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Docket No. 86830-Agenda 15-November 1999.

SHEILA JONES, Indiv. and as Mother and Next Friend of Shawndale Jones, a Minor, Appellant, v. CHICAGO HMO LTD. OF ILLINOIS, Appellee.

Opinion filed May 18, 2000.

JUSTICE BILANDIC delivered the opinion of the court:

This appeal asks whether a health maintenance organization (HMO) may be held liable for institutional negligence. We answer in the affirmative.

The plaintiff, Sheila Jones (Jones), individually and as the mother of the minor, Shawndale Jones, brought this medical malpractice action against the defendants, Chicago HMO Ltd. of Illinois (Chicago HMO), Dr. Robert A. Jordan and another party. The Joneses were members of Chicago HMO, an HMO. Dr. Jordan was a contract physician of Chicago HMO and the primary care physician of Shawndale.

The circuit court of Cook County awarded summary judgment in favor of Chicago HMO on all three counts of Jones' second amended complaint. Count I charges Chicago HMO with institutional negligence. Count II charges Chicago HMO with vicarious liability for Dr. Jordan's alleged negligence under the doctrine of apparent authority. Count III charges Chicago HMO with breach of contract. The circuit court also entered a finding pursuant to Supreme Court Rule 304(a) (155 Ill. 2d R. 304(a)). On appeal, the appellate court affirmed the grant of summary judgment as to counts I and III, but reversed the grant of summary judgment as to count II, remanding that claim for further proceedings. 301 Ill. App. 3d 103. We allowed Jones' petition for leave to appeal (177 Ill. 2d R. 315). Because Chicago HMO does not challenge the appellate court's reversal of count II, only counts I and III are at issue in this appeal.

Two organizations filed amicus curiae briefs with the permission of this court. See 155 Ill. 2d R. 345. The Illinois Association of Health Maintenance Organizations filed a brief in support of Chicago HMO. The Illinois Trial Lawyers Association filed a brief in support of Jones. For the reasons explained below, we affirm the summary judgment as to count III, breach of contract, but we reverse the summary judgment as to count I, institutional negligence, and remand that claim for further proceedings.

FACTS

In reviewing an award of summary judgment, we must view the facts in the light most favorable to the nonmoving party. Petrovich v. Share Health Plan of Illinois, Inc., 188 Ill. 2d 17, 30-31 (1999). The following facts thus emerge.

On January 18, 1991, Jones' three-month-old daughter Shawndale was ill. Jones called Dr. Jordan's office, as she had been instructed to do by Chicago HMO. Jones related Shawndale's symptoms, specifically that she was sick, was constipated, was crying a lot and felt very warm. An assistant advised Jones to give Shawndale some castor oil. When Jones insisted on speaking with Dr. Jordan, the assistant stated that Dr. Jordan was not available but would return her call. Dr. Jordan returned Jones' call late that evening. After Jones described the same symptoms to Dr. Jordan, he also advised Jones to give castor oil to Shawndale.

On January 19, 1991, Jones took Shawndale to a hospital emergency room because her condition had not improved. Chicago HMO authorized Shawndale's admission. Shawndale was diagnosed with bacterial meningitis, secondary to bilateral otitis media, an ear infection. As a result of the meningitis, Shawndale is permanently disabled.

The medical expert for the plaintiff, Dr. Richard Pawl, stated in his affidavit and deposition testimony that Dr. Jordan had deviated from the standard of care. In Dr. Pawl's opinion, upon being advised of a three-month-old infant who is warm, irritable and constipated, the standard of care requires a physician to schedule an immediate appointment to see the infant or, alternatively, to instruct the parent to obtain immediate medical care for the infant through another physician. Dr. Pawl gave no opinion regarding whether Chicago HMO was negligent.

Although Jones filed this action against Chicago HMO, Dr. Jordan and another party, this appeal concerns only counts I and III of Jones' second amended complaint, which are directed against Chicago HMO. Count I charges Chicago HMO with institutional negligence for, inter alia, (1) negligently assigning Dr. Jordan as Shawndale's primary care physician while he was serving an overloaded patient population, and (2) negligently adopting procedures that required Jones to call first for an appointment before visiting the doctor's office or obtaining emergency care. Count III charges Chicago HMO with breach of contract and is based solely on Chicago HMO's contract with the Department of Public Aid. Chicago HMO moved for summary judgment on both counts. Jones and Chicago HMO submitted various depositions, affidavits and exhibits in support of their positions.

Chicago HMO is a for-profit corporation. During all pertinent times, Chicago HMO was organized as an independent practice association model HMO under the Illinois Health Maintenance Organization Act (Ill. Rev. Stat. 1991, ch. 111