© 2017 The Texas Lawbook.
By L.M. Sixel of the Houston Chronicle
A Houston heart surgeon was awarded $6.4 million in damages after a Harris County jury found Wednesday that Memorial Hermann Health System defamed his reputation in an effort to protect its business from other hospitals and competitors.
In a case closely watched in the medical community, the jury also found Memorial Hermann acted with malice by making false statements about the surgical competence of Dr. Miguel Gomez III. Gomez, a star at Memorial Hermann hospital until he decided to shift his lucrative practice to Houston Methodist West, sued Memorial Hermann five years ago, contending the hospital launched a “whisper campaign” to smear his reputation to keep patients from following him to Methodist.
“I feel really, really good,” Gomez said shortly after the verdict. “After having to wait more than half a decade to have my day in court, it’s really nice to have the jury vindicate me.”
The case opened a window on the fierce battle among hospitals for market share and the lengths to which they may go to protect their turf. Independent doctors with admitting privileges are vital to hospitals since they provide a steady stream of patients, and specialists like Gomez, who perform procedures with high profit margins, are viewed as especially valuable. Hospitals fight hard to hold onto them.
Gomez’s case turned on peer review, a confidential process conducted by committees of physicians to weed out bad doctors. Gomez, however, alleged that Memorial Hermann misused the process, manipulating data on the outcome of his surgeries to suggest that his patients were more likely to die.
The jury, which began deliberations on Monday, determined that a comment from a Memorial Hermann employee about Gomez’s “bad quality, high mortality rates, unnecessary surgeries,” was false and damaged Gomez’s reputation, according to court records. The jury also found another employee’s comment about the hospital’s decision to share Gomez’s peer review data with referring cardiologists in the name of safety and transparency to be false and defamatory.
Memorial Hermann said in a statement that it has the “utmost respect for the judicial process,” but was disappointed by the jury’s verdict. The hospital noted that its purpose in collecting and reviewing data about surgical outcomes was not to hurt Gomez, but to improve patient safety.
“This verdict will not change that,” the hospital said in a statement.
Hospital officials said they will evaluate whether to appeal. They added that they expect state district judge Daryl Moore to reduce the jury award when he enters the judgment.
The Gomez case was unusual because it made it to trial, which lasted about two weeks. Typically, disputes like this are settled behind closed doors long before they get to a jury. That’s because such cases are difficult to bring in Texas, where the law allows doctors access to confidential peer review data only if they can show the process was used either to quash competition or discriminate.
Gomez’s case went all the way to the Texas Supreme Court, which determined in 2015 he had enough evidence to go forward and directed Memorial Hermann to provide confidential records.
As Gomez’s verdict shows, legal and health care specialists said, hospitals can use the process to protect market share by targeting doctors who don’t keep or funnel business to their facilities and networks. Brent Walker, a health care lawyer in Dallas, said the verdict Wednesday will sent a strong message to hospitals about the consequences of misusing the peer review process for business purposes.
“This jury has put hospitals on notice in the state of Texas and in the country that they can be held liable for abusing the peer review process for financial reasons,” said Walker. “Juries understand why hospitals do what they’re doing.”
Memorial Hermann prevailed on one key point in the trial that began March 15. While the jury found that Memorial Hermann engaged in a conspiracy to keep physicians from referring their cardiovascular and thoracic patients to Gomez, the jury determined that the conduct of Memorial Hermann did not unreasonably restrain the overall market for health care in Houston.
For more business news coverage in Houston and South Texas, please visit www.chron.com/business/.
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