By Paige Arnold, J.D.
A hospital was not liable to a former employee for retaliation under state statute for negative post-termination communications, a federal court in Maryland ruled. The court found that negative communications made by hospital representatives, after the employee was terminated, did not fall within the bar on retaliatory “personnel actions” under the statute ( Doe v. The John Hopkins Health System Corp., April 6, 2017, Chaung, T.).
Background. After she scaled back her private practice and was hired by the hospital as director of the Outpatient Mental Health department, the employee internally disclosed ethical and regulatory violations and was terminated a few years later. In particular, she identified various problems with the billing practices of a private psychiatry services company that contracted to provide psychiatric services. These problems included double billing to CMS; inflating bills payable by CMS, private insurers, and patients; falsely certifying compliance with CMS regulations; and providing and billing for unnecessary services.
Upon termination, the employee declined to sign a severance agreement; allegations and controversy ensued regarding her termination. Specifically it was alleged that negative communications were made post-employment about the employee to outside professional organizations. Moreover, the alleged communications related to her disclosure of the ethical and regulatory violations. The employee was subsequently terminated from her position at another unaffiliated employer and struggled to rebuild her private practice. The employee filed a complaint against the hospital for retaliation, defamation, and other claims related to her termination. The hospital filed a motion to dismiss the complaint.
Retaliation claim. The court found the hospital’s post-termination communications regarding a former employee were not retaliatory actions under state statute. While the court recognized that the state statute was designed to protect healthcare workers from retaliation for reporting misconduct, it did not protect whistleblowers from negative actions made after termination. The court looked to the plain language of the statute, and legislative intent, to determine that “personnel action” did not include disseminating communications that were made after an employee was terminated.
The hospital’s motion to dismiss the state retaliation claim was granted.
