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

Client Alert

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.


The Ohio State University Launches Its Accelerated Bachelor of Science in Nursing Program

In response to Ohio’s nursing shortage, The Ohio State University College of Nursing is accepting applications for its new Accelerated Bachelor of Science in Nursing program (aBSN). Created for students with a bachelor’s degree in non-nursing fields, the aBSN allows such students to obtain their nursing degree within 18 months. All aBSN students will participate in high-quality coursework and gain valuable clinical experience. Upon completion of the program, graduates will be eligible to take the State Board, National Council of Licensure Exam for Registered Nursing (NCLEX-RN).

Another Transparency Obligation: The FinCEN Beneficial Ownership Information Reporting Requirements

Many physician practices and healthcare businesses are facing a new set of federal transparency requirements that require action now. The U.S. Department of Treasury Financial Crimes Enforcement Network (“FinCEN”) Beneficial Ownership Information Reporting Requirements (the “Rule”), which was promulgated pursuant to the 2021 bipartisan Corporate Transparency Act, is intended to help curb illegal finance and other impermissible activity in the United States.

“In for a Penny, in for a Pound” is No Longer the Case for Florida Lawyers

On April 1, 2024, newly adopted Rule 1.041 to the Florida Rules of Civil Procedures goes into effect which creates a procedure for an attorney to appear in a limited manner in civil proceedings.  Currently, when a Florida attorney appears in a civil proceeding, he or she is reasonable for handling all aspects of the case for their client.  This new rule authorizes an attorney to file a notice limiting the attorney’s appearance to particular proceedings or specified matters prior to any appearance before the court.  For example, an attorney can now appear for the limited purpose of filing and arguing a motion to dismiss.  Once the motion to dismiss is heard by the court, the attorney may file a notice of termination of limited appearance and will have no further obligations in the case.

Enhancing Privacy Protections for Substance Use Disorder Patient Records

On February 8, 2024, the U.S. Department of Health and Human Services (“HHS”) finalized updated rules to 42 CFR Part 2 (“Part 2”) for the protection of Substance Use Disorder (“SUD”) patient records. The updated rules reflect the requirement that the Part 2 rules be more closely aligned with the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) privacy, breach notification, and enforcement rules as mandated by the Coronavirus Aid, Relief, and Economic Security Act of 2020.

Columbus, Ohio Ordinance Prohibits Employers from Inquiries into an Applicant’s Salary History

Effective March 1, 2024, Columbus employers are prohibited from inquiring into an applicant’s salary history. Specifically, the ordinance provides that it is an unlawful discriminatory practice to: