Exclusive Contract Between Hospital and Physician Lawsuit In Texas
In Gonzalez v. San Jacinto Methodist Hosp., 880 S.W.2d 436 (Tex. App.--Texarkana 1994, writ denied) an anesthesiologist with staff privileges at San Jacinto Methodist Hospital brought suit against the hospital after it entered into an exclusive contract for anesthesiology services with another anesthesiologist.
Gonzalez claimed that his own staff privileges at the hospital were worthless because of the exclusive contract with the other anesthesiologist. Id. at 439.
The court, however, held that the exclusive contract did not terminate or reduce Gonzalez' privileges as that concept was contemplated in the bylaws.
The court stated that the hospital, through the bylaws, did not "guarantee work for any physician" nor did it "limit its rights to enter into exclusive contracts" and to generally conduct the business of the hospital. Id.
The court explained:
For example, if the Hospital chose to eliminate treatment of some specialty from the Hospital, the prior granting of staff privileges would not by implication prohibit the Hospital from making that business decision. While in the present case, the exclusive contract may have the effect of eliminating Gonzalez's work in the Hospital, it does not reduce or alter his staff privileges as such.Id.
The court further reasoned that Gonzalez actually could still obtain work at the clinic:
He still had full staff privileges if he worked under the doctor with the exclusive contract or if he himself obtained the exclusive contract with the Hospital at a later time.
Under these circumstances, he could immediately work in the Hospital with no restrictions on the scope of his activities. Id. at 440.
The court also noted that the context of the bylaws' procedural requirements indicates that its procedural requirements for reducing physician's privileges "do not involve matters of administrative decisions, but rather deal with matters of professional competence and ethical conduct." Id.
The court found that "these procedures were not intended to cover cases in which a doctor's staff privileges have been affected by some administrative decision not directly involving that doctor." Id.
Because the court found that for the purposes of whether the bylaws required a hearing, Gonzalez' privileges were neither terminated or reduced, the court held that Gonzalez was not entitled to a hearing under the bylaws.
Gonzales is not entitled to a hearing because the underlying rationale for holding a hearing is not present. In other words, there is nothing to be considered in a hearing in this situation.
His staff privileges remain intact, subject only to his ability to find a way to get employment in the Hospital. the purpose of such a hearing is not to override administrative decisions on the operation of the Hospital. Id.