It’s not often that we get to blog about a new area of federal preemption, but we do so today.  This isn’t a big area, otherwise we would have known about it before, but it is pertinent to drug and medical device product liability litigation to the extent that it affects our client’s customers – hospitals and prescribing physicians.  

We’re talking about a statute called the “Patient Safety and Quality Improvement Act” (“PSQIA”).  It was passed as part of HIPAA amendments in 2005 to create reporting systems for medical errors, so that such errors could be analyzed and the analysis used to prevent future medical errors.  That’s all well and good, but we know how plaintiffs’ lawyers are anytime anything adverse has to be reported – and, more importantly, so did Congress.  Just as FDA adverse event reporting is protected, 21 U.S.C. §360i(b)(3) (reports inadmissible); 21 C.F.R. §20.63(f)(2) (discovery of reports preempted), so too is peer review reporting under the PSQIA.

This information – data generated by reporting and analysis of medical errors – is called “patient safety work product” (“PSWP”).  The PSQIA provides that it is privileged and confidential:

(a) Privilege

Notwithstanding any other provision of Federal, State, or local law . . ., patient safety work product shall be privileged and shall not be. . . .

(2) subject to discovery in connection with a Federal, State, or local civil, criminal, or administrative proceeding. . .;

(3) subject to disclosure pursuant to section . . . the Freedom of Information Act[] or any other similar Federal, State, or local law;

(4) admitted as evidence in any Federal, State, or local governmental civil proceeding . . . .

(b) Confidentiality of patient safety work product

Notwithstanding any other provision of Federal, State, or local law, and subject to subsection (c) of this section, patient safety work product shall be confidential and shall not be disclosed.

42 U.S.C. §299b-22(a-b).  Just about every state has some form of peer review privilege, and now PSQIA provides a uniform federal overlay to those state-created protections.

We hasten to point out that this privilege was created by Congress in the face of precedent holding that a similar prior statute − the Health Care Quality Improvement Act of 1986 (42 U.S.C. §§11101, et seq.) did not preempt state-law discovery of peer review material.  See discussion in Lee Memorial Health System. v. Guillermo, 2011 WL 5826672, at *6 (M.D. Fla. Nov. 18, 2011) (citing this precedent while abstaining on PSQIA preemption).  To the extent that “Congress spoke loudly with its silence” about peer review privilege in the 1986 act, Teasdale v. Marin General Hospital, 138 F.R.D. 691, 694 (N.D. Cal. 1991), its language speaks even more loudly in support of preemption of state discovery under the PSQIA.  See KD v. United States, 715 F. Supp. 2d 587, 595 (D. Del. 2010) (1986 act “no longer represents Congress’ final word on the issue of medical peer review”).

In Southern Baptist Hospital, Inc. v. Charles, ___ So.3d___, 2015 WL 6499139 (Fla. App. Oct. 28, 2015), the court recently held that Florida discovery directed against a hospital patient safety organization established under the PSQIA was preempted.  The plaintiffs in Charles demanded documents relating to all “adverse medical incidents” reported by or to the defendant hospital for three years before the particular claimed injury “related to any physician who worked for [there] or arose from care and treatment rendered [at the hospital during the three-year period.”  Id. at *2.  The court found both express and implied preemption – express because reports made pursuant to the PSQIA are “not subject to disclosure in various ways including discovery,” and implied “because compliance with both federal and state law would be impossible.  That is, documents that meet the definition of PSWP under the Act are categorically protected and excluded from production.”  Id. at *6.

The main argument that plaintiffs advanced in Charles was that the documents were “dual purpose” – not prepared exclusively for PSQIA submission purposes.  The statutory language was not so limited, so Charles held that “the Act gives the provider the flexibility to collect and maintain its information in the manner it chooses” and “it is the provider who determines how information is stored and reported.”  Id. at *5.  The solution to any “gamesmanship” that such discretion might engender was not “to ‘rummage through’ the provider's PSE system,” but rather to enforce any non-PSQIA reporting requirements, which nobody claimed were violated in Charles.  Id.

A similar effort to limit the scope of the federal PSQIA privilege was rejected in Tibbs v. Bunnell, 448 S.W.3d 796 (Ky. 2014). Nothing in the statute confined the privilege to “self-examining analysis.”  Such a limitation:

failed to consider the full context . . . [and] we believe . . .[i]s misguided in its ultimate limitations on the scope of the privilege.  In fact, as the statutory language indicates, the privilege also extends to certain types of information and data underlying, supporting, or triggering such an analysis. 42 U.S.C.A. § 299b-21(7).  We therefore reverse . . . to the extent it limited the scope of the Act's privilege to documents containing a “self-examining analysis.”

Id. at 802.  However, because the particular report at issue inTibbs (which did not involve the kind of blanket discovery at issue in Charles) was “collected, maintained or developed separately . . . from a patient safety evaluation system,” within the meaning of §299b-21(7)(B)(ii), that particular document was ruled discoverable.  Tibbs, 448 S.W.3d at 809 (“while the incident information may be relevant to [the PSQIA], it is not, nor can it be, patient safety work product, since its collection, creation, maintenance, and utilization is mandated by the [state] as part of its regulatory oversight”).  See also SBAV LP v. Porter Bancorp, Inc., 2015 WL 1471020, at *8 (W.D. Ky. March 31, 2015) (“acknowledging the remarkably broad work product privilege that [the PSQIA] created”; finding no equivalent banking-related privilege).

A third appellate decision, out of Illinois, likewise upheld the assertion of PSQIA privilege against administrative subpoenas, holding that reports prepared for a pharmacist were not discoverable under the statute:

The [PSQIA] announces a more general approval of the medical peer review process and more sweeping evidentiary protections for materials used therein. . . .  [T]he purpose of the [PSQIA] is to encourage a culture of safety and quality in the United States health care system by providing for broad confidentiality and legal protections of information collected and reported voluntarily for the purposes of improving the quality of medical care and patient safety.  The [PSQIA] provides that “patient safety work product shall be privileged and shall not be . . . subject to discovery in connection with a Federal, State, or local civil, criminal, or administrative proceeding.” 42 U.S.C. §299b-22(a) (2006).  Patient safety work product includes any data, reports, records, memoranda, analyses, or written or oral statements that are assembled or developed by a provider for reporting to a patient safety organization and are reported to a patient safety organization.  42 U.S.C. §299b-21(7) (2006).

Dept. of Financial & Professional Regulation v. Walgreen Co., 970 N.E.2d 552, 557 (Ill. App. 2012) (citations and quotation marks omitted).  Documents not prepared for any other reporting system were not exempt from the statutory preclusion of discovery, and thus the subpoenas could were unenforceable.  Id.at 558. See Francis v. United States, 2011 WL 2224509, at *6 (S.D.N.Y. May 31, 2011) (“recognizing a medical peer review privilege in a FTCA action” in light of PSQIA); KD, 715 F. Supp.2d at 596-97 (same with respect to boards governing a hospital’s participation in clinical trials).

These more recent state appellate cases – state courts ordinarily being less inclined to find preemption than federal cases – reject the more crabbed reading given the PSQIA in a non-tort case decided by a federal district court shortly after the statute’s enactment.  Cf. Schlegel v. Kaiser Foundation Health Plan, 2008 WL 4570619, at *3 (E.D. Cal. Oct. 14, 2008) (PSQIA “carves out a narrow peer review privilege for work product prepared by a patient safety organization or prepared for, and reported to, a patient safety organization”).

Our clients are frequently in litigation where hospitals and other entities that participate in peer review activities protected by PQSIA are parties.  Since we often see blanket discovery requests for all reports involving adverse events associated with this, or that, prescription medical product, it is important that the privileges created by PQSIA – and those supported by it, as inFrancis and KD – be enforced, even if our clients aren’t the ones directly doing the enforcing.  The more litigants who are aware of the limits on discovery provided by PQSIA, the better.