Client Alerts, News Articles & Blog Posts

Everything you need to know about BMD and the industry.

Ohio Hospitals and Healthcare Clinics: It’s Time to Revisit Your Billing and Collection Practices

According to a recent Cuyahoga County case, certain healthcare entities may not be protected from liability when engaging in unfair or deceptive billing acts. This decision is consistent with the growing trend across the country to encourage price transparency and eliminate unfair surprise billing practices by health care organizations.[1] Now is the time for hospitals and other health care organizations to revisit their billing and collection policies and procedures to confirm that they are legally defensible and consistent with best practices.

New Developments

On January 14, 2021, the trial court in Cuyahoga County ruled in Brakle v. Cleveland Clinic Foundation that Ohio’s Consumer Sales Practices Act (“CSPA”) does not exclude transactions between patients and hospitals or healthcare clinics. These healthcare entities are not “physicians” as such term is defined in the CSPA and are therefore not shielded from liability stemming from consumer transactions.

Ohio’s Consumer Sales Practices Act

The CSPA prohibits unfair or deceptive acts or practices in connection with a consumer transaction.[2] Examples of unfair or deceptive acts/practices under Ohio law include but are not limited to: (1) failing to notify a customer that the customer has a right to an estimate for any service that will cost over $25; (2) failing to provide an estimate upon request; and (3) failing to give the customer a receipt after accepting a deposit.[3] As defined, a consumer transaction means, in part, a service to an individual for purposes that are primarily personal, family, or household.[4] The law expressly carves out transactions between physicians and their patients.[5] Therefore, transactions between physicians and their patients are not subject to the rules and regulations surrounding unfair or deceptive acts or practices.

Brakle v. Cleveland Clinic Foundation

Pursuant to an order from her physician, Amanda van Brakle (“Plaintiff”) visited a Cleveland Clinic (“Defendant”) facility in 2018 for radiology services. No physician participated in administering the services. At no time prior to the services did Defendant inform Plaintiff that she was entitled to an estimate of the cost of the services nor was she given any estimate of the cost. At the appointment, Plaintiff made a small payment toward the total cost of the service and was not given a receipt for such payment. Over time, Plaintiff made additional payments toward the bill and Defendant failed to render receipts. Defendant also credited these payments to a balance owed for different services and not the radiology services. Defendant eventually sent Plaintiff’s debt to collection. Plaintiff brought suit against Defendant for violations of the CSPA for failing to notify her of her rights to a pre-service estimate, failing to provide such an estimate, and failing to provide receipts.

Defendant filed motion for summary judgment (i.e., asking the court to dismiss the case) on several grounds, but the overarching justification being the service provided to Plaintiff is not a “consumer transaction” covered by the CSPA since the law excludes transactions between physicians and their patients. The Court ultimately disagreed with Defendant and denied the motion for summary judgment. The Court found that “physician” means a person skilled in the art of healing or a practitioner of medicine; a person duly authorized or licensed to treat diseases; and one lawfully engaged in the practice of medicine.[6] Simply put, Defendant is not a human being. The Court stated it is a corporate entity clearly outside of the definition of “physician” as commonly understood.[7] As such, the transaction at issue is not protected by the CSPA, the motion for summary judgment was dismissed, and the case will proceed.

Please contact attorneys Kate Hickner at kehickner@bmdllc.com or Kevin Cripe at kmcripe@bmdllc.com should you have any additional questions about Brakle v. Cleveland Clinic Foundation, surprise billing, or other general healthcare issues.

[1] See American Medical Association High-Level Summary of the No Surprises Act (2020) https://osma.org/aws/OSMA/asset_manager/get_file/527681?ver=0

[2] Ohio Rev. Code § 1345.02(A).

[3] Ohio Admin. Code § 109:4-3-05, 07.

[4] Ohio Rev. Code § 1345.01(A).

[5] Id.

[6] Citing Chiropractic Clinic of Solon v. Kutsko, 92 Ohio App.3d 608, 611 (8th Dist. 1994).

[7] Brakle v. Cleveland Clinic Foundation, Journal Entry (Jan. 14, 2021), pg. 5., https://www.accountsrecovery.net/wp-content/uploads/2021/01/van-Brakle-v-Cleveland-Clinic.pdf.

El Contrato Escrito: La Herramienta Predilecta

No existe mejor herramienta a una disputa contractual que un documento firmado por las partes en el cual se expongan las obligaciones y acuerdos entre éstas.

New State Budget Institutes Licensure Requirement for Ohio’s Hospitals

On July 1, 2021, Governor Mike DeWine signed Ohio’s final budget codified at Ohio Revised Code 3722.01 et seq., which includes a new licensing requirement for Ohio’s hospitals. For years, Ohio was the only state in the country that did not license its hospitals. This approach will now be replaced with new, detailed requirements that will require careful review and compliance. Here are some of the highlights concerning these new changes:

Healthcare Provisions in the Ohio FY 22-23 Budget

Governor Mike DeWine signed Ohio’s Fiscal Year 2022-2023 budget bill (HB 110) into law on July 1, 2021. At almost 1,000 pages and 74.1 billion dollars, the budget lays out the State’s spending for the next two years. Below are a few highlighted provisions from the budget that will be important for the healthcare industry in Ohio

Interim Final Rule for Surprise Billing

In an effort to implement the new bipartisan No Surprises Act, on July 1, 2021, the Department of Health and Human Services (HHS), along with the Departments of Labor and Treasury, issued an interim final rule to safeguard patients against unforeseen medical bills arising from out-of-network care.

President Biden Seeks to Limit Non-Compete Agreements

Today, President Biden announced he would issue an Executive Order that calls on the Federal Trade Commission (FTC) to adopt rules to curtail worker non-compete agreements. Interestingly, a week ago, the FTC approved changes to its Rules of Practice to modernize and expedite the way it issues Trade Regulation Rules. If you have followed our alerts, we predicted the elimination of non-competes would probably happen. In 2016, then-Vice President Biden was a vocal opponent against non-compete agreements. He led the Obama administration’s initiative seeking to limit or eliminate non-compete agreements. In his presidential campaign, Biden promised to “work with Congress to eliminate all non-compete agreements, except the very few that are absolutely necessary to protect a narrowly defined category of trade secrets . . ..”