Final answer:
Negligent credentialing occurs when a hospital retains a physician that they knew or should have known was incompetent.
Step-by-step explanation:
The correct answer is b. Negligent credentialing. Negligent credentialing occurs when a hospital retains a physician that the governing body of the hospital knew or should have known was incompetent. This means that the hospital failed to adequately screen the physician's qualifications and allowed them to practice despite their incompetence.
For example, if a hospital hires a physician without thoroughly reviewing their credentials and later finds out that the physician has a history of malpractice or incompetence, the hospital can be held liable for negligent credentialing if harm occurs as a result.
In this scenario, negligent credentialing would apply if the hospital knew or should have known about the physician's incompetence but still decided to retain their services.