A Colorado hospital sued its patient for $229,112.13, claiming that the $74,597.35 it received from the patient’s health plan and the deductible it received from the patient were not enough for the patient’s back surgery and the three-night hospital stay after the surgery. The hospital had advised the patient before her back surgery that her estimated share of the medical expenses would be $1,336.90, of which she paid $1,000 before the surgery.
The hospital billed the patient’s self-funded ERISA health plan $303,888 for the surgery, two pre-surgical consultations, and the hospital stay. The employer contracted with a third-party health care consulting firm that audits medical bills and negotiates with health care providers on behalf of the employer’s health plan. The consulting firm concluded that $74,597.35 would be the hospital’s actual costs plus a fair profit margin.
The hospital was not satisfied with the payments it received and therefore sued the patient for nearly $230,000 in 2017.
Evidence introduced during the trial showed that the hospital paid about $31,000 for the surgical spinal implants that the hospital then charged the patient $197,640 on the hospital bill.
At the conclusion of the six-day trial that ended on June 11, 2018, the Colorado jury answered “No” to the question whether the hospital’s bills were reasonable. The jury reportedly determined that the hospital and the patient had a contract to pay “all charges of the hospital,” but the jury also found that the agreement was to pay “the reasonable value of the goods and services provided” and not the charges as established by the hospital. The Colorado jury determined that the patient owed the hospital only $766.74 more than what the hospital had already received.
After the Colorado jury rendered its verdict, the patient’s defense lawyer stated, “We had one expert, and they had three. They spent $100,000 on experts. The reality is that there’s nobody to say how much they’re charging is reasonable. They know they’re not going to collect from everybody, but in the end, it just reveals how antiquated and nontransparent the system is, because nobody understands the bill.”
The patient’s defense attorney was provided by and paid by her employer’s third-party health care consulting firm.
The hospital has vowed to appeal.
The third-party health care consulting firm stated after the verdict, “The jury decision reaffirms [our] successful business model of auditing overinflated and excessive hospital bills, and helping patients and business owners lower the cost of healthcare … We believe the jury decision shows our payments are fair to healthcare providers and reflect the values of the communities where our members live. Our commitment to fairness is one reason why [we have] a good working relationship with most providers — we have found that employers and providers can benefit from working together to establish more affordable healthcare.”
If you or a family member may be the victim of hospital malpractice in Colorado or in another U.S. state, you should promptly consult with a hospital malpractice attorney in Colorado or in your state who may investigate your hospital malpractice claim for you and represent you in a hospital malpractice case, if appropriate.
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