Federal Court Questions Legal Standing of Physician in Antitrust Case

In this dispute, a California orthopedic surgeon alleged that hospitals in northern New Jersey had conspired with the American Academy of Orthopedic Surgeons ("AAOS") to deny him medical staff privileges. The basis of his claim was that these hospitals required a physician to be board certified in order to obtain privileges but that he was prevented from doing so because the AAOS mandates that a physician have clinical privileges at a hospital as a condition of board certification. The lawsuit had been dismissed in federal district court for failure to state a cause of action on which relief could be provided and was on appeal before the 3rd Circuit.

The Court questioned whether the physician had standing in the case because he never actually applied for privileges and therefore was never denied. In response, his attorney argued that the hospitals had informed him upfront that his application would be denied because he was not board certified. The attorney further maintained that if his client applied anyway, the denial would be reportable to the National Practitioner Data Bank which could adversely affect his career. No evidence had been submitted establishing any oral or written agreement between the AAOS and any hospital to impose this certification/credentialing requirement. The AAOS also maintained that alleged economic injury to an individual did not qualify as "antitrust injury" to competition.

Some important points to keep in mind:

1. Physicians do not have a legal right to obtain medical staff privileges at a hospital.

2. A decision to refuse to give an application or deny an application based on the failure to meet a required qualification, such as board certification, is NOT reportable to the Data Bank.

3. Hospitals have a legal right to deny an application based on reasonable qualification requirements as well as, for example, because the physician is employed by a direct competitor