Former staff orthopedic surgeon had duty to notify hospital about fraud settlement, court rules


Warren, Ohio-based Trumbull Memorial Hospital was not out of line for terminating the staff privileges of Michael Jurenovich, DO, an orthopedic surgeon who did not notify the hospital that he'd settled a federal Medicare fraud suit, an Ohio appeals court ruled April 27. The decision affirmed an earlier trial court ruling.

In April 2016 — three months after Dr. Jurenovich's negotiated settlement — Trumbull Memorial Hospital immediately terminated him for bylaw violation upon learning about the settlement in a local newspaper article.

Section 3.3(k) of Trumbull Memorial Hospital's bylaws requires all medical staff members to notify the president and CEO within 14 days should they be subject to a final judgment or settlement alleging professional negligence or fraud.

Therefore, Dr. Jurenovich had an obligation to inform Trumbull Memorial Hospital that he settled a Medicare fraud action brought by the federal government, even though the August 2014 case was eventually settled and dismissed, the appeals court ruled.

Section 3.3(k) goes on to stipulate that "failure to provide any such notice … shall result in immediate loss of medical staff membership and clinical privileges." However, the affected provider may request that the failure to notify be excused for "good cause shown."

Dr. Jurenovich did make this request, saying he didn't know about the requirement to report his settlement, but the hospital determined that wasn't an adequate excuse.

Dr. Jurenovich sued Trumbull Memorial Hospital in December 2016, arguing that the hospital improperly terminated his staff privileges without conducting a full hearing, as he was entitled to under Article 8 of the bylaws.

Both the trial court and the appeals court determined that Section 3.3(k) took precedence over Article 8 because the former specifically applied to Dr. Jurenovich's situation. Article 8 "does not contain language stating that its hearing requirement applies to violations of Section 3.3(k)," the appeals court said in its ruling. "Therefore, the trial court did not err in granting summary judgment in the hospital's favor."

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