Louisiana Patients May Now Challenge Health Care Entities for Violations of the Balance Billing Act

In a ruling with broad repercussions for health care providers, patients and insurers, the Louisiana Supreme Court recently held that patients can sue health care providers directly for violations of the state’s Balance Billing Act (La. Rev. Stat. 22:1871 et. seq.). The Balance Billing Act prohibits health care providers, including doctors and hospitals, from collecting or attempting to collect from an insured patient any amount owed by the health insurer or amounts in excess of the contracted reimbursement rate between the patient’s insurance company and the provider. In the case of Anderson v. Ochsner Health System, the plaintiff, Yana Anderson was injured in an automobile accident caused by another driver and received medical treatment at an Ochsner facility. At the time she sought treatment at Ochsner, Ms. Anderson was insured by UnitedHealthcare and Ochsner was a “contracted health care provider” (also known as an in-network provider) with UnitedHealthcare. As a contracted health care provider, UnitedHealthcare had contracted with Ochsner for discounted rates for certain procedures and services for its insureds. However, instead of billing UnitedHealthcare for Ms. Anderson’s care, Ochsner sent a letter to Ms. Anderson’s attorney asserting a medical lien for the full amount of Ochsner’s charges, without any discount, on any recovery Ms. Anderson received from the lawsuit related to the underlying automobile accident. Ms. Anderson filed suit against Ochsner individually and on behalf of a putative class asserting that this practice violated the Balance Billing Act.

Although the Legislature did not explicitly include or prohibit a private right of action in the Balance Billing Act, Justice Clark, writing on behalf of the majority, held that the Act provides for such an action when a provider wrongfully seeks reimbursement from a patient. Rejecting Ochsner’s argument that a patient’s sole remedy was filing a complaint with the state Attorney General, the Court found that the legislature’s intent in enacting the Balance Billing Act was individual protection and “to make the burden on the violator more onerous, not less.” The Court also held that the medical lien asserted by Ochsner was enough to give Ms. Anderson the right to sue. However, the Court did not address whether the case could proceed as a class or the types and amounts of damages that could be awarded.

Following the Anderson ruling, the Louisiana Second Circuit Court of Appeal decided an appeal of a trial court judgment granting certification of a class seeking redress for violations of the Balance Billing Act.Baker v. PHC-Minden, L.P., 49,122 (La. App. 2 Cir. 8/13/14). Like the plaintiff in Anderson, the class representatives in the Baker class alleged that the Minden Medical Center’s policy of filing medical liens against insured patients involved in automobile accidents violated the Balance Billing Act. Although the Second Circuit recognized that a “trial court has wide discretion in deciding whether to certify a class and the decision will not be overturned absent a finding of manifest error or abuse of discretion,” it held that the class could not be certified because the legal theories raised by the Baker plaintiffs are “novel and untested” as “no jurisprudence exists whatsoever in regard to the actual merits of a claim brought as the result of alleged violations” of the Balance Billing Act.

Therefore, while Anderson opened the door for patients in Louisiana to seek legal remedies for violations of the Balance Billing Act, many questions remain unresolved that make the future of these cases murky. Until the courts or the legislature clarifies the type of damages available for successful plaintiffs, including the availability of mental anguish damages; the calculation of these damages for a successful plaintiff; and whether a class action can ever be certified to pursue these types of claims, the full protections of the Balance Billing Act will not be realized.