Tuesday, May 7, 2013

Doe v. Guthrie Clinic, Ltd.:
A New Privacy Battleground?

Most healthcare providers are aware of the significant liability implications of a breach of protected health information, including, in some cases, the cost of issuing a breach notification to affected individuals.  Providers have not, however, faced significant liability from patient lawsuits filed directly against a hospital or medical practice for damages arising from a breach of confidentiality.  The reason is, patients face an uphill battle when suing a hospital or medical practice directly because most laws that protect patient information, including HIPAA, do not provide a private right of action for patients to sue the provider.

The situation is different, of course, when a physician or other licensed provider breaches the fiduciary duty of patient confidentiality; then the patient may have direct recourse against the provider for breach of the provider’s professional duties.  Frequently, however, it is not the licensed provider that breaches patient confidentiality, but an unlicensed employee of a hospital or medical practice that makes an unauthorized disclosure of health information.  In that case, the patient’s recourse is limited to seeking damages from the hospital or medical practice under the legal doctrine of respondeat superior, that is, an employer’s liability for the foreseeable actions of an employee acting within the scope of employment.

Suing a hospital or medical practice for an employee privacy breach is of limited usefulness in many cases, however, because often the employee’s actions are not foreseeable or the employee is not acting within the scope of his or her employment.  Such a finding will usually defeat a patient’s claim against the employer hospital or medical practice for the employee’s actions.

As is frequently the case in health law, however, all of that may be about to change, and if it does, hospitals and medical practices may be exposed to a significant new area of direct liability.

Doe v. Guthrie Clinic, Ltd. [1]  is a case pending in the U.S. Court of Appeals, Second Circuit (New York, Connecticut and Vermont), which is considering whether to adopt a significant expansion of direct liability for hospitals and medical practices that, if approved, would open the door for patients in other states to seek damages under the same theory.  I’ll explain the Guthrie case in an upcoming post and discuss what providers should be doing now to shield themselves from this direct liability.

Clay B. Wortham
McBrayer, McGinnis, Leslie & Kirkland, PLLC
Lexington, Kentucky

[1]  Doe v. Guthrie Clinic Ltd., 12-1045-cv (2nd Cir. 2013).

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