BERGAN MERCY HEALTH SYSTEM, APPELLANT, v. DONDI S. HAVEN, APPELLEE.
No. S-99-078
Supreme Court of Nebraska
December 15, 2000
620 N.W.2d 339 | 260 Neb. 846
Randall L. Goyette, of Baylor, Evnen, Curtiss, Grimit & Witt, for amicus curiae Nebraska Medical Association.
Neil B. Danberg, Jr., Lyman L. Larsen, and Michael J. Leahy, of Stinson, Mag & Fizzell, for amicus curiae Nebraska Association of Hospitals and Health Systems.
Denzel R. Busick for amicus curiae Nebraska Association of Trial Attorneys.
HENDRY, C.J., WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.
I. NATURE OF CASE
The two questions presented in this appeal are (1) whether the Nebraska medical lien statute,
II. FACTUAL BACKGROUND
The underlying facts of this case are not in dispute. Appellee Dondi S. Haven was injured in an automobile accident and was treated by appellant Bergan Mercy Health System (Bergan) from November 1 through 4, 1996, and on February 21 and June 5, 1997. There is no issue in this appeal whether the charges of $23,000 are the usual, customary, or reasonable charges as the parties have stipulated for the purposes of this motion that the charges are usual, customary, and reasonable.
Bergan‘s operative petition alleges that General Casualty Insurance (General Casualty) insured the tort-feasor responsible for Haven‘s injuries. Bergan alleges that it filed a notice of hospital lien with General Casualty, pursuant to
III. PROCEDURAL BACKGROUND
Bergan filed suit in the district court, alleging two “counts,” the first of which simply prayed for judgment on the unpaid debt, and the second of which invoked the provisions of
Bergan filed a motion for partial summary judgment, which the district court sustained on March 10, 1998. Haven filed a motion to reconsider, which was sustained on July 23, 1998. In its order sustaining the motion to reconsider, the district court
Trial was had to the district court on Jаnuary 15, 1999. Incorporating by reference the reasons stated in its order of July 23, 1999, the district court entered judgment in favor of Bergan on count I of its petition, finding that such services and supplies were provided at the specific request of Haven on an open account and per Haven‘s express agreement to pay. Haven has not cross-appealed the decision as to count I. As to count II, whether
Bergan filed a motion in this court to bypass the Court of Appeals, which was granted. Bergan has also properly filed a notice of a constitutional question as required by Neb. Ct. R. of Prac. 9E (rev. 2000).
IV. ASSIGNMENTS OF ERROR
Bergan assigns, consolidated and restated, that the district court erred in determining that (1)
V. STANDARD OF REVIEW
Whether a statute is constitutional is a question of law; accordingly, the Nebraska Supreme Court is obligated to reach a conclusion independent of the decision reached by the court below. State ex rel. Stenberg v. Moore, 258 Neb. 738, 605 N.W.2d 440 (2000); State ex rel. Stenberg v. Moore, 258 Neb. 199, 602 N.W.2d 465 (1999).
Statutes are afforded a presumption of constitutionality, and the unconstitutionality of a statute must be clearly established before it will be declared void. Daily v. Board of Ed. of Morrill Cty., 256 Neb. 73, 588 N.W.2d 813 (1999). The burden of establishing the unconstitutionality of a statute is on the one attacking its validity. Daily v. Board of Ed. of Morrill Cty., supra; State ex rel. Shepherd v. Neb. Equal Opp. Comm., 251 Neb. 517, 557 N.W.2d 684 (1997).
Statutory interpretation is a matter of law, in connection with which an appellate court has an obligation to reach an independent, correct conclusion irrespective of the determination made by the court below. Phelps Cty. Bd. of Equal. v. Graf, 258 Neb. 810, 606 N.W.2d 736 (2000); Snyder v. Contemporary Obstetrics & Gyn., 258 Neb. 643, 605 N.W.2d 782 (2000).
VI. ANALYSIS
1. SPECIAL LEGISLATION
Bergan assigns that the trial court erred in determining that
Whenever any person employs a physician, nurse, or hospital to perform professional service or services of any nature, in the treatment of or in connection with an injury, and such injured person claims damages from the party causing the injury, such physician, nurse, or hospital, as the case may be, shall have a lien upon any sum awarded the injured person in judgment or obtained by settlement or compromise on the amount due for the usual and customary charges of such physician, nurse, or hospital applicable
at the times services are performed, except that no such lien shall be valid against anyone coming under the Nebraska Workers’ Compensation Act.
A legislative act constitutes special legislation, violative of
A legislative classification, in order to be valid, must be based upon some reason of public policy, some substantial difference of situation or circumstances, that would naturally suggest the justice or expediency of diverse legislation with respect to the objects to be classified. Big John‘s Billiards v. Balka, ante p. 702, 619 N.W.2d 444 (2000); State ex rel. Douglas v. Marsh, 207 Neb. 598, 300 N.W.2d 181 (1980). See, also, Haman v. Marsh, 237 Neb. 699, 467 N.W.2d 836 (1991). Classifications for the purpose of legislation must be real and not illusive; they cannot be based on distinctions without a substantial difference. State ex rel. Douglas v. Marsh, supra.
The general test of constitutionality with respect to prohibitions against special legislation is reasonableness of classification and uniformity of operation. Classification is proper if the special class has some reasonable distinction from other subjects of a like general character, which distinction bears some reasonable relation to the legitimate objectives and purposes of the legislation. Kuchar v. Krings, 248 Neb. 995, 540 N.W.2d 582 (1995); State ex rel. Douglas v. Marsh, supra. The question is always whether the things or persons classified by the act form by themselves a proper and legitimate class with reference to the purpose of the act. Id.
As Haven has conceded that
In fact,
(a) Hospitals, Doctors, and Nurses
In an attempt to lessen the burden imposed on hospitals by nonpaying accident cases, the legislatures of many states have enacted statutes which give a hospital a lien upon any recovery which the patient might receive from a tort-feasor causing the injuries for which treatment is given, or upon claims which the patient may have on account of the injuries for which the hospital rendered treatment. See, generally, Annot., 16 A.L.R.5th 262 (1993 & Supp. 2000). Forty-two states and the District of Columbia have laws authorizing liens for medical care provided for injuries resulting from an accident or wrongful act. See Meta Calder, Florida‘s Hospital Lien Laws, 21 Fla. St. U. L. Rev. 341 (1993). Nebraska‘s statute, first enacted in 1927, is the oldest in the United States. Id.
The underlying goal of a hospital lien statute is to lessen the burden on hospitals and other medical providers imposed by nonpaying accident cases. In re Guardianship & Conservatorship of Bloomquist, 246 Neb. 711, 523 N.W.2d 352 (1994). In Buchanan v. Beirne Lumber Company, 197 Ark. 635, 639, 124 S.W.2d 813, 815 (1939), the Supreme Court of Arkansas noted that the Arkansas hospital lien law was “enacted for the very humane purpose of encouraging physicians, hospitals and nurses to extend their services and facilities to indigent persons
Legislative history is unavailable for the original 1927 enactment of the predecessor to
The legislative history states:
The purposes of the lien law include the following:
—It helps health care providers by ensuring they are paid for their services out of the proceeds of any litigation arising from a patient‘s injuries; and
—It helps the patient because it provides a measure of security to the health care provider thereby diminishing or eliminating altogether the need to pursue other collection efforts.
Introducer‘s Statement of Intent, L.B. 172, Committee on Health and Human Services, 94th Leg., 1st Sess. (February 8, 1995).
The testimony provided at the committee hearing on the bill provided support for the stated objectives of the legislation. The tеstimony provided by representatives of hospitals and health care professionals generally established that health care providers give care to injured persons without regard to a person‘s ability to pay for such care and that the restriction placed on
Senator Wesely, in his remarks introducing L.B. 172 for floor debate, stated:
But the bottom line of why we are trying to do this is to recognize that if we don‘t provide for the medical care providers to be compensated for the care that they provide individuals, you will have a loss of millions of dollars to hospitals and other medical providers. And then you will have a problem, I think, resulting in these hospitals so quickly and completely giving care to individuals in trauma situations and otherwise needing medical assistance. . . . [T]he bottom line is that if we don‘t pass this bill, we will see hospitals losing millions of dollars, and in turn I think jeopardizing the care provided by those hospitals, and particularly the trauma care provided by those hospitals . . . .
Floor Debate, 94th Leg., 1st Sess. 2958 (March 23, 1995).
The facts underlying these comments establish thе reasonable basis for the distinction between doctors, nurses, and hospitals and other creditors. Unlike other creditors, doctors, nurses, and hospitals may be called upon to provide services without first ascertaining the patient‘s ability to pay. See,
This distinction also “bears some reasonable relation to the legitimate objectives and purposes of the legislation.” Id. The clear public purpose of the law, as stated in the legislative history, is to protect health care providers so that they can continue to provide care, particularly trauma care, to those who require such care without regard to a patient‘s ability to pay. The Legislature‘s clear intent was to ensure that medical care remained available to indigent persons by supplying health care providers with a means for eventually securing some compensation for the potentially charitable act of providing care to an injured party who is unable to pay.
Support for this argument is found in Campbell v. City of Lincoln, 195 Neb. 703, 240 N.W.2d 339 (1976). In that case, the appellant argued that the Political Subdivisions Tort Claims Act was special legislation because it placed persons injured by governmental torts in a different class than those injured by private torts. Id. This court rejected this argument, stating:
The act creates one single class of tort-feasors — all political subdivisions — which includes “villages, cities of all classes, counties, school districts, public power districts, and all other units of local government.” The act applies equally and uniformly to all tort claims against a political subdivision. The fact that public agencies, generally speaking, differ from private persons or corporations in many respects is obvious.
Id. at 709, 240 N.W.2d at 342. This court further stated that “[t]he taxpaying public has an interest in seeing that prompt and thorough investigation of claims is made where a political subdivision is involved. The public does not have such an interest as to claims against private persons or corporations.” Id. at 710, 240 N.W.2d at 343.
Similarly, in the instant case,
See, also, Taylor v. Karrer, 196 Neb. 581, 586, 244 N.W.2d 201, 204 (1976), disapproved on other grounds, Jorgensen v. State Nat. Bank & Trust, 255 Neb. 241, 583 N.W.2d 331 (1998) (2-year statute of limitations for professionals not special legislation because “[t]he situation of professional people and of those to whom they render services is substantially different from the normal situation encountered in the rendering of ordinary services and injuries sustained thereby“).
The Nebraska Association of Trial Attorneys, as amicus curiae, argues that the classification of doctors, nurses, and hospitals is unconstitutional because there is no reasonable distinction between doctors, nurses, and hospitals and other creditors whose services have been necessitated by an injury such as рhysical therapists, home health care aides, chauffeurs, or babysitters. This argument is without merit.
As we have noted in the context of equal protection, when the Legislature seeks to inaugurate reforms in the area of economics or social welfare, it need not choose between attacking every aspect of the problem or not attacking the problem at all. Distinctive Printing & Packaging Co. v. Cox, 232 Neb. 846, 443 N.W.2d 566 (1989). The fact that the Legislature has not protected the interests of other persons whose services are necessitated by accidents does not preclude it from addressing the needs of doctors, nurses, and hospitals, whose services are frequently necessitated by injury accidents, and whose financial well-being is most directly affected by the inability of injured persons to pay for their care.
Nor is the purpose of the Legislature limited to protecting the interests of doctors, nurses, and hospitals. In Prendergast v. Nelson, 199 Neb. 97, 256 N.W.2d 657 (1977), the appellant raised special legislation and equal protection challenges to the then applicable version of the Nebraska Hospital-Medical Liability Act,
The appellant in that case also argued that the act could not be justified on the basis of the societal circumstаnces under which it was alleged to have been adopted. Id. We rejected that argument, stating:
Defendant . . . assumes the legislation was enacted to relieve doctors or insurance companies of some of their burden. We do not accept defendant‘s premise. Doctors and insurance companies are able to protect themselves against financial burdens by passing the cost on to their patients. Because they were doing so, [they] created part of the problem. The Legislature deemed it necessary to exercise its police power to make available qualified medical services at reasonable prices for the Nebraska public. We find no constitutional violation of this effort.
Id. at 119-20, 256 N.W.2d at 671.
Similarly, in the instant case, doctors, nursеs, and hospitals would be equally able to protect themselves from the effects of nonpaying accident cases by passing those costs on to other patients, and by pursuing immediate collection efforts against accident victims. The Legislature has not violated the constitution by seeking to eliminate the need for such collection efforts, thus making medical services more affordable for all citizens of Nebraska by enacting
(b) Persons Injured by Tort-Feasors
The classification of those injured by tort-feasors is also constitutionally justified. The distinction between those injured by tort-feasors and injured parties generally is clear—where persons are injured by tort-feasors, the ultimate legal responsibility for the injuries sustained rests with the tort-feasor and not the injured party. Therеfore, those injured by tort-feasors are substantially different from other injured parties.
The public policy underlying the statute is that doctors, nurses, and hospitals are intended to be compensated by any judgment or settlement reached as compensation for the injuries
We determine that Bergan‘s assignment of error has merit, as
2. STATUTORY CONFLICT
Bergan assigns that the trial court erred in determining that
(1) Except as provided in subsection (2) of this section, all proceeds and benefits, including interest earned thereon, which are paid eithеr in a lump sum or are accruing under any structured settlement providing periodic payments, which lump-sum settlement or periodic payments are made as compensation for personal injuries or death, shall be exempt from attachment, garnishment, or other legal or equitable process and from all claims of creditors of the beneficiary or the beneficiary‘s surviving dependents unless a written assignment to the contrary has been obtained by the claimant.
(2) All proceeds and benefits, including interest earned thereon, which are paid for personal injuries may be garnished by a county attorney or authorized attorney pursuant to
section 43-512.03 or garnished for child support as defined insection 43-1705 by an obligee as defined insection 43-1713 .
Under the trial court‘s resolution of the perceived conflict betweеn
Repeal by implication, however, is not favored. Hamilton v. Hamilton, 242 Neb. 687, 496 N.W.2d 507 (1993); Sarpy Co. Pub. Emp. Assn. v. County of Sarpy, 220 Neb. 431, 370 N.W.2d 495 (1985). A statute will not be considered repealed by implication unless the repugnancy between the new provision and the former statute is plain and unavoidable. See id. In the absence of clear legislative intent, the construction of a statute will not be adopted which has the effect of nullifying or repealing another statute. See In re Invol. Dissolution of Battle Creek State Bank, 254 Neb. 120, 575 N.W.2d 356 (1998). See, also, Sarpy Co. Pub. Emp. Assn. v. County of Sarpy, supra.
We note that while
In this case, we can find no clear indication of an intent to repeal in the language or legislative history of either section. Consequently, we must endeavor to construct the statutes in a way which harmonizes them. In re Invol. Dissolution of Battle Creek State Bank, supra. See, also, Sarpy Co. Pub. Emp. Assn. v. County of Sarpy, supra. Moreover, we have noted that
To the extent that there is conflict between two statutes on the same subject, the specific statute controls over the general statute. See In re Invol. Dissolution of Battle Creek State Bank, supra.
We have stated that “‘[w]here general and special provisions of statutes are in conflict, the general law yields to the special, without regard to priority of dates in enacting the same, and a special law will not be repealed by general provisions unless by express words or necessary implication . . . .‘” (Citations omitted.) Nebraska Equal Opp. Comm. v. State Emp. Retirement Sys., 238 Neb. 470, 472, 471 N.W.2d 398, 400 (1991).
In this instance,
Bergan argues briefly that the statutes can be harmonized by holding that a “claim” under
VII. CONCLUSION
We conclude that
REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.
HENDRY, C.J., dissenting.
I respectfully dissent from the majority opinion insofar as it addresses
We have interpreted this constitutional provision to mean:
When the Legislature confers privileges on a class arbitrarily selected from a large number of persons standing in the same relation to the privileges, without reasonable distinction or substantial difference, then the statute in question has resulted in the kind of improper discrimination prohibited by the Nebraska Constitution. Haman v. Marsh, 237 Neb. 699, 467 N.W.2d 836 (1991). A legislative act can violate article III, § 18, in one of two ways: by creating a totally arbitrary and unreasonable method of classification, or by creating a permanently closed class.
Swanson v. State, 249 Neb. 466, 479, 544 N.W.2d 333, 341-42 (1996).
Further, in Stanton v. Mattson, 175 Neb. 767, 773, 123 N.W.2d 844, 849 (1963), we said, “The very purpose of Article III, section 18, of the Constitution, is to prevent legislative action which
In this appeal, Haven asserts that the medical lien statute,
The privilege granted by
Haven instead argues that the act creates two classes consisting of those injured by tort-feasors and those not injured by tort-feasors. Neither of these two purported classes, however, is granted the privilege of the lien which the statute creates. Notwithstanding, Haven contends there is in effect a privilege granted to people not injured by tort-feasors. The privilege for people in this “class” is that there is no lien which attaches due to the rendering of professional sеrvices to that person.
What Haven is asserting is the act, in its application, discriminates against people such as Haven, who are injured by tort-feasors, in the form of a lien. This, in my view, is an equal protection claim and does not address the issue of whether
To establish standing to bring a special legislation claim, the plaintiff must show that the statutе is depriving him or her of a constitutionally protected right. State v. Cushman, 256 Neb. 335, 589 N.W.2d 533 (1999); Kalisek v. Abramson, 257 Neb. 517, 599 N.W.2d 834 (1999); Metropolitan Utilities Dist. v. Twin Platte NRD, 250 Neb. 442, 550 N.W.2d 907 (1996); State ex rel. Dept. of Health v. Jeffrey, 247 Neb. 100, 525 N.W.2d 193 (1994). In order to establish standing, Haven must show that his constitutional rights are being violated because the privilege granted under
As Justice Shanahan stated in his concurrence in School Dist. No. 46 v. City of Bellevue, 224 Neb. 543, 556, 400 N.W.2d 229, 238 (1987):
Ordinarily, a challenge to constitutionality of a statute on the ground that the assailed statute denies equal rights and privileges by discriminating between persons or classes may not be made by one not belonging to the class alleged to be discriminated against. See Griffin v. Gass, 133 Neb. 56, 274 N.W. 193 (1937). See, also, Ritums v. Howell, 190 Neb. 503, 209 N.W.2d 160 (1973) (one who is not harmfully affected by a particular feature of a statute, alleged to be unconstitutional, may not urge the unconstitutionality of the statute in question).
In my view, the only persons who would have standing to assert that
Accordingly, because I believe Haven lacks standing, I would withhold any opinion regarding whether
McCORMACK, J., dissenting.
I believe that
PART I
I agree with the majority regarding the fact that
The unreasonable classifications of the statute are the result of the Legislature‘s not choosing a legitimate objective and enacting legislation to achieve that objective. If the objective is to provide for emergency care, for instance, then the statute is too broad because it is not limited to emergency care. If the objective, however, is tо provide for all health care needs, then the statute is too narrow because it does not encompass all health care providers.
Classifications for the purpose of legislation must be real and not illusive; they cannot be based on distinctions without a substantial difference. State ex rel. Douglas v. Marsh, 207 Neb. 598, 300 N.W.2d 181 (1980). I see no substantial difference between hospitals, doctors, and nurses and other health care providers whose services are equally necessary and valuable to persons injured by tort-feasors.
In Stanton v. Mattson, 175 Neb. 767, 123 N.W.2d 844 (1963), the appellant sought a declaratory judgment regarding the constitutionality of a statute allowing higher interest rates for retail
Are there real differences in situаtion and circumstances that warrant making retail sellers on installment contracts a reasonable classification for fixing a higher interest rate for a loan or forbearance of money, goods, or things in action?
We can see no valid reason, nor has one been pointed out to us, that warrants retail sellers to charge a rate of interest that is denied to all others.
Id. at 771, 123 N.W.2d at 847-48.
Similarly, in the instant case, there is no valid reason for affording hospitals, doctors, and nurses a method of securing debts that is denied other providers of necessary health care services. From the perspective of indigent injured persons, there is no reasonable distinction between the services provided by hospitals, doctors, and nurses and other necеssary services of other health care providers.
PART II
Second, I do not believe the classification of persons injured by tort-feasors forms, by itself, a proper and legitimate class with reference to the ostensible purpose of the act. See, Kuchar v. Krings, supra; State ex rel. Douglas v. Marsh, supra. While encouraging the provision of health care to indigent accident victims is a worthwhile legislative purpose, the terms of
The legislative history of
This creates the possibility that an injured person could have access to health insurance, yet the hospital, doctor, or nurse
Similarly, the legislative history indicates that one of the primary concerns of the Legislature was the financial effect of uncompensated emergency care. The statute, however, does not limit the costs that can be secured by the lien to the costs of emergent care. Compare
| State: | Limitation of Lien: |
| Alabama | Limited to 1 week after receiving injury |
| California | Limited to first 72 hours of emergency; then lien attaches to 50 percent of final judgment or settlement |
| Illinois | Lien based on “ward rates” and limited to one-third of sum paid |
| Kansas | Lien may not exceed $5,000 |
| Maryland | Limited to 50 percent of recovery |
| Massachusetts | Limited to “ward charges” |
| Missouri | Limited to $25 a day and reasonable costs of necessary x ray, laboratory, operating room, and medication; limited to 50 percent of recovery after attorney fees |
| New Jersey | “Ward rates.” Limited to 25 percent of total recovery |
| New York | Limited to “cost rates” for injury received up to 1 week prior to hospitalization |
| North Carolina | Limited to 50 percent of total amount recovered exclusivе of attorney fees |
| Tennessee | Limited to one-third of recovery |
| Texas | Limited to hospital charges from first 100 days of hospitalization for person admitted to hospital within 72 hours of accident |
| Virginia | Limited to $1,500 for hospital and $300 for physician, nurse, or physical therapist |
| Washington | Limited to 25 percent of recovery |
Moreover, the testimony from the legislative history indicates that the primary complaint of health care providers was that they would incur financial losses from nonpaying accident cases. This concern, however, could be alleviated by the limited step of allowing health care providers a lien to recover the actual costs of the treatment. See, e.g.,
In short, I believe that the purpose of making health care available for indigent accident victims is not reasonably related to the overly broad classification of persons injured by tort-feasors, as all persons injured by tort-feasors are not indigent. The vast majority of people who enter hospitals have insurance and are, therefore, not indigent. The further objection that I have to
Hence, I respectfully dissent.