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Posts Tagged ‘#hospital’

Eleventh Circuit Holds That Debt Collector Did Not Violate FDCPA Even Though It Misstated Name of Creditor In Collection Letter

Posted on: November 19th, 2018

By: Bill Buechner

The Eleventh Circuit very recently affirmed a district court’s ruling that a debt collector did not violate the Fair Debt Collection Practices Act even though the collection misstated the name of the creditor to whom the consumer owed the debt.

In Lait v. Medical Data Sys., 2018 U.S. App. LEXIS 31814 (11th Cir. Nov. 9, 2018) (per curiam), the plaintiff incurred medical expenses provided to him by Enterprise Medical Center. A debt collector sent the plaintiff a letter seeking to collect on the debt. The letter indicated that the debt collector was seeking to collect on the “accounts indicated below.” After two intervening paragraphs, the letter listed “Medical Center Enterprise” next to a service date, the plaintiff’s name, and an outstanding balance of $412. The letter did not expressly refer to Medical Center Enterprise as the plaintiff’s creditor.  Id. at *2.

The plaintiff alleged that the collection letter violated 15 U.S.C. § 1692g, which requires that debt collectors provide in writing certain information to a consumer in either the initial communication or within five days thereafter, including the name of the creditor to whom the debt is owed. The plaintiff did not contend that the different word order of the hospital in the letter caused him any confusion. Instead, the plaintiff asserted that the letter failed to “meaningfully convey” the name of the creditor to whom he owed the debt.

The Eleventh Circuit assumed, without deciding, that the plaintiff’s claim was governed by the least sophisticated consumer standard. Under this standard, the court presumes that the consumer “possess[es] a rudimentary amount of information about the world and a willingness to read a collection notice with some care.” Id. at *5 (citing cases).  Applying this standard, the Eleventh Circuit concluded that, because the plaintiff acknowledged that he had received medical treatment at a hospital called “Enterprise Medical Center,” the least sophisticated consumer “could be expected to connect the dots on a collection letter that lists the name ‘Medical Center Enterprise’ next to an outstanding balance.” Id. In other words, “[a] consumer who had been a patient at a hospital would surely understand the hospital to be the creditor when its name was listed next to the amount of the debt.” Id. at *5-6. Accordingly, the Eleventh Circuit held that the letter complied with § 1692g.

The Eleventh Circuit has applied the least sophisticated consumer standard to other sections of the FDCPA, including 15 U.S.C. §§ 1692e and 1692f.  Other circuits, including the Third, Sixth and Ninth Circuit have applied the least sophisticated consumer standard to claims brought pursuant to § 1692g as well. The Eleventh Circuit has suggested in at least one previous unpublished decision that it did not disagree with these other circuit decisions. The panel in Lait, however, suggested that concerns about obscuring information required to be disclosed under § 1692g could be addressed in other sections of the FDCPA. Lait, 2018 U.S. App. LEXIS 31814, at *4 n.2.

Thus, it remains an open question in the Eleventh Circuit as to whether the least sophisticated consumer standard applies to claims under § 1692g, or whether courts should simply consider whether the collection letter contains the information required by § 1692g without considering whether the least sophisticated consumer would understand it.

If you have any questions or would like more information, please contact Bill Buechner at [email protected].

Office of Inspector General Approves Warranty Program for Medical Device Manufacturer

Posted on: November 5th, 2018

By: Ali Sabzevari

The Department of Health and Human Services Office of Inspector General recently approved a medical device manufacturer’s proposed warranty program, which provides a refund to the hospital at which a patient underwent joint replacement surgery using the manufacturer’s knee or hip implant and related products, if the patient was readmitted within 90 days because of a surgical site infection or need for implant replacement surgery. The proposed model could serve as a road map for these kinds of risk sharing arrangements.

Advisory Opinion No. 18-10, which can be accessed here, set forth that although the suggested warranty implicates the safe harbor regulations to the anti-kickback statute, 42 C.F.R. § 1001.952, the “Proposed Arrangement poses a sufficiently low risk of fraud and abuse under the anti-kickback statute.”

The anti-kickback statute makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce or reward referrals of items or services reimbursable by a Federal health care program. See section 1128B(b) of the Act. Where remuneration is paid purposefully to induce or reward referrals of items or services payable by a Federal health care program, the anti-kickback statute is violated. By its terms, the statute ascribes criminal liability to parties on both sides of an impermissible “kickback” transaction. For purposes of the anti-kickback statute, “remuneration” includes the transfer of anything of value, directly or indirectly, overtly or covertly, in cash or in kind. The statute has been interpreted by several federal courts to cover any arrangement where one purpose of the remuneration was to obtain money for the referral of services or to induce further referrals.

The U.S. Department of Health and Human Services has promulgated safe harbor regulations that define practices that are not subject to the anti-kickback statute because such practices would be unlikely to result in fraud or abuse. See 42 C.F.R. § 1001.952. The safe harbors set forth specific conditions that, if met, assure entities involved of not being prosecuted or sanctioned for the arrangement qualifying for the safe harbor. However, safe harbor protection is afforded only to those arrangements that precisely meet all of the conditions set forth in the safe harbor.

The Advisory Opinion concludes that the Proposed Arrangement would not generate prohibited remuneration under the anti-kickback statute. Value-based care and risk sharing models continue to gain appeal, and the Office’s approval of this warranty program shows that the era of value-based care is here to stay.

If you have any questions or would like more information, please contact Ali Sabzevari at [email protected].

Did the Georgia Supreme Court Open the Door for a Personal Injury Defendant to Challenge the Reasonableness of a Plaintiff’s Medical Bills?

Posted on: June 24th, 2015

By: Abby A. Vineyard

Last week, the Georgia Supreme Court held that, where a lawsuit involves a question as to the validity of a hospital lien for charges for a patient’s care, the patient challenging the reasonableness of the charges is entitled to discover information relating to the amounts the medical provider charged other patients for similar care.  Bowden v. The Medical Center, Inc., No. S14G1632, 2015 WL 3658819 (Ga. June 15, 2015).

Danielle Bowden, who was uninsured, was treated at The Medical Center for injuries sustained in a car accident.  The Medical Center billed Bowden a total of $21,409.59 for her treatment and filed a hospital lien for the same amount.  After litigation ensued, Bowden filed a cross-claim against The Medical Center alleging “…her bill of $21,409.59 was grossly excessive and did not reflect the reasonable value in the community of her treatment.”

Bowden sought to discover information relating to how much The Medical Center charged other patients for similar treatment during the same time period.  The Medical Center objected and refused to provide the information, but the trial court granted Bowden’s motion to compel the information.  The Georgia Court of Appeals reversed the trial court’s order, agreeing with The Medical Center that the information sought was not relevant to Bowden’s claims.

The Georgia Supreme Court reversed the Georgia Court of Appeals’ opinion, holding that “the discovery Bowden sought may have some relevance to the reasonableness of [The Medical Center’s] charges for her care, and thus, assuming no other objections to her various requests are made and sustained…Bowden is entitled to see what the information and documents show and whether they support her claims and defenses.”  The Court emphasized that its ruling only applies to the discovery, rather than the admissibility, of the amounts medical providers charge other patients for similar care.  It reasoned that the concept of “relevance,” in the discovery context, has been broadly construed to mean “matter that is relevant to anything that is or may become an issue in the litigation.”

The Court’s decision opens the door for a lien defendant to challenge the validity of a hospital lien.  This decision raises a few interesting questions in the context of personal injury cases.  Can an insurer and/or a defendant in a personal injury case now challenge the reasonableness of the plaintiff’s medical bills, especially when the plaintiff is uninsured?  Will this lead to the amounts charged for other patients’ treatment being admissible at trial rather than only being discoverable?  Since medical providers have contracts with insurers under which they routinely accept a heavily-discounted percentage of the billed amount, will it be easier to argue that the actual billed amount is not reasonable?  It will be interesting to see if the Court expands its ruling when these kinds of issues are inevitably presented for the Court’s consideration.

Municipal Liability: No Action for Damages Against a Municipality in Georgia for its Failure to Provide Medical Care to an Inmate

Posted on: March 2nd, 2015

By: A. Ali Sabzevari

Earlier this month, the Georgia Supreme Court rendered its decision in City of Atlanta v. Mitcham, No. S14G0619, 2015 WL 659597 (Ga. Feb. 16, 2015), reversing the Georgia Court of Appeals’ flawed analysis in determining whether a municipality is entitled to sovereign immunity.  Last year, I noted that the Court of Appeals was erroneously blurring the distinction between the meaning of ministerial functions as pertinent to a City’s sovereign immunity and ministerial duties as pertinent to official immunity.  The Supreme Court, in reversing the Court of Appeals, agreed.

In Mitcham, an inmate was taken to a hospital because of “low blood sugar associated with diabetes.” When he was discharged, the hospital notified the City of the need to monitor his blood sugar and provide him with insulin.  When the City failed to monitor and regulate his insulin levels, the inmate suffered serious and permanent injuries.

Under Georgia law, cities are protected by sovereign immunity for acts taken in performance of a governmental function, but this immunity is waived for negligent performance of a ministerial function.

Governmental functions traditionally have been defined as those of a purely public nature, intended for the benefit of the public at large, without pretense of private gain to the municipality.  Ministerial functions, in comparison, are recognized as those involving the exercise of some private franchise, in which the general public has no interest.  The Supreme Court has acknowledged the difficulty in determining to which of the two classes a function belongs.

The Court of Appeals erroneously held that sovereign immunity in this case had been waived, stating that a government unit’s function of providing adequate medical care for inmates under its custody is ministerial in nature.  The Supreme Court reversed, finding that the care of inmates in the custody of a municipality is indeed a governmental function for which sovereign immunity has not been waived.

The operation of a jail and the care and treatment of individuals in police custody are purely governmental functions related to the governmental duty to ensure public safety and maintain order for the benefit of all citizens.  What this means, practically, is that in Georgia there can be no action for damages against a municipality for its failure to provide medical care to an inmate regardless of the presence of negligence.

For more information, contact A. Ali Sabzevari at 770.303.8633 or [email protected]