Who owns the information in the medical record? Copyright issues.
As part of every private healthcare practice and healthcare
facility, documentation of patients' healthcare, diagnoses and
treatment are an ongoing requirement with legal connotations. The
question that may arise is whether copyright can subsist in patient
medical records, and if so, what benefit may arise from ownership of
Keywords (MeSH): Intellectual Property; Copyright; Patient Records; Consultation Notes; Referral and Consultation; Prescriptions; Contracts; Medical Records
Supplementary keyword: Health Information Management
Physicians (General practice)
Physicians (General practice) (Services)
Prescription writing (Analysis)
Medical records (Usage)
|Publication:||Name: Health Information Management Journal Publisher: Health Information Management Association of Australia Ltd. Audience: Academic Format: Magazine/Journal Subject: Health Copyright: COPYRIGHT 2011 Health Information Management Association of Australia Ltd. ISSN: 1833-3583|
|Issue:||Date: Oct, 2011 Source Volume: 40 Source Issue: 3|
|Topic:||Event Code: 200 Management dynamics; 360 Services information|
|Geographic:||Geographic Scope: United States Geographic Code: 1USA United States|
The issue of copyright arose with respect to patient medical records in the recent case of Primary Health Care Limited v Commissioner of Taxation  FCA 419, and whether or not the applicant was entitled to claim tax deductions in relation to copyright. To answer that question, the court had to determine whether copyright subsists in patient medical records and, if so, whether such interest had been transferred to the applicant. Two further questions related to whether the applicant used copyright interests to produce assessable income and whether monetary consideration had been paid for copyright interest. The basis of the case also involved a construction of contracts between the applicant and parties from whom Primary Health Care Limited had purchased medical and dental practices. Did the property in patient medical and dental records pass to the applicant at the time of the purchase of a business? Was any copyright interest in those records transferred to the applicant? The facts and the law for this case are drawn from and summarised from the judgment of Stone J of the Federal Court of Australia.
Primary Health Care Limited (PHC) is a public company listed on the Australian Stock Exchange (ASX). The company is the sole beneficial owner of all units in a trust of which Idameneo is the trustee. PHC engages in purchasing, through the Trust, established medical practices in or near areas in which it intends to open a medical centre. At the time of sale for the practices, which are the subject of the court action, the Trust also entered into a contact with the relevant medical practitioner (or with the practitioner's practice company if the practitioner had incorporated his/her medical practice) . By virtue of this contract, Idameneo was obliged to provide services and facilities necessary for the practitioner to practise medicine from the relevant PHC centre and the practitioner was obliged to render medical services from that centre for a specified period. Both the contract of sale and the practitioner contract stipulated that the practitioner was not an employee of PHC. Around the time of the sale the practitioner would commence work in a PHC medical centre and the patient records from the purchased practice were taken to the PHC centre for use in that centre 
PHC opened a number of healthcare centres in New South Wales before it was listed on the ASX in 1998. It opened further medical centres in New South Wales and by the beginning of 2009 had within its portfolio approximately 43 large-scale medical centres together with 45 smaller medical centres in all states and territories other than Tasmania and the Northern Territory . Initially these centres offered mainly general practitioner services. Subsequently, additional medical and ancillary services were offered. Patients who attend the centres are seen by whichever doctor is available at the relevant time. Patients cannot make appointments and if they wish to see a particular doctor they must wait until that doctor is available. Under this arrangement, it is necessary for each doctor to have access to all patient records held there, alongside certain PHC management, information management and archive personnel from each PHC medical centre .
Having purchased a number of practices, Idameneo sought clarification as to whether it was entitled to claim income tax deductions with respect to the purchase of copyright interests in the medical records as part of its purchase of the practices, thereby reducing the assessable income of PHC .
The case involved an appeal under Part IVC of the Taxation Administration Act 1953 (Cth) (Administration Act). The Commissioner of Taxation disallowed the objections the Company made with respect to income tax assessments for the years ending 30 June 1999 to 30 June 2004. In brief, the relevant legislation, the Income Tax Assessment Act 1997 (Cth), permits a deduction for depreciating or writing off an interest in copyright acquired and used, or is available for use. In order to obtain a deduction for expenditure on an item of intellectual property, an entity must have used the item or 'the invention, design, work or other subject matter to which the item relates' for the purpose of producing assessable income . A depreciating asset is an asset 'that has a limited effective life and can reasonably be expected to decline in value over the time it is used' . According to Stone J, 'The preliminary questions all take the form of asking in respect of each sale of practice agreement (a) whether in consequence of the sale of practice agreement, Idameneo holds rights as the owner of copyright comprising an item or items of intellectual property within the relevant legislation; and (b) if so, whether Idameneo was entitled to a deduction in the relevant year of income under s 373-10(1) of the 1997 Act?' .
The issues as identified by Stone J are as follows:
* Whether copyright subsists in the patient records or any part of the patient records of the sample practices acquired by Idameneo and, if so, who owned the copyright prior to the sale?
* Whether Idameneo, pursuant to a contract between it and the vendor, acquired ownership (legal or equitable) of any such copyright, or a licence to use any such copyright. This issue involves the construction of the relevant agreement including whether the agreement is subject to an implied term. It may also involve construction of the relevant practitioner contract.
* Whether Idameneo gave any consideration for any acquisition of copyright from a vendor and whether any such consideration was monetary.
* How, if at all, was any such copyright used or available for use by Idameneo for the purpose of producing assessable income; and whether any works in which such copyright subsisted were used for that purpose? This involves a distinction between the use of copyright, the use of a work in which copyright subsists and the use of information in a work in which copyright is claimed .
According to Stone J, by virtue of the Copyright Act (Cth), copyright subsists in original literary and artistic works. In accordance with the Act the work must be 'an original literary ... work that is unpublished and of which the author was a qualified person'. A qualified person is an Australian citizen, a protected person or a resident in Australia. Subject to exceptions, the author of the work is the owner. The only exception that Stone J considered relevant was s35(6), which provides:
Stone J referred to s 10(1) of the Act, which defines 'literary work' as including '(a) a table, or compilation, expressed in words, figures or symbols; and (b) a computer program or compilation of computer programs'. The judge canvassed the precedent authorities for 'the basic or core meaning' of 'literary work' stating that it 'is clear that the use of the word 'literary' is not a reference to high quality or style but rather to the fact that the work is expressed in print or writing' . Stone J particularly referred to the judgment of French CJ, Crennan and Kiefel JJ in the High Court case of Ice TV Pty Ltd v Nine Network Australia Pty Ltd  HCA 14, in which it was said:
Stone J further stated that copyright arises when a work is made. In accordance with Act, a work is made when it is 'first reduced to writing or takes some material form', which includes any forms of storage or a work, whether or not that form is visible and whether or not it can be reproduced. According to Stone J, the Copyright Amendment Act 1984 supports the view that storage in a computer memory by direct keying into the computer is sufficient to make a work within the meaning of the Act . Other precedents referred to by Stone J emphasise the importance of identifying authorship and originality [33-37].
In placing the idea of 'independent intellectual effort' in context, Stone J expressed the view:
Stone J went on to consider the issues of copyright discussed above with respect to each of 12 sample practices. According to the Judge: 'For PHC to show that copyright subsisted in the patient records of the sample practices it must not only identify the works in which it says copyright exists but must also show that those works were original literary works of identified authors who are qualified persons' . The patient records in respect of which copyright was claimed consisted of a health summary sheet, consultation notes (including prescriptions for medicines) and specialist referral and other letters written in respect of the patient. In some cases these were in the form of paper records and some were electronic. Others were a mixture of electronic and handwritten records . PHC did not assert its claims in respect of third party reports such as reports from specialist practitioners and radiology and pathology reports .
PHC asserted that each referral letter as an original literary work. With respect to summary sheets and consultation notes, PHC submitted that they comprised one original literary work for each patient. In the alternative, PHC submitted that the latter consisted of separate literary works .
Stone J described patient records from the 12 sample practices under consideration. For the purposes of analysing the agreements for sale of those practices, Stone J divided them into two categories; (1) those entered into prior to 2001, the sample practices of Drs di Michiel, Galati, Tang, Fitch, Parissis, O'Shannessy and Urquhart (the di Michiel agreements); (2) those entered into after July 2001, the sample practices of Drs Ginnane, Panwar, Lyons, Sabag and Mundkur (the Ginnane agreements) .
All sample practices, initially kept hard-copy patient records on cards filed alphabetically. For each new patient the administration staff was instructed to record the patient's personal details on the cards and the sample doctor would add the patient's history and his consultation comments directly on to the card. Some moved on to use other systems of keeping patient records.
The di Michiel Agreements
In 1991, Dr Urquhart began to use the GP system, the record keeping system of the Royal Australian College of General Practitioners. This system included a health summary sheet and consultation notes kept in a manila folder under the patient's name. Dr Urquhart described his practice was to make notes of a new patient's relevant medical details, including previous and family medical history, medications, operations or allergies on the health summary sheet. He would then write notes of the consultation, diagnosis and treatment on the patient's progress notes. He kept these records in filing cabinets together with the original green card, specialist and other reports .
All doctors who worked at Dr Tang's practice adopted a standard procedure in creating and maintaining handwritten patient records, consisting of cards that came with the practice, which they had purchased from another doctor, along with a consultation card manufactured by Optiplan and the GP system .
Patient records in Dr Fitch's practice were created and maintained in a manner similar to that described in respect to Dr Tang's practice with the exception that Dr Fitch wrote more detailed notes of the consultations at the end of the day
In 1997/98 Dr Parrisis began using the Medical Director software to issue prescriptions and increasingly used the computer to make electronic records of diagnosis and treatment. Eventually he included the results of patient consultations electronically. However, he also continued to use handwritten cards .
Around 1979, Dr O'Shannessey, a dentist, began using computer records, initially for easy billing. In 1989, he commenced using 'a sophisticated computer system to store all patient medical and dental information' alongside the card system. In 1995, he began using 'Dental for Windows', which included all his patient records. He was then able to write his own notes directly on to the computer as well as on the cards. Around 1999 Dr O'Shannessey converted many of the old paper cards to microfilm. By 1998 the patient records consisted of a mixture of mediums .
With the exception of Dr Urquhart, most of the medical records of all the other doctors in the di Michiel category showed evidence of having been written in different hands. One example of a patient record card written by Dr Urquhart written solely by him involved a patient who first saw the doctor one week after birth in 1981 and the record continued until 1996, which gave a continuous developing picture of the patient's health . According to Stone J; 'Although brief and succinct the entries could have been expressed by another doctor quite differently' . This was a significant issue in Stone J's findings .
Two samples of Dr Galati's patient records were tendered and the judge commented they although they were kept in a similar hard-copy form, they were very different from those described for Dr di Michiel. The handwritten record for patient 1 consisted of five cards with numerous date stamps and the handwriting varied from difficult to impossible to read with 'odd words' and an 'occasional longer entry' .
The Ginnane Agreements
Dr Ginnane initially continued the paper card system that was in place when he purchased the practice from another doctor; however, he began to use the GP system in 1984. In 1999, he started using Medical Director Software for prescriptions and letters of referral to specialists. Examples of a health summary sheet and nine pages of consultation notes were tendered together with three patient records. The respondent produced one other record. Dr Ginnane stated that computer records for these patients had been destroyed after they had been transferred onto the PHC computer system .
Dr Panwar continued to use the card system that came with the practice, which she modified slightly to tailor it to her 'specific needs' . Third party reports were stapled to the record card or stored in a manila folder. In 1998 she began using Medical Director for issuing prescriptions and occasionally used it to write referral letters. She continued to use handwritten patient records for consultations . Around 2000 she began using the GP system for keeping patient records. In order to assist in identifying information, she adopted the practice of highlighting medical conditions and other important information in different colours .
When Dr Lyons purchased his share of the practice from another doctor, the patient records were kept on cards and filed alphabetically in filing cabinets. In 1990 the practice adopted the GP system using a health summary sheet and separate consultation notes. Reception staff would fill in a patient's identification details on the health summary sheet. Dr Lyons would record the patient's medical history on the health summary sheet at the first consultation and make notes of any diagnosis and treatment in the consultation notes. Specialist notes and other reports were attached to the patient's file. Dr Lyons began using Medical director Software for writing prescriptions in conjunction with his paper records around 1997 .
Dr Sabag recorded and stored his patient records in accordance with the GP system. Reception staff would enter the patient's general details on the front of the file and on the top of the health summary sheet. Dr Sabag would record details of the patient and family medical history, current medical condition and current medication in the health summary during the first consultation. Any diagnosis, recommended treatment and other relevant details elicited during consultations was entered on the consultation notes sheet and added to the patient's manila folder .
Dr Mundkur initially used a card system but used consultation sheets from 1995 onwards. In 2000 he began to keep a record of prescriptions using the Medical Director Software Program. Later on he expanded his electronic record keeping including consultation notes, in addition to his paper records. Given that the writing on the patient records, some of which were not in Dr Mundkur's writing, was 'almost indecipherable' and that there were limited entries for each consultation, Stone J considered that 'the records were of little assistance in supporting a claim that copyright subsisted in the records' .
According to Stone J; 'The above summary of the evidence concerning the records kept in each of the sample practices shows that the record keeping of the practices have much in common'. She went on the make some general comments.
* With the exception only of the patient records of Dr di Michiel, all of the records that were tendered in evidence showed input by a number of persons including the receptionists and/or clerical staff in most instances .
* Although all except one of the sample practice records have multiple authors they cannot be regarded as works of joint authorship. According to Stone J, 'it is central to the concept of joint authorship (as opposed to co-authorship) that the product of the collaboration between authors is a joint work, not one in which the individual contributions are separate' . Each individual entry in the consultation notes is separate and distinct and there was no evidence of collaboration in the production of the records .
* The copyright status of individual entries in the consultation notes 'include identification of each work for which copyright is claimed, the identity of the author, whether the author is a qualified person and whether the work is an original literary work' .
* The applicant's submission that the summary sheets and consultation notes of each patient comprise one, alternatively two, original literary work was rejected by Stone J. She held that: 'As the patient records are not works of joint authorship and are not compilations, the consultation notes cannot be regarded as one work for the purpose of copyright. It is therefore necessary to identify each work for which copyright is claimed', and this had not been done .
* Assuming that each individual entry in the consultation notes and summary sheets is an identified work, it would be necessary to identify the author for each work and this has not been done . Furthermore, each author must be proven to be a qualified person. Although the evidence establishes that each of the sample doctors is an Australian citizen, there is no such evidence with respect to other authors of the medical records .
* None of the individual entries were regarded by Stone J as being original literary works. After considering relevant precedents, Stone J held that even entries containing 'some comment are not sufficiently substantial to qualify as works the product of independent intellectual effort directed to expression . She went on to opine: 'None of this denies the intellectual effort and professional skill needed to form the diagnoses, to select methods of treatment or to understand the significance of clinical data that is recorded, however, copyright protects a form of expression not this underlying expertise' .
Conclusions as to subsistence of copyright
Stone J, in applying the above principles concluded that she 'found little evidence to support a finding that copyright subsists in them'. She found copyright only in the referral letters, and in the consultation notes one of Dr di Michiel's patients. She did not find any instances of copyright in prescriptions or in any of the health summaries . The prescriptions consisted only of medications, their dosage and directions for use. As the summary sheets generally described a list of previous illnesses and procedures, Stone J opined that those records 'were not sufficiently substantial to qualify as original literary works embodying independent intellectual effort directed towards expression' .
Stone J was of the view that the referral letters in evidence 'showed independent intellectual effort of some (occasionally minimal) substance'. She was satisfied that copyright would subsist in the letters in evidence written by the sample doctors, however, it was only in the case of those letters identified and authored by those doctors that she could find were 'qualified persons' within the meaning of the Act .
Except for the consultation notes of Dr di Michiel, Stone J was not satisfied that they were original literary works in which copyright existed as they consisted mainly of notations of various aspects of the patient condition, results of examinations and test data. As such they did 'not display the independent intellectual effort in the expression necessary for copyright protection' . There was also the obstacle in that, with few exceptions, other doctors who had written in the records, and/or the specific entries they authored, were not identified .
According to Stone J, the consultation notes with respect to one of Dr di Michiel's patients were wholly written by an identified author who is a 'qualified person'. She regarded the accumulated work as forming a single work authored by one person rather than a body of individual entries . As such 'it was possible to discern a continuous narrative showing independent intellectual effort expended in expression'. Stone J went on to find that those specific consultation notes, although minimal, as a whole constituted 'an original literary work'. She went on to opine that Dr di Michiel would not have had copyright in the records authored by his former partner nor those records that had multiple entries by the two doctors .
Transfer of copyright interests to PHC
Although Stone J found that copyright subsisted in the medical record of one only of Dr di Michiel's patients, she went on to consider the question of whether Idameneo, on the assumption that such copyright existed, obtained an interest in the copyright in the records of each of the 12 practices in evidence. This required an analysis of the contracts for sale between Idameneo and each of the vendors.
Applying principles laid down in High Court cases, Stone J stated: 'Any discussion of the transfer of an interest in copyright must take place with full cognisance of the nature of copyright as a proprietary interest and the distinction between that interest and a proprietary interest in the medium in which the copyright subsists. Thus it is legally possible for property in the patient records of the sample practices to be held by PHC and any copyright in those records to be held by other persons' .
Stone J identified that it was only in the case of Dr Urquhart that the sale agreement expressly provided for the assignment of copyright with the sale of his practice . None of the other sale agreements mentioned copyright . She stated that: 'A legal assignment of copyright must be in writing signed on behalf of the assignor; Copyright Act s196(3)'. Further, that: 'A promise to assign is not an actual assignment and does not meet the requirements' of the section. However, there may be a right 'in equity such that the promisee is entitled to require the legal title to be assigned in accordance with the statutory provisions' .
With respect to the agreements, Stone J stated: In the absence of an explicit provision, an interest in copyright could only have passed under the agreements for sale if the description of one or more of the assets subject to the sale includes an interest in copyright; or (b) the implication of a term to that effect is necessary to give business efficacy to the contract' .
The di Michiel agreements specifically listed patient records and patient lists among the assets included in the sale of the practice, therefore, the property in the patient records was transferred to PHC in accordance with the contract . However, it was only in the sale agreement in respect of Dr Urquhart that provided for the assignment of copyright .
Stone J rejected a submission by PHC that a failure to find that PHC had acquired an interest in any copyright would lead to an absurdity . After an extensive review of precedent, Stone J was not persuaded that there was any provision for the transfer of an interest in copyright in the contract other than Dr Urquhart. She opined that, 'nothing in the evidence leads me to the view that assignment of copyright or the acquisition of any interest in copyright was necessary for the continued operation of the practice acquired by PHC or to give business efficacy to the contract' . She accepted that it was necessary for PHC to be able to draw upon information in the patient records and other third party documents but that it was not necessary for them to have copyright in the records for it to be able to carry on its business. PHC achieved control of the records by its ownership of the physical records . Further, that at the time of the sales the parties did not consider the use of copyright as opposed to the use of the physical records .
Stone J held that it was only necessary to consider the issue of consideration with regard to the sale agreement with respect to Dr Urquhart as this was the only agreement for which she found that copyright had passed . However, she held that no amount of the purchase price was specifically allocated to copyright .
Use of copyright to produce assessable income
After an extensive analysis of the contracts, Stone J held that the use of the physical records had been satisfied in relation to the patient records acquired under the di Michiel agreements. Insofar as the other sample practices were concerned she concluded that there was evidence of such use only in relation of four of the sample practices categorised as the Ginnane agreements.
With respect to one of the sample practices, Dr Parrisis, the doctor had created floppy disks of all patient information stored on his computer and handed them to a person at PHC. It was that doctor's understanding that PHC's IT staff copied the files from those disks directly to PHC's computer software system. It was also his understanding that all doctors practising at the practice then had access to the computerised data that he had compiled for each of his patients . Stone J accepted 'PHC's submission that this data migration from the sample practice records to the PHC computer system is a reproduction of the whole of the records and thus, by any standard, a use of any copyright that may have existed in the patient records' .
Conclusion by Stone J
* With the exception of the medical record of one of Dr di Michiel's patients and referral letters written by the sample doctors, Stone J concluded that copyright does not exist in any other record in evidence. The owner of the copyright in the aforementioned documents prior to the sale was the relevant sample doctor . She expressed the view that this did not imply that copyright can never subsist in medical records.
* Except in relation to handwritten letters by Dr Urquhart, who specifically provided for the assignment of any copyright he (or his company) had in the handwritten components of the patient records, Stone negated any ownership of copyright, or a licence to use that copyright, with respect to the other agreements .
* With respect to whether Idameneo gave consideration for copyright by virtue of the contact with Dr Urquhart, Stone J held that the purchase price for Dr Urquhart's practice was fully apportioned between goodwill and other items, therefore, Idameneo did not give any money consideration for copyright .
* With respect to the use of the physical records in producing assessable income, Stone J found that such use had been satisfied in relation to the patient records acquired under what she had categorised as the di Michiel agreements. Insofar as she concluded there was evidence of such use only in the case of the patient records from four sample practices from the Ginnane group.
Whether or not medical records can be regarded as copyright raises the issue of whether the purchase of a practice confers a benefit on the purchaser in the way of acquiring copyright and claiming tax deductions in relation to that copyright. Stone J was clearly of the view that copyright can subsist in consultation notes provided that it constitutes a continuous narrative authored by an identified doctor who is a qualified person under the Act. Referral letters are further examples in which copyright can subsist. Summary sheets and prescriptions are not. The issue of whether or not any of those documents is sufficient to attract copyright remains a matter of determination on a case-by-case basis if challenged. Ownership of the copyright prior to sale would also need to be established and whether the author was a qualified person under the Copyright Act (Cth).
Even if a copyright is held to subsist in a medical record, it is necessary to determine whether that copyright was transferred under the contract of sale. Where there is an express term under the contract that copyright is transferred upon sale, it is easier to determine. Where it is not an express term of the contract, the issue involves finding if there is an implied term to that effect, which is necessary to give business efficacy to the contract.
To be a valid contract the law requires that consideration be exchanged between the parties to the contract. The form of consideration that would be required under contracts for the purchase of a practice would be monetary. Where the contract specifically allocates a sum of money for the purchase of the copyright then it can be said that consideration has passed from the vendor to the purchaser with respect to that copyright.
Finally, there must be use of copyright to produce assessable income. It would appear from this case that the use of existing records transferred as part of the sale is a use in order to produce assessable income. Likewise the transference of data from one electronic form to another is sufficient to constitute use. However, it is not necessary to acquire copyright in the patient records in order to use them in producing assessable income where the records are transferred as part of the sale of the practice.
This was a complex and lengthy case. Stone J's judgment is 70 pages in length. This report has focused on summarising the issues as outlined by Stone J, her findings and conclusions. Throughout the judgment are extracts copied from patient records that would be of interest to Health Information Managers as examples of records kept by the sample practices. If any reader wishes to obtain a copy of the complete judgment they can obtain it by accessing www.austlii.edu.au, accessing the Federal Court of Australia contained within the Commonwealth site.
Judith Mair PhD, LLB, RN, RM, DNE
Faculty of Health Sciences, The University of Sydney
Lidcombe NSW 1825 AUSTRALIA
Where a literary, dramatic or artistic work to which neither of the last two preceding subsections applies, or a musical work, is made by the author in pursuance of the terms of his or her employment by another person under a contract of service or apprenticeship, that other person is the owner of any copyright subsisting in the work by virtue of this Part. 
Copyright does not protect facts or information. Copyright protects the particular form of expression of the information, namely the words, figures and symbols in which the pieces of information are expressed, and the selection and arrangement of that information. That facts are not protected is a crucial part of the balancing of competing policy considerations in copyright legislation. The information/expression dichotomy, in copyright law, is rooted in considerations of social utility. Copyright, being an exception to the law's general abhorrence of monopolies, does not confer a monopoly on facts or information because to do so would impede the reading public's access to and use of facts and information. Copyright is not given to reward work distinct from the production of a particular form of expression. 
Given that copyright protects the expression of an idea not the idea itself, it is necessary to bear in mind that the independent intellectual effort that is required to produce an original literary work must be effort directed to the expression of the idea. In the case or patient records, even the barest statement of a medical diagnosis, say 'hypertension' or 'urticaria', will have behind it considerable skill and expertise in reaching that diagnosis. Similarly the decision to prescribe certain medication is an exercise of the professional expertise of the doctor, however, merely writing the name of the medication, for instance 'Amoxil' or 'Adalaf, in the patient record does not involve any effort directed to the expression of an idea; it is not, however, directed to the expression of the idea.  Stone J referred to the fact that the definition of a 'literary work' under the Act includes a 'compilation' if it has been created through the exercise of skill and judgment. However, PHC did not contend that the patient records or any part of them are original literary compilations. The respondent suggested that this was because a compilation of facts would not constitute an original work .
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