A medical malpractice action can have negative implications for the health care provider. If a medical malpractice action is lost at trial or settled out of court, it must be reported to The National Practitioner Data Bank (NPDB). NPDB is an online government organization that stores information related to medical malpractice payments and adverse actions against health care practitioners. The NPDB was established by congress in 1986 to prevent practitioners from moving to a different state without disclosure of previous potential malpractice claims and payments. Along with an adverse jury verdict and settlement payments, there are a number of things that must be reported to the NPDB such as board of medical examiners licensure actions, adverse professional society membership actions, state and federal licensure actions, peer review organization negative actions or findings, and other adjudicated actions or decisions. NPDB reporting can have a negative effect on a healthcare provider employment opportunities as well as their ability to obtain medical liability insurance.

Only certain entities are eligible to report to and review the NPDB such as medical malpractice payers, peer review organizations, hospitals and other health care entities, and federal and state licensing agencies. For settlement payments, if a health care entity pays a sum for a healthcare provider due to malpractice based on a settlement or jury verdict it must be reported to NPDB. For instance, if an insurance carrier pays a settlement or verdict on your behalf, they are required to inform NPDB. However, there is an exception to this rule based on a U.S. Court of Appeals for the District of Columbia Circuit court case American Dental Association v. Shalala. In that case, the court held that NPDB reporting would not be required if an individual made a payment for their own benefit. Thus, making a settlement payment from your own personal funds makes one exempt from reporting. This exception only applies to settlements – Individuals who pay jury verdicts out of their own personal funds are still required to report. While an individual may not need to report settlements to the NPDB, this would not make them exempt from reporting settlement and lawsuit information to relevant licensing boards if asked. For instance, if in a licensing application they ask if you have ever been sued and how was it resolved you would have to disclose.

If you have any questions regarding the National Practitioner Data Bank or reporting requirements please feel free to reach me at bleib@lkglaw.net .