit of
the other, and to deal with particular conduct in terms of a legal standard
of what is required to meet the obligation. In other words, `duty' is a
question of whether the defendant is under any obligation for the benefit
of the particular plaintiff; and in negligence cases, the duty is always
the same, to conform to the legal standard of reasonable conduct in light
of the apparent risk. What the defendant must do, or must not do, is a question
of the standard of conduct required to satisfy the duty. The distinction
is one of convenience only, and it must be remembered that the two are correlative,
and one cannot exist without the other.
|||A duty, in negligence cases, may be defined as an obligation, to which
the law will give recognition and effect, to conform to a particular standard
of conduct toward another." (Emphasis added.) W. Prosser, Torts, at
324 (4th ed. 1971).
|||In an ordinary negligence case, the standard of care required of a defendant
is to act as would an " `ordinarily careful person' " or a "
`reasonably prudent' person." Advincula v. United Blood Services, 176
Ill. 2d 1, 22 (1996), quoting Cunis, 56 Ill. 2d at 376. No expert testimony
is required in a case of ordinary negligence. See Advincula,176 Ill. 2d
|||In contrast, in a professional negligence case, the standard of care required
of a defendant is to act as would an "ordinarily careful professional."
Advincula, 176 Ill. 2d at 23. Pursuant to this standard of care, professionals
are expected to use the same degree of knowledge, skill and ability as an
ordinarily careful professional would exercise under similar circumstances.
Advincula, 176 Ill. 2d at 23-24. Expert testimony is usually required in
a case of professional negligence. Advincula, 176 Ill. 2d at 24, 38. Expert
testimony is necessary to establish both (1) the standard of care expected
of the professional and (2) the professional's deviation from the standard.
See Purtill v. Hess, 111 Ill. 2d 229, 242 (1986). The rationale for requiring
expert testimony is that a lay juror is not skilled in the profession and
thus is not equipped to determine what constitutes reasonable care in professional
conduct without the help of expert testimony. Advincula, 176 Ill. 2d at
24; see Purtill, 111 Ill. 2d at 246. In Illinois, a professional standard
of care has been applied in cases involving a variety of both medical and
non-medical professions, such as law and dentistry. Advincula, 176 Ill.
2d at 23-24 (and cases cited therein).
|||The foregoing principles of law establish that the crucial difference
between ordinary negligence and professional malpractice actions is the
necessity of expert testimony to establish the standard of care and that
its breach was the cause of the plaintiff's injury. Although not applicable
to this case, there are exceptions to the requirement of expert testimony
in professional negligence cases. For example, in instances where the professional's
conduct is so grossly negligent or the treatment so common that a lay juror
could readily appraise it, no expert testimony or other such relevant evidence
is required. Advincula, 176 Ill. 2d at 24 (and cases cited therein); Walski
v. Tiesenga, 72 Ill. 2d 249, 257 (1978) (noting that examples of this exception
in medical malpractice cases include instruments left in a patient's body
after surgery and X-ray burns); see also Ohligschlager v. Proctor Community
Hospital, 55 Ill. 2d 411 (1973) (holding that a drug manufacturer's instructions
provided the proper standard of care with which to measure the conduct of
|||As Jones correctly notes, the institutional negligence of hospitals can
also be determined without expert testimony in some cases. The standard
of care evidence required to bring an action for institutional negligence
against a hospital is best understood by a review of the relevant case law.
|||In Darling v. Charleston Community Memorial Hospital, 33 Ill. 2d 326 (1965),
the plaintiff had his leg placed in a cast at the defendant hospital. While
remaining at the hospital, he suffered a serious case of gangrene. He ultimately
lost his leg below the knee. The plaintiff brought an action directly against
the hospital for failing to have trained nurses monitor his condition and
for failing to review his treatment. In support of his argument that the
hospital breached the standard of care required of hospitals in this regard,
the plaintiff presented evidence that the hospital breached its own bylaws,
as well as the state's licensing regulations and the "Standards for
Hospital Accreditation." Darling, 33 Ill. 2d at 330-32. A jury returned
a verdict for the plaintiff, and this court affirmed. Darling, 33 Ill. 2d
|||As earlier noted, this court in Darling recognized an independent duty
of hospitals to assume responsibility for the care of their patients. Relevant
here, Darling also held that the hospital bylaws, licensing regulations,
and standards for hospital accreditation were sufficient evidence with which
to establish the hospital's standard of care. Darling likened this evidence
to evidence of custom, which may also be used to determine a hospital's
standard of care. The jury was therefore entitled to conclude from the plaintiff's
evidence that the hospital had breached its duty to the plaintiff. Darling,
33 Ill. 2d at 330-33.
|||In Greenberg v. Michael Reese Hospital, 83 Ill. 2d 282 (1980). A group
of plaintiffs sued the hospital for injuries that they sustained as a result
of being X-rayed without a protective shield. As standard of care evidence,
the plaintiffs presented an expert witness who was a health physicist specializing
in the effects of radiation. The hospital challenged the qualifications
of plaintiffs' expert, claiming that, since he was not a physician practicing
in any school of medicine, he could not testify concerning conduct that
involves a medical judgment. This court held that the affidavit of the plaintiffs'
nonphysician expert was sufficient to withstand the hospital's motion for
summary judgment. Greenberg, 83 Ill. 2d at 293-94. Although the expert was
not a medical practitioner, he was highly qualified and familiar with radiation
therapy in hospitals. This court deemed "it appropriate to the diversity
inherent in hospital administration that a broad range of evidence be available
to establish the applicable standard of care." Greenberg, 83 Ill. 2d
|||More recently, this court in Advincula v. United Blood Services, 176 Ill.
2d 1, 29 (1996), stated that the standard of care required of a hospital
in a case of institutional negligence may be shown by a wide variety of
evidence, including, but not limited to, expert testimony, hospital bylaws,
statutes, accreditation standards, custom and community practice. Advincula
explained that this variety of evidence is appropriate given the inherent
diversity in hospital administrative and managerial actions, only a portion
of which involves the exercise of medical judgment. Advincula, 176 Ill.
2d at 32-34. Advincula further explained, however, that the tort of institutional
negligence "does not encompass, whatsoever, a hospital's responsibility
for the conduct of its *** medical professionals." Advincula, 176 Ill.
2d at 31. Rather, in cases against hospitals based on vicarious liability
for the conduct of medical professionals, the standard of care remains the
standard applied to all professionals, i.e., to use the same degree of knowledge,
skill and ability as an ordinarily careful professional would exercise under
similar circumstances. Advincula, 176 Ill. 2d at 30, 31.
|||Darling and its progeny have firmly established that, in an action for
institutional negligence against a hospital, the standard of care applicable
to a hospital may be proved via a number of evidentiary sources, and expert
testimony is not always required. Advincula, 176 Ill. 2d at 29-34; Greenberg,
83 Ill. 2d at 293-94; Darling, 33 Ill. 2d at 330-33. We likewise conclude
that, in an action for institutional negligence against an HMO, the standard
of care applicable to an HMO may be proved through a number of evidentiary
sources, and expert testimony is not necessarily required. Accordingly,
expert testimony concerning the standard of care required of an HMO is not
a prerequisite to Jones' claim. Nonetheless, Jones, as the plaintiff here,
still bears the burden of establishing the standard of care required of
an HMO through other, proper evidentiary sources. We must therefore evaluate
the evidence presented on this point to determine whether Jones' claim withstands
Chicago HMO's motion for summary judgment. In deciding whether Jones' standard
of care evidence is sufficient, we look to whether that evidence can equip
a lay juror to determine what constitutes the standard of care required
of a "reasonably careful HMO" under the circumstances of this
|||A. Patient Load
|||We first consider Jones' assertion that Chicago HMO negligently assigned
more patients to Dr. Jordan than he was capable of serving. Parenthetically,
we note that this assertion involves an administrative or managerial action
by Chicago HMO, not the professional conduct of its physicians. Therefore,
this claim properly falls within the purview of HMO institutional negligence.
Jones argues that the standard of care evidence in the record is sufficient
to support her claim. She points to Dr. Trubitt's testimony, as well as
the contract between Chicago HMO and the Department of Public Aid.
|||Dr. Trubitt was the medical director for Chicago HMO. He testified that,
when Chicago HMO entered into agreements with primary care physicians, it
considered the number of patients that the physician is capable of handling.
The HMO would look to federal "guidelines" in making this determination.
Based on those guidelines, Dr. Trubitt expressed 3,500 as the maximum number
of patients that should be assigned to any one primary care physician. He
stated that, if Dr. Jordan himself had 6,000 or more patients, then that
would be an unusually large number and of concern to Chicago HMO.
|||We agree with Jones that Dr. Trubitt's testimony is proper and sufficient
evidence of the standard of care on this issue. According to Dr. Trubitt,
an HMO should not assign more than 3,500 patients to any single primary
care physician. Chicago HMO even concedes in its brief that the maximum
patient load to which Dr. Trubitt testified "represent[s] a `standard
of care' whose violation could affect the quality of patient care."
This particular standard of care evidence, setting forth a limit of 3,500
patients per primary care physician, is adequate to equip a lay juror to
determine what constitutes the standard of care required of a "reasonably
careful HMO" under the circumstances of this case. Whether Dr. Trubitt
relied on an unidentified federal regulation or some other source in arriving
at a maximum patient load of 3,500 is of no consequence. It is enough that
Chicago HMO, through its medical director, admitted that it used the 3,500
limit as a guide in assigning patient loads. See Darling, 33 Ill. 2d at
330-33 (holding that the hospital's own bylaws may be used to establish
the hospital's standard of care).
|||Chicago HMO, however, submits that there is no evidence in the record
that Dr. Jordan's patient load exceeded 3,500. We disagree. Chicago HMO's
"Provider Capitation Summary Reports" listed Dr. Jordan as being
the primary care provider of 4,527 Chicago HMO members as of December 1,
1990. Thus, Chicago HMO's own records show Dr. Jordan's patient load as
exceeding the 3,500 limit by more than 1,000 patients. In addition, Dr.
Jordan estimated that he himself was designated the primary care physician
for an additional 1,500 members of other HMOs. He also maintained his own
private practice of non-HMO patients. This evidence supports Jones' theory
that Dr. Jordan had more than 6,000 HMO patients.
|||Chicago HMO, in support of its position, points to Dr. Jordan's testimony
that he employed four part-time physicians in his office. We disagree with
Chicago HMO concerning the significance of this testimony. Although Dr.
Jordan testified that he employed four part-time physicians, he never explained
in what capacities these physicians served. In fact, the record contains
no further information regarding these physicians. Notably, the agreements
between Chicago HMO and Dr. Jordan do not refer to any physicians other
than Dr. Jordan himself. The evidence in the record, therefore, supports
Jones' theory that Chicago HMO negligently assigned more than 3,500 patients
to Dr. Jordan himself. At best, the testimony regarding the four part-time
physicians creates a genuine issue of material fact as to how many patients
Dr. Jordan actually served himself. Consequently, this limited information
in the record about part-time physicians does not entitle Chicago HMO to
summary judgment. As earlier noted, it is well established that summary
judgment is a drastic remedy and should be awarded only where the right
of the moving party is clear and free from doubt.
|||Chicago HMO also submits that Jones' claim of patient overload must fail
because there is no evidence of a causal connection between the number of
patients that Dr. Jordan was serving and his failure to schedule an appointment
to see Shawndale. We disagree. We can easily infer from this record that
Dr. Jordan's failure to see Shawndale resulted from an inability to serve
an overloaded patient population. A lay juror can discern that a physician
who has thousands more patients than he should will not have time to service
them all in an appropriate manner.
|||We note, moreover, that additional evidence in the record supports Jones'
claim. The record indicates that Chicago HMO was actively soliciting new
members door-to-door around the same time that it lacked the physicians
willing to serve those members. Jones described how she first enrolled in
Chicago HMO while living in Park Forest. A Chicago HMO representative visited
her home and persuaded her to become a member, telling her that Chicago
HMO "is better than a regular medical card." When Jones later
moved to Chicago Heights, another Chicago HMO representative visited her
home. Jones explained that this meeting was not arranged in advance. Rather,
the representative was "in the building knocking from door to door."
Jones also testified that, when she moved to Chicago Heights, Chicago HMO
assigned Dr. Jordan to her and did not give her a choice of primary care
|||The latter aspect of Jones' testimony was supported by Dr. Trubitt. He
explained that, before Chicago HMO and Dr. Jordan executed the Chicago Heights
service agreement, another physician serviced that area. When Chicago HMO
terminated that other physician, Dr. Jordan agreed "to go into the
[Chicago Heights] area and serve the patients." Chicago HMO then assigned
to Dr. Jordan all of the patients of that physician. Chicago HMO directed
its members to Dr. Jordan; they had no other choice of a physician because
"[a]t that point in the area there was no choice." According to
Dr. Trubitt, Dr. Jordan was Chicago HMO's only physician who was willing
to serve the public aid membership in Chicago Heights. Dr. Trubitt stated
that this lack of physicians was "a problem" for Chicago HMO.
|||The record further reflects that Chicago HMO directed its Chicago Heights
members to Dr. Jordan, even though it knew that Dr. Jordan worked at that
location only half the time. Chicago HMO entered into two service agreements
with Dr. Jordan, the first for a Homewood site in 1987, and the second for
the Chicago Heights site in 1990. Dr. Trubitt indicated that Chicago HMO
and Dr. Jordan executed the Chicago Heights service agreement at the time
that Chicago HMO terminated the other physician. Dr. Jordan confirmed that,
in January of 1991, he was dividing his time equally between his two offices.
All of the foregoing evidence supports Jones' theory that Chicago HMO acted
negligently in assigning more enrollees to Dr. Jordan than he was capable
|||Jones also relies on the contract between Chicago HMO and the Department
of Public Aid as standard of care evidence. That contract stated that Chicago
HMO shall have one full-time equivalent primary care physician for every
2,000 enrollees. We need not address in this appeal whether this contractual
provision may serve as standard of care evidence. Our role here is to determine
whether Chicago HMO is entitled to summary judgment on the patient overload
aspect of the institutional negligence claim. Even if this contractual provision
is removed from consideration, Chicago HMO is not entitled to summary judgment.
Accordingly, we express no opinion on whether this provision may properly
serve as standard of care evidence.
|||One final matter with respect to patient load remains to be considered.
Chicago HMO contends that imposing a duty on HMOs to ascertain how many
patients their doctors are serving would be unreasonably burdensome. Chicago
HMO asserts that only physicians, and not HMOs, should have the duty to
determine if the physician has too many patients.
|||To determine whether a duty exists in a certain instance, a court considers
the following factors: (1) the reasonable foreseeability of injury, (2)
the likelihood of injury, (3) the magnitude of the burden of guarding against
the injury, and (4) the consequences of placing that burden upon the defendant.
Deibert v. Bauer Brothers Construction Co., 141 Ill. 2d 430, 437-38 (1990);
Kirk v. Michael Reese Hospital & Medical Center, 117 Ill. 2d 507, 526
(1987). Lastly, the existence of a duty turns in large part on public policy
considerations. Ward v. K mart Corp., 136 Ill. 2d 132, 151 (1990); see Mieher
v. Brown, 54 Ill. 2d 539, 545 (1973). Whether a duty exists is a question
of law to be determined by the court. Cunis, 56 Ill. 2d at 374.
|||Here, given the circumstances of this case, we hold that Chicago HMO had
a duty to its enrollees to refrain from assigning an excessive number of
patients to Dr. Jordan. HMOs contract with primary care physicians in order
to provide and arrange for medical care for their enrollees. It is thus
reasonably foreseeable that assigning an excessive number of patients to
a primary care physician could result in injury, as that care may not be
provided. For the same reason, the likelihood of injury is great. Nor would
imposing this duty on HMOs be overly burdensome. Here, for example, Chicago
HMO needed only to review its "Provider Capitation Summary Reports"
to obtain the number of patients that it had assigned to Dr. Jordan. This
information is likely to be available to all HMOs, as they must know the
number of patients that a physician is serving in order to compute the physician's
monthly capitation payments. The HMO may also simply ask the physician how
many patients the physician is serving. Finally, the remaining factors favor
placing this burden on HMOs as well. Public policy would not be well served
by allowing HMOs to assign an excessive number of patients to a primary
care physician and then "wash their hands" of the matter. The
central consequence of placing this burden on HMOs is HMO accountability
for their own actions. This court in Petrovich recognized that HMO accountability
is needed to counterbalance the HMO goal of cost containment and, where
applicable, the inherent drive of an HMO to achieve profits. Petrovich,
188 Ill. 2d at 29.
|||In conclusion, Chicago HMO is not entitled to summary judgment on Jones'
claim of institutional negligence for assigning too many patients to Dr.
|||B. Appointment Procedures
|||We next consider Jones' assertion that Chicago HMO negligently adopted
procedures requiring Jones to call first for an appointment before visiting
the doctor's office or obtaining emergency care. Jones fails to develop
this argument in her brief. In particular, she points to no evidence in
the record as providing the standard of care required of an HMO in developing
appointment procedures. This claim cannot proceed without standard of care
evidence. Chicago HMO is therefore entitled to summary judgment with respect
to this portion of Jones' claim of institutional negligence.
|||II. Breach of Contract
|||Jones argues that Chicago HMO is not entitled to summary judgment on her
breach of contract claim. This claim, set forth in count III of Jones' complaint,
is based solely on the contract between Chicago HMO and the Department of
Public Aid. Jones is not a signatory to this contract, but rather a beneficiary.
Jones, however, expressly disclaims any reliance on a third-party beneficiary
theory of liability. Instead, Jones insists that she may maintain an action
for damages against Chicago HMO as if she were a party to the agreement.
|||The appellate court held that summary judgment was properly awarded to
Chicago HMO on this claim because Jones is not a party to the contract at
issue. The appellate court also noted that Jones' theory of liability in
this regard was "murky at best." 301 Ill. App. 3d at 115.
|||We hold that Chicago HMO is entitled to summary judgment on count III.
The record discloses that Jones is not a party to the contract that she
seeks to enforce. Rather, the contracting parties are Chicago HMO and the
Department. Nonetheless, Jones insists that she may maintain a cause of
action on that contract, while also disclaiming any reliance on a third-party
beneficiary theory of liability. Jones' position is not correct as a matter
of law. See Olson v. Etheridge, 177 Ill. 2d 396, 404 (1997) (explaining
third-party beneficiary theory); 17A Am. Jur. 2d Contracts §§ 435, 437 (2d
ed. 1991) (noting that a nonparty to a contract must sue under a third-party
beneficiary theory). We also agree with the appellate court that the theory
presented by Jones on this point is not clear.
|||III. Breach of Warranty
|||Jones lastly argues that she should be permitted to pursue a breach of
warranty claim against Chicago HMO. She asserts that count III can be construed
as raising this claim. Chicago HMO counters that Jones has waived any breach
of warranty claim by failing to raise it in the courts below. We agree with
Chicago HMO. Issues raised for the first time on appeal are waived. Employers
Insurance v. Ehlco Liquidating Trust, 186 Ill. 2d 127, 161 (1999). Our review
of the record reveals that Jones did not raise this claim in either the
circuit court or the appellate court. Nor did Jones raise this issue in
her petition for leave to appeal. We thus conclude that Jones has waived
any claim of breach of warranty.
|||An HMO may be held liable for institutional negligence. Chicago HMO is
not entitled to summary judgment on Jones' claim charging Chicago HMO with
institutional negligence for assigning more enrollees to Dr. Jordan than
he was capable of serving. We therefore reverse the award of summary judgment
to Chicago HMO on count I of Jones' second amended complaint and remand
that claim to the circuit court for further proceedings. As to count III,
we affirm the award of summary judgment to Chicago HMO.
|||The judgments of the appellate and circuit courts are affirmed in part
and reversed in part and the cause is remanded to the circuit court.
|||Judgments affirmed in part and reversed in part;
|||JUSTICE MILLER, concurring in part and dissenting in part:
|||I agree with the majority that the trial court properly granted the defendant's
motion for summary judgment on count III of the plaintiff's second amended
complaint, which alleges breach of contract. I do not agree with the majority's
conclusion that summary judgment is not also appropriate on count I, which
alleges institutional negligence.
|||The majority opinion correctly notes that the defendant makes no argument
against extending the doctrine of institutional negligence to health maintenance
organizations, such as the defendant. Slip op. at 12. In this regard, Justice
Rathje's separate opinion would grant the defendant more extensive relief
than the defendant itself requests, by ruling in its favor on an issue much
broader than the one actually raised by the HMO, and for that reason I cannot
join his partial concurrence and dissent. The defendant does argue, however,
that summary judgment was proper on count I because there is no evidence
of a causal connection between the number of patients assigned to Dr. Jordan
by the defendant and the doctor's failure to schedule an immediate appointment
to see the plaintiff's daughter.
|||Reaching a contrary conclusion, the majority accepts the plaintiff's assertion
that a genuine issue of material fact exists regarding whether the number
of patients assigned by the defendant to Dr. Jordan was a proximate cause
of the plaintiff's injury. In support of this result, the majority states,
"We can easily infer from this record that Dr. Jordan's failure to
see Shawndale resulted from an inability to serve an overloaded patient
population. A lay juror can discern that a physician who has thousands more
patients than he should will not have time to service them all in an appropriate
manner." Slip op. at 18-19.
|||The majority emphasizes Dr. Trubitt's deposition testimony, in which Dr.
Trubitt stated that 6,000 to 6,500 patients would be an unusually large
load for a doctor to carry. The majority ignores Dr. Trubitt's further testimony
on this subject, however, in which he explained that the number of patients
formally assigned to a particular doctor may be expanded, if there are additional
doctors in the office and the hours of operation for the office are increased.
|||But even this testimony is insufficient to give rise to a genuine issue
of material fact, for the plaintiff presents no support for the allegation
that the injury was proximately caused by the number of patients assigned
by the defendant to Dr. Jordan. As the trial judge reasoned in granting
summary judgment to the defendant on this portion of the plaintiff's second
|||"[Plaintiff's counsel] comes up with some theories. He comes up with
some numbers. But, you know, there's no nexus. There's no expert testimony
to show how these claimed theories and numbers, omissions, or failures had
any impact on the doctor's decisions in this case."
|||The appellate court made the same point, similarly noting the absence
of any evidence in the record specifically linking the size of Dr. Jordan's
patient load in January 1991 with the negligence alleged by the plaintiff,
the failure to schedule an immediate appointment for her daughter. 301 Ill.
App. 3d 103, 111.
|||Whether Dr. Jordan and the other physicians in his practice together served
1,000 patients, 3,000 patients, 5,000 patients, or more, the majority cites
nothing in the record before us from which one may infer that Dr. Jordan's
failure to schedule an immediate appointment to see the plaintiff's daughter
on the day in question was the result of the number of patients assigned
to and served by his office. I believe that summary judgment in the defendant's
favor was proper on count I, and therefore I would affirm that portion of
the judgment below.
|||JUSTICE RATHJE, also concurring in part and dissenting in part:
|||I agree with both the majority's affirmance of summary judgment on the
breach of contract claim and its determination that plaintiff has waived
the breach of warranty claim. I strongly disagree, however, with the majority's
holding that Chicago HMO can be liable under a theory of institutional liability.
|||The majority reasons that, because an HMO is an "amalgam of many
individuals" like a hospital, then Chicago HMO can be institutionally
liable under the rule set forth in Darling v. Charleston Community Memorial
Hospital, 33 Ill. 2d 326 (1965). Slip op. at 11-12. Although both a hospital
and an HMO hire many different people for many different reasons, the reasons
for holding hospitals liable under this theory do not hold true for Chicago
|||Generally, institutional liability attaches when an organization breaches
a duty it owes as an organization. *fn1
Under Darling, hospitals are vulnerable to institutional liability partly
because, as organizations, they offer complete medical services, including
nurses, doctors, orderlies, and administration. Darling, 33 Ill. 2d at 332.
Hospital facilities include both the place and the staff, and hospitals
"assume certain responsibilities for the care of the patient."
Darling, 33 Ill. 2d at 332. In Darling, the hospital was negligent for two
reasons: it failed to properly review the work of an independent doctor,
and its nurses failed to administer necessary tests. Darling, 33 Ill. 2d
at 333. The rule set forth in Darling is that a hospital must act as a reasonably
careful hospital would and is responsible for reviewing and supervising
the medical care given to its patients. Advincula v. United Blood Services,
176 Ill. 2d 1, 28-29 (1996).
|||Shannon v. McNulty, 718 A.2d 828 (Pa. Super. 1998), the case upon which
the majority relies, is perfectly consistent with the principles set forth
in Darling and Avincula. In Shannon, the defendant HMO was not serving simply
as a vehicle through which a member's medical bills are paid. Instead, the
HMO employed nurses to work its own triage service and to advise members
on medical decisions such as whether to seek treatment at a hospital. Shannon,
718 A.2d at 832-33. The court concluded:
|||"Where the HMO is providing health care services rather than merely
providing money to pay for services their conduct should be subject to scrutiny.
We see no reason why the duties applicable to hospitals should not be equally
applied to an HMO when that HMO is performing the same or similar functions
as a hospital. When a benefits provider, be it an insurer or a managed care
organization, interjects itself into the rendering of medical decisions
affecting a subscriber's care it must do so in a medically reasonable manner.
Here, HealthAmerica provided a phone service for emergent care staffed by
triage nurses. Hence, it was under a duty to oversee that the dispensing
of advice by those nurses would be performed in a medically reasonable manner.
Accordingly, we now make explicit that which was implicit in McClellan [v.
Health Maintenance Organization of Pennsylvania, 413 Pa. Super. 128, 604
A.2d 1053 (1992)] and find that HMOs may, under the right circumstances,
be held corporately liable." (Emphasis added.) Shannon, 718 A.2d at
|||The passage demonstrates why Chicago HMO is not subject to institutional
liability. Under Chicago HMO's contract with Dr. Jordan, Chicago HMO is
responsible for enrolling members, providing the doctor's group with a current
list of those members, paying capitation fees, providing a list of hospitals
and health care providers, providing other funding, and obtaining the appropriate
regulatory licensure for the doctor's group. The doctor's group is solely
responsible for providing the health services. Moreover, Chicago HMO's member's
handbook specifically explains that the individual doctors are responsible
for nurses and all other medical attention. Unlike the HMO in Shannon, which
"provid[ed] health care services," Chicago HMO "merely provid[ed]
money to pay for services." Thus, institutional liability is inappropriate
in this case.
|||The primary flaw in the majority's analysis is that it attempts to create
a rule of general application that fails to take into account not only the
differences that exist between a hospital and an HMO but also those that
exist among HMOs. To determine whether an HMO should have the same duty
to its members that a hospital has to its patients, a court must assess
not only whether hospitals are similar to HMOs but also whether the patient's
relationship to the hospital is similar to the member's relationship to
the HMO. See Kirk v. Michael Reese Hospital & Medical Center, 117 Ill.
2d 507, 525 (1987) (the question of whether a duty exists is "whether
the defendant and the plaintiff stood in such a relationship to one another
that the law imposed upon the defendant an obligation of reasonable conduct
for the benefit of the plaintiff").
|||Hospitals are "institutions holding themselves out as devoted to
the care and saving of human life." Johnson v. St. Bernard Hospital,
79 Ill. App. 3d 709, 716 (1979). Institutional liability makes sense in
the hospital context because a person in need of treatment must be assured
that the hospital will abide by a sufficient standard of care. That patient
generally does not have the time or opportunity to compare hospital bylaws
or look for the hospital with the best administrative policies and the highest
standard of care. A person goes to the nearest hospital in an emergency
or to a hospital where his doctor has privileges in a non-emergency. In
many cases, including most emergent cases, the patient has no time to make
an informed choice. In his relationship with a hospital, the patient is
at a severe disadvantage, which the law acknowledges by subjecting hospitals
to institutional liability.
|||By contrast, the goal of an HMO is to provide health care in a cost- sensitive
manner. B. Furrow, Managed Care Organizations and Patient Injury: Rethinking
Liability, 31 Ga. L. Rev. 419, 457 (1997). HMOs offer medical services,
but they do not do so in the same way that hospitals do. HMOs offer the
funding and the contact with the medical professionals. In Chicago HMO,
for instance, the way in which daily business is conducted, the duties of
nurses and other staff, and other day-to-day decisions are made by the individual
doctor or hospital with whom the HMO has contracted. *fn2
This type of HMO makes no decision as to what type of care is ultimately
given; they only decide whether the HMO will pay for that care.
|||Moreover, when a person joins an HMO, he knows beforehand what that HMO
will cover and, in most cases, chooses which HMO he will join based on his
assessment of the costs and benefits. To become a member, that person usually
has to contract with the HMO. *fn3 As
a result, the HMO will be held accountable for any failure to comply with
its own policies through a contract action.
|||In this case, the Chicago HMO representative arrived at plaintiff's door
and asked her whether she would prefer to receive her public aid medical
benefits through the HMO or continue receiving them directly through public
aid. He reviewed the policies, and plaintiff made the decision to join,
signing a statement that her participation in the HMO was voluntary and
that she could disenroll at any time. Plaintiff was given the opportunity
to make an informed choice and chose to receive her medical services through
|||Just as hospitals can differ substantially from HMOs, substantial differences
may exist among HMOs. Generally, HMOs are organized under one of four major
models: (1) staff, in which the providers are all salaried employees of
the HMO; (2) medical group, in which the HMO contracts with an organized
group of doctors who have combined their practices; (3) independent practice
association; in which the HMO contracts with individual physicians who are
solo or group practitioners; and (4) network models, in which the HMO contracts
with two or more physician group practices who may serve several HMOs at
the same time. Both the methods of organization and the methods of reimbursement
vary among the models. E. Weiner, Managed Health Care: HMO Corporate Liability,
Independent Contractors, and the Ostensible Agency Doctrine, 15 J. Corp.
L. 535, 540 (1990). In some cases, an HMO may behave very much like a hospital,
and institutional liability might be appropriate in such cases. In most
cases, however, an HMO will do everything in its power not to behave like
a hospital, precisely to avoid the liability that comes with operating as
one. Having a uniform standard of care for all HMOs makes little sense,
given the major differences in structure.
|||Before concluding, I wish to stress that I by no means believe that HMOs
should not be held accountable for their actions. Ordinarily, an HMO will
be accountable to its members through the contract that is signed by both
parties. Unfortunately, in this case, plaintiff was receiving benefits from
the HMO through public aid and, therefore, did not contract with the HMO.
Consequently, as the majority correctly holds, her particular situation
leaves her unable to enforce the policy provisions because she was not a
party to the contract. Slip op. at 22. While I sympathize with plaintiff's
unenviable position, the fact remains that plaintiff's theory of liability
is not one permissible under our laws.
|||*fn1 Contrast with vicarious liability,
which attaches to an organization when one of its agents breaches his duty.
|||*fn2 Some HMOs do employ the staff and
provide the facilities for care, but most do not. See E. Weiner, Managed
Health Care: HMO Corporate Liability, Independent Contractors, and the Ostensible
Agency Doctrine, 15 J. Corp. L. 535, 540 (1990).
|||*fn3 This case is an exception to that
rule because the HMO membership was given to plaintiff by the Department
of Public Aid. See slip op. at 22.
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