Summit Health, Ltd. v. Pinhas

500 U.S. 322 (1991)

Facts

Dr. Simon J. Pinhas (P) filed a complaint alleging that D and its medical staff, and others had entered into a conspiracy to drive him out of business 'so that other ophthalmologists and eye physicians will have a greater share of the eye care and ophthalmic surgery in Los Angeles.' P refused to follow an unnecessarily costly surgical procedure at D wherein a second surgeon must assist in all eye surgeries. Prior to 1986, most eye surgeries in Los Angeles were performed by a primary surgeon with the assistance of a second surgeon. This increased the cost of eye surgery. In 1986, the administrators of the Medicare program announced that they would no longer reimburse physicians for the services of assistants, and most hospitals in southern California abolished the assistant surgeon requirement. D refused to do so. The added surgeon would cost P about $60,000 per year in payments to competing surgeons for assistance that he did not need. P refused to sign a 'sham' contract to reimburse P by doing fake services. D initiated peer review proceedings against P and summarily suspended, and subsequently terminated, his medical staff privileges. Prior to 1986, most eye surgeries in Los Angeles were performed by a primary surgeon with the assistance of a second surgeon. This increased the cost of eye surgery. In 1986, the administrators of the Medicare program announced that they would no longer reimburse physicians for the services of assistants, and most hospitals in southern California abolished the assistant surgeon requirement. D refused to do so. The added surgeon would cost P about $60,000 per year in payments to competing surgeons for assistance that he did not need. P refused to sign a 'sham' contract to reimburse P by doing fake services. D initiated peer review proceedings against him and summarily suspended, and subsequently terminated, his medical staff privileges. D owns and operates 19 hospitals, and 49 other healthcare facilities in California and six other states. D moved to dismiss in that the issues related to a single surgeon does not affect interstate commerce. The District Court dismissed the complaint and the Court of Appeals reversed, rejecting Ds' argument that the Act's jurisdictional requirements were not met because there was no allegation that interstate commerce would be affected by P's removal from staff. D appealed and the Supreme Court granted certiorari.