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California Supreme Court:
MICRA Cap on Damages Applies to Physician Assistants
Justices Approve Slashing of Noneconomic Damages in Wrongful Death Case From $4.25 Million
To $250,000; Liu Says There’s No Exception Based on Lack of Supervision by Doctor
By a MetNews Staff Writer
The California Supreme Court held yesterday that the $250,000 lid on noneconomic damages applies in medical malpractice actions where services are negligently performed by a physician assistants who are subject to minimal or no supervision, validating the action of a Los Angeles Superior Court judge who reduced a $4.25 million award to the statutory maximum.
Left open by the opinion is that a different result might be reached if an update-to-date version of a Business & Professions Code section were applied rather than the version applicable in the case at bar.
Judge Lawrence P. Riff’s slashing of damages occurred in a wrongful death case. Suzanne Freesemann and Brian Hughes, who were “physician assistants”—a position created by the Physician Assistant’s Practice Act (“PAPA”) of 1975—were blamed for the death of a 4-year-old girl whose malignant melanoma was not detected by them.
Supervising Physician Designated
Their services were provided to California Dermatology Center, Inc. under a delegation of services agreement (“DSA”) which designated Dr. Glenn Ledesma, a Beverly Hills dermatologist, as the supervising physician. The problem was that he did not provide meaningful supervision.
That, plaintiff Marisol Lopez contended, takes the case outside the ambit of the Medical Injury Compensation Reform Act (“MICRA”) of 1975, which created the ceiling on damages contained in Civil Code §3333.2(b). She pointed out that under §3333.2(c)(2), the ceiling applies to medical services “provided that such services are within the scope of services for which the provider is licensed and which are not within any restriction imposed by the licensing agency or licensed hospital.”
Treating her daughter was not within the scope of the physician assistants’ licenses, Lopez argued, because they were confined to providing treatment under supervision.
Liu’s Opinion
Writing for a unanimous court, Justice Goodwin H. Liu declared:
“We hold that a physician assistant practices within the scope of his or her license for purposes of MICRA’s cap on noneconomic damages when the physician assistant acts as the agent of a licensed physician, performs the type of services authorized by that agency relationship, and does not engage in an area of practice prohibited by the PAPA.”
He explained:
“The version of Business and Professions Code section 3501 that applies to this case defined ‘supervision’ to mean that a licensed physician ‘oversees the activities of, and accepts responsibility for, the services rendered by the physician assistant.’…This language suggests that a physician ‘supervis[es]’ a physician assistant when the physician undertakes legal responsibility for the physician assistant’s conduct. While that provision has recently been amended to additionally specify that supervision requires ‘[a]dherence to adequate supervision as agreed to in the practice agreement,’ the amended law is not before us today.”
Violation of Restrictions
Lopez also argued that the MICRA cap does not apply because the physician assistants’ services were performed in violation of a “restriction imposed by the licensing agency or licensed hospital.” Unsupervised treatment violates several state regulations, she pointed out.
Liu responded:
“If unprofessional conduct of the kind at issue here were all one sufficient to trigger the ‘within any restriction imposed by the licensing agency’ proviso in section § 3333.2, subdivision (c)(2), then medical malpractice plaintiffs could avoid MICRA’s damages cap by identifying one member of a health care team who violates a single regulation governing that team. That individual, and potentially the supervising physician under a theory of vicarious liability, would then be subject to unlimited liability for noneconomic damages.”
He continued:
“Allowing medical malpractice plaintiffs to avoid the MICRA cap in this way would be at odds with MICRA’s purpose to ‘control and reduce medical malpractice insurance costs by placing a predictable, uniform limit on a defendant’s liability for noneconomic damages.’…Neither the language of MICRA nor the legislative history provides any indication that the Legislature intended to enact such a broad exemption from the cap. We hold that a physician assistant does not render services ‘within [a] restriction imposed by the licensing agency’…simply by engaging in unprofessional conduct, such as the noncompliance with supervisory regulations at issue in this case.”
The jurist added that “the fact that Freesemann’s and Hughes’s conduct could give rise to professional discipline or criminal liability does not render MICRA inapplicable.”
Second Issue
The high court also granted review on the issue of whether a DSA had legal vitality where a supervising physician is disabled.
“On closer examination,” Liu said, “we decline to consider this issue, which was neither raised in the trial court nor timely raised in the Court of Appeal.”
The case is Lopez v. Ledesma, 2022 S.O.S. 790.
C.A. Opinions
Liu’s opinion affirms a March 24, 2020 decision by Div. Two of this district’s Court of Appeal. The majority opinion, authored by Presiding Justice Elwood Lui and joined in by Justice Victoria M. Chavez, says:
“In the absence of any clear legislative statement on the issue, we conclude that a physician assistant acts within the scope of his or her license for purposes of section 3333.2, subdivision (c)(2) if he or she has a legally enforceable agency agreement with a supervising physician, regardless of the quality of actual supervision.”
Justice Judith Ashmann-Gerst dissented, opining:
“The common sense understanding of Civil Code section 3333.2, subdivision (c)(2) is that MICRA applies only if the physician assistant is supervised. After all, acting autonomously is not within the scope of the services for which he or she was licensed…, and the applicable regulation imposes an obligation on physicians to ensure that physician assistants do not function autonomously.”
License Revoked
Not reflected by the court decisions is that Ledesma’s medical license was revoked by the Medical Board effective Aug. 31, 2015. The board adopted the proposed decision of Administrative Law Judge Stuart Waxman who wrote:
“The evidence evinced Respondent’s ongoing predilection for dishonesty in both his private and professional life. For many years, he operated his medical practice in defrauding insurance carriers with false records and bills, and his patients with promises that they would not be charged by Cal Derm for treatments not covered by their health insurance policies. For many years, he defrauded his disability insurance carriers with false statements that he was totally disabled and unable to do anything but visit his doctor, run errands and rest when, in fact, he was quite active and working in his regular occupation as a dermatologist and business owner. Such conduct bodes poorly for public protection.”
Based on the determination in California, the Office of Professional Medical Conduct of the New York State Department of Health on Aug. 14, 2017, revoked Ledesma’s medical license.
Ledesma and his adopted son were arrested in 2015. The Department of Insurance had determined that the two had garnered collected disability benefits totaling in excess of $1.8 million while continuing to work.
It was alleged that during the period from 2008-13, the doctor treated more than 2,900 patients while collecting $1,605,464 in disability benefits. A prosecution was apparently not pursued.
Ledesma on Feb. 4 declared bankruptcy under Chapter 7, claiming that he has no assets.
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