Quinn v. BJC Health Sys.Quinn v. BJC Health Sys.
Dwight L. QUINN, Freida Eyster Martin, and David W. Kuneman, Plaintiffs,
v.
BJC HEALTH SYS., Barnes-Jewish Hospital, American Hospital Ass'n Defendants.
United States District Court, E.D. Missouri, Eastern Division.
*1047 *1048 Anthony L. Dewitt, Edward D. Robertson, Jr., James R. Bartimus, Mary Doerhoff Winter, Bartimus and Frickleton, PC, Jefferson City, MO, Harry Huge, Harry Huge Law Firm, LLP, Charleston, SC, Maurice B. Graham, Robert F. Ritter, Don M. Downing, Gray, Ritter and Graham, P.C., St. Louis, MO, for Plaintiffs.
John Michael Clear, Leonardo J. Asaro, Stephen D. Feldman, Bryan Cave LLP, St. Louis, MO, Catherine E. Stetson, Christopher R. Zaetta, Edward C. Crooke, Mitchell E. Zamoff, Ty Cobb, Hogan and Hartson, Washington, DC, for Defendants.
MEMORANDUM AND ORDER
WEBBER, District Judge.
This matter is before the Court upon American Hospital Associаtion's Motion to Dismiss [doc. # 33], BJC HealthCare and Barnes-Jewish Hospital's Motion to Dismiss [doc. # 37], BJC HealthCare and Barnes-Jewish Hospital's Motion to Dismiss, or, in the Alternative, for Summary Judgment with Respect to Plaintiff Quinn [doc. # 39], and BJC HealthCare and Barnes-Jewish Hospital's Motion for Partial Summary Judgment with Respect to Plaintiff Kuneman [doc. # 42].
I. FACTUAL AND PROCEDURAL BACKGROUND
This is one of numerous cases filed in various federal district courts across the nation by certain uninsured patients against certain not-for-profit medical institutions. [1]*1049 This case was originally initiated by Plaintiff Dwight L. Quinn ("Plaintiff Quinn"), a Missouri resident, against BJC HealthCare ("BJC"), a Missouri-based chаritable hospital system, and John Does 1-10 on June 22, 2004.[2] An Amended Complaint was subsequently filed on July 22, 2004, adding Plaintiff Freida Eyster ("Plaintiff Eyster"), Plaintiff David W. Kuneman ("Plaintiff Kuneman"), Defendant Barnes-Jewish Hospital ("Barnes"), and Defendant American Hospital Association ("AHA").[3] Barnes is a not-for-profit hospital, located in the City of St. Louis and affiliated with Defendant BJC (collectively, "BJC/Barnes"). AHA, headquartered in Chicago, Illinois, is a national organization representing and serving hospitals and health care networks.
In the Amended Complaint, Plaintiff Quinn alleges that he was admitted to Barnes, remained for a рeriod of five days, and underwent surgery for angioplasty and arterial stents during his hospitalization in January, 1996. When he was admitted, Plaintiff Quinn believed he was covered by insurance; however, during the course of his stay in the hospital, he was informed that he was not covered by insurance. After his stay, Plaintiff Quinn was contacted repeatedly in an effort to collect payment for the services that had been rendered during his stay. On June 23, 1999, Barnes filed a lawsuit in the Circuit Court of the City of St. Louis, seeking to collect Plaintiff Quinn's unpaid medical bills for the medical treatment rendered from January 26, 1996, to June 16, 1997. On August 9, 2001, Barnes obtained a default judgment against Plaintiff Quinn in the amount of $63,308.06, plus court costs. Barnes Hospital, Inc., v. Dwight L. Quinn, No. 992-01591 (Mo.Cir.Ct. Aug. 9, 2001). Plaintiff Quinn alleges that his credit history is ruined as a result of the judgment against him.
Plaintiff Eyster alleges that she went to the emergency room at Barnes with chest pains on December 31, 2003, and had several tests performed during her thirty-six hour stay at Barnes. At the time of her admission, Plaintiff Eyster told the intake worker that she was not covered by insurance. During her stay, it was determined that an additional stress test should be performed. When she told the physician that she did not have insurance and asked how much the test would cost, the physician told her that he did not think she needed the test if she did not have insurance. Plaintiff Eyster was told that her pain was due to arthritis and she was released from the hospital thereafter. She continued to experience chest pains and sought treatment from another facility approximately two months later. She was diagnosed with super ventricular tachardia and a mineral deficiency. Barnes allegedly billed Plaintiff Eyster $8,944.55. Eyster has made monthly payments of $100.00 toward her total bill. Barnes admits having received $500.00 from her.
Plaintiff Kuneman alleges that he was insured by United Healthcare until January, 2001. Prior to January, 2001, he had certain tests performed at Barnes-Jewish laboratories and was charged $156.00. On June 8, 2001, the same tests were again *1050 performed. Plaintiff Kuneman was charged $348.00 for these tests. On July 19, 2001, Plaintiff Kuneman inquired of two other laboratories, Glaxo Smithkline and Quest, to obtain quotes for the same laboratory tests. He was quoted a fee of $137.10, and the quote was made with the knowledge that Plaintiff Kuneman was not insured. Through correspondence with BJC, Plaintiff Kuneman has learned that BJC charges uninsured patients a higher rate than it charges insured patients.
II. STANDARD OF REVIEW: MOTION TO DISMISS
A complaint shall not be dismissed for failure to state a claim upon which relief can be granted unless it appears beyond doubt that the plaintiff cannot prove any set of facts which would entitle him to relief. Schaller Tel. Co. v. Golden Sky Sys., Inc.,
A plaintiff is only required to set forth sufficient facts to provide notice of the basis for the claims alleged.
III. DISCUSSION
Plaintiffs bring a mixture of federal and state law claims in their ten-count Amended Complaint. With respect to the federal claims, the crux of Plaintiffs' argument is that they are entitled to monetary damages and other equitable relief based on their status as third-party beneficiaries of a contract formed between BJC/Barnes and the federal government. The Court will address the federal claims before addressing the state claims.
A. Federal Law Claims
1. Count One: Third Party Breach of Contract
In Count One, Plaintiffs allege that BJC/Barnes entered into an express and/or[4] implied contract with the federal government pursuant to
In their briefing on this issue, Plaintiffs reason that "the contract between BJC and the United States is founded on the government's decision to forgo tax revenue in return for BJC's agreement to provide significant charitable health care services to the medicаlly indigent." Pls.' Resp. at 7. Defendants BJC/Barnes counter that "the decided cases uniformly reject the notion that tax laws or tax exemptions create enforceable contracts" and that "
The notion that the Federal Income Tax is contractual in nature has been rejected repeatedly by the courts. See McLaughlin v. Comm'r,
Other district courts which have recently decided this issue are in unanimous agreement regarding this lack of contractual relationship. As one court noted, "[t]he assertion that [Plaintiffs] have an implied right of action under
As a matter of law, Plaintiffs have failed to state a federal law claim under Count One. Thus, Count One will be dismissed to the extent it is premised on a contractual relationship arising from operation of
2. Count Three: Breach of Duty of Good Faith and Fair Dealing
In Count Three, Plaintiffs allege, among other things, that BJC/Barnes' actions with respect to the contracts described in Count One constitute a breach of their duties of good faith and fair dealing. Thus, the federal law portion of Count Three is necessarily dependent on Plaintiffs' ability to prevail on Count One. Because the Court has found that, as a matter of law, no contractual relationship based in federal law exists, the federal law portion of Count Three will be dismissed.
3. Count Four: Breach of Charitable Trust
In Count Four, Plaintiffs allege, among other things, that BJC/Barnes created and enterеd into a public charitable trust by accepting federal tax exemptions under
Charitable trusts require language which demonstrates a specific intent to create the trust. Here, there is simply nothing in the language of
4. Count Six: Violations of the Emergency Medical Treatment and Active Labor Act
In Count Six, Plaintiffs allege that BJC/Barnes violated the Emergency Medical Treatment and Active Labor Act ("EMTALA"),
EMTALA requires a hospital to provide a patient with an appropriate medical screening and to stabilize a patient's condition or arrange for an appropriate transfer to another facility.
The Amended Complaint fails to state a claim for an EMTALA violation. As an initial matter, the claims by Plaintiffs Quinn and Kuneman are barred by the two-year statute of limitations. This lawsuit was initiated on June 22, 2004, more than eight years after Plaintiff Quinn was admitted to Barnes on January 16, 1996, and more than three years after Plaintiff Kuneman allegedly received medical tests at BJC/Barnes on June 8, 2001.[11]*1054 Plaintiff Eyster also fails to state a claim for any EMTALA violation. Plaintiff Eyster alleges that she went to the emergency room at Barnes with chest pains and, at the time of admission, told the intake clerk that she was a "self-pay." She next alleges that, "[d]uring her thirty-six hour stay" at the hospital, several tests were performed. Then, "[w]hen it was determined an additional stress test should be performed, Plaintiff Eyster told the physician she did not have insurance and asked how much the test would cost. The physician responded that if she did not have insurance, he did not think she needed the test." Amend. Compl. at 14-15. Plaintiff Eyster's own allegations make it clear that the action of which she complains took place, not as part of the screening and stabilization process, but аfter her admission to the hospital. "If the hospital admits the individual as an inpatient for further treatment, the hospital's obligation [under EMTALA] ends." 42 C.F.R. 489.24(a)(1)(ii). By Plaintiff Eyster's own allegations, her alleged discriminatory treatment took place "[d]uring her thirty-six hour stay," after the EMTALA obligation had already ended. She does not allege that she was denied the screening or treatment required by EMTALA.
Finally, Plaintiffs' allegation that they were required to sign a form contract promising to pay for their medical treatment is not sufficient to establish a claim for an EMTALA violation. Requiring an individual to sign a standard intаke form does not violate EMTALA, and hospitals may follow reasonable registration processes, including asking whether the individual is insured. See
5. Count Seven: Unjust Enrichment/Constructive Trust
In Count Seven, Plaintiffs allege that, as a result of BJC/Barnes' breaches of contract "along with their wrongful, unfair, discriminatory, abusive, and noncharitable conduct," BJC/Barnes have been unjustly *1055 enriched at Plaintiffs' expense. Plaintiffs allege that they are entitlеd to the imposition of a constructive trust in the amount of BJC/Barnes' tax exemption savings, profits wrongfully obtained by charging Plaintiffs the undiscounted cost of medical care, and the difference between the amount charged to Plaintiffs and the amount charged to insured patients. To the extent this count is premised on federal law, it will be dismissed. The Court has already found that, as a matter of law, Plaintiffs have failed to demonstrate the existence of any contract under
6. Counts Eight and Nine: Civil Conspiracy/Concert of Action and Aiding/Abetting
In Count Eight, Plaintiffs allege that the AHA, through certain internal memos, "conspired and acted in concert with BJC" to charge Plaintiffs certain costs for care and to aggressively collect those costs. Plaintiffs also allege that the AHA conspired with BJC to wrongfully rеtain its tax exempt status and breach BJC's "contracts" with the federal and Missouri governments. Further, Plaintiffs allege that the AHA conspired with BJC to violate the Missouri Merchandising Practices Act ("MMPA") and to breach BJC's duty of good faith and fair dealing. In Count Nine, Plaintiffs allege that the AHA, through internal memos and other advisory assistance, aided and abetted BJC in charging Plaintiffs certain medical care costs and collecting those costs from Plaintiffs. Plaintiffs further allege that the AHA aided and abetted BJC's breach of its "contracts" with the Missouri and federal governments by taking certain aсtions, and that, through these actions, the AHA aided and abetted BJC's violations of the MMPA and BJC's breach of its duty of good faith and fair dealing.
Both of these Counts are clearly based, on the theory that there exists a "contract" between BJC/Barnes and the federal government. Plaintiffs' allegation is that AHA conspired with BJC/Barnes and/or aided or abetted BJC/Barnes to breach said contract. The Court, however, has already found that Plaintiffs' theory regarding any alleged contract pursuant to
B. State Law Claims
Counts One, Two,[15] Three,[16] Four, *1056 Five,[17] Seven, Eight, and Nine contain allegations regarding state law claims over which the Court has no original jurisdiction. Pursuant to
Here, the Court has determined that all of the federal claims should be dismissed. It is preferable for the Missouri courts to interpret the remaining issues of state law. In accordance with
Accordingly,
IT IS HEREBY ORDERED that Defendant AHA's Motion to Dismiss [doc. # 33] and Defendants BJC/Barnes' Motion to Dismiss [doc. # 37] are GRANTED, in part, and DENIED, in part. Those portions of Counts One, Three, Four, Seven, Eight, Nine, and Ten which are premised on federal law are dismissed, with prejudice, for failure to state a claim. Those portions of Counts One, Three, Four, Seven, Eight, Nine, and Ten which are premised on state law are dismissed, without prejudice to be rеfiled in state court, for lack of jurisdiction. Count Six is dismissed, with prejudice, for failure to state a claim. Counts Two and Five are dismissed, without prejudice to be refiled in state court, for lack of jurisdiction.
IT IS FURTHER ORDERED that Defendants' Motion to Dismiss, or, in the Alternative, for Summary Judgment with Respect to Plaintiff Quinn [doc. # 39] and Defendants' Motion for Partial Summary *1057 Judgment with Respect to Plaintiff Kuneman [doc. # 42] are DENIED as moot.
An appropriate order of dismissal will accompany this Order.
ORDER OF DISMISSAL
In accordance with the Memorandum and Order of this Court filed on this date and incorporated herein,
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that all сlaims against Defendants BJC Health Systems, Barnes-Jewish Hospital, and American Hospital Association shall be dismissed as follows: Those portions of Counts One, Three, Four, Seven, Eight, Nine, and Ten which are premised on federal law are DISMISSED, with prejudice, for failure to state a claim. Those portions of Counts One, Three, Four, Seven, Eight, Nine, and Ten which are premised on state law are DISMISSED, without prejudice to be refiled in state court, for lack of jurisdiction. Count Six is DISMISSED, with prejudice, for failure to state a claim. Counts Two and Five are DISMISSED, without prejudice to be refiled in state court, for lack of jurisdiction.
NOTES
Notes
[1] On October 19, 2004, the Motion for centralization of the 28 nationwide actions, including the instant case, pursuant to
[2] On November 9, 2004, John Doe Defendants 1-10 were dismissed without prejudice.
[3] Although this Amended Complaint is styled "Amended Class Action Complaint," Am. Compl. [doc. # 13], this case has not been certified as a class action pursuant to
[4] Ordinarily, the Court refrains from using the term "and/or" because the Court finds it to be ambiguous. However, because Plaintiffs make their allegation using "and/or," the Court will repeаt it here.
[5]
(3) Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes ..., no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation..., and which does not participate in, or intervene in ..., any political campaign on behalf of ... any candidate for public office.
[6] Plaintiffs cite to "Chapter 355 RSMO," without specifying any section(s) or clause(s) of the Missouri statute upon which the alleged contract between BJC/Barnes and Missouri government is based.
[7] In addition to the lack of contractual relationship problem, Plaintiffs' claim also fails because they have not pled facts to indicate that they are intended third-party beneficiaries here. Parties that benefit from government contraсts are presumed to be incidental beneficiaries and are unable to enforce the contract, absent some clear contrary intent. See Klamath Water Users Protective Ass'n v. Patterson,
[8] As BJC/Barnes points out, Plaintiffs have not alleged facts which might be read as permitting them to fall within thе narrow exception to the general rule that private parties cannot enforce charitable trusts.
[9] Although the Amended Complaint makes these broad allegations, none of the three Plaintiffs alleges any facts indicating that they were denied treatment or that their treatment was delayed for failing to sign such a form.
[10]
[11] Plaintiffs argue that the EMTALA accrual period begins when they discovered or should have discovered their injuries. The Court need not decide this issue because, even if their claims were not time-barred, Plaintiffs Quinn and Kuneman nonetheless fail to state an EMTALA claim. Plaintiff Quinn alleges that he was admitted to Barnes and underwent surgery. Plaintiff Kuneman had some medical tests performed and received treatment at BJC/Barnes. Neither Plaintiff alleges that his care was delayed or that he received inappropriate emergency treatment in violation of EMTALA.
[12]
Hospitals may follow reasonable registration processеs for individuals for whom examination or treatment is required by this section, including asking whether an individual is insured and, if so, what the insurance is, as long as that inquiry does not delay screening or treatment.....
[13] Throughout the Amended Complaint, Plaintiffs allege that insured and uninsured patients are charged different rates for the same medical care. BJC admits that there is a price discrepancy for medical services charged to insured and uninsured patients. There is no dispute that refusing care to patients because of their non-insured status (i.e., "patient dumping") is illegal under EMTALA. See Summers v. Baptist Med. Ctr. Arkadelphia,
[14] In its briefing, AHA makes several First Amendment arguments. These arguments need not be addressed because the Court has determined that Plaintiffs' claims will be dismissed.
[15] In Count Two, Plaintiffs allege that they entered into express form contracts with BJC/Barnes. According to Plaintiffs, imputed in these contracts is an express or implied contractual obligation by BJC/Barnes to charge Plaintiffs no more than a fair and reasonable charge for medical сare. Plaintiffs further allege that, by accepting and admitting Plaintiffs into its hospitals, BJC/Barnes undertook an express or implied contractual obligation to charge them no more than a fair and reasonable charge for medical care. Plaintiffs state that BJC/Barnes breached this contractual obligation by charging them the "highest and full undiscounted cost for medical care."
[16] In Count Three, Plaintiffs allege that BJC/Barnes' actions with respect to the contracts described in Count One, or alternatively, the contracts described in Count Two, constitute а breach of their duties of good faith and fair dealing.
[17] In Count Five, Plaintiffs allege that BJC/Barnes violated the MMPA,
[18] Thе Amended Complaint also contains Count Ten, which is actually not an independent basis for relief, but is instead a request for injunctive relief. In Count Ten, Plaintiffs state that, as a result of BJC/Barnes' charging and collection practices and AHA's participation in those practices, they have suffered and will continue to suffer severe and irreparable harm. They request an injunction ordering BJC, Barnes, and AHA to refrain from certain actions and a prospective order requiring BJC/Barnes to take certain actions. Count Ten will be dismissed to the extent it is premised upon the federal law claims.