Key Takeaways From The Natarajan v. Dignity Health Decision

On August 12, 2021, the California Supreme Court issued its opinion in Natarajan v. Dignity Health, No. S259364. The case addresses the potential bias of hearing officers appointed to preside over hospital administrative proceedings that are held when a medical staff committee recommends that a physician with privileges at the hospital be subject to disciplinary action. The Supreme Court, in a unanimous decision, held that the fact that a hospital might hire a hearing officer again for future work does not create a presumption that the hearing officer has a financial incentive to favor the hospital and does not, without more, require disqualification for bias. The Natarajan decision clarifies the statutory scheme governing selection of hearing officers for peer review hearings and provides important guidance for hospitals and their medical staffs in making such selections.