United States: California Supreme Court Holds Balance Billing Illegal
Last Updated: January 14 2009

Buchalter Nemer attorneys instrumental in unanimous ruling

January 8, 2009. Los Angeles. The California Supreme Court today unanimously reversed the Court of Appeal in a matter titled Prospect Medical Group Inc. vs. Northridge Emergency Medical Group., to hold that balance billing is illegal under California law. As the Supreme Court explained, balance billing occurs when "emergency room doctors directly bill the patient for the difference between the bill submitted [to an HMO] and the payment received." 

Buchalter Nemer appellate specialists Harry W.R. Chamberlain II and Robert Dato wrote the successful petition for review and preliminary briefs on the merits for the prevailing independent physician medical groups led by Prospect Medical Group, and Buchalter Nemer attorney Carol Lucas wrote the amicus curiae brief on behalf of CAPG (California Association of Physician Groups).

"The decision once and for all takes managed care patients out of the middle of payment disputes between HMOs and emergency providers" said Ms. Lucas, Co-Chair of Buchalter Nemer's Business Practices Group. "It is good for patients, who have been used to gain leverage, and it is good for managed care as a whole, because it will compel the providers and payors to work out between themselves the value of noncontracted services. Before patients were taken out of the middle, there was no incentive for noncontracted providers to engage with payers to determine value. Now they must."

"The Supreme Court held 'A patient who is a member of an HMO may not be injected into the dispute. Emergency room doctors may not bill the patient for the disputed amount.' I think that says it all," said Harry W.R. Chamberlain, II.

Buchalter Nemer is a full-service business law firm representing local, regional and national clients in eight major areas of practice and their subspecialties, among them: Bank and Finance, Business Practices, Financial Solutions, Litigation, Labor and Employment, Intellectual Property, Real Estate, and Tax and Estate Planning. Buchalter Nemer has offices in Los Angeles, Orange County, San Francisco and Scottsdale. For more information about the firm, visit www.buchalter.com.

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