Cover Story
It's a Privilege
By Jan Greene
The Board’s Role in Physician Credentialing and Privileging
The world of doctors can be an intimidating place—their language is arcane, their internal politics intense, their importance to the hospital’s survival unquestioned. And so it can be easy for hospital trustees to allow the medical staff to practice with little or no oversight, with the medical executive committee deciding who should get privileges and sending the board a list to rubber-stamp each month.
But physician credentialing and privileging is one of those issues where legal liability—not to mention responsibility for quality of care—rests ultimately with the governing body of the hospital. Boards that fail to take an interest in this issue can be putting their organizations in legal peril, as courts increasingly make the hospital responsible when an incompetent medical professional harms a patient.
Even though the medical staff may have more scientific expertise to judge whether a given specialist is qualified to perform some new procedure, it’s still the board’s responsibility to ensure that the process for giving that physician privileges is sound and to work with the medical staff to set standards for all medical professionals who will work in the hospital. But many boards don’t fully understand that responsibility. For governance consultant Larry Walker, that’s reflected in the approach many boards take to credentialing and privileging as “just an agenda item.”
“It’s disconnected from the most important job of the board, which is to ensure patient care quality and safety,” says Walker, president of The Walker Company, Lake Oswego, Ore. At the same time, boards can get too involved in the process if, for example, they have had a bad experience in the past with a doctor who was a substance abuser or disruptive, and they had to terminate his or her privileges. “Boards don’t soon forget those kinds of things and to prevent them in the future, they may overreact,” Walker says. But instead of studying every detail of a physician’s application for privileges, he suggests that the board focus on its overall policy and strategy, establishing standards and processes to ensure high-quality patient care.
What are Credentialing and Privileging?
Essentially, credentialing consists of getting a doctor’s paperwork in order—verifying his identity and licensure, confirming references and reviewing his record on issues such as malpractice claims and performance reviews at previous jobs. The application process, often organized by hospital staff but ultimately resting with the medical staff executive committee, also includes a check of the National Practitioner Data Bank, which tracks physicians who have had their hospital privileges modified, suspended, revoked or otherwise “adversely affected.”
Privileges involve the right to provide specific types of medical care within the hospital. These may apply to a general category of care or for a specific procedure, and the medical staff and board work together to set criteria for these privileges.
The credentialing and privileging process is used not only for new applications, but also for physicians already working at the hospital who want to expand their privileges. Ongoing review of doctors’ work in the hospital is also a responsibility of the board and medical staff, which generally handles this through a peer review process. The peer review also handles complaints or concerns about a doctor whose privileges may need to be limited or revoked.
New Joint Commission Standards
In 2007, the Joint Commission set new standards for credentialing and privileging doctors in response to the more complex ways that physicians and quality of care are being assessed. “In the last decade with the patient safety issue, we have a more sophisticated understanding of what creates quality and safety. It’s the system,” not the individual, explains Paul Schyve, M.D., senior vice president of the Joint Commission. “Traditionally, people have thought that the quality and safety of care were dependent primarily on the individual physician’s competence and commitment,” he says, so that is what evaluations used to focus on. With the new standards, however, accreditors are recognizing that quality is also about how physicians work on a team, how well they communicate with colleagues and patients, and whether they understand a systems approach to safety.
Of course, it’s easier to find out whether a doctor has the proper licenses than to determine objectively whether he communicates well. Schyve says the commission recognizes that this is a new area of physician evaluation and that hospitals are just developing tools to quantify and evaluate these kinds of skills.
The board can make a difference by supporting the efforts of the hospital’s quality and information technology staff to improve the ways they collect and analyze data about physician performance. This might include analysis of doctors’ prescribing patterns or how well they follow practice guidelines.
The Joint Commission also wants to make the physician review process an ongoing responsibility rather than something that physicians undergo every two years, Schyve explains. “There was a realization that this needs to be seen as a more continuous process,” he says. “You can’t simply wait for two years if there are concerns being raised about an individual’s performance.” The Joint Commission has named this day-to-day monitoring process “ongoing professional practice evaluation.”
By contrast, when a new application or new privilege is being considered, or if there is a concern about someone’s privileges, a focused professional practice evaluation is conducted by the medical staff executive committee. The focused review could involve looking closely at the doctor’s records or actually observing his or her performance. The Commission also suggests that evaluations incorporate the experiences of other hospital staff with whom the doctor works, such as nurses.
Trustees and administrators might see these new, complex standards for evaluating physicians as potentially risky because doctors may more readily challenge hospital leaders—through appeals or lawsuits—if their privileges are restricted or denied. But Schyve sees a much bigger risk in failing to establish high standards and then having something go wrong. “The risk to the organization is really failing to take something into account,” he says. “Every time you hear a big brouhaha it’s because there’s a claim that somebody who harmed a patient hadn’t been adequately evaluated.” Besides, Schyve notes, data about prescribing patterns or interaction with nurses, for example, would simply be considered as part of an overall review, rather than a single issue on which a privileging decision hinged.
The commission wants privileging and renewal of physician privileges to be based on an assessment of six competencies as developed by the American Board of Medical Specialties and the Accreditation Council for Graduate Medical Education: patient care; medical/clinical knowledge; practice-based learning and improvement; interpersonal and communication skills; professionalism; and systems-based practice.
There can actually be a recruiting advantage in establishing strict criteria for those seeking privileges and certainly in establishing a fair and complete process for evaluating each applicant, Walker says. “Because [the process] is so leading edge in the way it’s carried out, it gives physicians great comfort knowing it’s not just a slam dunk getting on the medical staff,” he says. Walker believes physicians want to know they can rely on their colleagues and that they will be treated fairly in the process.
Problems with Credentialing
Given the stakes involved in hospital privileges—doctors’ reputations and patient safety are on the line—it’s not surprising that the process can become contentious at times. And while doctors and boards may have their conflicts, it’s actually more common that problems arise within the medical staff. A typical scenario involves two physicians from different specialties arguing over who should own the privileges to perform a particular procedure at a hospital.
Despite generally good relations among the medical staff, administration and trustees of Northern Berkshire Healthcare in North Adams, Mass., spats among the doctors occasionally erupt, affirms trustee Mary Fuqua. “[The board’s] role is to get [physicians] talking to each other and work it out,” explains Fuqua. “You have to understand the issues from both sets of physicians, and support a solution that is as good as possible for both sides. But our concern is good patient care and meeting community needs. We’ve never had a case our management could not help the physicians work through.”
There are times, though, when the hospital itself and physicians have a conflict. The most typical ones emerge over competition, such as when community physicians invest in outpatient surgery or imaging centers that compete with lucrative services the hospital already provides. Some hospitals take a hard line against doctors who want to maintain privileges but also benefit from a competing facility. The legal term for denying or restricting privileges is “economic credentialing,” a new application of the term for a relatively new scenario.
In some cases, hospital boards can head off such conflicts if they raise the issue of unmet community needs before physicians rush to fill a perceived hole or a weak spot in clinical services, Walker suggests. If the board promotes good communication with its physicians on a regular basis, it can have a discussion about financial opportunities and the potential for joint ventures or some other amicable arrangement.
“What a great opportunity for a board and its medical staff to work together to craft a local solution,” Walker says. “It could think through some of the dilemmas and scenarios and force a better understanding … of what’s best for the community and for patients and for the medical staff.”
Trustees should also be aware of how the board itself handles these issues. Questions about conflict of interest can be raised when members of the hospital’s medical staff who are also on the board get involved in privileging. Walker suggests that these board members treat the issue just like any other conflict of interest, recusing themselves only when there’s a direct conflict. However, he doesn’t see a need for physician trustees to step away from every privileging decision. “Physicians who serve at large on the board need to understand that they don’t represent physicians on the [hospital’s] medical staff—they are community members,” he explains.
All trustees need to avoid favoritism, Walker says. He’s seen many examples of board members who are friendly with a particular doctor whose privileges aren’t renewed, and the trustee tries to help. “Out of friendship, the trustee goes out of his or her way to influence the process,” he says. “It’s very damaging when they do that.”
Physicians are always concerned that privileging and peer review processes are fair because of the potential for internal politics and competition among specialties to influence these processes, notes Michael Cassidy, a Pittsburgh attorney who represents physicians. “There’s no doubt in my mind that I’ve had clients who’ve been victims of powerful interest groups or anti-competitive groups in hospitals,” Cassidy says. For this reason, trustees should be on the lookout for an unusually high number of peer review actions against doctors, or physicians appealing such actions in court. “If there were 10 peer review cases last year, you’d want to look at the situation and why they ended up in litigation,” he says.
What the Board Needs to Do
Hospital boards are all over the map in their attention to physician credentialing and privileging issues, Walker says. Awareness is key; boards should be careful not to use the rubber stamp. Instead, they should consider establishing a credentialing committee of their own or name a trustee to sit on a medical staff credentialing panel as a liaison.
Penny Brooke, a nurse and attorney from Salt Lake City, became the first chairperson of Intermountain Health Care’s new credentialing committee after she suggested a more thorough review of the issue. She first spent a few days in the records room reviewing the current medical staff files to ensure that the paperwork was all in order, and then her committee turned its focus to the approval process.
“Initially I was concerned that the medical staff would not much like a nurse being chair of a committee that was reviewing what the medical staff was doing,” Brooke says. “When they got to know me and saw how the committee was working, they saw it was a supportive group—not looking for problems, but maintaining the integrity and high standards we had going.” The system’s regional credentialing panel includes medical directors from the system’s four urban area hospitals and an equal number of nonphysician trustees.
Similarly, Northern Berkshire recently added a trustee liaison to its clinical practice committee, which deals with the peer review process. “It’s a new thing, and it’s a very important step in keeping both the board informed and [giving] the physicians a link to the board,” Fuqua says.
It’s appropriate to have that kind of board appointment to keep communication going, even if a trustee isn’t a voting member of the physician panel, which might not be appropriate since the peer review process is meant to be physicians overseeing themselves, Walker says. Trustees should also be reminded of the importance of confidentiality in these kinds of proceedings.
The American Hospital Association’s Center for Healthcare Governance recommends that a board member sit on the physician credentialing committee panel. “That way the board member can look at the process with a critical eye and ask questions about things that don’t resonate correctly,” suggests John Combes, M.D., president and chief operating officer of the Center. Once the medical staff has made its recommendations, it should provide the full board with more than a simple list of names, Combes recommends. “It should include the criteria used and how a particular candidate has fulfilled or not fulfilled those criteria,” he advises. “If you have a very large medical staff and it may be too much for the board, then ensure there’s a process [through which] they can review by exception [i.e., the problem cases].”
Additionally, boards should offer new members a review of its credentialing and privileging processes during their orientation, and the board should have a yearly refresher on its role. The board may also want to review its own bylaws and those of the medical staff regularly as medical care and quality measures evolve, to be sure the hospital is keeping up and that both sets of bylaws work together. Additionally, if the board is considering granting privileges for some new, highly technical medical procedure, it can always seek outside help from a consultant to evaluate the application, Schyve points out.
Overall, the principle is that trustees sit on the ultimate credentialing and privileging body for the hospital. “It really all boils down in the end to a quality issue,” Combes says. “That’s the touchstone for everything. As long as you stay focused on the quality issues, you’ll [make] good decisions.”
Jan Greene is a writer based in Alameda, Calif.
This article 1st appeared in the March 2008 issue of Trustee Magazine.
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