This article has been published in “The Advocate”, a monthly publication of the Arizona Association for Justice/Arizona Trial Lawyers Association, March-April 2015 issue, @2015 by Steven J. Bruzonsky, Esq.
Hospital Medicare Advantage Balance Billing
Medicare Advantage Balance Billing Class Action Litigation Consent Judgments and Settlement Agreements:
The hospital Medicare Advantage balance billing class action Complaint was filed on May 20, 2014 in Aycock et al v. Scottsdale Healthcare Corp., Dignity Health, and John C. Lincoln Health Network, Maricopa County Superior Court, CV2014-006892. The legal basis of the Complaint is that federal Medicare/Medicare Advantage statutes and regulations prohibit Medicare Advantage balance billing and that this federal scheme preempts Arizona law including A.R.S. §33-931 et seq. The case was removed to the U.S. District Court, District of Arizona, Case No. 2:14-cv-01483-DLR and assigned to the Honorable Douglas L. Rayes.
On October 14, 2014, Judge Rayes signed an Order approving a Consent Judgment for Defendants Scottsdale Healthcare (SHC) and John C. Lincoln Health Network (JCL), ordering as follows: (1) From the date of this Consent Judgment forward, SHC and JCL are permanently enjoined from filing or recording A.R.S. §33-931 liens for which they “billed or received payment” from a Medicare Advantage Organization (MAO). (2) Concerning A.R.S. §33-931 liens (Medicare Advantage balance billing) filed or recorded prior to the date of this Consent Judgment, Defendants SHC and JCL shall not seek payment of such liens. Upon written request, which may be emailed to firstname.lastname@example.org, SHC or JCL shall record a Lien Release within seven days of the request. (3) From the date of this Consent Judgment forward, if SHC or JCL inadvertently records or accepts money to satisfy a lien (Medicare Advantage balance billing), then upon written request (including email), SHC or JCL shall record a Lien Release and return any monies paid to satisfy the lien within fourteen days of the request.
On December 11, 2014, Judge Rayes signed an Order approving a Consent Judgment for Defendant Dignity Health (Dignity), with the Order essentially the same as the one for SHC and JCL, except that (1) the permanent injunction on filing A.R.S. §33-931 liens, from the date of the Consent Judgment forward, applies only “after having received any payment” from a MAO; and (2) Dignity may assert or enforce A.R.S. §33-931 liens (Medicare Advantage balance billing) for the purpose of collecting unpaid “cost sharing”, as defined by 42 C.F.R. § 422.2 or other applicable Medicare Advantage statutes and regulations, owed by that enrollee. Requests to Dignity to record a Lien Release may be emailed to email@example.com.
Banner Health entered into a Settlement Agreement, effective January 1, 2015, which mirrors the terms of the Aycock et al v. Scottsdale Healthcare Corp., Dignity Health, and John C. Lincoln Health Network Consent Agreement and Order, except that this Settlement Agreement does not provide for any refunds for liens (Medicare Advantage balance billing) previously compromised and released. Tuscon Medical Center is in process of entering into a similar agreement which does not provide for any refunds for liens (Medicare Advantage balance billing) previously compromised and released.