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McKeesport Hosp. v. Accreditation Council for Graduate Medical Educ.

filed: May 17, 1994; As Corrected May 27, 1994.



Before: Becker and Nygaard, Circuit Judges, and Yohn, District Judge*fn*

Author: Nygaard


NYGAARD, Circuit Judge.

McKeesport Hospital brought this 42 U.S.C. § 1983 action against the Accreditation Council for Graduate Medical Education (the "ACGME") and the Executive Secretary of its residency review committee for surgery, alleging that their withdrawal of the accreditation of the Hospital's general surgery residency program violated due process. The district court entered a preliminary injunction blocking the accreditation withdrawal. Because we conclude that the ACGME's conduct was not state action, we will reverse.


Pennsylvania's Medical Practice Act of 1985 (the "Act"), 63 Pa. Cons. Stat. Ann. §§ 422.1 - 422.25, requires that the admission standards, facilities, curricula, and training at any medical college or "medical training facility" in the Commonwealth "meet the requirements set by the [Pennsylvania State Board of Medicine (the "Board")] and any accrediting body which may be recognized by the board." Id. § 422.23(a). The term "medical training facility" includes a medical college, hospital or other institution providing graduate medical training. Id. § 422.2. Graduate medical training, which is commonly referred to as a residency, is defined in the Act as

training approved or recognized by the board which is either:

(1) accredited as graduate medical education by any accrediting body recognized by the board for the purpose of accrediting graduate medical education. . . ; or

(2) provided by a hospital accredited by any accrediting body recognized by the board and is acceptable to an American specialty board towards the training it requires for the certification it issues in a medical specialty or subspecialty. . . .

Id. § 422.2.

The Act provides that

it shall be the duty of the board, in its discretion, periodically to ascertain the character of the instruction and the facilities possessed by each of the medical colleges and other medical training facilities offering or desiring to offer medical training in accordance with the requirements of this act.

Id. § 422.23(b). If the Board deems a program inadequate, "the board shall not recognize the education or degrees obtained from [it] during the period of inadequacy." Id. § 422.23(c). The Board must provide "due notice" to any institution found not to meet its standards. Id. Its actions, moreover, are "subject to the right of notice, hearing and adjudication, and the right to appeal therefrom, in accordance with the provisions of Title 2 of the Pennsylvania Consolidated Statutes (relating to administrative law and procedure)." Id. § 422.9.

The Board has by regulation recognized the ACGME as the accrediting body for graduate medical training programs in Pennsylvania. The relevant regulation reads

the Board is responsible for determining the character of instruction and the facilities possessed by each of the various medical education institutions and hospitals who carry out graduate medical education programs in this Commonwealth. The Council on Medical Education of the American Medical Association [the ACGME's predecessor] possesses the facilities and staffing required to perform evaluations of the qualifications of the various programs and also the mechanism for accreditation of acceptance programs. The Board and the Council . . . work cooperatively in evaluating and approving the training programs in this Commonwealth. A comity exists between the board and the Council . . . under which all intended observations of training programs for accreditation are communicated to the Board and the Board makes all requests for accreditation or investigation of training programs to the Council . . . . If an investigation of the programs of the various institutions in this Commonwealth is to be conducted, the Board will provide one of its members or appoint an individual to accompany the investigator on each occasion. An institution within this Commonwealth seeking approval of its programs by the Council . . . will be informed that action taken by the accrediting agency will be related to the Board.

49 Pa. Code § 17.23. The ACGME is a private, unincorporated association made up of representatives of five medical organizations -- the American Board of Medical Specialties, the American Medical Association, the American Hospital Association, the Association of American Medical Colleges, and the Council of Medical Specialty Societies -- that evaluates and accredits residency programs throughout the United States.

The ACGME's review is governed by its own set of standards, The Essentials of Accredited Residencies. The ACGME has organized twenty-six residency review committees, one for each of twenty-six medical specialties, that evaluate the programs in each area under these standards. The committee for surgery, for example, is composed of 12 members appointed by the American Board of Surgery, the American College of Surgeons, and the American Medical Association.

The evaluation process begins when an application is submitted by the residency program's director. The committee then sends a surveyor to the training facility to verify the information. When reviewing a program in Pennsylvania, the ACGME notifies the Board of the visit, and a Board member or representative may accompany the surveyor to the facility. The surveyor meets with faculty and students, reviews program data, and submits a report to the committee. The submission of the report ends the site surveyor's role; he or she does not participate in the committee's decision.

The residency review committee then reviews the report and the program's file, and recommends either full accreditation, probation, or withdrawal of accreditation. A training facility that is dissatisfied with the recommendation may request reconsideration by the committee and, if the committee adheres to its position, may seek a hearing before an appeals panel consisting of three directors of accredited residencies in the program's specialty. A facility requesting an appeals panel hearing receives a list of potential members from which it may delete up to one-third of the candidates; the panel is constituted from those who remain. The facility may submit additional information at both the reconsideration and appeal stages and may be represented by counsel and present witnesses before the appeals panel.

The appeals panel's recommendation, the material it considered, and a transcript of its hearing are reviewed and either adopted or rejected by the ACGME's executive committee. The executive committee's determination is then voted on by the ACGME, whose decision is final. A training facility whose accreditation is withdrawn may, however, reapply for ACGME accreditation at any time.


McKeesport Hospital, a community hospital in McKeesport, Pennsylvania, offers graduate medical training in several specialties, including general surgery. The Hospital's general surgery residency program was first accredited by the ACGME's predecessor in 1961, although its ACGME accreditation has been provisional since 1979. The program has had Board recognition since the Board began recognizing residency programs under the Act.

After a November 1990 site visit and its review, the ACGME's residency review committee for surgery recommended withdrawal of the program's accreditation, citing five deficiencies that allegedly rendered the program not in substantial compliance with The Essentials of Accredited Residencies. The Hospital requested reconsideration and the committee, as a result, rescinded one of the deficiencies and extended the withdrawal's effective date by one year. The Hospital appealed to an appeals panel, which held a hearing and ultimately affirmed the committee's action. The appeals panel's decision was adopted by the ACGME's executive committee and then by the entire ACGME, and the Hospital was notified that the program's ACGME accreditation would be withdrawn.

It does not appear that the ACGME communicated this decision to the Board. Rather, the Hospital sought review of the ACGME's decision by the Board. The Board, however, dismissed the case, concluding that it had no authority to intrude upon the ACGME's accreditation process and, because the Hospital had failed one of the two criteria to be a medical training facility in Pennsylvania, no jurisdiction over the Hospital's appeal. The Hospital appealed the Board's dismissal to the Pennsylvania Commonwealth Court.

Before the Commonwealth Court rendered any decision in the case against the Board, however, the Hospital commenced this action against the ACGME, alleging that its decision to withdraw the program's accreditation lacked due process.*fn1 After a three-day hearing, the district court made extensive findings of fact and Conclusions of law and granted the Hospital's motion for a preliminary injunction to prevent the accreditation withdrawal from becoming effective. The ACGME appealed.

After this appeal was filed, the Commonwealth Court reversed the Board's dismissal order. McKeesport Hosp. v. Pennsylvania State Bd. of Medicine, 156 Pa. Commw. 480, 628 A.2d 476 (Pa. Commw. Ct. 1993). The Commonwealth Court determined that under the plain language of the Act, the Board is "the final arbiter of matters involving the accreditation of medical training facilities in Pennsylvania," and remanded the case to the Board for a hearing. Although the court agreed that the Board could not intervene in the ACGME's accreditation process, it disagreed that the ACGME's decision ended the Board's inquiry. Id. at 479 & n.12. The court stated: "accreditation by the ACGME merely is a tool which establishes critical facts leading to the Board's recognition" of a medical training facility. Id. at 479. The court ordered that the program remain recognized ...

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