March 02, 2016

Touhy Regulations in Malpractice Actions

The Department of Health routinely inspects healthcare facilities to determine compliance with state and federal regulations, sometimes in response to complaints from an aggrieved family member. During these investigations, inspectors interview healthcare providers, review medical records, and produce an internal investigation report which is used by the Department to determine if regulations were violated.

The internal investigation report or other investigation materials may contain information that is highly prejudicial to the defense in a malpractice lawsuit. Inspectors interview providers without notice and without counsel. They also render opinions about the medical care provided, including physician care, even though the inspectors may not be physicians and may not review all of the relevant medical records. The good news is that the internal investigation report, as well as other materials such as proffer notes or recordings, are not made publicly available and are protected from discovery via regulation.

The particular regulations at issue, 45 C.F.R.§ 2.3, et seq., protect the use of investigation material in civil proceedings. Many government agencies have similar regulations, and together they are known as Touhy regulations based on the U.S. Supreme Court case of the same name. The purpose of Touhy regulations is to ensure that the parties being investigated are candid and cooperative with inspectors.

Despite the existence of Touhy regulations, investigation material sometimes slips through the sieve and becomes an unwelcome part of the litigation. Many arguments can be raised to prevent the investigation material from being used as evidence. The investigation report, for example, usually contains multiple layers of hearsay, and medical opinions contained therein are usually unqualified and inadmissible pursuant to the Medical Care Availability and Reduction Of Error Act’s expert qualification requirements. That being said, hearsay within the report is often made by a party, and the report itself is a business record; thus, a court may find that it falls within one or more hearsay exceptions. In addition, the MCARE Act’s expert qualification requirements may not preclude opinions related to nursing or operations. Finally, the investigation report can be couched as impeachment material waiting to pounce on a medical provider’s testimony, i.e., non-hearsay.

Presented with such a delicious ensemble of evidentiary issues with no predictable outcome, it is best to turn to the help of a friend to preclude this prejudicial evidence. The friend in this situation is the Department of Health. As the institution with the standing to enforce its Touhy regulations, the Department will intervene and fight aggressively to keep its own investigation material from being used in civil proceedings. The ongoing use of investigation material threatens the Department’s ability to inspect healthcare facilities. If word got out that statements made in the course of an investigation could be used in civil proceedings, health care providers would seal their lips. Because investigation material presents an ongoing threat to the Department’s objectives, its ability to enforce its Touhy regulations is non-waiveable, absent authorization from the Department head, even if the Department is responsible for the leak.

What It Means to You

It is essential that the Department of Health is notified of all possible leaks of investigation material and provided with copies of the same, and the earlier on in the litigation, the better. The outcome is likely to be more favorable than going it alone.