Lin v. Board of Directors of PrimeCare Medical Network, Inc.

Lin v. Board of Directors of PrimeCare Medical Network, Inc. (Feb. 19, 2025, D084821) __ Cal.App.5th __ [2025 WL 544022]

Non-licentiate directors of a private corporation lack statutory authority to perform medical peer review.

PrimeCare, a private corporation licensed as a healthcare service plan under the Knox-Keene Act, contracts with full-service health plans (such as Blue Shield and Blue Cross) to provide medical care to health plan enrollees. It also contracted to conduct peer review for the medical group that employed Dr. Jason Lin. After a patient and her son complained to the medical group about Lin grabbing and shaking hitting the patient’s wrist during an argument, PrimeCare’s chief medical officer summarily suspended Dr. Lin’s privileges pending an investigation. He specified that the suspension took effect immediately under the statutory exception to the notice requirement for situations where the failure to take immediate action may result in “ ‘imminent danger to the health of any individual.’ ” When Dr. Lin was informed of the suspension, he stated he would have “slapped [the patient] across the face” if he could have. PrimeCare maintained Dr. Lin’s suspension pending completion of an anger management course and specified that he would be chaperoned for six months when he returned to work. Dr. Lin requested that a judicial hearing committee (JHC) review the disciplinary action.

The JHC found PrimeCare failed to prove the immediate summary suspension was justified. But PrimeCare’s board of directors (the Board) reversed the JHC pursuant to a Fair Hearing Plan provision that allowed the Board to make the final disciplinary decision when the JHC’s decision was inconsistent with the applicable burden of proof, which the Board construed as authorizing its independent review. Dr. Lin filed a petition for writ of administrative mandamus seeking reinstatement of his credentials and privileges. The trial court granted the petition, finding the Board did not have authority to independently review the JHC’s decision. The Board appealed.

The Court of Appeal affirmed. It explained that, as an entity licensed under the Knox-Keene Act, PrimeCare is a peer review body and its chief medical officer had authority to suspend Dr. Lin. However, the court construed the Fair Hearing Plan as limiting the Board’s authority to decide whether the JHC had identified and applied the applicable burden of proof. Construing the Fair Hearing Plan to authorize the Board, whose members included non-licentiates, to perform medical peer review itself was inconsistent with the statutory requirement that peer review be conducted by licentiates. The only exception to that requirement did not apply to PrimeCare because it is not an acute care hospital. Accordingly, the Board exceeded its authority when it reversed the JHC’s peer review decision.

The bulletin describing this appellate decision was originally prepared for the California Society for Healthcare Attorneys (CSHA) by H. Thomas Watson, Peder K. Batalden, and Lacey Estudillo at the appellate firm Horvitz & Levy LLP, and is republished with permission.

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