Attorney General’s Office Issues Opinion on the Definition of “Effective Date” as Used in Business and Professions Code Section 805

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At the request of the Medical Board of California, on April 17, 2020, the Office of the Attorney General issued California Opinion of the Attorney General No. 15-301 (“Opinion”), to formally address the meaning of the term “effective date” in Business and Professions Code section 805. 805 reports are the potentially career-changing reports filed with the Medical Board when corrective action is taken by a peer review body such as a hospital’s medical staff or a medical group to restrict or terminate a physician’s clinical privileges or employment for medical disciplinary cause or reason. The timing of 805 reports are critical as the report prompts a required investigation by the Medical Board of California and the potential negative licensure consequences that may follow.

Business and Professions Code section 805(b) reads:

The chief of staff of a medical or professional staff or other chief executive officer, medical director, or administrator of any peer review body and the chief executive officer or administrator of any licensed healthcare facility or clinic shall file an 805 report with the relevant agency within 15 days after the effective date on which any of the following occur as a result of an action of a peer review body:

(1) A licentiate’s application for staff privileges or membership is denied or rejected for a medical disciplinary cause or reason.

(2) A licentiate’s membership, staff privileges, or employment is terminated or revoked for a medical disciplinary cause or reason.

(3) Restrictions are imposed, or voluntarily accepted, on staff privileges, membership, or employment for a cumulative total of 30 days or more for any 12-month period, for a medical disciplinary cause or reason.

Section 805(b) (emphasis added).

The Opinion identified the potential conflict in interpretations prompting the Medical Board’s request: “We are asked about the meaning of the phrase 'effective date,' particularly whether it refers to the date of the peer review body’s initial decision, or instead to the resolution of the body’s appeal process in the event the licentiate appeals that initial decision.” (AG Op., page 3, emphasis added).

The Attorney General concludes, in what has generally if not universally been agreed to be the case for years, that the term “effective date,” as used in Business and Professions Code section 805, means the date on which the triggering decision becomes final, following the conclusion of any appeal by the licentiate to the peer review body, except where expressly provided otherwise.”

The Attorney General’s conclusion on when the 805 report must be filed closely aligns with the corresponding language in Section 809, which outlines the statutorily mandated features of a peer review appeal hearing. The section 809 statutorily-mandated peer review appeal process provides the subject physician the opportunity to contest the recommended action of the peer review body before the action becomes final and an 805 report must be filed. Given the extreme length of some of these peer review fair procedure hearings, months or even years may pass between the peer review body’s final recommendation and the conclusion of the hearing and filing of the 805 report.

Attorney General’s Straightforward Analysis

The Attorney General’s analysis relies on the common statutory interpretation tools of “plain and ordinary meaning” and “[looking at] the context of the statutory framework as a whole.” According to the Opinion, the “effective date” clearly means when the action becomes final, takes effect and becomes enforceable. In its contextual review, the analysis also spends a great deal of time elaborating on other areas of the same statute where reporting is explicitly expressed to be due before the peer review appeal takes place. These are the “except where expressly provided otherwise” situations, which include Summary Suspensions (Section 805(e)) –where the report must be filed within 15 days of the “imposition of” the summary suspension “if the summary suspension remains in place for a period in excess of 14 days,” and Recommendations for Discipline in any of four high-priority areas for the Medical Board covered by Section 805.01(b)1.

Medical Board Will Utilize Opinion to Enforce Compliance with 805 Reporting

The Medical Board has made concerted efforts over the past several years to ensure 805 reporting is done on an accurate and timely basis. The Medical Board has advocated for legislative changes to increase the penalties for failure to report as required by section 805. The Medical Board can impose a fine of up to $50,000 for negligent failure to make an 805 report (see section 805(l)) and up to $100,000 for a willful failure to report (see 805(k)). In addition, willful failures to report can subject the mandated reporter to license discipline, “A violation of this subdivision may constitute unprofessional conduct by the licentiate [mandated reporter].”(§805(k)).

The Medical Board has prosecuted a number of actions against chiefs of medical staffs for failing to make 805 reports, either altogether or on a timely basis. This Attorney General’s Opinion will be helpful for the Medical Board in eliminating contentions by non-reporting chiefs of staff that there was ambiguity as to when the 805 statute requires reporting.

 

1Section 805.01(b) requires a Chief of Staff or other designated reporter shall file a report with the Medical Board “within 15 days after a peer review body makes a final decision or recommendation regarding the disciplinary action…” where the conduct falls in one of four areas: (i) incompetence or gross negligence resulting in death or serious bodily injury; (ii) self-prescribing; (iii) excessive prescribing ; and (iv) sexual misconduct with a patient.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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