California Negotiated Health Care: Implications for Malpractice Liability

This Comment addresses the impact of California\u27s new Medi-Cal payment system, selective provider contracting, on physician, hospital and state liability. The author argues that selective provider contracting encourages provider cost efficiency by contractually binding providers to a pre-determined cost allowance, thereby creating cost-consciousness in medical decision-making, and that such consideration may affect the physician\u27s standard of care. The author further argues that a change in the physician\u27s duty to the beneficiary would also affect hospital liability under respondeat superior and corporate negligence principles, and that selective provider contracting may expose the state to liability for negligent provider selection and review