In the closing days of its May term, the Illinois Supreme Court heard oral arguments in Klaine v. Southern Illinois Hospital Services, which poses an issue of potential importance to the medical malpractice bar: are applications for medical privileges discoverable in a negligent credentialing claim in a medical malpractice case? Our detailed summary of the underlying facts and lower court opinions in Klaine is here.
Klaine began when the plaintiffs sued the defendant doctor for medical malpractice, and the defendant hospital for being negligent in giving the doctor hospital credentials. The plaintiffs demanded that the hospital produce various applications for staff privileges. When the defendants refused, the plaintiffs moved to compel. After examining the documents in camera, the Circuit Court ordered production of three specific groups of documents. In order to facilitate an immediate appeal, the defendants declined to comply and requested entry of a “friendly contempt.” The Fifth District affirmed the order requiring production in most respects.
Counsel for the hospital began the argument, explaining that only the defendant doctor’s application for privileges was still at issue. Counsel explained that the Credentials Data Collection Act, 410 ILCS 517/15(h), created a standardized form that all hospitals are required to use in credentialing doctors. The statute also provides that the application materials are confidential. Chief Justice Garman asked whether counsel was asking that a privilege be inferred, since the statute didn’t expressly create one. Counsel answered that if the Court looks at the language, the intent of the legislature, and construes the Act in pari materia with the Medical Studies Act, then it does create a privilege. The regulations create confidentiality. The Chief Justice asked whether counsel agreed that confidentiality and discoverability were separate concepts. Counsel said that in a general sense, and in terms of things like the Freedom of Information Act, that’s so. But where the legislature has provided a process through which the hospital must collect certain data with the understanding of confidentiality, counsel disagreed with the Chief Justice. In this context, confidentiality means privilege. Justice Thomas asked whether it was immaterial that the Medical Studies Act, 735 ILCS 5/8-2102, provided broader protection from disclosure. Counsel disagreed with the proposition that the Act provides broader protection. It provides that materials used by a credentials committee are confidential. Counsel argued that there is a multiple step process involved in credentialing a doctor, and the legislature has created similar privileges at every step. Justice Burke asked whether the exception to the rule of nondisclosure means that a hospital is allowed to disclose information. Counsel answered that the legislature has recognized an exception for credentialing and recredentialing, but only for challenges to the granting or denying of privileges by the doctor. It doesn’t cover third party litigants. Justice Burke asked whether a finding of discoverability would chill the free exchange of information. Counsel answered that the Data Collection Act and the Medical Studies Act must be construed in pari materia. Both are essential parts of the process, working together to ensure that unqualified persons aren’t either given or continued credentials. Justice Thomas asked whether counsel was relying on the Illinois Administrative Code. Counsel responded that two statutes about the same thing must be construed together to produce a harmonious whole. Justice Thomas asked again whether the defendant relied upon the Administrative Code. Counsel answered that the Code offered further support to the argument. Justice Thomas pointed out that the Administrative Code only refers to confidentiality. Counsel answered that the Administrative Code references the Code of Civil Procedure, which discusses confidentiality, discoverability and admissibility. The Appellate Court had created inconsistency and discord between the two Acts, counsel argued. Both are part of the credentialing process. The application was part of that, and the regulations say it is to be given the same protection as set forth in the Medical Studies Act.
Counsel for the plaintiff followed, arguing that the hospital was actually trying to torpedo the tort of negligent credentialing. Counsel argued that the Medical Studies Act uses three distinct terms – confidentiality, inadmissibility and non-discoverability. Only one of those three terms is used in the Data Collection Act. Parties can’t get information protected by the Medical Studies Act because it’s necessary to protect the peer review process. But the same concerns aren’t implicated in the Data Collection Act, counsel argued, since it comes earlier in the process. The only way one can make a claim for negligent credentialing is with the records that the hospital had at the time of making the credentialing decision. Justice Kilbride asked how confidentiality plays out under the statute if the plaintiff’s position is upheld. Counsel answered that everything remains confidential. The presumption is for confidentiality. But that’s separate from admissibility and discoverability. The Medical Studies Act looks back at the tort, so that requiring disclosure would be akin to disclosing subsequent remedial measures. But the Data Collection Act is about an earlier step in the process, before the tort has ever happened. Counsel insisted that the Appellate Court had read the statutes in concert – the Court said that the Medical Studies Act uses three distinct concepts, and that must mean something. Counsel argued that the hospital certainly is asking the Court to infer a privilege. Justice Theis noted that the plaintiffs didn’t participate in the litigation at the Appellate Court. Counsel agreed. Justice Theis pointed out that the issue of attorney-client privilege hadn’t arisen until late in the process. The Appellate Court had found that the issue was forfeited, and then went ahead and discussed the issue anyway. There wasn’t much litigation about it, Justice Theis suggested. Counsel said that the plaintiff hadn’t participated because the plaintiff doesn’t know what the withheld documents are. The first time that the doctor-patient privilege, relied upon by the hospital to support redaction of certain material, had been raised was here. Justice Theis asked whether counsel meant the Supreme Court. Counsel responded that the issue of the Data Collection Act had been argued below, but the secondary argument that certain materials were covered by the doctor-patient privilege had been raised for the first time in the petition for leave to appeal.
Concluding, counsel for the hospital explained that the Appellate Court had found a relevance argument forfeited. All other arguments had been presented and heard at both levels of the courts. But nonetheless, waiver is a restriction on the parties, not the Court, so the Court may rule on that basis that details of care and treatment given unrelated patients be redacted. Counsel agreed that the Appellate Court had considered both Acts, but it failed to consider both with the principle of in pari materia in mind. One can’t separate out the steps of the credentialing process, counsel argued. All these documents are steps in the credentialing process, and all should have the same protection. Before the Data Collection Act, the credentials application was considered non-privileged. So if the legislature approved of a rule that such material was discoverable, there was no reason for the Act. Counsel argued that a negligent credentialing claim could still be asserted with evidence recovered from outside the peer review process. And if the plaintiffs wanted an exception for claims like this, they were free to take that up with the legislature. A holding that the credentialing materials were discoverable would render the language that they’re confidential meaningless.
We expect Klaine to be decided in three to four months.