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92_HB3101 LRB9200933LBgcA 1 AN ACT regarding exclusive contracts for hospital 2 services. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Hospital Licensing Act is amended by 6 changing Section 10.4 and adding Section 10.5 as follows: 7 (210 ILCS 85/10.4) (from Ch. 111 1/2, par. 151.4) 8 Sec. 10.4. Medical staff privileges. 9 (a) Any hospital licensed under this Act or any hospital 10 organized under the University of Illinois Hospital Act 11 shall, prior to the granting of any medical staff privileges 12 to an applicant, or renewing a current medical staff member's 13 privileges, request of the Director of Professional 14 Regulation information concerning the licensure status and 15 any disciplinary action taken against the applicant's or 16 medical staff member's license, except for medical personnel 17 who enter a hospital to obtain organs and tissues for 18 transplant from a deceased donor in accordance with the 19 Uniform Anatomical Gift Act. The Director of Professional 20 Regulation shall transmit, in writing and in a timely 21 fashion, such information regarding the license of the 22 applicant or the medical staff member, including the record 23 of imposition of any periods of supervision or monitoring as 24 a result of alcohol or substance abuse, as provided by 25 Section 23 of the Medical Practice Act of 1987, and such 26 information as may have been submitted to the Department 27 indicating that the application or medical staff member has 28 been denied, or has surrendered, medical staff privileges at 29 a hospital licensed under this Act, or any equivalent 30 facility in another state or territory of the United States. 31 The Director of Professional Regulation shall define by rule -2- LRB9200933LBgcA 1 the period for timely response to such requests. 2 No transmittal of information by the Director of 3 Professional Regulation, under this Section shall be to other 4 than the president, chief operating officer, chief 5 administrative officer, or chief of the medical staff of a 6 hospital licensed under this Act, a hospital organized under 7 the University of Illinois Hospital Act, or a hospital 8 operated by the United States, or any of its 9 instrumentalities. The information so transmitted shall be 10 afforded the same status as is information concerning medical 11 studies by Part 21 of Article VIII of the Code of Civil 12 Procedure, as now or hereafter amended. 13 (b) All hospitals licensed under this Act, except county 14 hospitals as defined in subsection (c) of Section 15-1 of the 15 Illinois Public Aid Code, shall comply with, and the medical 16 staff bylaws of these hospitals shall include rules 17 consistent with, the provisions of this Section in granting, 18 limiting, renewing, or denying medical staff membership and 19 clinical staff privileges. Hospitals that require medical 20 staff members to possess faculty status with a specific 21 institution of higher education are not required to comply 22 with subsection (1) below when the physician does not possess 23 faculty status. 24 (1) Minimum procedures for pre-applicants and 25 applicants for medical staff membership shall include the 26 following: 27 (A) Written procedures relating to the 28 acceptance and processing of pre-applicants or 29 applicants for medical staff membership, which 30 should be contained in medical staff bylaws. 31 (B) Written procedures to be followed in 32 determining a pre-applicant's or an applicant's 33 qualifications for being granted medical staff 34 membership and privileges. -3- LRB9200933LBgcA 1 (C) Written criteria to be followed in 2 evaluating a pre-applicant's or an applicant's 3 qualifications. 4 (D) An evaluation of a pre-applicant's or an 5 applicant's current health status and current 6 license status in Illinois. 7 (E) A written response to each pre-applicant 8 or applicant that explains the reason or reasons for 9 any adverse decision (including all reasons based in 10 whole or in part on the applicant's medical 11 qualifications or any other basis, including 12 economic factors). 13 (2) Minimum procedures with respect to medical 14 staff and clinical privilege determinations concerning 15 current members of the medical staff shall include the 16 following: 17 (A) A written notice of an adverse decision. 18 (B) An explanation of the reasons for an 19 adverse decision including all reasons based on the 20 quality of medical care or any other basis, 21 including economic factors. 22 (C) A statement of the medical staff member's 23 right to request a fair hearing on the adverse 24 decision before a hearing panel whose membership is 25 mutually agreed upon by the medical staff and the 26 hospital governing board. The hearing panel shall 27 have independent authority to recommend action to 28 the hospital governing board. Upon the request of 29 the medical staff member or the hospital governing 30 board, the hearing panel shall make findings 31 concerning the nature of each basis for any adverse 32 decision recommended to and accepted by the hospital 33 governing board. 34 (i) Nothing in this subparagraph (C) -4- LRB9200933LBgcA 1 limits a hospital's or medical staff's right to 2 summarily suspend, without a prior hearing, a 3 person's medical staff membership or clinical 4 privileges if the continuation of practice of a 5 medical staff member constitutes an immediate 6 danger to the public, including patients, 7 visitors, and hospital employees and staff. A 8 fair hearing shall be commenced within 15 days 9 after the suspension and completed without 10 delay. 11 (ii) Nothing in this subparagraph (C) 12 limits a medical staff's right to permit, in 13 the medical staff bylaws, summary suspension of 14 membership or clinical privileges in designated 15 administrative circumstances as specifically 16 approved by the medical staff. This bylaw 17 provision must specifically describe both the 18 administrative circumstance that can result in 19 a summary suspension and the length of the 20 summary suspension. The opportunity for a fair 21 hearing is required for any administrative 22 summary suspension. Any requested hearing must 23 be commenced within 15 days after the summary 24 suspension and completed without delay. Adverse 25 decisions other than suspension or other 26 restrictions on the treatment or admission of 27 patients may be imposed summarily and without a 28 hearing under designated administrative 29 circumstances as specifically provided for in 30 the medical staff bylaws as approved by the 31 medical staff. 32 (iii) If a hospital exercises its option 33 to enter into an exclusive contract limited 34 under Section 10.5 and that contract results in -5- LRB9200933LBgcA 1 the total or partial termination or reduction 2 of medical staff membership or clinical 3 privileges of a current medical staff member, 4 the hospital shall provide the affected medical 5 staff member 60 days prior notice of the effect 6 on his or her medical staff membership or 7 privileges. An affected medical staff member 8 desiring a hearing under subparagraph (C) of 9 this paragraph (2) must request the hearing 10 within 14 days after the date he or she is so 11 notified. The requested hearing shall be 12 commenced and completed (with a report and 13 recommendation to the affected medical staff 14 member, hospital governing board, and medical 15 staff) within 30 days after the date of the 16 medical staff member's request. If agreed upon 17 by both the medical staff and the hospital 18 governing board, the medical staff bylaws may 19 provide for longer time periods. 20 (D) A statement of the member's right to 21 inspect all pertinent information in the hospital's 22 possession with respect to the decision. 23 (E) A statement of the member's right to 24 present witnesses and other evidence at the hearing 25 on the decision. 26 (F) A written notice and written explanation 27 of the decision resulting from the hearing. 28 (F-5) A written notice of a final adverse 29 decision by a hospital governing board. 30 (G) Notice given 15 days before implementation 31 of an adverse medical staff membership or clinical 32 privileges decision based substantially on economic 33 factors. This notice shall be given after the 34 medical staff member exhausts all applicable -6- LRB9200933LBgcA 1 procedures under this Section, including item (iii) 2 of subparagraph (C) of this paragraph (2), and under 3 the medical staff bylaws in order to allow 4 sufficient time for the orderly provision of patient 5 care. 6 (H) Nothing in this paragraph (2) of this 7 subsection (b) limits a medical staff member's right 8 to waive, in writing, the rights provided in 9 subparagraphs (A) through (G) of this paragraph (2) 10 of this subsection (b) upon being granted the 11 written exclusive right to provide particular 12 services at a hospital, either individually or as a 13 member of a group. If an exclusive contract is 14 signed by a representative of a group of physicians, 15 a waiver contained in the contract shall apply to 16 all members of the group unless stated otherwise in 17 the contract. 18 (3) Every adverse medical staff membership and 19 clinical privilege decision based substantially on 20 economic factors shall be reported to the Hospital 21 Licensing Board before the decision takes effect. These 22 reports shall not be disclosed in any form that reveals 23 the identity of any hospital or physician. These reports 24 shall be utilized to study the effects that hospital 25 medical staff membership and clinical privilege decisions 26 based upon economic factors have on access to care and 27 the availability of physician services. The Hospital 28 Licensing Board shall submit an initial study to the 29 Governor and the General Assembly by January 1, 1996, and 30 subsequent reports shall be submitted periodically 31 thereafter. 32 (4) As used in this Section: 33 "Adverse decision" means a decision reducing, 34 restricting, suspending, revoking, denying, or not -7- LRB9200933LBgcA 1 renewing medical staff membership or clinical privileges. 2 "Economic factor" means any information or reasons 3 for decisions unrelated to quality of care or 4 professional competency. 5 "Pre-applicant" means a physician licensed to 6 practice medicine in all its branches who requests an 7 application for medical staff membership or privileges. 8 "Privilege" means permission to provide medical or 9 other patient care services and permission to use 10 hospital resources, including equipment, facilities and 11 personnel that are necessary to effectively provide 12 medical or other patient care services. This definition 13 shall not be construed to require a hospital to acquire 14 additional equipment, facilities, or personnel to 15 accommodate the granting of privileges. 16 (5) Any amendment to medical staff bylaws required 17 because of this amendatory Act of the 91st General 18 Assembly shall be adopted on or before July 1, 2001. 19 (c) All hospitals shall consult with the medical staff 20 prior to closing membership in the entire or any portion of 21 the medical staff or a department. If the hospital closes 22 membership in the medical staff, any portion of the medical 23 staff, or the department over the objections of the medical 24 staff, then the hospital shall provide a detailed written 25 explanation for the decision to the medical staff 10 days 26 prior to the effective date of any closure. No applications 27 need to be provided when membership in the medical staff or 28 any relevant portion of the medical staff is closed. 29 (Source: P.A. 90-14, eff. 7-1-97; 90-149, eff. 1-1-98; 30 90-655, eff. 7-30-98; 91-166, eff. 1-1-00.) 31 (210 ILCS 85/10.5 new) 32 Sec. 10.5. Limitations on exclusive contracts. 33 (a) No person shall participate in offering or making an -8- LRB9200933LBgcA 1 exclusive contract for hospital services of a physician 2 licensed to practice medicine in all its branches practicing 3 other than emergency medicine, neonatology, pathology, 4 radiology, or anesthesiology. No exclusive contract is 5 permissible for pain management services performed by a 6 physician licensed to practice medicine in all its branches, 7 including but not limited to physicians practicing 8 anesthesiology. 9 (b) The hospital medical staff shall be permitted to 10 review and make recommendations to the governing body related 11 to exclusive contract arrangements prior to any of the 12 following decisions being made: 13 (1) the decision to execute an exclusive contract in 14 a previously open department service; 15 (2) the decision to initiate, renew, or otherwise 16 modify an exclusive contract in a particular department 17 or service; or 18 (3) the decision to terminate an exclusive contract 19 in a particular department or service. 20 In addition, prior to the initiation or termination of an 21 exclusive contract, a fair hearing, as defined by the medical 22 staff and hospital under item (C) of paragraph (2) of 23 subsection (b) of Section 10.4, shall be held to permit 24 interested parties to express their views on the hospital's 25 proposed action. 26 (c) This Section applies only to relationships entered 27 into or renewed on or after July 1, 2001. 28 (d) A violation of this Section is a business offense 29 punishable by a fine of up to $1,000 for the first violation 30 and $5,000 for a subsequent violation. 31 (e) A person aggrieved by a violation of this Section or 32 of a rule promulgated under this Section shall have a right 33 of action in circuit court and may recover the following for 34 each violation: -9- LRB9200933LBgcA 1 (1) against any person who negligently violates this 2 Section or the rules promulgated under this Section, 3 liquidated damages of $1,000 or actual damages, whichever 4 is greater; 5 (2) against any person who intentionally or 6 recklessly violates a provision of this Section or the 7 rules promulgated under this Section, liquidated damages 8 of $2,500 or actual damages, whichever is greater, for 9 the first violation and liquidated damages of $5,000 or 10 actual damages, whichever is greater, for subsequent 11 violations; 12 (3) reasonable attorney fees; and 13 (4) such other relief as the court may deem 14 appropriate, including an injunction or reinstatement of 15 medical staff membership or clinical privileges. 16 Section 10. The Medical Practice Act of 1987 is amended 17 by adding Section 53.6 as follows: 18 (225 ILCS 60/53.6 new) 19 Sec. 53.6. Limitation on exclusive contracts. 20 (a) No person shall participate in offering or making an 21 exclusive contract for hospital services of a physician 22 licensed to practice medicine in all its branches practicing 23 other than emergency medicine, neonatology, pathology, 24 radiology, or anesthesiology. No exclusive contract is 25 permissible for pain management services performed by a 26 physician licensed to practice medicine in all its branches, 27 including but not limited to physicians practicing 28 anesthesiology. 29 (b) This Section applies only to relationships entered 30 into or renewed on or after July 1, 2001. 31 (c) A violation of this Section is a business offense 32 punishable by a fine of up to $1,000 for the first violation -10- LRB9200933LBgcA 1 and $5,000 for a subsequent violation. 2 (d) A person aggrieved by a violation of this Section or 3 of a rule promulgated under this Section shall have a right 4 of action in circuit court and may recover the following for 5 each violation: 6 (1) against any person who negligently violates this 7 Section or the rules promulgated under this Section, 8 liquidated damages of $1,000 or actual damages, whichever 9 is greater; 10 (2) against any person who intentionally or 11 recklessly violates a provision of this Section or the 12 rules promulgated under this Section, liquidated damages 13 of $2,500 or actual damages, whichever is greater, for 14 the first violation and liquidated damages of $5,000 or 15 actual damages, whichever is greater, for subsequent 16 violations; 17 (3) reasonable attorney fees; and 18 (4) such other relief as the court may deem 19 appropriate, including an injunction or reinstatement of 20 medical staff membership or clinical privileges. 21 Section 99. Effective date. This Act takes effect upon 22 becoming law.
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