Ronotable George N. Rodriguez,Jr. Opinion No. M-912
County Attorney
El Paso county                      Re: ~Queetionsrelating to
Room 201, City-CountyBuilding            authority to contractby
El P&so, Texas 79901                     El Paso County Hospital
                                         with.privatehospital for
                                         latter's patient5 at a
Dear Mr. 'Rodriguez:                     discounted fee rate.
            By your recent letter you have asked our opinion on the
following   questions:
           "Does the El Paso County Rospital District and
      specificallyR. E. Thomason General Hospital, have
      authority to contract with a privately owrledhospital
      situated within the Hospital District whereby labora-
      tory tests pertaining to patients of the privately
      owned hospital are performed by R. E. Thomason
      General Hospital at a‘disdountedfee rate?
           "Does the El Paso County Hospital District and
      specificallyR. E. Thomson General Hospital, have
      authority~to contractwith private physicians in El
      Paso County, TeXas, whereby laboratorytests pertain-
      ing to patients of the private physicians are performed
      by R. E. Thomason General Hospital at a discounted fee
      basis?"
          you further relate the following facts: That recently
R. E. Thomson General Hospital acquired additional laboratory
equipment;that laboratorytesting with this equipment has been
furnishedby R. E. Thomason Hospital for a privately owned
hospital within the Hospital District; and that "during the
period that this agreemnt has been in effect.no p.atientat
R. B. Thomason General Hospital has been denied or deprived
utilizationof the Dew equipment. In fact this new equipment
has a capacity for a twofold increase in the number of tests
presently conducted for both R. E. Thomason General Bospital
and ProvidenceMemorial Hospital." You further state that the
equipment is operated by personnel employed by R. E. Thomason

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nonorable George N. Rodriguez, Jr., page 2    (M-912)



General Hospital, including a pathologistwho $8 a licensed
medical dootor, on a monthly salary basis.
           Our opinion is that the El Paso County Bospital Dis-
 trict, and the R. E. Thomason General Hospital (hereinafter
 referred to as the hospital) and its lriadical
                                              staff, my under
 lawful contracts perform the laboratorytests under consfdera-
 tlon but the existing terms of employment between the hospital
 and its medical doctor pathologist,with feer being charged
‘for the.doctor’s services by the hospital, appear'to violate
 the Medical Practice Aat.
          A hospital district has a constitutionalobligation
to care for the needy which, according to you. recited facts,
has and is being met. Art. IX, Sec. I, Tex. Conat.
           The responsibilityfor the managementand operation of
the hospital is placed in a Board of Hospital Managers by the
State Legislatureby Article 4494, Section-5, Vernon’s Civil
Statutes,  which reads, in part, as follows:
           (I
            . . . ,whoaeduties shail be to manage, control
      and admidiaterthe hospital or hospital system of
      the Hospital District. . . .* (Emphasisadded.)
          Purther, certain actions of the Board are subject to
the approval of the CommissionersCourt. tit. 44948, Sec. 5b,
Vernon’s Civil Statutes.

          As long*aa the Board fulfills its constitutionalduty
to care for indigents and needy persons, it may contract with
others and perform services for others, in the field of health
care when in the Board's judgment such contract is in the fur-
therance of its duty to *manage* or "administer"the needs and
operationsof the district.
           You state that the licensed medical doctor pathologist,
one of the employees of the hospital who performs ‘he teatt, is
employed by the hoepital on a monthly salary basis. Your two
questions,quoted in full at the outset of~thia opinion, state
that these teats ' ... . are perfomed by R. E. Thomason 'General
noapital  . . ,I) at a discounted fee rate or basis. The statement
of faota you presented to ua indioated that the fee charged for
the teat L8 colleated by the hoapital in its own name -andnot in
the name of the doctor. Xf such is the case, then the hospital
diatrtct  and the doctor are operating in vfo&ation of the Medical
Practict   Act.   Art. 741, Vernon's Ptnal Code, and Art. 4505,

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.

     HonorableGeorge N. Rodriguez, Jr., page 3      (h-912)


      aubd. 12,'Vernon’s Civil Statutes; Rockett v. Texas State Board
      of Medical Examiners, 207 S.W.2d 198 (Tex.Civ.App.1956, error
            . Watt v. Texas State Board of Medical Examiners, 303 S.W.
    - z i9i (Tex.Civ.App.1957, error ref.), cert. den. 356 U.S. 912:
      Attorney General's-OpinionsNos. WW-278'(1957)and WW-1511 (1962).
      We suggest that all of the terms of the contract of employmentbe-
      tween the hospital and its medical doctor personnel be examined
      in light of these authorities. .

                             SUMMARY
               As long as it fulfills its constitutionalduty
          to care for indigents and needy persona, a County
          lioapitalDistrict, through its Board of Mamagera, has
          authority to contractwith private hospitals and doc-
          tors within the District for laboratoryservices at a
          discountedfee rate and vice versa by reason of the
          Board's duty and authority to manage and administer
          the Hospital District.
               The contractsbetween the hospital and its medi-
          cal doctor personnel must confo   to the requirements
          of the Medical Practice Act. 3":'
                                    Ve.rytruly yours,



                                    Attorney General of Texas
     Preparedby Sam L. Jones, Jr.
     AssistantAttorney General
     APPROVED:
     OPINI,ONCDRRITTEE
     Kerns Taylor, Chairman
     W. R. Allen, Co-Chairman
     IVan Williams
     Arthur Sandlin
     Charles Parrttt
     Robert Lemena
     MRADE P. GRIFFIN
     Staff Legal Assistant

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