Class Action Lawsuit Tests Baptist Billing Tactic
Originally published in Arkansas Business by Mark Friedman mfriedman@ABPG.com
A Little Rock Firefighter recently scored a legal victory against the state’s largest hospital system over how it bills patients injured by the actions of others. Chief US District Judge D.P. Marshall, Jr. Ruled that the suit, filed by Brian Whitley against Baptist Health of Little Rock, will proceed as a class action. Whitley is represented by
Heninger Garrison Davis with Jeff Leonard as lead counsel.
Baptists’s billing strategy, plaintiffs say, can delay and reduce financial settlements to which victims are entitled. Whitley’s suit stems from a car accident in November 2013, in which he was severely injured by a driver going the wrong way on Interstate 440. The firefighter, a North Little Rock resident with health insurance through QualChoice of Little Rock, was taken to Baptist Health Medical Center-Little Rock.
But instead of billing QualChoice for the medical care, Baptist Health filed a medical lien against Whitley. Here’s why: QualChoice would have paid a discounted rate negotiated with Baptist for its insurance customers. The medical lien against Whitley directly could result in a much higher list-price payment from the proceeds of any settlement Whitley would get from the at-fault driver’s insurance.
Whitley sued Baptist Health in 2016 and sought class-action status, accusing the hospital of violating the Arkansas Deceptive Trade Practices Act. Judge Marshall said the class members will be patients who had health insurance through one of six major providers and from whom Baptist sought to recover the full amount of the bill through other sources, such as the at-fault driver or his liability carrier.
In Whitley’s case, Baptist left a $64,000 lien in place against Whitley, even though it billed QualChoice for his treatment, and QualChoice paid a portion of the bill. The lien prevented Whitley from receiving a $50,000 settlement from the at-fault driver’s insurance carrier. The lien was eventually released, and Whitley received the settlement.
“It’s unclear exactly how many of these patients Baptist treated like Whitley,” Marshall wrote in his 22-page opinion and order filed Sept. 13 in U.S. District Court in Little Rock. More than 6000 people are estimated to be in the class. Baptist Health said in its court filings that first seeking payment from liability insurance carriers rather than a patient’s health insurance company is standard procedure for hospitals, and it did nothing wrong.
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One of Whitley’s attorneys, Jeffrey Leonard of Birmingham, Alabama, quizzed Donna Crutchfield, Baptist’s director of patient financial services, about what would be better financially for the patient – paying a health insurance copay for the treatment or the hospital’s full list amount of the price.
“We bill…the same way every single time, whether the patient is going to owe more or less,” Crutchfield said. “We don’t pay any attention to what ‘s best for the patient financially.”