Alabama court rules for hospital in bylaws case

The state medical society is let down by the ruling but says it was a narrow vote.

By Tanya Albert, AMNews staff. Feb. 21, 2005.

The Alabama Supreme Court has ruled that there was nothing in a set of medical staff bylaws that would stop a hospital board from transferring ownership of a hospital-based oncology center to an office-based center.

Radiation Therapy Oncology -- a group of three physicians -- sued Providence Hospital in Mobile, Ala., arguing that the hospital's decision had breached medical staff bylaws.

The hospital's decision resulted in radiology equipment being moved out of the hospital and into office-based practices on property next to the hospital. So even though the radiation oncologists had privileges at Providence Hospital, they did not have the equipment to treat patients there.

Providence Hospital, which said it made the transfer because it thought the office-based center would provide for better patient care, disagreed that it had violated medical staff bylaws. In court documents, the hospital argued that the medical staff doesn't have the power to overrule a valid business decision by the hospital board.

The Alabama Supreme Court in January agreed with the hospital.

"Providence's corporate bylaws specifically authorize the board to make business decisions for the hospital, including transferring assets and reorganizing a department," the court wrote. "The medical staff bylaws specifically provide that the physicians who are part of the medical staff accept their privileges subject to the corporate bylaws and that the responsibilities of those physicians include 'abiding by Providence Hospital policies and procedures.' "