COA: liability precedent applies to hospitals and non-hospital medical providers

In a lawsuit over a missed areteriovenous fistula, the Indiana Court of Appeals has ruled the Indiana Supreme Court precedent which holds that a hospital can be held vicariously liable for the negligence of an independent-contractor physician also applies to a non-hospital facility.

Harold Arrendale sued Marion Open MRI and Alexander Boutselis, M.D., claiming they failed to diagnose and treat his fistula. Boutselis is an independent radiologist who worked on contract for the MRI facility.

In granting summary judgment to Marion Open MRI, the Allen Superior Court noted Sword v. NKC Hospitals, Inc., 714 N.E.2d 142 (Ind. 1999) was specifically about hospitals being liable for their contract employees. The ruling did not include any mention of non-hospital facilities.

“The consideration of expanding present law beyond the confines of a hospital is left to the wisdom of the Indiana appellate courts,” Allen Superior Judge Craig Bobay wrote.

In reversing the trial court and finding Sword does cover non-hospital facilities, the Court of Appeals also allowed its decision to be applied retroactively to Harold Arrendale v. American Imaging & MRI, LLC, a/k/a Marion Open MRI, 20A-CT-2184.

Arrendale argued in his appeal that Sword applied to non-hospitals because a patient receiving medical care “reasonably expects or believes” the health care professionals working there are employees or agents of the facilities.

In an amicus brief in support of Arrendale, the Indiana Trial Lawyers Association asserted there is no logical justification for holding hospitals are liable for independent contractors but non-hospital health care providers are not.

Both Marion Open MRI and the Defense Trial Counsel of Indiana maintained Sword should be limited to hospitals. They argued hospitals are full-service institutions that provide a range of services provided by employees and independent contractors and the patient would have no way of knowing whether their health care provider is an employee or an independent contractor.

The Court of Appeals cited what it described as the “highly persuasive” federal court ruling in Webster v. Center for Diagnostic Imaging, Inc., 1:16-cv-02677-JMS-DML, 2017 WL 3839377 (S.D. Ind. Aug. 31, 2017). There a patient sought to hold a diagnostic imaging center vicariously liable for the negligence of an independent-contractor radiologist and the district court held there are no meaningful differences between a hospital and a diagnostic imaging center under Sword.

Writing for the Court of Appeals, Judge Nancy Vaidik concluded, “In short, just as it is reasonable for a hospital patient to believe that doctors providing care in a hospital are employees or agents of the hospital, it is reasonable for a patient of a diagnostic imaging center to believe that the radiologists interpreting images for the center are employees or agents of the center, unless the center informs the patient to the contrary,” Judge Nancy Vaidik wrote.

Also, in a footnote, the appellate panel respectfully disagreed with the trial court’s belief that the lower courts have no role to play in the expansion of Indiana law. “As demonstrated by the court’s thorough twenty-five page order, trial courts are fully capable of contributing to the development of the law,” it wrote.