Med Mal News

In New Jersey, companies that provide medical staff to healthcare facilities may find themselves vicariously liable for medical malpractice damages if mistakes occur, even if they consider the medical personnel they have placed to be independent contractors. This is what a New Jersey appeals court said Oct. 11 when it reinstated a claim brought in Monk v. Emergency Physician Assocs., A-489-11, by the widow of a patient who died at Virtua/West Jersey Hospital after allegedly being given an overdose of the painkiller Dilaudid there. The doctor accused of this negligence, Joseph O'Connell, was provided to the hospital through Emergency Physician Associates (EPA), a Woodbury, NJ, company that staffed the hospital's emergency room. The trial court granted summary judgment to EPA after concluding that Dr. O'Connell was merely an independent contractor of the company. The Appellate Division disagreed, finding that the facts that EPA termed O'Connell an “independent contractor” in its contracts and did not withhold income taxes or pay unemployment taxes for him were not dispositive on the issue of agency. Several other things rendered him an “employee” of EPA, the court found, including these: EPA could terminate O'Connell's contract for cause; EPA paid O'Connell an hourly rate and was to give him bonuses for certain things; EPA paid O'Connell's medical malpractice insurance premiums; EPA handled patient billing for O'Connell, using his name and then paying him from the proceeds; and EPA provided the hospital with its chief medical director of emergency medical services, who was authorized to act on EPA's behalf and to manage the E.R's daily operations. The appeals court also found that the nature-of-the-work test for determining employee status was satisfied because O'Connell's income depended on EPA, his work was integral to the company and EPA had an ongoing contractual and business relationship with him and with its other doctors.