Lead Opinion
MCG Health, Inc. appeals from the trial court’s ruling on summary judgment that the hospital lien it filed pursuant to OCGA § 44-14-470 et seq. for hospital care furnished to Christopher Eight was void, and from the award of attorney fees and expenses of litigation to Eight pursuant to OCGA § 13-6-11. For the following reasons, we reverse.
MCG Health (the Hospital) operates a hospital under the name MCG Medical Center. On March 21, 2007, the Hospital filed a lien pursuant to OCGA § 44-14-470 et seq. for hospital care furnished to Eight from February 4 to February 20, 2007, for hospital charges in the amount of $36,177.68. It is undisputed that the hospital care was furnished to Eight for injuries he sustained in an automobile accident in which Eight was a passenger in a car driven by an allegedly intoxicated driver (the tortfeasor), and that the Hospital furnished the care pursuant to a contract with Eight’s managed health care insurer, Blue Cross/Blue Shield (Blue Cross).
Pursuant to OCGA § 44-14-470 (b), the lien for hospital care furnished to Eight was a lien “upon any and all causes of action” accruing to Eight on account of the injuries that necessitated the care. In December 2007, after Eight received an offer from the tortfeasor to settle his cause of action for the
After Eight moved for summary judgment, the Hospital also moved for summary judgment on its counterclaim and on Eight’s claims. In February 2010, the trial court entered an order granting partial summary judgment in favor of Eight on his claims seeking declaratory and equitable relief; ruling that the hospital lien filed on March 21, 2007, was invalid and “void ab initio”; directing the clerk to cancel the lien; and ruling that the Hospital was not entitled to use the lien to collect any unpaid deductibles or co-pays sought in its counterclaim. The trial court denied Eight’s motion for summary judgment on his claim for attorney fees pursuant to OCGA § 13-6-11, and denied the Hospital’s motion for summary judgment on all issues. In June 2012, the trial court entered an order (pursuant to consent of the parties) dismissing with prejudice Eight’s remaining counts in the complaint (except the count seeking attorney fees and expenses), and ruling that Eight owed the Hospital the $863.10 amount sought in its counterclaim for unpaid deductibles and co-pays, but with payment deferred until resolution of Eight’s claim for attorney fees and expenses. In August 2012, the trial court appointed a special master to conduct a hearing and rule on Eight’s claim for attorney fees and expenses pursuant to OCGA § 13-6-11, and on October 9, 2012, after an evidentiary hearing, the special master awarded Eight attorney fees in the amount of $40,950 and expenses in the amount of $3,376.60. On October 29, 2012, the trial court entered its final judgment in the case adopting the special master’s award subject to a set-off in the amount of $863.10 in favor of the Hospital.
1. The Hospital contends that the trial court erred by granting partial summary judgment in favor of Eight on his claims that the hospital lien filed on March 21, 2007, pursuant to OCGA § 44-14-470 (b) was invalid and void on the basis that, when the lien was filed, there was no debt owed to the Hospital for the care furnished to Eight under the contract with Blue Cross.
Eight was a member of the Blue Cross managed health care insurance plan, and the hospital care furnished to Eight for injuries he suffered in the accident was covered under a contract between the Hospital and Blue Cross. Under the contract, the Hospital agreed to discount its billed charges for covered hospital care and accept the discounted amount as “payment in full” for the covered care provided to Blue Cross members. The contract allowed the Hospital to bill Eight directly for deductibles and co-pays owed by Eight to the Hospital, but the Hospital agreed under the contract not to balance-bill Eight for the difference between the Hospital’s billed charges and the discounted amount due under the contract.
Subsequent to February 8, Eight received additional care furnished by the Hospital for his injuries. On February 15, 2007, Eight received care resulting in billed charges of $294 discounted to $ 119.98 and paid by Blue Cross on March 30, 2007, and a deductible or co-pay owed by Eight of $85.82. On February 20, 2007, Eight received care resulting in billed charges of $345.39 discounted to $141.12 and paid by Blue Cross on March 30, 2007, and a deductible or co-pay owed by Eight of $100.66. On February 27,2007, Eight received care resulting in billed charges of $252 discounted to $141.12 andpaidby Blue Cross on March 30, 2007, and a deductible or co-pay owed by Eight of $35.28. On March 2 to March 15, 2007, Eight received care resulting in billed charges of $1,124.45 discounted to $629.58 andpaidby Blue Cross on April 30, 2007, and a deductible or co-pay owed by Eight of $157.40. And on April 3 to April 5, 2007, Eight received care resulting in billed charges of $599.60 discounted to $335.78 and paid by Blue Cross on May 16, 2007, and a deductible or co-pay owed by Eight of $83.94. Accordingly, for hospital care furnished from February 4 to April 5, 2007, Eight owed the Hospital a total of $863.10 in deductibles or co-pays, the same amount the Hospital sought from Eight in its counterclaim, and the same amount that the trial court awarded to the Hospital in the consent order on the counterclaim and in the final judgment.
Pursuant to OCGA § 44-14-471 (b), the Hospital filed the lien on March 21, 2007, stating “the amount claimed to be due for the hospital. . . care” ($36,177.68); stating “the dates of admission and discharge of the patient” (from February 4 to February 20, 2007) for the furnished care; and showing that the lien was filed, as required, “within 75 days after the person has been discharged... .’’As shown above, when the Hospital filed the lien, the amount still owed to the Hospital under the Blue Cross contract for care furnished from February 4 to February 20 was $261.10 in unpaid discounted payments due from Blue Cross, and $186.48 in unpaid deductibles or co-pays due from Eight. During that period, there were also unpaid “write-offs” from the Hospital’s billed charges: $23,603.81 written off for treatment furnished from February 4 to February 8, and $378.29 written off for additional treatment furnished between February 8 and February 20.
Despite the unpaid sums, the trial court granted partial summary judgment in favor of Eight and declared the hospital lien void on the basis that, when the lien was filed on March 21, 2007, no debt was owed to the Hospital under the contract with Blue Cross for care furnished to Eight during the lien period from February 4 to February 20, 2007. In reaching this conclusion, the trial court relied on the decision in Constantine v. MCG Health,
Pursuant to OCGA § 44-14-470 (b), a hospital operating in this state
shall have a lien for the reasonable charges for hospital. . . care and treatment of an injured person, which lien shall be upon any and all causes of action accruing to the person to whom the care was furnished or to the legal representative of such person on account of injuries giving rise to the causes of action and which necessitated the hospital... care The lien provided for in this subsection is only a lien against such causes of action and shall not be a lien against such injured person, such legal representative, or any other property or assets of such persons and shall not be evidence of such person’s failure to pay a debt.
The statute enables hospitals to collect payment for unpaid reasonable charges for furnishing hospital care to an injured person by giving the hospital a lien against any cause of action that accrues to the injured person arising out of the injuries that necessitated the care. The cause of action referred to by the statute is the injured person’s right to claim that a tortfeasor caused the personal injuries that necessitated the hospital care, and to seek compensation from the tortfeasor for the injuries and economic damages including charges for the hospital care. Where a tortfeasor (or an insured tortfeasor’s insurance company) makes liability payments to the injured person to cover the economic damages caused by the tortfeasor, the payments are subject to the hospital lien for the unpaid charges for hospital care. State Farm Mut. Automobile Ins. Co. v. Adams,
Eight’s cause of action against the tortfeasor for injuries and economic damages he sustained in the accident was not limited to seeking economic damages represented by the discounted amounts paid on the Hospital’s billed charges under the contract with Blue Cross. Rather, Eight was entitled to recover medical expenses arising from his injuries, including hospital charges, that were “reasonable and necessary.” Allen v. Spiker,
Under the lien provisions of OCGA § 44-14-470, the Hospital steps into Eight’s shoes for purposes of receiving payment from the tortfeasor or the tortfeasor’s insurance company for economic damages represented by the hospital charges. Adams,
The Hospital’s contract with Blue Cross and its members provided that the Hospital would write off or reduce portions of its billed charges for hospital care, and that the Hospital would accept the reduced charges as full payment for services covered under the contract without balance-billing members for the difference. The absence of debt owed to the Hospital under the contract with Blue Cross, and the Hospital’s agreement in the contract not to balance-bill Blue Cross members to collect the difference between the reduced charges and the billed charges, cannot be construed as a waiver or preclusion of the Hospital’s lien rights under OCGA § 44-14-470 et seq. In MCG Health v. Owners Ins. Co.,
because the [contract between the hospital and the insurance plan] negates the existence of a debt owed by [the injured plan member] to the hospital[,] and because the filing of the lien violates the hospital’s agreement to not seek recourse against [the plan member], the hospital is precluded under the contract from asserting its lien rights.
Id. at 816, n. 15 (quoting Door v. Sacred Heart Hosp.,
In Constantine, a similar contract between the hospital and the health care insurer required the hospital to accept reduced amounts as full payment for billed hospital charges, and the hospital agreed not to balance-bill the injured insured to recover billed charges in excess of the agreed-upon reduced amounts. Id. at 129. The contract in Constantine also provided that in no event would the hospital have “any recourse” against an injured insured for hospital services covered by the agreement. Id. at 130. Constantine found that these provisions prohibited balance-billing by the hospital and were “written to protect both [the health care insurer] and its insureds from any claims for repayment in excess of those agreed to.” Id. Considering these provisions, Constantine held that the health care insurer’s payment to the hospital of reduced amounts due under the contract extinguished any debt owed to the hospital under the contract, and the absence of debt precluded the hospital from filing a lien under OCGA § 44-14-470 to collect for unpaid hospital services in excess of the reduced amounts. Id. at 130-131; accord MCG Health,
In MCG Health,
After finding that the absence of debt owed to the hospital under the contract did not preclude the hospital lien, the Supreme Court in MCG Health employed the “right for any reason” rule to affirm the judgment invalidating the lien on the basis that (1) Tricare, the federal insurance program pursuant to which the hospital services were provided, was governed by federal regulations that preempted the lien under OCGA § 44-14-470, and (2) the contract between the hospital and Tricare contained a provision prohibiting the hospital from “any recourse” against the insured for covered services provided under the contract. MCG Health,
The contract between the Hospital and Blue Cross in this case was not governed by Tricare or similar federal regulations and did not contain a similar provision prohibiting the Hospital from “any recourse” against a Blue Cross insured for covered services under the contract. So the manner in which those federal regulations or an “any recourse” contractual provision affects lien rights under OCGA § 44-14-470 is not at issue in this case. As the special concurrence points out, the contract between the hospital and the health care insurer in Constantine, supra, did contain an “any recourse” provision similar to the provision addressed by the Supreme Court in MCG Health, supra. Constantine,
2. Because Eight’s underlying claims against the lien failed, he was not entitled to an award of attorney fees and expenses of litigation pursuant to OCGA § 13-6-11. Monterrey Mexican Restaurant of Wise v. Leon,
Judgment reversed.
Notes
The lien filed on March 21, 2007, for the unadjusted billed charges of $36,177.68 was extinguished to the extent the hospital’s reasonable charges were paid. Despite the unpaid charges for the lien period from February 4 to February 20,2007, the Hospital amended the lien on September 24, 2008, to reflect only unpaid deductibles or co-pays. We need not determine whether the amended lien was perfected under OCGA § 44-14-471. In any event, any issue as to unpaid charges stated in the amended lien was settled in the June 2012 consent order.
Concurrence Opinion
concurring fully and specially.
While I concur fully with the majority, I write separately to emphasize that Constantine v. MCG Health,
In MCG Health v. Owners Ins. Co.,
But that does not end the matter in all cases. It is a well-settled principle of Georgia law that, “absent a public policy interest, contracting parties are free to contract to waive numerous and substantial rights.” (Citation and punctuation omitted.) Aetna Workers’ Comp Access v. Coliseum Med. Center,
This Court reached a similar conclusion in Constantine, 275 Ga. App. 128. In that case, the hospital filed a lien pursuant to OCGA § 44-14-470 (b) on the patient’s cause of action against a third-party tortfeasor in anticipation of collecting from any funds awarded to the patient in a settlement or judgment. Id. at 129. Among other things, we concluded that the hospital could not pursue the lien in the face of a “no recourse” provision of the contract between the hospital and patient’s health insurer that was similar to the provision found in MCG Health
[n] othing in the agreement or the record suggests that either party had the [hospital lien] statute’s distinction between persons and causes of action in mind when they framed [the “no recourse”] provision, which was written to protect both [the insurer] and its insureds from any claims for repayment in excess of those agreed to.
Id. at 130 (1). We further noted that the parties’ obligations were set “by the terms of [the] negotiated contract” and that the hospital would be held “to the terms of the bargain it struck.” Id.
Constantine, therefore, ultimately turned on this Court’s interpretation of the “no recourse” provision of the contract between the hospital and the patient’s insurer. In this regard, we construed the language of the “no recourse” provision as precluding the hospital from collecting on a lien from funds awarded to the
It follows that under the reasoning of MCG Health and Constantine, a hospital can contractually waive its right to collect on a hospital lien from funds awarded to the patient in a settlement or judgment entered in a third-party tort action through the inclusion of a “no recourse” provision in the hospital’s contract with the patient’s health insurer. But the contract between MCG Health and Blue Cross/Blue Shield of Georgia in the present case is materially different from the contracts in MCG Health and Constantine because it did not contain a similarly worded “no recourse” provision. Rather, the provision relied upon by appellee Christopher Eight in an effort to hold MCG Health’s lien invalid and uncollectible simply stated that
[MCG Health] agrees to accept [Blue Cross’s] payments, as provided in this Agreement as payment in full for Eligible Services provided to PPO Covered Persons. [MCG Health] may bill PPO Covered Persons for hospital services renderedthat are not PPO Covered Services, applicable deductibles, or co-insurance amounts provided in PPO Covered Person’s PPO Membership Agreement .... Without limiting the foregoing, [MCG Health] agrees not to bill PPO Covered Persons for any charge discount amount provided to PLAN.
In contrast to the contracts found in MCG Health and Constantine, the contract at issue here prevented balance-billing but was silent as to what other avenues of recourse were available to MCG Health. Given the absence of a “no recourse” provision, the contract did not preclude MCG Health from pursuing a lien under OCGA § 44-14-470 (b) against any funds awarded to Eight in a settlement or judgment in the third-party tort action. And, as previously noted, the hospital lien statute, standing alone and without any evidence of a contractual waiver of the statute by the hospital, did not preclude MCG Health from pursuing a lien for reasonable charges for hospital care and treatment even if Eight personally owed no debt to MCG Health at the time the lien was filed. Accordingly, I agree with the majority that the trial court erred in invalidating the hospital lien filed by MCG Health under the specific circumstances of this case.
I am hereby authorized to state that Chief Judge Phipps, Presiding Judge Ellington, Presiding Judge Doyle, and Judges Miller and McFadden join in this special concurrence.
The provision of the contract stated in relevant part:
Hospital hereby agrees that in no event, including, but not limited to nonpayment by HMHS or the Government, HMHS insolvency or breach of this Agreement, shall Hospital bill, charge, collect a deposit from, seek compensation, remuneration or reimbursement or have any recourse against Beneficiaries, or persons other than HMHS acting on their behalf, for Covered Services provided pursuant to this Agreement.
(Emphasis supplied.) MCG Health,
The provision of the contract stated in relevant part:
PAYMENT. [MCG] shall hill [Aetna] for Hospital Services rendered to Members according to the terms of this Agreement____[MCG] hereby agrees that in no event, including, hut not limited to non-payment by [Aetna,] [Aetna’s] insolvency[,] or breach of this Agreement, shall [MCG] bill, charge, collect a deposit from, seek remuneration or reimbursement from, or have any recourse against Member or persons other than [Aetna] acting on their behalf for services listed in this Agreement.
(Emphasis supplied.) Constantine,
I agree with the majority that Constantine was implicitly overruled, by MCG Health to the extent that it held that a hospital cannot pursue a lien under OCGA § 44-14-470 (b) in the absence of an outstanding debt owed to the hospital under the contract between the hospital and the patient’s health insurer.