Here is an analysis of the Renaissance Medical Foundation v. Lugo case decided by the Texas Supreme Court in 2025. You can read the full opinion by clicking here.
This case wrestled with whether a nonprofit health organization (NPHO) like Renaissance Medical Foundation can be held vicariously liable for the medical malpractice of its employed physicians, specifically when Texas law limits the control such organizations can exert over a doctor’s independent medical judgment.
What happened?
Rebecca Lugo sued after her daughter suffered permanent brain damage during surgery performed by Dr. Burke, a neurosurgeon employed by Renaissance Medical Foundation. Lugo claimed the Foundation should be held liable for Dr. Burke’s alleged negligence because he was their employee. Renaissance argued it wasn’t liable because Texas law prohibits such organizations from controlling how physicians exercise independent medical judgment, and thus they shouldn’t be responsible for malpractice.
Key legal question:
Does Texas law, particularly statutes governing nonprofit health organizations, change the usual common-law rules about vicarious liability for employee torts, given that these laws say NPHOs cannot interfere with doctors’ independent professional judgment?
What did the court decide?
The court confirmed that while NPHOs can employ physicians and may have some right of control, they cannot be held liable if exercising control over the alleged malpractice would interfere with the physician’s independent medical judgment. This limits the scope of vicarious liability compared to typical employer-employee setups.
The Court emphasized:
- The traditional common-law test for employment status (right to control the details and methods of work) still applies but is modified by the statute.
- Physicians retain independent medical judgment, which can’t be overridden by the NPHO without violating the law.
- Vicarious liability depends on whether the NPHO’s control relates to the alleged negligent acts and whether exercising such control would interfere with the doctor’s judgment.
- The Court rejected a piecemeal “task-by-task” approach but acknowledged the statute requires courts to carefully consider the nature of control in this unique statutory context.
Outcome:
The Court affirmed the denial of Renaissance’s motion for summary judgment because they hadn’t conclusively shown that any control over Dr. Burke’s allegedly negligent acts would interfere with his independent medical judgment. The case was sent back for further proceedings under this clarified legal standard.
Why it matters:
This decision carves out a nuanced middle ground. NPHOs can still be liable for employee physicians’ malpractice, but only where their control doesn’t infringe on independent medical judgment. It protects physicians’ autonomy while recognizing that NPHOs, as employers, can bear responsibility if they exercise proper control consistent with the law.
Girards Law Firm specializes in severe injury and wrongful death cases, especially those that involve brain damage, heart damage, spinal cord injuries or severe burns in Texas, Arkansas and Oklahoma. Contact us at www.girardslaw.com by using the chat feature for more information