South Carolina Appellate Court Affirms Hospital Owes No Duty To Insure Doctors Have Medical Malpractice Insurance

The South Carolina Court of Appeals ruled in its opinion filed on January 8, 2020 that the defendant hospital owed no duty to a patient for the medical negligence of a doctor who provided services to a patient at the hospital: “We conclude as a matter of law that the phrase “services to be rendered” was plain and unambiguous. No reasonable contracting party would contemplate that “services to be rendered” by a hospital would include the monitoring of the treating doctors’ compliance with malpractice insurance requirements imposed by the hospital and the board. The plausibility of such a reading dwindles further when it is remembered the parties agreed that Hospital was “not responsible for any act or omission of the physicians.” And the Admission Contract never references the Bylaws or the Subsidy Contract.”

The Underlying Facts

The plaintiffs both suffered complications following surgeries performed by a local OB/GYN at the defendant hospital between December 2008 and May 2009. In 2014, the plaintiffs both obtained default judgments against the OB/GYN for medical malpractice for $1,740,692.75 and $1,468,580, respectively. The OB/GYN did not have medical malpractice insurance coverage for the plaintiffs’ judgments against him.

Before their surgeries, the plaintiffs both signed a form entitled “Conditions of Admission” (the Admission Contract), which provided, “The undersigned agrees he signs as agent or as patient that in consideration of the services to be rendered to that patient, he hereby individually obligates himself to pay the account of the hospital, in accordance with the regular rates and terms of the hospital.” (emphasis added). The Admission Contract also provided, “[T]he hospital is not responsible for any act or omission of the physicians. . . . The undersigned recognizes that most medical staff members furnishing services to the patient, including the radiologists, pathologist, anesthesiologists, and the like (are) independent contractors and not employees of the hospital.”

The defendant hospital’s medical staff bylaws (the Bylaws) provided that medical staff “shall maintain valid professional liability insurance coverage in the amounts deemed necessary by the Board from time to time and shall provide a current certificate of insurance as recommended.”

Additionally, the defendant hospital subsidized the OB/GYN and the contract between them provided, in part: “The physician shall furnish to the Hospital proof of insurance. Said policy shall cover professional liability in a minimum amount of $1,000,000 per claim/$3,000,000 aggregate or JUA/PCF coverage.”

The South Carolina Appellate Court stated: “We have considered the corporate negligence doctrine for hospitals before but passed on the invitation to recognize it … Other courts have rejected attempts to saddle hospitals with a duty to verify its treating physicians are covered by adequate malpractice insurance. In Florida, where by statute doctors are required to be financially able to pay malpractice claims, the supreme court has held hospitals have no affirmative duty to condition the grant of staff privileges on the doctor’s proof of compliance with the financial responsibility statute … We decline to find Hospital owed such a duty under the specific circumstances here. Even if we were inclined to agree with the hospital corporate negligence doctrine, such a declaration of public policy is the function of the legislature or perhaps our supreme court. We therefore affirm summary judgment to Hospital.”

McCord v. Laurens County Health Care System, Opinion No. 5705.

If you or a loved one may have been injured as a result of medical malpractice in South Carolina, you should promptly find a South Carolina medical malpractice attorney who may investigate your medical malpractice claim for you and represent you or your loved one in a South Carolina medical malpractice case, if appropriate.

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This entry was posted on Tuesday, February 4th, 2020 at 5:30 am. Both comments and pings are currently closed.

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