Caselaw Update: Appellate Court Holds Quality Control Reports Not Privileged

On June 23, 2017, the Second District Appellate Court affirmed a trial court decision that quality control reports prepared pursuant to a standing policy to report incidents and serving both quality-improvement and risk-management purposes were not privileged under the Medical Studies Act.

In Nielson v. SwedishAmerican Hospital et al., 2017 IL App (2d) 160743, the plaintiffs alleged the defendant gynecologist and her employer Hospital (on a theory of agency) were negligent in performing an outpatient surgery. Hospital nurses prepared three quality control reports pertaining to the surgery. During discovery, plaintiffs moved to compel production of the reports. The Hospital claimed privilege over the reports pursuant to the Medical Studies Act. In support of its claim, it submitted an affidavit from the director of risk management, stating that the Hospital’s quality-assurance committee had established a standing request that information regarding “medical occurrences” be collected and reported to the committee via a quality control report form. The affidavits of the nurses who prepared the reports were also submitted. The nurses each stated that they prepared the reports at the request of the committee and forwarded the reports to the director of risk management, understanding that the information therein would be kept confidential.

After an in camera review, the trial court granted the motion to compel. When the Hospital refused to produce the reports, the trial court held it in civil contempt and subjected it to a fine of one dollar per day until the reports were produced.

On appeal, the Appellate Court affirmed the trial court’s ruling that the reports were not privileged. First, the Court emphasized that the reports were generated before the committee was even aware of the incident. The standing policy that declared in advance that the reports were peer-review materials was insufficient to support a claim of privilege. Pursuant to the recent First District decision Eid v. Loyola, a quality committee can authorize a designee of the committee to investigate a potential quality issue on the committee’s behalf, thus cloaking any documents generated thereafter in privilege. However, the Nielson Court makes clear that the designee may not be declared (and thus cannot generate privileged documents) until after the committee becomes aware of the incident and authorizes the investigation. In other words, the committee must already be investigating the incident at issue in order for the privilege to apply.

The Court also emphasized that the reports were not prepared exclusively for peer-review purposes. Contrary to the trial court’s findings, the Appellate Court found the reports were also prepared in anticipation of litigation, as they were sent to the risk management department, and potential legal implications of the incident could be flagged on the form.

The protection offered health care institutions for the improvement of the quality of patient care under the Medical Study Act continues to erode. This decision warns that hospitals and other protected care providers should not rely on incident or occurrence reports as privileged data regardless of language in policies, bylaws, or protocols establishing the report as part of the ad hoc information gathering process or delegated committee action on a standing basis. This case further illustrates the need for quality committees to expeditiously document the decision to investigate an incident in order to capture all subsequent data under the Medical Studies Act. While the standing policy in Nielson served to quickly apprise the committee of an incident, and the intent behind the policy was for the information generated to be privileged, the Court found the report to be a mere trigger for committee action. We have counseled our clients that incident and occurrence reporting should be viewed with the likelihood that production will be ordered, should contain information that is also or that should otherwise be contained in the medical record, and should be a minimalist notification of an event with no further information or action tied to it. The necessary committee and its members or delegates can then respond to that information in a privileged and protected manner. L&G Law Group has several attorneys with the experience and skill set to guide health care providers through the construction and operation of a protected reporting and investigation system under the Medical Studies Act.