The harrowing impact of a report to the National Practitioner Data Bank

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Health care providers practice in a regulatory environment that is evolving at a dizzying pace. Within the last century, physicians have journeyed from an entirely self-regulated guild to a complex system of rigid enforcement controlled by lawyers, compliance officers and government regulators. However, the most significant aspect of health law that has changed markedly over the last half century is the disciplinary reporting system, which affects everything from physician credentialling, privileging, licensing and third-party payer provider status to specialty board certification and membership in professional societies.

Up until the late 1980s, a physician whose licensure was suspended or revoked in one state could simply transfer his practice to another state or seek employment at a federal health care facility operated by the Veterans Administration or the federal prison system. Any entity hiring that disciplined doctor would either have to accept the doctor’s word relating to his or her past or conduct their own research and investigation in order to determine if there were issues with that physician’s record. Often, physicians were able to obtain employment without any disclosure or discovery of the physician’s previous damaging or incompetent performance.

With regard to physician discipline invoked by hospitals and health care facilities, medical staff leadership were often reluctant to punish staff physicians for misconduct, quality of care or impairment issues due to fear of a retaliatory lawsuit. After an Oregon surgeon successfully sued his hospital medical staff for antitrust violations following a peer review hearing, Congress became concerned. A growing number of medical malpractice suits, coupled with a lack of interstate reporting mechanisms for disciplined physicians and pressure from the AMA, finally prompted the enactment of the Health Care Quality Improvement Act of 1986 (HCQIA), which became law four years later.

The HCQIA drastically altered the medical landscape in two significant ways. First, it provided incentives for disciplinary reporting and second, it provided immunity for hospitals, medical boards and other agencies that brought adverse actions against physicians.

The National Practitioners Data Bank

In an effort to ensure protection of health care consumers from physicians with a record of malfeasance, the HCQIA created a national clearinghouse for the reporting of any and all discipline against all licensed physicians, from any source. Today, that clearinghouse is known as the National Practitioner Data Bank (NPDB). While the general public does not generally have access to the NPDB, the NPDB can be accessed by registered health care organizations that meet certain federal requirements, a list that is quite long and includes entities which handle physician privileging, employment or professional review. Among the entities permitted to access NPDB reports are state licensing authorities, hospital or health care entity credentialling staff, state and federal law enforcement authorities, professional societies, specialty boards and all third-party payers who contract with providers. Those entities permitted to file a report on the NPDB include most of the above, as well as entities that make medical malpractice payments, the DEA, the OIG, criminal prosecutors and private accreditation organizations.

In other words, whenever a physician is the subject of a formal peer review process that results in discipline or sanction, an NPDB report will be generated. Regardless of whether that discipline is in the form of fines, penalties, reprimand, suspension, revocation, or any conditions or restrictions of practice, if that sanction was imposed by an entity that allows for a peer review process, it will be reported. Thus, the NPDB has become an essential tool for medical credentialling, hiring and firing.

Immunity for health care review organizations

A common question: Can a physician sue the hospital medical staff or licensing board that levied sanctions against them and filed a subsequent report to the NPDB? The answer is always “no.” Through the HCQIA, Congress created an added incentive for hospitals, state licensing boards and other health care organizations to conduct peer review without fear of backlash from the physician.

In exchange for timely reporting of physician discipline by those organizations, Congress granted a blanket immunity to all peer review organizations for decisions made relating to physician discipline, thereby allowing them free reign to reprimand, suspend, revoke or restrict licensing and medical staff privileges.While this has encouraged medical staff leadership not to hesitate when deciding whether or not to punish wayward physicians on staff, many have argued that it has also fostered a wave of “peer review execution;” more specifically, the utilization of medical staff discipline to “eliminate” a physician for reasons other than competency or compliance.

In any case, however, enhanced peer review is a vital tool to ensure that health care entities maintain the appropriate standard of care, enhance their risk management and avoid potential liability for employing physicians with a pattern or history of wrongdoing.

Information collected by the NPDB

The NPDB collects and maintains physician information regarding all of the following:

• Payments for medical malpractice settlements and judgements
• Licensure and certification actions by state medical boards
• Licensure and certification actions by Federal agencies
• Adverse actions taken by hospitals, ambulatory care centers and other health care facilities relating to clinical privileges, including professional review actions taken by professional societies
• Adverse actions or findings by private accreditation entities
• Criminal convictions relating to the provision of health care
• Civil judgments relating to the provision of health care
• Exclusions from participating in federal or state healthcare programs

All of the entities required to report adverse actions to the NPDB must do so, or risk losing their immunity under the HCQIA, in addition to incurring possible fines and having their name published in the Federal Register.

Why you want to avoid a report to the NPDB

Every physician practicing today relies on a medical license in good standing. Many others are board certified in a medical specialty, are members of hospital, ambulatory surgery center, or other health care facility medical staff. Most physicians are authorized providers in contracts with third-party payers, and some are credentialled or certified by any number of private or government agencies. When an entity makes an adverse report to the NPDB, it becomes available to all of these entities, many of whom regularly query the NPDB. Notice of the adverse action, depending on its severity, can prompt any of these entities to invoke their own discipline or restrictions against the physician.

As an example, the American Board of Psychiatry and Neurology (ABPN) can suspend or revoke ABPN diplomate status if the certified physician has any “restriction or condition” imposed on his or her practice. Many hospitals require that medical staff members maintain specialty board certification. Third-party payers, be they federal programs like Medicare, state-run programs like Medicaid, or commercial payers, will not hesitate to terminate provider status of a physician if the underlying adverse action relates to a significant quality of care or insurance fraud issue. Similarly, state licensing boards will take action against licensees who are disciplined by other states’ licensing boards, a process known as “sister state reciprocity.”

What to do when you are reported to the NPDB

A NPDB report is permanent, remaining on the NPDB website for the duration of a physician’s practice. When an organization submits a report, the reported physician will be notified. At that stage, there are a number of options. If the physician simply wants to convey his own version of events or explanation about the subject of the report, they can add a response statement, limited to 400 words. The statement will become part of the NPDB report.

If the physician disagrees with the accuracy of the report, the physician must contact the reporting entity and attempt to resolve the dispute directly. Once a report is placed in dispute, the reporting health care organization can correct the report, void the report, or choose to leave the report unchanged. If after 60 days, the physician has received no response from the reporting entity or is unsatisfied with the response received, they can elevate the case to Dispute Resolution, which is a longer, more detailed process involving the appointment of a dispute resolution manager.

The takeaway

Every physician must ensure that, to the extent possible, any settlement, resolution, plea agreement or consent order that they agree to with any civil, administrative, criminal, regulatory or law enforcement authority does not become the subject of a report to the NPDB. If reporting the adverse action to the NPDB cannot be avoided, working with the reporting entity to attempt to limit the content of that report is the next best step.

Alex Keoskey, Esq., a certified civil trial attorney and certified health compliance officer, is a partner at Mandelbaum Barrett PC in Roseland, NJ, where he focuses on healthcare litigation and complex regulatory compliance issues, including defending medical professionals and healthcare entities in employment, administrative and regulatory compliance challenges, as well as disciplinary actions brought by state licensing boards, investigations by the OIG, FDA, DEA and other government agencies, employment law claims, medical malpractice actions, billing-related fraud claims and other actions brought against physicians by government entities, insurers and private parties. Contact him at akeoskey@mblawfirm.com.