## Facts

- James Johnson underwent surgery at Misericordia Community Hospital in Milwaukee to remove a pin fragment from his right hip.
- The surgeon, Dr. Lester V. Salinsky, severed Johnson’s right femoral artery and nerve, causing permanent paralysis and loss of function in Johnson’s right thigh.
- Salinsky had applied for full surgical and orthopedic privileges and represented that his privileges had never been suspended, diminished, revoked, or not renewed.
- Evidence indicated other hospitals had restricted or suspended Salinsky’s practice, refused him staff privileges, and that physicians had expressed doubts about his competence.
- Johnson settled with Salinsky pretrial through a Pierringer-type agreement; Salinsky paid $140,000 and received a release.
- A jury found Salinsky negligent in performing the surgery (20% causal negligence) and found the hospital negligent in granting orthopedic privileges (80% causal negligence).
- The jury awarded $315,000 for personal injuries and $90,000 for impairment of earning capacity.

## Issues

1. Whether a hospital owes a duty to use reasonable care in selecting medical staff and granting specialized privileges, supporting direct liability for negligent credentialing.
2. Whether hospital bylaws and applicable state administrative regulations may be used as evidence of the hospital’s credentialing standard of care.
3. Whether there was sufficient evidence that negligent credentialing was a substantial factor in causing Johnson’s injuries.
4. Whether evidence of other hospitals’ restrictions, suspensions, denials of privileges, and professional opinions about the surgeon’s competence was admissible to show what a reasonable credentialing investigation would have revealed.

## Decision

- The Wisconsin Court of Appeals affirmed the judgment against the hospital.
- The court held the hospital owed patients a duty of reasonable care in selecting its medical staff and granting orthopedic/surgical privileges and could be directly liable for breaching that duty.
- The court upheld using the hospital’s bylaws and relevant state administrative regulations as evidence of the credentialing standard of care and found the evidence supported a breach.
- The court concluded the jury could reasonably find the hospital’s inadequate investigation and evaluation of Salinsky’s background was a substantial factor in Johnson’s injuries.
- The court upheld admission of evidence concerning other hospitals’ actions and reputation-related information about Salinsky as relevant to what reasonable investigation would have uncovered and to foreseeability.

## Legal Principles

- A hospital may have a direct duty to exercise reasonable care in selecting and retaining medical staff and in granting clinical privileges; this duty is not avoided by treating physicians as independent professionals.
- A hospital’s bylaws and applicable administrative regulations governing credentialing and privileging may be used to inform and prove the applicable standard of care.
- In negligent credentialing claims, causation is satisfied if the hospital’s breach was a substantial factor in producing the patient’s harm; the hospital’s negligence need not be the sole cause.
- Evidence of prior restrictions, suspensions, denials of privileges, and professional assessments of competence may be admissible to show what a reasonably careful credentialing process would have discovered and whether patient harm was foreseeable.

## Conclusion

The court affirmed liability based on the hospital’s negligent granting of orthopedic privileges, holding that hospitals must conduct a reasonably careful credentialing process consistent with bylaws and regulatory requirements, and that failure to do so can be a substantial factor in patient injury supporting direct hospital liability.


Johnson v. Misericordia Cmty. Hosp., 97 Wis. 2d 521, 294 N.W.2d 501 (Wis. Ct. App. 1980)