Description
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IHP 420 Milestone One Guidelines and Rubric
Overview
The final case study for this course will require you to analyze a court decision in which a hospital was found vicariously liable on a theory of apparent authority for professional malpractice in the form of negligence of an independent contractor. You will focus on facts pertaining to the medical standard of care, breach of care, and causation, and you will explain how they were applied to law. You will then use the facts of the case to identify an ethics issue and determine an ethical theory that would help provide a safe, quality healthcare experience for the patient. Next, you will apply a clinician–patient shared decision-making model to describe how the ethics issue could be resolved. You will also include a discussion about possible violations of the code of ethics in your given field. Lastly, you will augment or vary the facts of the case to create a hypothetical scenario that changes the outcome so that the hospital is no longer vicariously liable for professional malpractice in the form of negligence of an independent contractor.
For this milestone, you will start working on the case for the Final Project: Malpractice. Below you will find the name of the case you will investigate:
Popovich v. Allina Health System. https://law.justia.com/cases/minnesota/supreme-cou…
Prompt
In this milestone, you will complete part of your analysis of the malpractice case. Using this analysis of the case, you will address the facts pertaining to the medical standard of care, breach of care, and causation.
Specifically, the following critical elements must be addressed:
Introduction:
Summarize the selected case, including information on the stakeholders involved, the problem, and the time period in which the incident occurred.
Medical Malpractice Component: In this section, you will evaluate the case to address the legal components, the malpractice policies similar to this case, and the standard of care given to the patient and how it was breached. Then, you will draw connections to how this malpractice case impacted stakeholders and healthcare consumers outside of the case.
Explain the key legal components of the case, including the nature of the issue and the rules that applied.
Determine relevant malpractice policies in place for addressing the issues within the case.
Analyze the malpractice case for the standard of care provided to the victim. Be sure to apply what the law states about standard of care to support whether or not it was breached in the case.
Analyze how the malpractice case would impact healthcare consumers from different cultural backgrounds. For example, would this case have a similar impact on a person from a culture different from the one in the case? How could this incident change the views of these healthcare consumers toward the healthcare system?
Assess the malpractice case for accountability based on its severity. To what extent was the healthcare provider held accountable?
What to Submit
Your paper should be a 2 to 3 full page Microsoft Word document with double spacing, 12-point Times New Roman font, one-inch margins, and at least three sources cited in APA format.
Milestone One Rubric
Criteria Proficient (100%) Needs Improvement (70%) Not Evident (0%) Value
Introduction: Summarize Summarizes the case, including information on the stakeholders involved, the problem, and the time period of the incident that occurred Summarizes the case, but summary is cursory or illogical, contains inaccuracies, or does not include information on the stakeholders, the problem, or the time period of the incident Does not summarize the case 15
Medical Malpractice Component: Legal Components Explains the key legal components of the case, including the nature of the issue and the rules that applied Explains the key legal components of the case, but analysis is illogical, contains inaccuracies, or does not include the nature of the issue or the rules that applied Does not explain the key legal components of the case 15
Medical Malpractice Component: Malpractice Policies Determines relevant malpractice policies in place for addressing the issues within the case Determines malpractice policies, but response lacks detail, or the chosen policies are irrelevant or do not address the issues of the case Does not determine relevant malpractice policies in place for addressing the issues within the case 15
Medical Malpractice Component: Standard of Care Analyzes the malpractice case for the standard of care provided to the victim, and applies what the law states about standard of care to support whether or not it was breached in the case Analyzes the malpractice case for the standard of care provided to the victim, but does not apply what the law states about standard of care Does not analyze the malpractice case for the standard of care provided to the victim 15
Medical Malpractice Component: Cultural Backgrounds Analyzes how the malpractice case would impact healthcare consumers from different cultural backgrounds Analyzes how the malpractice case would impact healthcare consumers from different cultural backgrounds, but analysis is cursory or contains inaccuracies Does not analyze how the malpractice case would impact healthcare consumers from different cultural backgrounds 15
Medical Malpractice Component: Accountability Assesses the malpractice case for accountability based on its severity and explains the level of accountability the healthcare provider was held to Assesses the malpractice case for accountability based on its severity and explains the level of accountability the healthcare provider was held to, but explanation lacks detail or is illogical Does not assess the malpractice case for accountability based on its severity 15
Articulation of Response Submission has no major errors related to citations, grammar, spelling, syntax, or organization Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas 10
Total: 100%
Requirements: 2-3 Full Pages Times New Roman Size 12 Font Double-Spaced APA Format Excluding the Title and Reference Pages
Please provide an answer that is 100% original and do not copy the answer to this question from any other website since I am already well aware of this. I will be sure to check this.
Please be sure that the answer comes up with way less than 18% on Studypool’s internal plagiarism checker since anything above this is not acceptable according to Studypool’s standards. I will not accept answers that are above this standard.
No AI or Chatbot! I will be sure to check this.
Please be sure to include an introduction paragraph with a clear thesis statement in the last sentence of the introduction paragraph and a conclusion paragraph.
Please be sure to carefully follow the instructions.
No plagiarism & No Course Hero & No Chegg. The assignment will be checked for originality via the Turnitin plagiarism tool.
Please be sure to include at least one in-text citation for each body paragraph.
Please be sure to read, use, and cite the case provided in the link above. I also attached the same case as a pdf as well: https://law.justia.com/cases/minnesota/supreme-cou…
Unformatted Attachment Preview
STATE OF MINNESOTA
IN SUPREME COURT
A18-1987
Court of Appeals
Hudson, J.
Dissenting, Anderson, J., Gildea, C.J.
Took no part, Chutich, J.
Alla K. Popovich, as wife and Guardian
Ad Litem for Aleksandr M. Popovich, et al.,
Appellants,
vs.
Filed: July 29, 2020
Office of Appellate Courts
Allina Health System,
Respondent,
Emergency Physicians Professional Association, et al.,
Defendants.
________________________
Brandon E. Thompson, Colin F. Peterson, Ciresi Conlin LLP, Minneapolis, Minnesota, for
appellants.
Charles F. Webber, Nicholas J. Nelson, Faegre Drinker Biddle & Reath LLP, Minneapolis,
Minnesota, for respondent.
Patrick Stoneking, Robins Kaplan LLP, Minneapolis, Minnesota, for amicus curiae
Minnesota Association for Justice.
________________________
SYLLABUS
1.
A hospital may be vicariously liable on a theory of apparent authority for the
professional negligence of an independent contractor.
1
2.
A plaintiff states a vicarious liability claim against a hospital for the
professional negligence of an independent contractor in the hospital’s emergency room
based on a theory of apparent authority if (1) the hospital held itself out as a provider of
emergency medical care; and (2) the patient looked to the hospital, rather than a specific
doctor, for care and relied on the hospital to select the personnel to provide services.
Reversed and remanded.
OPINION
HUDSON, Justice.
This appeal involves a medical malpractice action brought against a hospital system
based on the alleged negligence of independent contractors involved in providing care for
a patient in the emergency rooms of two different hospitals owned by the hospital system.
At issue is whether a hospital can be held vicariously liable for the negligence of an
independent contractor based on the doctrine of apparent authority. The court of appeals
affirmed the dismissal of the medical malpractice action on the grounds that a hospital can
be vicariously liable for a physician’s negligence only if the physician is an employee of
the hospital. We reverse and remand.
FACTS
Appellant Alla Popovich brought this medical malpractice action as wife and
guardian ad litem for her husband, Aleksandr Popovich, alleging that her husband suffered
a stroke after receiving negligent medical care in the emergency rooms of two hospitals
owned and operated by respondent Allina Health System.
2
In the early morning hours of February 9, 2016, 38-year-old Aleksandr Popovich
went to the emergency room at Unity Hospital complaining of dizziness, loss of balance,
blurry vision, and trouble breathing. One of the physicians on duty ordered a computed
tomography (CT) scan of Mr. Popovich’s head, and a radiologist reviewed the scan. After
spending approximately 2 hours in Unity Hospital’s emergency department, Mr. Popovich
returned home shortly before 7:00 a.m.
Later that morning, Mr. Popovich had trouble breathing and became unresponsive.
An ambulance took him to the emergency room at Mercy Hospital, where he arrived at
11:16 a.m. A doctor working in the emergency room ordered a second CT scan of
Mr. Popovich’s head. A radiologist reviewed both the scan from Mr. Popovich’s first
emergency room visit at Unity Hospital and the second scan taken at Mercy Hospital. The
radiologist identified abnormalities in the scans and noted swelling in Mr. Popovich’s brain
that had increased since the first scan.
After more tests showed abnormalities in Mr. Popovich’s brain, he was transferred
to Abbott Northwestern Hospital for further care. He arrived at Abbott at 5:37 p.m., where
doctors diagnosed him with “dissection of the left proximal vertebral artery with
thrombus.” Mr. Popovich had suffered a stroke. The stroke left him with serious and
irreversible brain damage. He spent several weeks in the hospital followed by a month of
in-patient rehabilitation. He still cannot walk without great assistance, he has very little
use of his right arm and leg, and he has severe speech and cognitive impairments. He will
need therapy and nursing care for the rest of his life due to his permanent disability.
3
Allina owns and operates both of the hospitals where Mr. Popovich received
treatment on February 9, 2016, Unity Hospital and Mercy Hospital. The emergency room
doctors and radiologists involved in Mr. Popovich’s care, however, were not Allina
employees. The doctors working in the emergency rooms were employees of Emergency
Physicians Professional Association (EPPA), an entity that contracted with Allina to
provide doctors for emergency departments located within Allina-owned facilities. The
radiologists that reviewed images of Mr. Popovich’s brain were employees of Suburban
Radiologic Consultants (SRC), a separate entity with a contract to provide radiology
services to patients at Unity and Mercy Hospitals.
Alla Popovich1 sued Allina, EPPA, and the emergency room physicians for medical
malpractice in Hennepin County District Court. An amended complaint added a claim
against SRC based on the alleged negligence of its employee, the unnamed radiologist who
reviewed Mr. Popovich’s first CT scan at Unity Hospital. The amended complaint asserted
that if the emergency room doctors and the radiologist had recognized Mr. Popovich’s
stroke symptoms at an earlier point in the course of his treatment, he would not have
suffered catastrophic injuries.2
As against Allina, the amended complaint alleges that Mr. Popovich suffered a
stroke after receiving negligent care from the radiologist and two emergency room
physicians, and asserts that Allina is vicariously liable for their negligent acts and
1
We refer to Aleksandr Popovich as “Mr. Popovich” throughout. We refer to the
appellant in this case, his wife Alla, as “Popovich.”
2
The claims against the physicians, EPPA, and SRC are not at issue in this appeal.
4
omissions through the doctrine of apparent authority.
The amended complaint
acknowledges that the physicians were not employed by Allina.
Allina moved to dismiss the amended complaint for failure to state a claim upon
which relief can be granted under Minn. R. Civ. P. 12.02(e). Allina argued that the
amended complaint does not state a claim because Minnesota law bars a suit against a
hospital based on the negligence of independent contractors. The district court granted
Allina’s motion to dismiss, ruling that a hospital is not vicariously liable for the acts of
non-employees. The district court relied on the court of appeals’ decision in McElwain v.
Van Beek, 447 N.W.2d 442, 446 (Minn. App. 1989), rev. denied (Minn. Dec. 20, 1989),
which concluded that “a hospital can only be held vicariously liable for a physician’s acts
if the physician is an employee of the hospital.”
Popovich appealed. A divided court of appeals affirmed the dismissal of the claims
against Allina. Popovich v. Allina Health Sys., No. A18-1987, 2019 WL 3000755, at *1
(Minn. App. July 8, 2019). Like the district court, the majority held that the court of
appeals’ prior decision in McElwain forecloses the vicarious liability claims against Allina.
2019 WL 3000755, at *3. The dissent, however, concluded that the majority erred by
relying on McElwain, arguing that “Minnesota has never properly established any rule
categorically immunizing hospitals from vicarious liability premised on the tortfeasor’s
apparent authority to act for the institution.” Id. at *6 (Ross, J., dissenting). We granted
Popovich’s petition for review.
5
ANALYSIS
The merits of Popovich’s medical malpractice claims are not before us. Instead, the
task before us is two-fold. First, we must decide whether Popovich may bring a claim
against Allina to hold Allina vicariously liable for the medical malpractice of an
independent contractor based on a theory of apparent authority. If the answer to that
question is “yes,” we must determine the proper legal standard for apparent authority in
this context. We consider these issues in turn below.
I.
The question of whether hospitals should be exempt from vicarious liability where
a plaintiff seeks to hold a hospital responsible for the medical malpractice of an
independent contractor based on a theory of apparent authority is an issue of first
impression for our court.3 This is a question of law that we review de novo. See Gieseke
ex rel. Diversified Water Diversion, Inc. v. IDCA, Inc., 844 N.W.2d 210, 214 (Minn. 2014).
Popovich argues that the court of appeals’ decision in McElwain misinterpreted our
precedent, that Minnesota law implicitly recognizes vicarious tort liability premised on a
theory of apparent agency, and that there should be no categorical exemption for hospitals.
447 N.W.2d 442. Allina contends that the court of appeals’ decisions, both in McElwain
and in this case, represent a correct understanding of Minnesota law and that we should not
3
Characterizing this as “a pure question of public policy,” the dissent ignores
McElwain. Plainly this case raises public policy issues. But we granted Popovich’s
petition for review to clarify the law—and it is impossible to clarify the law without
discussing McElwain.
6
recognize apparent authority as a theory of vicarious liability as it applies to hospitals and
the negligence of medical personnel who are not hospital employees.
Before addressing the parties’ dispute over the court of appeals’ decision in
McElwain, we provide a brief review of our vicarious liability precedent. Minnesota
recognizes both respondeat superior and apparent authority as theories of vicarious
liability. Under the doctrine of respondeat superior, “an employer is vicariously liable for
the torts of an employee committed within the course and scope of employment.”
Schneider v. Buckman, 433 N.W.2d 98, 101 (Minn. 1988). A business or individual—a
principal—is vicariously liable under the doctrine of apparent authority4 where they hold
an agent out “as having authority” or “knowingly” permit the agent to act on their behalf,
and the agent is negligent. Hockemeyer v. Pooler, 130 N.W.2d 367, 375 (Minn. 1964).
The “proof of the agent’s apparent authority” is found in “the conduct of the principal, not
the agent.” Id.
We have previously held that respondeat superior applies to hospitals to impose
vicarious liability on hospitals for the negligence of employees, including physicians and
other medical personnel. See St. Paul-Mercury Indem. Co. v. St. Joseph’s Hosp., 4 N.W.2d
637, 638 (Minn. 1942) (“It is well established in this state that a hospital, private or
charitable, is liable to a patient for the torts of its employees under the doctrine of
respondeat superior.”). In St. Joseph’s Hospital, we explained that a hospital is vicariously
liable for the negligence of its employees where the hospital has control over the actions
4
Our prior decisions use the terms “apparent authority” and “apparent agency”
interchangeably.
7
of the employees. Id. If there is a break in the chain of control between employer and
employee, the hospital cannot be vicariously liable under the doctrine of respondeat
superior. Id. at 639 (holding that the hospital was not vicariously liable for the negligence
of its employees where a non-employee controlled their work at the time of the plaintiff’s
injury). We reaffirmed this rule of law with our decision in Moeller v. Hauser, 54 N.W.2d
639, 644–46 (Minn. 1952), holding a hospital vicariously liable for the negligence of an
employee where the negligence occurred in the course of the employee’s regular hospital
duties and there was no break in the chain of control.
Neither St. Joseph’s Hospital nor Moeller involved the issue of whether a hospital
was vicariously liable for the actions of a non-employee based on a theory of apparent
authority. Although the theories of respondeat superior and apparent authority are closely
related concepts within the law of agency, they are theoretically distinct.
Notably,
respondeat superior requires the element of control, while apparent authority does not.
Restatement (Second) of Agency § 2.03 cmt. a, c (Am. Law. Inst. 1958). Thus, a business
may be vicariously liable for the negligence of a non-employee even if the business does
not have control over the non-employee, as long as the business held the non-employee out
as having authority or knowingly permitted the non-employee to assume authority. See
Hockemeyer, 130 N.W.2d at 375; Restatement (Third) of Agency § 2.03 cmt. c (Am. Law.
Inst. 2006) (“Apparent authority holds a principal accountable for the results of third-party
beliefs about an actor’s authority to act as an agent when the belief is reasonable and is
traceable to a manifestation of the principal.”).
8
The court of appeals’ decision in McElwain overlooks this critical distinction
between theories of vicarious liability. The case concerned a hospital’s potential vicarious
liability for the alleged malpractice of a doctor working in the hospital’s emergency room
as an independent contractor. 447 N.W.2d at 446. The hospital argued that it could not be
vicariously liable under either a theory of apparent authority or respondeat superior because
the doctor was not a hospital employee, citing Moeller to support its argument in both
instances.
The court of appeals held in favor of the hospital, but did not specifically refer to
either respondeat superior or apparent authority in its decision, simply stating, “In
Minnesota, a hospital can only be held vicariously liable for a physician’s acts if the
physician is an employee of the hospital.” McElwain, 447 N.W.2d at 446 (citing Moeller,
54 N.W.2d at 645–46). The court of appeals conflated the two theories of vicarious
liability and cited Moeller for a holding we never made—that an employment relationship
between a hospital and physician is a necessary condition for vicarious liability.
McElwain’s reliance on Moeller as support for this proposition was therefore incorrect.
Allina argues that our statements about respondeat superior in St. Joseph’s Hospital
and Moeller “led naturally” to the rule created by McElwain because there can be no
liability where the hospital has no control in the absence of an employment relationship.
But this logic repeats the error of conflating the two theories of vicarious liability. Simply
put: control is irrelevant to whether there is vicarious liability based on apparent authority.5
5
The dissent credits Allina’s argument about “control,” asserting that we should
exempt hospitals from liability based on apparent authority because hospitals cannot
9
Allina also makes several policy arguments as to why hospitals should be exempt
from vicarious liability based on apparent authority. For example, Allina argues that
patients already have sufficient remedies for medical malpractice, such as direct actions
against physicians for negligence and direct actions against hospitals for negligent
credentialing. Allina also claims that the rule of law proposed by Popovich will increase
costs without an improvement in patient care.
The existence of other remedies does not justify granting a hospitals-only exemption
from the general rule of vicarious liability based on apparent authority. We have long
allowed plaintiffs to hold individuals and businesses vicariously liable for the acts and
control the acts of independent contractor physicians. Not only is the matter of control
irrelevant to apparent authority for the reasons already stated, we doubt the dissent’s claim
that hospitals are entirely powerless to affect the quality of care administered within their
facilities. For example, the dissent cites to an ethics manual stating that physicians’
foremost duty is to their patients. Physicians can continue to make specific treatment
decisions with respect to individual patients while adhering to a hospital’s policies
designed to avoid medical errors. The two are not mutually exclusive. The dissent’s claim
ignores the important difference between a general workplace policy and a specific
instruction to a medical professional about how to proceed in an individual case.
10
omissions of apparent agents,6 and have done so despite the existence of other remedies.7
Furthermore, the majority of courts considering the same issue have held that hospitals
may be vicariously liable for the negligence of independent contractors under a theory of
apparent authority.8 Allina cites no evidence from these jurisdictions to support its
6
See, e.g., Duluth Herald & News Tribune v. Plymouth Optical Co., 176 N.W.2d 552,
557 (Minn. 1970) (holding a franchisor vicariously liable to a newspaper company for
advertising services provided to a franchisee because the franchisee acted with apparent
authority in making the contract); McGee v. Breezy Point Estates, 166 N.W.2d 81, 89–90
(Minn. 1969) (holding sellers of real estate responsible for statements that their apparent
agent made to escrow agents); Burkel v. Pro-Vid-All Mills, Inc., 141 N.W.2d 143, 145
(Minn. 1966) (holding a feed company liable to pay the salary of a turkey salesman based
on the statements of the company’s apparent agent); Lindstrom v. Minn. Liquid Fertilizer
Co., 119 N.W.2d 855, 861–63 (Minn. 1963) (holding a fertilizer manufacturer and
distributor liable for a contract made by an apparent agent); Nehring v. Bast, 103 N.W.2d
368, 376 (Minn. 1960) (holding an insurance company liable for the negligence of an
apparent agent); Temple, Brissman & Co. v. Greater St. Paul Corp., 248 N.W. 819, 819−20
(Minn. 1933) (holding a property management company vicariously liable for a contract
executed on its behalf by an apparent agent); Jewison v. Dieudonne, 149 N.W. 20, 22–23
(Minn. 1914) (ruling in favor of a personal injury plaintiff where the plaintiff based his
claim on a theory of apparent authority to hold the former owner of a storefront vicariously
liable for injuries suffered on the premises); Larson v. Great N. Ry. Co., 133 N.W. 867,
868 (Minn. 1911) (holding a railroad company liable for the negligence of an apparent
agent).
7
For example, a tort claim based on a nondelegable duty theory may provide a
remedy in some cases for those injured by the negligence of independent contractors. See
Conover v. N. States Power Co., 313 N.W.2d 397, 404 (Minn. 1981) (“[A]n employer
should not be permitted to escape a direct duty of care for the personal safety of another by
delegating that responsibility to the independent contractor for the proper conduct of
certain types of work.”).
8
See Brown ex rel. Brown v. St. Vincent’s Hosp., 899 So. 2d 227, 235–36 (Ala. 2004);
Jackson v. Power, 743 P.2d 1376, 1381 (Alaska 1987); Barrett v. Samaritan Health Servs.,
735 P.2d 460, 467–68 (Ariz. Ct. App. 1987); Ermoian v. Desert Hosp., 61 Cal. Rptr. 3d
754, 780 (Cal. Ct. App. 2007); Cefaratti v. Aranow, 141 A.3d 752, 762–63 (Conn. 2016);
Vanaman v. Milford Mem’l Hosp., Inc., 272 A.2d 718, 722 (Del. 1970); Godwin v. Univ.
of S. Fla. Bd. of Trs., 203 So. 3d 924, 929 (Fla. Dist. Ct. App. 2016); Jones v. HealthSouth
Treasure Valley Hosp., 206 P.3d 473, 480 (Idaho 2009); Gilbert v. Sycamore Mun. Hosp.,
11
argument that failing to exempt hospitals from apparent authority as a theory of vicarious
liability will have deleterious effects on hospital systems.9 Hospitals have a variety of
622 N.E.2d 788, 794 (Ill. 1993); Sword v. NKC Hosps., Inc., 714 N.E.2d 142, 147 (Ind.
1999); Wilkins v. Marshalltown Med. & Surgical Ctr., 758 N.W.2d 232, 236–37 (Iowa
2008); Paintsville Hosp. Co. v. Rose, 683 S.W.2d 255, 258 (Ky. 1985); Mehlman v. Powell,
378 A.2d 1121, 1123–24 (Md. 1977); Grewe v. Mt. Clemens Gen. Hosp., 273 N.W.2d 429,
433 (Mich. 1978); Hefner v. Dausmann, 996 S.W.2d 660, 666 (Mo. Ct. App. 1999); Butler
v. Domin, 15 P.3d 1189, 1196–97 (Mont. 2000); Renown Health, Inc. v. Vanderford,
235 P.3d 614, 618 (Nev. 2010); Dent v. Exeter Hosp., Inc., 931 A.2d 1203, 1210–11 (N.H.
2007); Basil v. Wolf, 935 A.2d 1154, 1172 (N.J. 2007); Zamora v. St. Vincent Hosp.,
335 P.3d 1243, 1248–49 (N.M. 2014); Hill v. St. Clare’s Hosp., 490 N.E.2d 823, 828–29
(N.Y. 1986); Diggs v. Novant Health, Inc., 628 S.E.2d 851, 858–61 (N.C. Ct. App. 2006);
Clark v. Southview Hosp. & Family Health Ctr., 628 N.E.2d 46, 53 (Ohio 1994); Roth v.
Mercy Health Ctr., Inc., 246 P.3d 1079, 1089–90 (Okla. 2011); Eads v. Borman, 277 P.3d
503, 514 (Or. 2012); Green v. Pa. Hosp., 123 A.3d 310, 317 (Pa. 2015); Rodrigues v.
Miriam Hosp., 623 A.2d 456, 461–62 (R.I. 1993); Boren ex rel. Boren v. Weeks,
251 S.W.3d 426, 436 (Tenn. 2008); Baptist Mem’l Hosp. Sys. v. Sampson, 969 S.W.2d 945,
949 (Tex. 1998); Mohr v. Grantham, 262 P.3d 490, 498 (Wash. 2011); Burless v. W. Va.
Univ. Hosps., Inc., 601 S.E.2d 85, 92–93 (W. Va. 2004); Pamperin v. Trinity Mem’l Hosp.,
423 N.W.2d 848, 855 (Wis. 1988); Sharsmith v. Hill, 764 P.2d 667, 672 (Wyo. 1988).
Exceptions to this pattern include Colorado and Virginia, where courts have not
allowed plaintiffs to hold hospitals vicariously liable for the acts of non-employees under
a theory of apparent agency. See Daly v. Aspen Ctr. for Women’s Health, Inc., 134 P.3d
450, 454–55 (Colo. App. 2005) (explaining that it is “unclear” whether Colorado courts
could allow the use of apparent authority to hold a hospital liable for the medical
malpractice of independent contractor physicians and continue to recognize the state’s
corporate practice of medicine doctrine); Sanchez v. Medicorp Health Sys., 618 S.E.2d 331,
335–36 (Va. 2005) (“The theory of apparent or ostensible agency . . . has never been used
in Virginia to impose vicarious liability on an employer for the negligent acts of an
independent contractor. In light of that fact, we are unwilling to apply that theory in order
to hold Medicorp vicariously liable for the alleged negligence of its independent
contractor . . . .”).
9
In fact, empirical evidence indicates that the number of malpractice suits and
settlements declined nationwide, despite the trend of courts holding that hospitals may be
vicariously liable for the negligence of independent contractors under a theory of apparent
authority. See Myungho Paik, Bernard Black & David A. Hyman, The Receding Tide of
Medical Malpractice Litigation: Part 1 – National Trends, 10 J. Empirical Legal Stud. 612,
624, 630 (2013) (reviewing national data on medical malpractice claims and finding that
both the number of paid claims and the number of claims filed decreased between 1992
12
methods to address these risks, should they arise. Hospitals can establish policies and
monitor the quality of care administered within their facilities.10 Hospitals can also allocate
risk through the agreements they have with the independent contractors providing care to
patients in the emergency room.11 In contrast, the typical emergency room patient has
significantly less bargaining power and little ability to predict or manage the risks of
negligent medical care.
Nor are we persuaded by the dissent’s argument that the regulation of hospitals
through state and federal laws means that hospitals should be exempt from vicarious
liability based on apparent authority. The same could be said of many industries. For
example, the food service industry is subject to a variety of health and safety regulations,
including licensing requirements and regular inspections. See, e.g., Minn. Stat. § 157.16
and 2012). While we share Allina’s concern about the many challenges facing hospital
systems, doctors, and patients in Minnesota, we are not convinced that those challenges
require us to grant hospitals a categorical exemption from liability based on a theory of
apparent authority.
10
See Barry R. Furrow, Enterprise Liability and Health Care Reform: Managing Care
and Managing Risk, 39 St. Louis U. L.J. 79, 109 (1994) (“The hospital is arguably in the
best position to monitor conduct within its walls, to enforce adherence to policies, and to
provide a source of compensation to injured patients.”).
11
See John Dwight Ingram, Liability of Medical Institutions for the Negligence of
Independent Contractors Practicing on Their Premises, 10 J. Contemp. Health L. & Pol’y
221, 229 (1994) (“Nonemployee physicians providing medical services in the hospital have
a contractual relationship with the hospital. As such, the parties are free to make any
agreement they wish between themselves. In addition to its common law right to
indemnification when held vicariously liable, the hospital can provide in its nonemployee
physician contracts that the physician will defend, indemnify and hold the hospital
harmless from all claims and liabilities resulting from the physician’s negligence.”
(footnotes omitted)).
13
(2018) (requiring “food and beverage service establishments” to apply for an annual
license); Minn. Stat. § 157.20 (2018) (providing for regular inspections of the same
establishments by the State Commissioner of Health); Minn. R. ch. 4626 (2019) (listing
hundreds of regulations for the food service industry). Nothing about such regulation
justifies an exemption from the doctrine of apparent authority.
There is also a strong public policy argument in favor of applying apparent authority
to hold hospitals vicariously liable for the negligence of independent contractors, as
Popovich correctly observes. We have long recognized that the doctrine of apparent
authority prevents businesses and individuals alike from placing “secret limitations” on
their “liability to third persons” for the acts or omissions of their agents. Lindstrom v.
Minn. Liquid Fertilizer Co., 119 N.W.2d 855, 862 (Minn. 1963).12
Here, Allina
acknowledges that many members of the public are unaware of the arrangements it has
with the physicians that provide services for the emergency rooms located within Allinaowned hospitals. It would be contrary to the fundamental purpose of the apparent authority
doctrine to allow hospital systems to escape vicarious liability for the negligence of
independent contractors working in emergency rooms through these little-known
contractual relationships, even as hospitals reap both reputational and financial benefits
12
The dissent takes issue with our citation to Lindstrom because the case did not
involve vicarious liability for medical malpractice. We cite Lindstrom not for its factual
similarity to this case, but for its explanation of the rationale underlying the doctrine of
apparent authority.
14
from operation of their emergency rooms.13 We therefore see no reason to grant to
hospitals a categorical exemption from vicarious liability based on apparent authority.
For these reasons, we hold that a plaintiff may assert a claim against a hospital to
hold the hospital vicariously liable for the negligence of a non-employee based on a theory
of apparent authority.14
II.
We turn next to the question of the appropriate legal standard for apparent authority
in a case involving a hospital and the alleged medical malpractice of non-employees
providing services to patients in the hospital’s emergency room. This is a question of law.
See Soderberg v. Anderson, 922 N.W.2d 200, 203 (Minn. 2019) (“The application or
extension of our common law is a question of law that we review de novo.”).
Apparent authority “is not actual authority; rather it is authority which the principal
holds the agent out as possessing or knowingly permits the agent to assume.” Tullis v.
Federated Mut. Ins. Co., 570 N.W.2d 309, 313 (Minn. 1997). Our precedent sets forth two
basic requirements for establishing a claim against a principal based on apparent authority.
13
See Elizabeth Isbey, Note, Diggs v. Novant Health, Inc. and the Emergence of
Hospital Liability for Negligent Independent-Contractor Physicians in North Carolina,
43 Wake Forest L. Rev. 1127, 1145 (2008) (“If the purpose of the hospital is truly to
provide complete care to the patient, allowing a hospital to be immune from suit for
physician negligence eviscerates the quality health care image it so often advertises.
Permitting a hospital to reap the benefits of physicians providing care in its facility while
escaping liability for its physicians’ wrongdoings is inequitable.”).
14
Accordingly, we abrogate the court of appeals’ decisions in McElwain, 447 N.W.2d
442, and Kramer v. St. Cloud Hospital, No. A11-1187, 2012 WL 360415 (Minn. App.
Feb. 6, 2012), rev. denied (Minn. Apr. 25, 2012), to the extent that they are inconsistent
with this holding.
15
The first is that the principal must have either “held the agent out as having authority” or
“knowingly permitted the agent to act on its behalf.” Hockemeyer, 130 N.W.2d at 375.
The second is “reliance,” meaning that the plaintiff was aware of these representations of
authority by the principal. See Foley v. Allard, 427 N.W.2d 647, 653 (Minn. 1988); Truck
Crane Serv. Co. v. Barr-Nelson, Inc., 329 N.W.2d 824, 826–27 (Minn. 1983).
The parties agree that apparent authority requires an element of reliance, but they
disagree on the applicable standard. Allina argues that a plaintiff must show actual reliance
to hold a hospital vicariously liable for the negligence of a non-employee under a theory
of apparent authority. Actual reliance, as explained by Allina, would mean that a plaintiff’s
claim fails unless the plaintiff can show that the patient would not have accepted care had
the patient known that the personnel in the emergency room were not actually agents or
employees of the hospital.15 Popovich contends that Allina’s position is inconsistent with
our precedent because we have never held a plaintiff to the type of actual reliance
advocated by Allina. We agree with Popovich.
Our precedent does not describe an actual reliance standard whereby a plaintiff must
show that certain actions would not have been taken but for the appearance of an agent’s
15
The dissent also advocates for an actual reliance standard. The dissent does not,
however, explain how our precedent supports the adoption of an actual reliance standard.
There simply is no ruling by this court—even in a contract case—where we have said that
a plaintiff must show actual reliance. Why should we require actual reliance in cases where
the defendant is a hospital when we don’t require it for any other type of business? And
while the dissent criticizes the reliance standard adopted herein as “subjective,” the same
criticism would apply to an actual reliance standard. A standard that requires plaintiffs to
show that they would have acted differently in a counterfactual world where they had more
information about the contractual relationship between hospital and doctor is not an
“objective” standard.
16
authority.16 That said, we have never addressed apparent authority in the context of
medical malpractice and the hospital emergency room. We find guidance, however, in the
decisions of other state supreme courts—in particular the Ohio Supreme Court’s rejection
of a “but for” reliance standard.
The Ohio Supreme Court initially adopted the type of “but for” reliance standard
that Allina asks us to apply here. Albain v. Flower Hosp., 553 N.E.2d 1038, 1049–50 (Ohio
1990). In Albain v. Flower Hospital, the court held that a hospital patient could not
establish reliance because the record did not show that the patient “would have refused”
care if she had known the doctor “was not an employee of the hospital.” Id. at 1050. Just
4 years later, the court reversed course. Clark v. Southview Hosp. & Family Health Ctr.,
628 N.E.2d 46, 53 (Ohio 1994). The court rejected the “but for” reliance standard adopted
in Albain because the standard “force[d] the emergency patient to demonstrate that she
would have chosen to risk further complications or death rather than be treated by a
physician of whose independence she had been unaware.” Clark, 628 N.E.2d at 50.
According to the court, that standard also imposed a burden on the emergency room patient
to “ascertain and understand the contractual arrangement between the hospital and treating
16
Indeed, no jurisdiction currently imposes a “but for” standard of reliance in the
emergency room context, although there are jurisdictions that require a showing of actual
or detrimental reliance. See Bain v. Colbert Cty. Nw. Ala. Health Care Auth., 233 So. 3d
945, 957 (Ala. 2017) (explaining that the plaintiff must show she “actually relied on the
appearance” that the doctor was an agent or employee of the hospital); Rodrigues v. Miriam
Hosp., 623 A.2d at 462 (“The patient must establish (1) that the hospital, or its agents, acted
in a manner that would lead a reasonable person to conclude that the physician was an
employee or agent of the hospital, (2) that the patient actually believed the physician was
an agent or a servant of the hospital, and (3) that the patient thereby relied to his detriment
upon the care and skill of the allegedly negligent physician.”).
17
physician, while simultaneous
