Doctors, Hospital Settle Rights Lawsuit

Ending a long and bitter feud, Community Memorial Hospital and its medical staff announced Tuesday the settlement of a lawsuit that doctors had brought against the hospital last year for allegedly undercutting their rights as a self-governing branch of the medical center.

Both sides said the settlement heralded a new era of trust and unity among administrators, trustees and the medical staff at the 103-year-old Ventura hospital. And it’s intended to staunch the flow of disgruntled doctors and their patients to other facilities.

“The medical staff has full confidence in the board’s leadership, and the board recognizes the medical staff’s indispensable role in fulfilling CMH’s mission,” said the one-paragraph announcement.

The agreement was approved last week by hospital trustees and the executive committee of the medical staff, and announced Tuesday night at a meeting of the full medical staff. Staff members are expected to ratify the settlement next month.

“We’re very happy with what we’ve achieved,” said surgeon John Hill, president of the medical staff. “This settlement allows the medical staff to continue to be the prime entity to determine medical policies. And [trustees] have agreed to not unreasonably withhold their blessing.”

Hill said keys to resolving the dispute were a Superior Court judge’s ruling last summer that the medical staff represented a legal entity that could sue the hospital, followed by the trustees’ decision to replace embattled hospital Chief Executive Michael Bakst with a new administrator, Gary Wilde.

“Gary is easy to talk to,” Hill said. “He’s very attuned to trying to resolve problems and working things out for the betterment of the hospital.”

Wilde, a veteran administrator from Cottage hospitals in Santa Barbara County, said the settlement was a victory for everyone.

“We get back our ability to work together and act as top-notch hospitals act in California,” Wilde said. “We get back mutual respect.”

The agreement even describes how doctors and administrators will resolve conflicts in the future, he said.

While Hill and Wilde were reluctant to describe the settlement in terms of victory or defeat, physician groups said the Ventura doctors had set legal precedent.

“It took professionalism and courage to stand for the rights of physicians against the raw power of a wrong-headed hospital administration,” said Dr. Jack Lewin, chief executive officer of the California Medical Assn. “This is a significant victory for quality of care and patients.”

The Ventura case prompted a bill by state Sen. Sheila Kuehl (D-Santa Monica) that defines a self-governing medical staff, sets a framework to resolve disputes with administrators and permits the staff to sue to halt hospital interference in medical staff business.

The bill has passed both houses of the Legislature and is in a joint committee for consideration of amendments before going to the governor, medical association counsel Greg Abrams said.

“The first five months of litigation in the Ventura case was to determine whether or not the medical staff was a legal entity,” he said. “That issue has been resolved.”

Community Memorial became embroiled in an internal fight more than two years ago as the 242-bed hospital tightened controls over its medical staff members.

After attempts at mediation, a group of physicians, led by a majority of the medical staff’s executive committee, filed suit.

Doctors alleged that administrators tried to rig a staff election, adopted a code of conduct to stifle dissent, implemented a conflict-of-interest policy to disqualify select physicians from leadership positions and illegally allowed physicians to practice at the hospital without the staff’s review.

And, they said, the hospital’s seizure of $250,000 in medical staff funds was illegal.

Administrators maintained the dispute was purely financial and was being pressed, in large part, by doctors with conflicts of interest -- such as competing in-office surgery wards -- that take business away from the hospital. Under Community Memorial’s trustee-imposed conflicts policy, such doctors could not be elected to leadership positions on the medical staff or vote in staff elections.

Hill said the doctors got what they were looking for.

Trustees agreed that medical staff bylaws could not be changed unilaterally by administrators.

They also agreed to comply with staff bylaws, including those for staff elections and leadership, peer review, credentialing and privileges as a medical staff. They agreed not to “unreasonably withhold” approval of new medical staff bylaws, and to increase funding for the medical staff.

The hospital will return the $250,000 in medical staff dues and it agreed the money could be used to hire a lawyer, even to sue the hospital -- all points of contention last year.

For its part, the medical staff agreed not to pursue incorporation as an entity separate from the hospital for at least two years.

The doctors also agreed to draft their code of conduct and conflict of interest policies requested by the trustees.

“The code of conduct is generic, prohibiting any type of harassment in the workplace, and is enforced by the staff, not the administration,” Hill said. “And the conflict of interest policy is reasonable.”

Yet, Hill said, it will take time for hurt feelings to heal and medical practices to return to Community Memorial. For instance, Hill said he now performs more than half his surgeries at St. John’s Regional Medical Center in Oxnard, and that may not change.

“It’ll take time to get back where we were, and we may never get there,” he said. “But we’re all moving in the same direction now.”