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91_SB1554
LRB9110231ACtm
1 AN ACT to prohibit exclusive contracts for hospital
2 services of physicians.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Hospital Licensing Act is amended by
6 changing Section 10.4 as follows:
7 (210 ILCS 85/10.4) (from Ch. 111 1/2, par. 151.4)
8 Sec. 10.4. Medical staff privileges.
9 (a) Any hospital licensed under this Act or any hospital
10 organized under the University of Illinois Hospital Act
11 shall, prior to the granting of any medical staff privileges
12 to an applicant, or renewing a current medical staff member's
13 privileges, request of the Director of Professional
14 Regulation information concerning the licensure status and
15 any disciplinary action taken against the applicant's or
16 medical staff member's license, except for medical personnel
17 who enter a hospital to obtain organs and tissues for
18 transplant from a deceased donor in accordance with the
19 Uniform Anatomical Gift Act. The Director of Professional
20 Regulation shall transmit, in writing and in a timely
21 fashion, such information regarding the license of the
22 applicant or the medical staff member, including the record
23 of imposition of any periods of supervision or monitoring as
24 a result of alcohol or substance abuse, as provided by
25 Section 23 of the Medical Practice Act of 1987, and such
26 information as may have been submitted to the Department
27 indicating that the application or medical staff member has
28 been denied, or has surrendered, medical staff privileges at
29 a hospital licensed under this Act, or any equivalent
30 facility in another state or territory of the United States.
31 The Director of Professional Regulation shall define by rule
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1 the period for timely response to such requests.
2 No transmittal of information by the Director of
3 Professional Regulation, under this Section shall be to other
4 than the president, chief operating officer, chief
5 administrative officer, or chief of the medical staff of a
6 hospital licensed under this Act, a hospital organized under
7 the University of Illinois Hospital Act, or a hospital
8 operated by the United States, or any of its
9 instrumentalities. The information so transmitted shall be
10 afforded the same status as is information concerning medical
11 studies by Part 21 of Article VIII of the Code of Civil
12 Procedure, as now or hereafter amended.
13 (b) All hospitals licensed under this Act, except county
14 hospitals as defined in subsection (c) of Section 15-1 of the
15 Illinois Public Aid Code, shall comply with, and the medical
16 staff bylaws of these hospitals shall include rules
17 consistent with, the provisions of this Section in granting,
18 limiting, renewing, or denying medical staff membership and
19 clinical staff privileges. Hospitals that require medical
20 staff members to possess faculty status with a specific
21 institution of higher education are not required to comply
22 with subsection (1) below when the physician does not possess
23 faculty status.
24 (1) Minimum procedures for pre-applicants and
25 applicants for medical staff membership shall include the
26 following:
27 (A) Written procedures relating to the
28 acceptance and processing of pre-applicants or
29 applicants for medical staff membership, which
30 should be contained in medical staff bylaws.
31 (B) Written procedures to be followed in
32 determining a pre-applicant's or an applicant's
33 qualifications for being granted medical staff
34 membership and privileges.
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1 (C) Written criteria to be followed in
2 evaluating a pre-applicant's or an applicant's
3 qualifications.
4 (D) An evaluation of a pre-applicant's or an
5 applicant's current health status and current
6 license status in Illinois.
7 (E) A written response to each pre-applicant
8 or applicant that explains the reason or reasons for
9 any adverse decision (including all reasons based in
10 whole or in part on the applicant's medical
11 qualifications or any other basis, including
12 economic factors).
13 (2) Minimum procedures with respect to medical
14 staff and clinical privilege determinations concerning
15 current members of the medical staff shall include the
16 following:
17 (A) A written notice of an adverse decision.
18 (B) An explanation of the reasons for an
19 adverse decision including all reasons based on the
20 quality of medical care or any other basis,
21 including economic factors.
22 (C) A statement of the medical staff member's
23 right to request a fair hearing on the adverse
24 decision before a hearing panel whose membership is
25 mutually agreed upon by the medical staff and the
26 hospital governing board. The hearing panel shall
27 have independent authority to recommend action to
28 the hospital governing board. Upon the request of
29 the medical staff member or the hospital governing
30 board, the hearing panel shall make findings
31 concerning the nature of each basis for any adverse
32 decision recommended to and accepted by the hospital
33 governing board.
34 (i) Nothing in this subparagraph (C)
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1 limits a hospital's or medical staff's right to
2 summarily suspend, without a prior hearing, a
3 person's medical staff membership or clinical
4 privileges if the continuation of practice of a
5 medical staff member constitutes an immediate
6 danger to the public, including patients,
7 visitors, and hospital employees and staff. A
8 fair hearing shall be commenced within 15 days
9 after the suspension and completed without
10 delay.
11 (ii) Nothing in this subparagraph (C)
12 limits a medical staff's right to permit, in
13 the medical staff bylaws, summary suspension of
14 membership or clinical privileges in designated
15 administrative circumstances as specifically
16 approved by the medical staff. This bylaw
17 provision must specifically describe both the
18 administrative circumstance that can result in
19 a summary suspension and the length of the
20 summary suspension. The opportunity for a fair
21 hearing is required for any administrative
22 summary suspension. Any requested hearing must
23 be commenced within 15 days after the summary
24 suspension and completed without delay. Adverse
25 decisions other than suspension or other
26 restrictions on the treatment or admission of
27 patients may be imposed summarily and without a
28 hearing under designated administrative
29 circumstances as specifically provided for in
30 the medical staff bylaws as approved by the
31 medical staff.
32 (iii) If a hospital exercises its option
33 to enter into an exclusive contract that is
34 limited under item (4) and that contract
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1 results in the total or partial termination or
2 reduction of medical staff membership or
3 clinical privileges of a current medical staff
4 member, the hospital shall provide the affected
5 medical staff member 60 days prior notice of
6 the effect on his or her medical staff
7 membership or privileges. An affected medical
8 staff member desiring a hearing under
9 subparagraph (C) of this paragraph (2) must
10 request the hearing within 14 days after the
11 date he or she is so notified. The requested
12 hearing shall be commenced and completed (with
13 a report and recommendation to the affected
14 medical staff member, hospital governing board,
15 and medical staff) within 30 days after the
16 date of the medical staff member's request. If
17 agreed upon by both the medical staff and the
18 hospital governing board, the medical staff
19 bylaws may provide for longer time periods.
20 (D) A statement of the member's right to
21 inspect all pertinent information in the hospital's
22 possession with respect to the decision.
23 (E) A statement of the member's right to
24 present witnesses and other evidence at the hearing
25 on the decision.
26 (F) A written notice and written explanation
27 of the decision resulting from the hearing.
28 (F-5) A written notice of a final adverse
29 decision by a hospital governing board.
30 (G) Notice given 15 days before implementation
31 of an adverse medical staff membership or clinical
32 privileges decision based substantially on economic
33 factors. This notice shall be given after the
34 medical staff member exhausts all applicable
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1 procedures under this Section, including item (iii)
2 of subparagraph (C) of this paragraph (2), and under
3 the medical staff bylaws in order to allow
4 sufficient time for the orderly provision of patient
5 care.
6 (H) Nothing in this paragraph (2) of this
7 subsection (b) limits a medical staff member's right
8 to waive, in writing, the rights provided in
9 subparagraphs (A) through (G) of this paragraph (2)
10 of this subsection (b) upon being granted the
11 written exclusive right to provide particular
12 services at a hospital, either individually or as a
13 member of a group. If an exclusive contract is
14 signed by a representative of a group of physicians,
15 a waiver contained in the contract shall apply to
16 all members of the group unless stated otherwise in
17 the contract.
18 (3) Every adverse medical staff membership and
19 clinical privilege decision based substantially on
20 economic factors shall be reported to the Hospital
21 Licensing Board before the decision takes effect. These
22 reports shall not be disclosed in any form that reveals
23 the identity of any hospital or physician. These reports
24 shall be utilized to study the effects that hospital
25 medical staff membership and clinical privilege decisions
26 based upon economic factors have on access to care and
27 the availability of physician services. The Hospital
28 Licensing Board shall submit an initial study to the
29 Governor and the General Assembly by January 1, 1996, and
30 subsequent reports shall be submitted periodically
31 thereafter.
32 (4) No person shall participate in offering or
33 making an exclusive contract for hospital services of a
34 physician licensed to practice medicine in all its
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1 branches. For purposes of this Section, "licensed
2 physician" means a physician licensed to practice
3 medicine in all its branches who practices other than
4 emergency medicine, neonatology, pathology, radiology or
5 anesthesiology. No exclusive contract is permissible for
6 pain management services performed by a physician
7 licensed to practice medicine in all its branches,
8 including but not limited to physicians practicing
9 anesthesiology.
10 The hospital medical staff shall be permitted to
11 review and make recommendations to the governing body
12 related to exclusive contract arrangements prior to any
13 decision being made in the following situations: (i) the
14 decision to execute an exclusive contract in a previously
15 open department service; (ii) the decision to initiate,
16 renew, or otherwise modify an exclusive contract in a
17 particular department or service; and (iii) the decision
18 to terminate an exclusive contract in a particular
19 department or service. In addition, prior to the
20 initiation or termination of an exclusive contract, a
21 fair hearing, as defined by the medical staff and
22 hospital under item (C) of paragraph (2) of subsection
23 (b) of this Section, shall be held to permit interested
24 parties to express their views on the hospital's proposed
25 action.
26 This item (4) shall apply only to relationships
27 entered into or renewed on or after January 1, 2000.
28 A violation of this item (4) shall be a petty
29 offense punishable by a fine of up to $1,000 for the
30 first violation and a business offense punishable by a
31 fine of up to $5,000 for a second or subsequent
32 violation.
33 Any person aggrieved by a violation of this item (4)
34 or of a rule promulgated hereunder shall have a right of
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1 action in the circuit court and may recover for each
2 violation (i) against any person who negligently violates
3 this item (4) or the regulations promulgated hereunder,
4 liquidated damages of $1,000 or actual damages, whichever
5 is greater; (ii) against any person who intentionally or
6 recklessly violates a provision of this item (4) or the
7 regulations promulgated hereunder, liquidated damages of
8 $2,500 or actual damages, whichever is greater, and
9 liquidated damages of $5,000 or actual damages, whichever
10 is greater, for subsequent violations; (iii) reasonable
11 attorney fees; and (iv) such other relief, including an
12 injunction or reinstatement of medical staff membership
13 or clinical privileges, as the court may deem
14 appropriate.
15 (5) (4) As used in this Section:
16 "Adverse decision" means a decision reducing,
17 restricting, suspending, revoking, denying, or not
18 renewing medical staff membership or clinical privileges.
19 "Economic factor" means any information or reasons
20 for decisions unrelated to quality of care or
21 professional competency.
22 "Pre-applicant" means a physician licensed to
23 practice medicine in all its branches who requests an
24 application for medical staff membership or privileges.
25 "Privilege" means permission to provide medical or
26 other patient care services and permission to use
27 hospital resources, including equipment, facilities and
28 personnel that are necessary to effectively provide
29 medical or other patient care services. This definition
30 shall not be construed to require a hospital to acquire
31 additional equipment, facilities, or personnel to
32 accommodate the granting of privileges.
33 (5) Any amendment to medical staff bylaws required
34 because of this amendatory Act of the 91st General
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1 Assembly shall be adopted on or before July 1, 2001.
2 (c) All hospitals shall consult with the medical staff
3 prior to closing membership in the entire or any portion of
4 the medical staff or a department. If the hospital closes
5 membership in the medical staff, any portion of the medical
6 staff, or the department over the objections of the medical
7 staff, then the hospital shall provide a detailed written
8 explanation for the decision to the medical staff 10 days
9 prior to the effective date of any closure. No applications
10 need to be provided when membership in the medical staff or
11 any relevant portion of the medical staff is closed.
12 (Source: P.A. 90-14, eff. 7-1-97; 90-149, eff. 1-1-98;
13 90-655, eff. 7-30-98; 91-166, eff. 1-1-00.)
14 Section 10. The Medical Practice Act of 1987 is amended
15 by adding Section 53.6 as follows:
16 (225 ILCS 60/53.6 new)
17 Sec. 53.6. Limitation on exclusive contracts.
18 (a) For purposes of this Section, "licensed physician"
19 means a physician licensed to practice medicine in all its
20 branches practicing other than emergency medicine,
21 neonatology, pathology, radiology or anesthesiology.
22 (b) No person shall participate in offering or making an
23 exclusive contract for hospital services of a physician
24 licensed to practice medicine in all its branches. No
25 exclusive contract is permissible for pain management
26 services performed by a physician licensed to practice
27 medicine in all its branches, including but not limited to
28 physicians practicing anesthesiology.
29 (c) This Section shall apply only to relationships
30 entered into or renewed on or after January 1, 2000.
31 (d) A violation of this Section shall be a petty offense
32 punishable by a fine of up to $1,000 for the first violation
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1 and a business offense punishable by a fine of up to $5,000
2 for a second or subsequent violation.
3 (e) Any person aggrieved by a violation of this Section
4 or of a rule promulgated hereunder shall have a right of
5 action in the circuit court and may recover for each
6 violation:
7 (1) against any person who negligently violates
8 this Section or the regulations promulgated hereunder,
9 liquidated damages of $1,000 or actual damages, whichever
10 is greater;
11 (2) against any person who intentionally or
12 recklessly violates this Section or the regulations
13 promulgated hereunder, liquidated damages of $2,500 or
14 actual damages, whichever is greater, and liquidated
15 damages of $5,000 or actual damages, whichever is
16 greater, for subsequent violations;
17 (3) reasonable attorney fees; and
18 (4) such other relief, including an injunction or
19 reinstatement of medical staff membership or clinical
20 privileges, as the court may deem appropriate.
21 Section 99. Effective date. This Act takes effect upon
22 becoming law.