Many health care entities struggle with the dilemma of whether and when to make reports to the National Practitioner Data Bank (“NPDB”), particularly when the situations involve a physician or dentist who has voluntarily limited or otherwise ceased practicing at the hospital after quality of care or professionalism issues have arisen. In such instances, hospitals and their medical staffs must determine whether a practitioner had been “under investigation” at the time they voluntarily took a leave of absence, resigned, or otherwise restricted their clinical privileges. While the decision to report will always be fact dependent, hospitals must take into account statutory and regulatory requirements, the NPDB Guidebook, and relevant case law when deciding whether a there is a duty to report to the NPDB. 

Overview of NPDB Relevant Reporting Requirements 

The Health Care Quality Improvement Act (“HCQIA”) of 1986¹ established the NPDB in an effort to improve quality of care, encourage peer review, and to restrict physicians moving from state to state “without disclosure or discovery of the physician’s previous damaging or incompetent performance.”² HCQIA created mandatory reporting requirements for health care entities, sets standards governing professional review actions, and provides liability protection to health care entities that conform with the standards. To comply with federal law, hospitals and other health care entities with formal peer review processes must report certain adverse actions related to a physician or dentist’s³ professional competence or conduct to the NPDB. An adverse action is reportable if it adversely affects a practitioner’s clinical privileges or medical staff membership for more than 30 days.⁴ Actions that must be reported include reducing, restricting, suspending, revoking, or denying clinical privileges, or a decision not to renew a practitioner’s clinical privileges if that decision was based on the practitioner’s professional competence or professional conduct.⁵ Health care entities must also report to the NPDB if a physician or dentist surrenders or otherwise voluntarily restricts their clinical privileges while under investigation or in return for the health care entity not conducting or proceeding with such an investigation.⁶

Surrender or Restriction of Clinical Privileges While Under Investigation 

Investigations, in and of themselves, are not reportable. Rather, it is the decision by the physician or dentist to surrender, restrict, or resign their clinical privileges while under or to avoid an investigation that must be reported. What is considered a “surrender” or “restriction” can be much broader than a clear statement from a physician that they are resigning their clinical privileges and medical staff membership. For example, the NPDB considers the failure to renew an application for reappointment while under investigation to constitute a surrender of clinical privileges. The same applies to a voluntary decision to not exercise certain clinical privileges or to take a leave of absence after a summary suspension has been imposed that prompted an investigation.⁸ 

Regardless of the reason for surrender or restriction, a report must be filed if an investigation was open or ongoing at the time.⁹ For example, if a physician resigns from Hospital A because they decided to focus their practice at Hospital B, but an investigation by the Hospital A medical staff pertaining to unprofessional conduct remained ongoing at the time of the resignation, Hospital A must file a report with the NPDB.¹⁰ Similarly, if a physician voluntarily restricts their own privileges amidst an investigation about their clinical competency, a report must also be filed, even if the physician was not notified about the investigation.¹¹ Further, a leave of absence that restricts clinical privileges also must be reported as a surrender of clinical privileges if the physician was under investigation at the time they took the leave of absence.¹²

“Investigation” Is Broadly Construed 

While the NPDB statutes and implementing regulations do not define “investigation,” the NPDB Guidebook broadly describes what constitutes an “investigation.” The NPDB Guidebook states that an investigation runs “from the start of an inquiry [into a physician’s practice] until a final decision on a clinical privileges action” has been reached.¹³ Routine reviews applicable to all practitioners are not considered investigations; however, a formal, targeted process related to a specific practitioner’s professional competence or conduct is considered an investigation for the purposes of reporting to the NPDB.¹⁴ For example, the initial focused professional practice evaluation (“FPPE”) applicable to all practitioners granted new privileges does not equate to a “investigation,” whereas a “for cause FPPE” initiated by an ongoing professional practice evaluation does. Notably, an investigation is not limited to how a medical staff defines investigation in its bylaws or policies.¹⁵ Even if a medical staff indicates in its bylaws that an investigation has not been commenced unless the medical executive committee has commissioned an investigation and/or appointed an ad hoc investigating committee, if the physician resigns or take a leave of absence while subject to a targeted review by another committee (such as a credentials committee), the NPDB may still consider the resignation or leave to be reportable. 

Despite the broad expanse of what the NPDB considers an investigation, only investigations related to professional competence or conduct will lead to reporting obligations. In Long v. United States Dep’t of Health & Hum. Servs.,¹⁶ a physician challenged an NPDB report, alleging the underlying investigation did not pertain to his professional conduct or competence.¹⁷ The court disagreed, citing to evidence that the CEO discussed “serious concerns raised by [the medical staff] related to the significant disruption of hospital services,” and a letter from an ad hoc committee stating that the physician had conducted himself in a “confrontational manner” that caused disruptions and undermined the appropriate team approach to patient care.¹⁸ Further, the court found a communication that ordered the physician to undergo a psychological evaluation and the ad hoc committee’s recommendations for an external chart review as adequate evidence that the investigation had been related to the physician’s professional competence or conduct.¹⁹ 

The NPDB reporting requirements apply regardless of whether the practitioner knew of the initiation of an investigation or had mistakenly thought that an investigation had been completed.²⁰ In addition, the NPDB Guidebook provides that an investigation remains ongoing until the entity’s decision-making authority takes a final action or formally closes the investigation.²¹ Therefore, documentation of an investigation, including any final action or closure, can be a key factor in determining whether to report a resignation or restriction. 

In Doe v. Leavitt,²² a nurse filed a written complaint against a physician alleging the physician had threatened the nurse.²³ The following day, the medical staff executive committee temporarily suspended Dr. Doe’s privileges and appointed an adhoc committee to inquire into the nurse’s allegations, which determined the report had been credible.²⁴ The executive committee proposed that Dr. Doe be allowed to return to work if they agreed to regular proctoring and psychological evaluations.²⁵ The physician rejected the proposal and voluntarily relinquished their clinical privileges and the hospital accepted the physician’s resignation.²⁶ The physician challenged the NPDB report subsequently filed by the hospital, arguing that the investigation had ended when the ad hoc committee presented its report to the executive committee and, therefore, the physician did not resign while under investigation.²⁷ The Court of Appeal disagreed with the physician, finding that the investigation remained ongoing at the time the physician resigned, finding that an “investigation” ends only when a health care entity’s “decision-making authority either takes a final action or formally closes the investigation.”²⁸

Courts Give Deference to the NPDB Guidebook

Courts give great deference to the NPDB Guidebook when determining the meaning of the term “investigation” even though the NPDB Guidebook is not the product of formal rulemaking. Therefore, health care entities should be diligent in reviewing the NPDB Guidebook, including the multiple Q&As that address reporting actions while under investigation, when determining whether to report.

In Doe v. Rogers,²⁹ when a hospital’s representatives met with a physician to discuss a clinical incident, the physician agreed to refrain from exercising their surgical privileges pending investigation.³⁰ Later that day, the physician executed a letter voluntarily suspending their surgical privileges for two weeks.³¹ Two days later, the physician voluntarily resigned from the medical staff, prompting the hospital to submit an NPDB report.³² 

When the physician challenged the NPDB report, the Rogers court gave deference to the NPDB Guidebook’s definition of investigation in determining that the physician had resigned while under investigation.³³ The court stated that “when a statute is silent about an issue a court will defer to an agency’s interpretation contained in a regulation if it is reasonable, based on a permissible construction of the statute, involves a statute the agency administers, and the regulations were promulgated pursuant to notice and comment so they have the force of law.”³⁴ Further, the court presumed that Congress intended to give the term “investigation” its “ordinary meaning” and the term is ordinarily understood to mean a “systematic examination.” The court concluded that the hospital embarked on a “systematic examination”³⁵ relating to “the surgical incident by gathering the necessary documentation, conferring with the relevant Hospital executives, meeting with the physicians who were involved, reporting the incident to the state health department, and organizing a team to conduct a Root Cause Analysis.”³⁶ The court found these activities to be fundamental characteristics and demonstrative evidence of the beginning of an investigation.³⁷ Additionally, the court rejected the physician’s argument that there was no evidence of a formal investigation as defined under the medical staff bylaws. The court instead held that the term investigation is defined as contemplated by HCQIA and not by the hospital’s internal governing documents.³⁸ In another more recent case, Wisner v. Dignity Health,³⁹ a medical staff had asked for information from the physician in connection with a pending criminal indictment in response to the physician’s request to be on the call panel.⁴⁰ The physician resigned his privileges and an NPDB report was filed regarding the “resignation while under investigation.”⁴¹ The physician challenged the appropriateness of the report, arguing that he was not “under investigation” at the time he resigned.⁴² Although neither the statute nor the implementing regulations related to the NPDB define “investigation,” the California Court of Appeal determined that the NPDB Guidebook is entitled to a high level of deference due to the agency’s expertise and knowledge and found “expansive interpretation of what constitutes an investigation is necessary.”⁴³ Upon concluding that an investigation commences as soon as there is a focused “inquiry” into potential misconduct, the court affirmed that the physician was under investigation and that the defendants were immune from liability under HCQIA.⁴⁴ 

Practical Considerations 

To the extent it does not compromise an investigation, medical staffs should consider putting physicians and dentists on notice as soon as they are under investigation as it could impact the subject physician’s or dentist’s own decisions about their clinical privileges and membership. 

In deciding whether to report a surrender or voluntary restriction of clinical privileges while under or to avoid an investigation, health care entities should carefully review the facts and not focus only on how their bylaws define investigation. Nevertheless, medical staffs should still include language in their bylaws defining investigation, including guidance on when notice should be provided to practitioners. 

If a health care entity determines a report should be filed, it should assure that it has written documentation of an investigation. Examples of acceptable evidence may include committee meeting minutes, correspondence from officers directing an investigation, or notices to practitioners of an investigation (although as noted above practitioners’ knowledge of an ongoing investigation is not required).⁴⁵ The same holds true for an entity that decides a resignation or investigation should not be reported because the practitioner was not – or was no longer – under investigation. Closures of investigation, whether due to an action taken or a determination that no action is warranted, should be documented in meeting minutes and a letter to the practitioner under review. 

Physicians should also be mindful of the NPDB reporting requirements. If considering a resignation after receiving notice of an investigation, the practitioner should consider whether resigning after the investigation has been closed would be more favorable to their professional interests. If the practitioner knows or suspects they may have been the subject of a past investigation, they may want to confirm with the health care entity that the investigation has been closed prior to taking an action that impacts their clinical privileges.

1 Title IV of Public Law 99-660 (42 U.S.C. § 11101 et seq.).     
2 42 U.S.C. § 11101.     
3 Reporting of other health care practitioners is optional but encouraged. 45 C.F.R. § 60.12(a)(2).     
4 45 C.F.R. § 60.12(a).     
5 National Practitioner Data Bank Guidebook (“NPDB Guidebook”) at E-32. Generally, the entity taking the action will determine whether the physician’s or dentist’s     
professional competence or professional conduct adversely affects, or could adversely affect, the health or welfare of a patient.     
6 45 C.F.R. § 60.12(a)(1)(ii).   
7 NPDB Guidebook at E-36.  
8 Id. at E-39.  
9 Id. at E-49.  
10 See id.  
11 Id. at E-36.  
12 Id. at E-50.  
13 Id. at E-36  
14 Id. at E-37.  
15 See id. at E-36-E-37.  
16 422 F. Supp. 3d 143 (2019), aff’d, No. 19-5358, 2021 WL 6102198 (D.C. Cir. Dec. 3, 2021).  
17 Id. at 146, 156. 
18 Id. at 150-151. 
19 Id. at 151. 
20 NPDB Guidebook at E-36-E37. 
21 Id. 
22 552 F.3d 75 (2009). 
23 Id. at 77. 
24 Id. at 78. 
25 Id. at 77. 
26 Id. 
27 Id. 
28 Id. at 86. 
29 139 F.Supp.3d 120 (2015). 
30 Id. at 130. 
31 Id. at 130-131. 
32 Id. at 131. 
33 Id. at 135. 
34 Id. 
35 Id. at 137 (citing to Merriam–Webster, http://www.merriam-webster.com/dictionary/investigation). 
36 Id. at 138.
37 Id.
38 Id. at 142.
39 85 Cal. App. 5th 35 (2022).
40 Id. at 39.
41 Id. at 40.
42 Id.
43 Id. at 47.
44 Id. at 49.
45 NPDB Guidebook at E-37.