Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE NEWS RELEASE #023
FROM: CLERK OF SUPREME COURT OF LOUISIANA
The Opinions handed down on the 5th day of May, 2015, are as follows:
BY KNOLL, J.:
2014-C -2243 PRENTISS BAKER AND SHERYL WIGINTON, INDIVIDUALLY AND ON BEHALF OF
ALL OTHERS SIMILARLY SITUATED v. PHC-MINDEN, L.P. D/B/A MINDEN
MEDICAL CENTER (Parish of Webster)
For these reasons, we reverse the judgment of the Court of Appeal
and hereby reinstate the judgment of the District Court. This
case is remanded to the District Court for further proceedings
REVERSED; JUDGMENT OF THE DISTRICT COURT REINSTATED AND REMANDED.
GUIDRY, J., additionally concurs and assigns reasons.
05/05/15
SUPREME COURT OF LOUISIANA
NO. 2014-C-2243
PRENTISS BAKER AND SHERYL WIGINTON, INDIVIDUALLY AND ON
BEHALF OF ALL OTHERS SIMILARLY SITUATED
VERSUS
PHC-MINDEN, L.P. D/B/A MINDEN MEDICAL CENTER
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
SECOND CIRCUIT, PARISH OF WEBSTER
KNOLL, JUSTICE
We granted this writ application to resolve a conflict among the appellate
courts of this state on the issue of whether a class action is the superior method for
adjudicating actions brought pursuant to the Health Care Consumer Billing and
Disclosure Protection Act, La. Rev. Stat. § 22:1871 et seq. (―Balance Billing Act‖).
Baker v. PHC-Minden, L.P., 14-2243 (La. 1/16/15), __ So.3d __. Across the state,
plaintiffs are filing these actions against health care providers from whom they
sought treatment following automobile accidents and with whom their health care
insurers had contracted reimbursement rates for the services rendered. At issue is
the legality of these providers‘ policy of collecting or attempting to collect the
undiscounted rate from the insured if a liability insurer may be liable, implemented
through the filing of medical liens against plaintiffs‘ lawsuits and settlements
pursuant to the health care provider lien statute, La. Rev. Stat. § 9:4752. A review
of the jurisprudence reveals plaintiffs in the Third Circuit Court of Appeal proceed
pursuant to our class action provisions, while plaintiffs in the Second Circuit Court
of Appeal have been denied class certification. After reviewing the record and the
applicable law, we find the class action is superior to any other available method
for a fair and efficient adjudication of the common controversy over the disputed
billing and lien practices. Accordingly, we reverse the judgment of the court of
appeal, Second Circuit. Finding all other requirements for class certification
properly met, we reinstate the judgment of the trial court.
FACTS
On July 13, 2011, plaintiffs Prentiss Baker,1 Sheryl Wiginton, and Judyette
Allen filed this class action proceeding, alleging PHC-Minden, L.P. d/b/a Minden
Medical Center (―Minden‖) engaged in unlawful billing practices by billing them
in an amount in excess of the agreed upon rate negotiated between the hospital and
plaintiffs‘ respective insurers. Specifically, plaintiffs alleged Minden had a
collection policy in effect since at least 2000 for billing insured patients involved
in automobile accidents where a third party was liable for the crash. This collection
policy was implemented across-the-board, regardless of the health insurance issuer
involved, through the following actions:
1. Upon admission or soon thereafter, Minden collected information
from the patient about the offending driver‘s liability insurance and
the patient‘s own automobile insurance;
2. If the patient did not know the information upon admission, Minden
sent a form letter to the patient requesting the patient get the liability
insurance information and contact Minden with that information;
3. Once the liability insurance information was obtained or the
patient‘s attorney was known, Minden would send a lien pursuant to
La. Rev. Stat. § 9:4752 to the liability insurer and the patient‘s
attorney seeking to collect from the patient‘s damage settlement the
full and undiscounted rate.
4. If the time delays were such that Minden was close to running out
of time to file with the patient‘s health insurance, Minden would only
then file a claim with the health insurance company, but not before it
first asserted its lien on the patient‘s settlement through the liability
insurance company and the patient‘s attorney.
1Since the institution of this lawsuit, Prentiss Baker died, and his widow, Dorothy Baker, has
been substituted as the party plaintiff.
2
Even if Minden filed a claim with and received payment through the health
insurance company, Minden still allegedly attempted to collect the full rate from
the patient‘s settlement through the patient‘s attorney and the liability insurer using
medical liens. Plaintiffs allege hundreds of other patients have been subjected to
this collection policy, which they argue violates the Balance Billing Act. Below is
a summary of the specific manner in which the collection policy was allegedly
applied to the named plaintiffs individually.
Prentiss Baker
On January 31, 2007, Baker was admitted to Minden‘s emergency room for
injuries sustained in an automobile accident in Minden, Louisiana, and incurred
medical expenses in the undiscounted amount of $1,394.56. At the time of
treatment, Baker was insured under a Mail Handlers Benefit Plan (―Mail
Handlers‖) health insurance policy. On February 7, 2007, Baker‘s medical bill was
sent by Minden to Mail Handlers for payment. Because he was involved in an
automobile accident, Minden also sent a letter to Baker asking for information
regarding any automobile insurance that might have been available. On February
23, 2007, the hospital received a letter from Baker‘s attorney, Kirby Kelly,
requesting an itemized bill. The record reveals Minden quoted the full,
undiscounted amount and also placed a lien against the proceeds of the lawsuit
filed by Baker in which he sought damages, including medical expenses, from the
adverse driver.
On June 19, 2007, Mail Handlers sent Minden a denial of the claim stating it
had not received a copy of the plan reimbursement agreement. The hospital
followed up by telephone, and Mail Handlers stated Baker had not returned the
necessary subrogation forms; therefore, it denied the claim. Baker then called
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Minden on July 12, 2007, and indicated the bill was being turned over to State
Farm, the third party insurer, and they would take care of the bill.
After apparently settling the lawsuit, Kirby Kelly‘s office called Minden on
August 20, 2007, and inquired into whether the hospital would reduce the bill by
50%. Ultimately, the hospital agreed to reduce the bill by 20% and accepted
$1,115.72 as payment in full. The remaining balance was written off as a loss by
Minden.
Sheryl Wiginton
Wiginton presented at Minden‘s emergency room on March 31, 2008, for
injuries sustained in an automobile accident in Minden, Louisiana, and incurred
medical expenses in the undiscounted amount of $2,087. At the time of treatment,
Wiginton was insured under a Blue Cross Blue Shield of Louisiana (―Blue Cross‖)
health insurance policy.
On April 7, 2008, Minden billed Blue Cross for her medical treatment. Blue
Cross issued an explanation of benefits setting forth the patient‘s liability of
$505.66, which was the copayment plus the deductible. However, the record
indicates Wiginton paid $100 upon arrival at the emergency room, thus the balance
of her liability was $405.66. She later paid $200 for a total payment by her of
$300. As per its collection policy, the hospital also filed a lien against the proceeds
of her lawsuit for the full undiscounted amount.
Wiginton‘s attorney, Kirby Kelly, called Minden on November 20, 2008,
and informed Minden his office was going to send a check for Wiginton‘s medical
bills in the amount of $1,773.95. Minden received this check on December 3,
2008, and a note was made by Minden to refund the patient all monies except her
responsibility (deductible) under the insurance policy. Nevertheless, a clerical error
was made on the part of Minden whereby it never reimbursed Wiginton‘s
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payments. It was not until three years later, and after the instant lawsuit was filed,
that Minden realized its error and sent a check to Wiginton in the amount of
$1,568.29.
Judyette Allen
Allen was involved in an automobile accident on July 8, 2010, in Minden,
Louisiana, and presented at the Minden emergency room, seeking medical
attention. After being treated for her injuries, Allen incurred medical expenses in
the undiscounted amount of $2,756.95. At the time of treatment, Allen was also
insured under a Blue Cross health insurance policy. However, Blue Cross was
never billed for Allen‘s medical treatment. Instead, on July 14, 2010, a copy of the
bill and a lien for the full, undiscounted rate was sent by Minden to State Farm, the
third party insurer. Soon thereafter, and after apparently being advised of the lien,
Allen called Minden and informed the hospital she was going to begin making
payments on her account until the lawsuit settled with the party at fault.
In due time, State Farm settled the lawsuit pertaining to medical payments
and sent a check to Allen‘s attorney, Kirby Kelly. Although Minden‘s name was
on the check, the record indicates Kirby Kelly refused to forward payment to the
hospital until the liability portion of the lawsuit also settled. Because the liability
portion of the suit did not settle for some time, Allen again began to make
payments on the bill. Ultimately, Allen paid a total amount of $480.
Approximately one year later, on September 12, 2011, Allen called Minden
and asked that Blue Cross be billed for the medical expenses. Blue Cross
eventually paid Minden $573.27 in February of 2012, and the hospital refunded
Allen her payment of $480.
As a result of these allegedly illegal billing practices, plaintiffs claim
Minden is liable unto petitioners and to those similarly situated for:
5
(1) repayment of all overpayments;
(2) mental anguish, worry and concern caused by wrongful collection
practices and collections;
(3) loss of profits or use;
(4) out-of-pocket expenses;
(5) emotional distress;
(6) all other damages allowed by law; and
(7) penalties, attorney fees, costs, and expenses.
Seeking class certification, plaintiffs filed a motion to certify class on
September 28, 2011. Minden opposed class certification on various grounds. First,
Minden argued it cannot be found to have violated the Balance Billing Act for the
years 2000 through 2003 since the law was not in existence during that time
period, only having taken effect on January 1, 2004. Second, because each
plaintiff‘s situation was resolved differently, Minden took issue with a broad and
over-encompassing class definition.
After a hearing on the plaintiffs‘ motion, the trial court granted class
certification. In a lengthy opinion, the trial court recognized the class should only
extend back to January 1, 2004, given the effective date of the Balance Billing Act,
but otherwise granted class certification. The trial court also found merit in
defendant‘s argument the different circumstances pertaining to the individual
plaintiffs was an obstacle to creating a blanket class and reasoned, therefore,
subclasses should be formed in accordance with the Third Circuit decision in
Desselle v. Acadian Ambulance Serv., Inc., 11-742 (La. App. 3 Cir. 02/01/12), 83
So.3d 1243, writ denied, 12-0518 (La. 04/13/12), 85 So.3d 1253.
The trial court concluded the common question is whether Minden‘s alleged
billing practices violated the Balance Billing Act. It also found the evidence
showed: (1) the class of individuals is so numerous that joinder is impracticable,
(2) the issue is common to the class, (3) the claims of the representatives appointed
are typical of the claims of the class, and (4) the named representatives adequately
6
represent the class. Finding the class action procedure superior to any other
available method for resolving the single, paramount issue concerning Minden‘s
billing practices, the trial court reasoned it would be imprudent to try the cases
individually as they may result in incompatible judgments, and class action is
appropriate due to the possibility that many of the claims made by the class
members may be small or nominal in nature.
Accordingly, the trial court certified the following class:
All persons currently and/or formerly residing in the United States of
America from January 1, 2004 through December 31, 2011:
(1) Having ―Health Insurance Coverage‖ [as defined by La. R.S.
22:1872(18)] providing coverage for themselves or for others for
whom they are legally responsible, with any ―Health Insurance Issuer‖
[as defined by La. R.S. 22:1872(19)] at the time ―covered health care
services‖ [as defined by La. R.S. 22:1872(8)] were provided by any
facility operated by PHC–MINDEN, L.P. D/B/A MINDEN
MEDICAL CENTER; and
(2) With which ―Health Insurance Issuer‖ PHC–MINDEN, L.P.
D/B/A MINDEN MEDICAL CENTER was a ―contracted health care
provider‖ at the time of service [as defined by La. R.S. 22:1872(6)];
and
(3) From whom PHC–MINDEN, L.P. D/B/A MINDEN MEDICAL
CENTER collected, and/or attempted to collect, the ―Health Insurance
Issuer‘s Liability‖ [as defined by La. R.S. 22:1872(20)], including, but
not limited to, any collection or attempt to collect from any
settlement, judgment, or claim made against any third person or
insurer who may have been liable for any injuries sustained by the
patient (which insurers include those providing liability coverage to
third persons, uninsured/underinsured coverage, and/or medical
payments coverage); and/or
(4) From whom PHC–MINDEN, L.P. D/B/A MINDEN MEDICAL
CENTER collected, and/or attempted to collect, any amount in excess
of the ―Contracted Reimbursement Rate‖ [as defined by La. R.S.
22:1872(7)], including but not limited to, any collection or attempt to
collect from any settlement, judgment, or claim made against any
third person or any insurer which may have been liable for any
injuries sustained by the patient (which insurers include those
providing liability coverage to third persons, uninsured/underinsured
coverage, and/or medical payments coverage);
7
(5) From whom PHC–MINDEN, L.P. D/B/A MINDEN MEDICAL
CENTER collected, and/or attempted to collect, any amount without
first receiving an explanation of benefits or other information from the
Health Insurance Issuer setting forth the liability of the insured as
required by La. R.S. 22:1874(A)(2) and (3).
The class is composed of the following subclasses:
―Attempt to Recover‖ subclass: A subclass of persons who received
covered health care services, and who had health insurance coverage,
and from whom Minden Medical Center attempted to recover any
amount in excess of the ―contracted reimbursement rate‖ from
January 1, 2004, through December 31, 2011.
―Payor‖ Subclass: A subclass of persons who received covered health
care services, and who had health insurance coverage, and/or who
paid Minden Medical Center in any manner including but not limited
to liability insurance proceeds and/or from proceeds of a settlement or
judgment, an amount in excess of the ―contracted reimbursement rate‖
either directly and/or through their attorney and/or through a liability
insurance carrier and/or any third party from January 1, 2004, through
December 31, 2011.
Finally, the trial court appointed Baker and Wiginton class representatives
for the ―Payor‖ subclass, and Allen class representative for the ―Attempt to
Recover‖ subclass.
On appeal, the Second Circuit Court of Appeal reversed, finding a class
action is not the superior procedural method for resolving the controversy herein,
―given the unchartered territory of litigation associated with actions brought
pursuant to [the Balance Billing Act].‖ Baker v. PHC-Minden, 49,122, p. 15 (La.
App. 2 Cir. 8/13/14), 146 So.3d 921, 929. In so holding, the appellate court
reasoned that while this Court recently in Anderson v. Ochsner Health Sys., 13-
2970 (La. 7/1/14), __ So.3d __, has recognized a private right of action under the
Balance Billing Act and has held the practice of asserting a medical lien constitutes
―maintaining an action at law,‖ ―many unanswered questions remain, including
those pertaining to what damages a successful plaintiff would be entitled to
receive.‖ Baker, 49,122 at pp. 13-14, 146 So.3d at 928. And without knowing how
8
the parties‘ losses arise and are calculated, the appellate court found it difficult to
group them together in a common class. Id.
It noted this Court has not addressed whether the Balance Billing Act and
the lien right afforded providers under La. Rev. Stat. § 9:4752 can be harmonized
or whether such liens are now prohibited by the Balance Billing Act. Id. (citing La.
Atty. Gen. Op. No. 05-0056, 2005 WL 1429238 (La.A.G.05/17/05). When faced
with such ―undeveloped legal storms‖ where little guidance is available, the
appellate court commented:
Louisiana courts will deny class certification when presented with
novel and untested legal theories. Ford v. Murphy Oil U.S.A., Inc.,
96–2913 (La.09/09/97), 703 So.2d 542; see also Banks v. New York
Life Ins. Co., 98–0551 (La.12/07/98), 722 So.2d 990, 995 (―Federal
courts, and this court will not certify a class where the theory of law is
novel and untested‖). In Ford, supra, at 15, 703 So.2d 542, citing
Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir.1996), the
Louisiana Supreme Court stated ―[T]he court must have experience
with a tort in the form of several individual actions before it can
certify issues in a way that preserves judicial resources.‖
Id. at p. 15, 146 So.3d at 929.
Applying this reasoning, the Second Circuit concluded courts must have
experience with lawsuits of this nature before it can certify issues in a way that
preserves judicial resources, and only when ―the legislature or courts of this state
clarify the remaining legal issues surrounding the [Balance Billing Act]‖ will this
claim be proper as a class action. Id. The court then pretermitted all remaining
issues on appeal.
DISCUSSION
As we previously stated, there exists a split among the circuit courts of
appeal on the superiority of the class action where the common question is the
legality under the Balance Billing Act of a health care provider‘s practice of filing
liens seeking the undiscounted rates before or even after billing the patient‘s
9
insurer. While the Third Circuit has affirmed certification of these classes, thus
permitting plaintiffs in those circuits to proceed as class actions, Vallare v. Ville
Platte Medical Center, LLC, 14-261 (La. App. 3 Cir. 11/5/14), 151 So.3d 984;
Desselle, 11-742 at p. 14, 83 So.3d at 1253, the Second Circuit has now held just
the opposite, decertifying the class given the novel and untested nature of the
theory advanced, Baker, 49,122 at p. 15, 146 So.3d at 929. Consequently, it falls
upon this Court to resolve the split, but first an overview of the procedural device
at the heart of this matter is warranted.
Class Actions
A class action is ―a nontraditional litigation procedure that permits a
representative with typical claims to sue or defend on behalf of, and stand in
judgment for, a class of similarly situated persons when the question is one of
common interest to persons so numerous as to make it impracticable to bring them
all before the court.‖ Ford v. Murphy Oil U.S.A., Inc., 96-2913 (La. 9/9/97), 703
So.2d 542, 544. Its purpose and intent is to adjudicate and obtain res judicata
effect on all common issues applicable to persons who bring the action, as well as
to all others similarly situated. Brooks v. Union Pacific R. Co., 08-2035, p. 10 (La.
05/22/09), 13 So.3d 546, 554.
The only issue to be considered by the trial court when ruling on
certification, and by this Court on review, is whether the case at bar is one in which
the procedural device is appropriate. In determining the propriety of such action,
the court is not concerned with whether the plaintiffs have stated a cause of action
or the likelihood they ultimately will prevail on the merits, but whether the
10
statutory requirements have been met. Eisen v. Carlisle and Jacquelin, 417 U.S.
156, 178, 94 S.Ct. 2140, 2153 (1974).2
This determination of whether a class action meets the requirements
imposed by law involves a rigorous analysis in which the trial court ―must
evaluate, quantify, and weigh [the relevant factors] to determine to what extent the
class action would in each instance promote or detract from the goals of
effectuating substantive law, judicial efficiency, and individual fairness.‖
McCastle v. Rollins Environmental Services of Louisiana, Inc., 456 So.2d 612, 618
(La. 1984). Doing so, the trial court must actively inquire into every aspect of the
case and not hesitate to require showings beyond the pleadings. Brooks, 08-2035 at
p. 10, 13 So.3d at 554. ―Going beyond the pleadings is necessary, as a court must
understand the claims, defenses, relevant facts, and applicable substantive law in
order to make a meaningful determination of the certification issues.‖ Dupree v.
Lafayette Ins. Co., 09-2602, p. 7 (La. 11/30/10), 51 So.3d 673, 680.
Any errors to be made in deciding class action issues should be in favor of
and not against the maintenance of the class action, because a class certification
order is always subject to modification or decertification, ―if later developments
during the course of the trial so require.‖ McCastle, 456 So.2d at 620. To that end,
La. Code. Civ. Proc. art. 592(A)(3)(d) provides the trial court ―may alter, amend,
or recall its initial ruling on certification and may enlarge, restrict, or otherwise
redefine the constituency of the class or the issues to be maintained in the class
2 Interestingly, the Supreme Court further noted:
… a preliminary determination of the merits may result in substantial
prejudice to a defendant, since of necessity it is not accompanied by the
traditional rules and procedures applicable to civil trials. The court‘s tentative
findings, made in the absence of established safeguards, may color the subsequent
proceedings and place an unfair burden on the defendant.
Id.
11
action.‖ La. Code. Civ. Proc. art. 592(A)(3)(d). Nonetheless, the trial court should
evaluate the case closely before certifying the class in light of the consequent
burdens of giving notice and additional discovery. See Dupree, 09-2602 at p. 7, 51
So.3d at 680.
A trial court has wide discretion in deciding whether to certify a class.
Brooks, 08-2035 at p. 10, 13 So.3d at 554. Subject to the manifest error standard,
its factual findings can only be reversed upon finding, based on the entire record,
no reasonable factual basis for the factual finding and the factfinder is clearly
wrong. Stobart v. State, though Department of Transp. and Development, 617
So.2d 880, 882 (La. 1993). However, we review its ultimate decision of whether or
not to certify the class under the abuse of discretion standard. Dupree, 09-2602 at
p. 7, 51 So.3d at 680. Implicit therein ―is recognition of the essentially factual basis
of the certification inquiry and of the district court‘s inherent power to manage and
control pending litigation.‖ Brooks, 08-2035 at p. 11, 13 So.3d at 554.
Under Louisiana law, the requirements for class certification are set forth in
La. Code Civ. Proc. art. 591. Article 591(A) provides five threshold prerequisites,
often referred to as numerosity, commonality, typicality, adequacy of
representation, and objective definability of class:
A. One or more members of a class may sue or be sued as
representative parties on behalf of all, only if:
(1) The class is so numerous that joinder of all members is
impracticable.
(2) There are questions of law or fact common to the class.
(3) The claims or defenses of the representative parties are
typical of the claims or defenses of the class.
(4) The representative parties will fairly and adequately
protect the interests of the class.
(5) The class is or may be defined objectively in terms of
ascertainable criteria, such that the court may determine the
constituency of the class for purposes of the conclusiveness of
any judgment that may be rendered in the case. This
prerequisite shall not be satisfied if it is necessary for the court
12
to inquire into the merits of each potential class member's
cause of action to determine whether an individual falls within
the defined class.
Once these five prerequisites have been met, La. Code Civ. Proc. art. 591(B)
lists three additional criteria, one of which must also be satisfied for certification
depending on the type of class action sought. Here, the parties submit the
additional requirement that must be met for certification is set forth in La. Code
Civ. Proc. art. 591(B)(3), which provides:
(3) The court finds that the questions of law or fact common to the
members of the class predominate over any questions affecting only
individual members, and that a class action is superior to other
available methods for the fair and efficient adjudication of the
controversy. The matters pertinent to these findings include:
(a) The interest of the members of the class in individually
controlling the prosecution or defense of separate actions;
(b) The extent and nature of any litigation concerning the
controversy already commenced by or against members of the
class;
(c) The desirability or undesirability of concentrating the
litigation in the particular forum;
(d) The difficulties likely to be encountered in the
management of a class action;
(e) The practical ability of individual class members to
pursue their claims without class certification;
(f) The extent to which the relief plausibly demanded on
behalf of or against the class, including the vindication of such
public policies or legal rights as may be implicated, justifies
the costs and burdens of class litigation.
The Legislature has specifically provided, emphasizing the commonality and
predominance requirements, that class ―[c]ertification shall not be for the purpose
of adjudicating claims or defenses dependent for their resolution on proof
individual to a member of the class.‖ La. Code. Civ. Proc. art. 591(C); see also
Ford, 703 So.2d at 549 (former La. Code Civ. Proc. art. 593.1(C) prohibits class
certification when too many individual liability issues exist that could not be tried
separately). Nevertheless, where certification is maintained, ―the court shall retain
jurisdiction over claims or defenses dependent for their resolution on proof
13
individual to a member of the class.‖ La. Code Civ. Proc. art. 591(C). Thus, ―the
mere fact that varying degrees of damages may result from the same factual
transaction and same legal relationship or that class members must individually
prove their right to recover does not preclude class certification.‖ Bartlett v.
Browning-Ferris Industries Chemical Services, Inc., 99-0494 (La. 11/12/99), 759
So.2d 755, 756.
The burden of establishing the statutory criteria have been satisfied falls on
the party seeking to maintain the class action. Dupree, 09-2602 at p. 10, 51 So.3d
at 682. Thus here, the plaintiffs were required to prove the five prerequisites of La.
Code Civ. Proc. art. 591(A), namely numerosity, commonality, typicality,
adequacy of the representative parties, and objectively definable class. Likewise,
they were required to prove common questions of law or fact predominate over
individual issues and the class action is superior to any other method for resolving
the controversy fairly and efficiently under La. Code Civ. Proc. art. 591(B).
Because the appellate court ruled solely on the superiority, or lack thereof,
of the class action to resolve the common question regarding the legality of
Minden‘s lien practices under the Balance Billing Act, we begin our review by
addressing this criteria. However, to properly do so, we find it necessary to first
review our holding in Anderson from which these recent class actions arise.
In Anderson, this Court was asked to determine whether an individual
plaintiff is afforded a private right of action under the Balance Billing Act. Similar
to our plaintiffs herein, the plaintiff in Anderson alleged she was injured in an
automobile accident caused by a third party, after which she received medical
treatment at an Ochsner facility. Although Anderson was insured by
UnitedHealthcare and presented proof of insurance, Ochsner refused to file a claim
14
with her insurer. Instead, Ochsner sent a letter to her attorney, asserting a medical
lien for the full amount of undiscounted charges.
Thereafter, Anderson filed a putative class action against Ochsner, seeking,
among other remedies, damages arising from Ochsner‘s billing practices and
claiming Ochsner‘s actions violated the Balance Billing Act. In response, Ochsner
filed a motion for summary judgment, arguing no private right of action exists
under the Balance Billing Act. The trial court denied Ochsner‘s motion for
summary judgment, and the appellate court denied writs. Anderson v. Ochsner
Health System, 13-798 (La. App. 5 Cir. 11/21/13), __ So.3d __.
After examining the relevant statutes, we found Ochsner‘s act of sending a
lien letter to Anderson‘s attorney constituted ―maintaining an action at law.‖
Anderson, 13-2970 at p. 11. Specifically, we reasoned La. Rev. Stat. § 9:4752
authorizes health care providers to recover ―reasonable charges or fees‖ from third
party tortfeasors through the use of ―medical liens,‖ providing:
A health care provider … that furnishes services or supplies to
any injured person shall have a privilege for the reasonable charges or
fees … on the net amount payable to the injured person … out of the
total amount of any recovery or sum had, collected, or to be collected,
whether by judgment or by settlement or compromise, from another
person on account of such injuries, and on the net amount payable by
any insurance company under any contract providing for indemnity or
compensation to the injured person….
La. Rev. Stat. § 9:4752. Pursuant to La. Rev. Stat. § 9:4753(A), the liens become
effective ―if, prior to the payment of insurance proceeds, or to the payment of any
judgment, settlement, or compromise on account of injuries, a written notice ... is
delivered by certified mail, return receipt requested, or by facsimile transmission
with proof of receipt of transmission by the interested health care provider ...‖ to
the ―injured person....‖ Because La. Rev. Stat. § 9:4754 then makes anyone who
interferes with the privilege liable for the amount of the privilege, we found a lien
15
in this context operates automatically as a matter of law with legal consequences
attaching when the lien is ignored, and thus, its use constituted an action at law.
Anderson, 13-2970 at p. 11.
Having found an action at law existed, we then turned to the language in the
Balance Billing Act granting a right to sue:
No contracted health care provider may maintain any action at
law against an enrollee or insured for a health insurance issuer
liability or for payment of any amount in excess of the contracted
reimbursement rate for such services. In the event of such an action,
the prevailing party shall be entitled to recover all costs incurred,
including reasonable attorney fees and court costs….
La. Rev. Stat. § 22:1874(B). Concluding the explicit right to recover ―all costs
incurred‖ inclusive of attorney fees and court costs was a clear recognition that a
private cause of action is available, we found:
Anderson is expressly given a private right of action under
these facts by virtue of La. R.S. 22:1874(B). Having found an express
right of action affording Anderson an avenue for recourse, we
purposefully extend our holding to find an implied right of action as
well. In so doing, we are cognizant that offenders may interpret a
limited holding to mean that other methods of demanding payment
from insured patients are allowed under the Balance Billing Act. We
intentionally address and forego that possibility.
Anderson, 13-2970 at p. 11.
Though numerous actions similar to Anderson‘s and plaintiffs‘ herein have
recently been filed, the Second Circuit viewed the lack of any jurisprudence
―whatsoever‖ in regard to the actual merits of a claim brought under the Balance
Billing Act as an insurmountable obstacle. The Third Circuit, however, has taken a
completely contrary view, in their own words, ―respectfully disagree[ing] with the
second circuit‘s assertion that ‗novel and untested legal theories‘ are involved in
the determination of whether a billing practice violates La. R.S. 22:1874.‖ Vallere,
14-261 at p. 8, 151 So.3d at 989.
16
In Vallere, an insured, just like our plaintiffs here, sought class certification
against the hospital where she was treated for injuries sustained in an automobile
accident, alleging that hospital‘s lien practice also violated the Balance Billing Act.
After the trial court certified the class, the defendants challenged the certification
on appeal by advancing the novel and untested argument relied upon by the Second
Circuit. However, the Third Circuit summarily rejected the claim in light of its
previous decision in Desselle upon which the trial court in this case relied. Vallare,
14-261 at p. 8, 151 So.3d at 989-90.
Interestingly, the Desselle plaintiffs were also insureds who brought a class
action under the Balance Billing Act, challenging the lien/billing practices of the
health care provider that rendered them assistance following their automobile
accidents—Acadian Ambulance. The Third Circuit affirmed certification of the
class therein, Deselle, 11-742 at p. 14, 83 So.3d at 1253, and this Court denied
writs two years before we rendered our decision in Anderson. Deselle v. Acadian
Ambulance Service, Inc., 12-518 (La. 4/13/12), 85 So.3d 1253. This along with
Baker’s recognition that ―plaintiffs have armed themselves with [Anderson’s]
language and have brought lawsuits all across this State against hospitals such as
[Minden], alleging violations under the Act,‖ led the Vallare court to conclude the
issue is hardly novel. Vallare, 14-261 at p. 8, 151 So.3d at 989-90 (quoting Baker,
49,122 at p. 13, 146 So.3d at 928). We agree.
Clearly, Anderson held insureds in these circumstances have a direct action
against their health care providers under the Balance Billing Act for ―all costs
incurred.‖ Anderson, 13-2970 at p. 11. More importantly, though, we note with
significance class action certification is purely procedural. What is of primary
concern in the certification proceeding is simply whether the plaintiffs have met
the statutory requirements to become a class action, not the merits of the
17
underlying litigation. Eisen, supra; see also supra note 2. It is the Second
Circuit‘s focus upon the merits of the common issue that ultimately led it into legal
error and resulted in its inappropriate analysis. Rather, a court‘s focus on review
must be on the requirements and whether the evidence establishes the procedural
device is appropriate.
As to the superiority requirement, the record shows there is little proof on
liability or causation necessary in this case individual to each plaintiff. Their
claims do not require highly individualized inquiries into the cause of the damages.
The alleged damages were caused by Minden‘s acting pursuant to its collection
policy and procedure. The eventual question for the factfinder is whether or not
Minden‘s actions violated the Balance Billing Act. Once the factfinder determines
Minden‘s actions pursuant to its collection policy did or did not violate the Balance
Billing Act, liability and causation for all class members is decided. Thus, this
case fundamentally revolves around the interplay of Minden‘s collection policy
with the Balance Billing Act, the resolution of which will be conclusive to all.
If the court eventually resolves this single, paramount issue in plaintiffs‘
favor, the remaining issues individual to class members relate to the calculation of
damages. It is only then the court will need to determine what damages are
awardable under the Balance Billing Act. If the court resolves the paramount issue
in defendant‘s favor, any question regarding damages will be rendered moot.
Moreover, there is no indication the consideration of the billing issue,
particular to the plaintiffs, would require individual trials or be unduly
burdensome. To the contrary, the evidence shows many claims may be small or
nominal in nature, rendering individual actions financially impractical, if not
impossible. Accordingly, we find the evidence does reasonably show the class
action is the superior method for adjudication as the common question herein
18
would be most efficiently answered in the context of a class action suit. We
therefore find the trial court did not manifestly err in its findings as to this issue.
Likewise, we find no error in its factual findings on the remaining five
prerequisites—numerosity, commonality, typicality, adequacy of representation,
and definability.
Numerosity
The first requirement for class certification, often referred to as
―numerosity,‖ is determined based upon the facts and circumstances of each
individual case. This requirement reflects the basic function of the class action as a
device for allowing a small number of persons to protect or enforce rights or
claims for the benefit of many where it would be inequitable and impracticable to
join every person sharing an interest in the rights or claims at issue in the suit.
Kent A. Lambert, ―Certification of Class Actions in Louisiana,‖ 58 La.L.Rev.
1085, 1114 (Summer 1998).
There is no set number above which a class is automatically considered so
numerous as to make joinder impractical as a matter of law. Dumas v. Angus
Chemical Co., 25,632 (La. App. 2 Cir. 3/30/94), 635 So.2d 446, 450, writ denied,
94-1120 (La. 6/24/94), 640 So.2d 1349; O’Halleron v. L.E.C., Inc., 471 So.2d 752,
755 (La. App. 1st Cir. 1985). Likewise, the numerosity element may not be met by
simply alleging a large number of potential claimants exist. Boyd v. Allied Signal,
Inc., 03-1840, pp. 11-12 (La. App. 1 Cir. 12/30/04), 898 So.2d 450, 457, writ
denied, 05-0191 (La. 4/1/05), 897 So.2d 606. While the determination of
numerosity is in part based upon the number of putative class members, it is also
based upon considerations of judicial economy in avoiding a multiplicity of
lawsuits, financial resources of class members, and the size of the individual claim.
Davis v. American Home Products Corp., 02-0942, p. 19 (La. App. 4 Cir. 3/26/03),
19
844 So.2d 242, 257, writ denied, 03-1180 (La. 6/27/03), 847 So.2d 1279.
Ultimately, to meet this requirement, the plaintiff must show joinder is impractical,
but, at the same time, there is a definable group of aggrieved persons. Dumas, 635
So.2d at 450.
Grace Askew, Minden‘s representative, testified Minden subjected the
liability accident billing procedure to well over 100 patients during the relevant
time period of 2004-2011. She further indicated, given proper parameters, the
hospital‘s computerized billing system could provide a list of patients who fit the
class definition. Although Minden argues plaintiffs did not introduce any evidence
the scenario encountered by each of the three named plaintiffs occurred more than
100 times, we agree with the trial court a sufficient number of potential class
members exist so as to make joinder impracticable, and given many of the claims
may be small or nominal in nature, we likewise find the numerosity element has
been satisfied.
Commonality
The commonality prerequisite requires a party seeking class certification to
show that ―[t]here are questions of law or fact common to the class.‖ La. Code Civ.
Proc. art. 591(A)(2). However, the mere existence of common questions alone will
not satisfy the commonality requirement. Price v. Martin, 11-853, p. 10 (La.
12/6/11), 79 So.3d 960, 969. Rather, plaintiffs seeking to satisfy this requirement
must demonstrate their ―claims depend on a common contention, and that common
contention must be one capable of class-wide resolution—one where the
‗determination of its truth or falsity will resolve an issue that is central to the
validity of each one of the claims in one stroke.‘‖ Id. (quoting Wal-Mart Stores,
Inc. v. Dukes, 131 S.Ct. 2541 (2011).
20
The record is fairly straightforward in a factual sense as to this prerequisite
and again reasonably supports the trial court‘s finding. Each plaintiff in the instant
case will have been injured in an automobile accident and will have received
treatment at Minden. Each will be covered by a health insurance policy issued by
a health insurance provider with whom Minden was a contracted health care
provider. As to each patient, Minden will have determined a third party was at
fault in the accident, and pursuant to its collection policy, Minden will have
pursued payment at a rate exceeding the contracted rate with the health insurer.
Notwithstanding, the plaintiffs responded to the demand differently, each claim
shares a common issue that is central to the validity of all the claims: whether
Minden‘s collection policy violates the Balance Billing Act. Accordingly, the
record reasonably supports the trial court‘s finding plaintiffs met the commonality
burden.
Typicality
The third element is whether the claims or defenses of the representative
parties are typical of the claims or defenses of the class. La. Code Civ. Proc. art.
591(A)(3). This element determines whether a sufficient relationship exists
between the injury to the named plaintiff and the conduct affecting the class, so
that the court may properly attribute a collective nature to the challenged conduct.
Lambert, supra, at 1094. A plaintiff‘s claim is typical if it rises out of the same
event, practice, or course of conduct giving rise to the claims of the other class
members and those claims arise from the same legal theory. Id.; Deselle, 11-742 at
p. 9, 83 So.3d at 1251.
Although Minden argued the testimony of the named plaintiffs shows it did
not act uniformly as to all patients and that plaintiffs are insured by different
insurers with different agreements with the hospital, Minden‘s representative
21
testified the complained-of procedure was uniform across-the-board from 2000 to
2011. Her testimony does reasonably support both the trial court‘s belief the
hospital consistently applied this collection policy to all patients involved in
automobile accidents wherein a third party was found to be at fault and its finding
the typicality element was satisfied.
Adequacy of Representation
The fourth element plaintiffs must establish is whether the representative
parties will fairly and adequately protect the interest of the class. The following
are ―factors which may be relevant‖ to this inquiry:
(1) The representative must be able to demonstrate that he or she
suffered an actual-vis-à-vis hypothetical-injury;
(2) The representative should possess first hand knowledge or
experience of the conduct at issue in the litigation;
(3) The representative‘s stake in the litigation, that is, the
substantiality of his or her interest in winning the lawsuit, should be
significant enough, relative to that of other class members, to ensure
that representative's conscientious participation in the litigation; and
(4) The representative should not have interests seriously antagonistic
to or in direct conflict with those of other class members, whether
because the representative is subject to unique defenses or additional
claims against him or her, or where the representative is seeking
special or additional relief.
Lambert, supra, at 1117; Howard v. Willis-Knighton Medical Center, 40,634, pp.
36-37 (La. App. 2 Cir. 3/8/06), 924 So.2d 1245, 1265, writ denied, 06-850 (La.
6/14/06), 929 So.2d 1268; see also Desselle, 11-742 at p. 10, 83 So.3d at 1251
(three prong test consists of (1) the absence of conflicting or antagonistic claims
between the representatives and other class members; (2) the representatives‘
sufficient interest in the outcome to insure vigorous advocacy; and (3) competent,
experienced, and qualified counsel).
22
The trial court concluded it is Minden‘s collection policy, not necessarily the
individual damages suffered as the result of this policy, that is at the center of this
case. The evidence does show all the plaintiffs have an interest in the outcome as
they have been subjected to the same collection policies giving rise to this suit and
have testified they are dedicated to the prosecution of this case. In the absence of
conflicting or antagonistic claims between the representatives and the putative
class members, we agree with the trial court the named plaintiffs adequately
represent the class.
Definability
Under the final requirement, plaintiffs must show the class is or may be
defined objectively in terms of ascertainable criteria, such that the court may
determine the constituency of the class for purposes of the conclusiveness of any
judgment rendered in the case. La. Code Civ. Proc. art. 591(A)(5). We find the
trial court‘s definition clearly meets this requirement. Minden‘s own billing
documents will serve in defining the class as these documents can be utilized to
identify those insureds Minden has pursued under the complained-of collection
policy.
Accordingly, we find the trial court did not abuse its vast discretion in
certifying the class.
CONCLUSION
In summary, we find the class action is the superior method for adjudicating
the common issue regarding the legality, under the Balance Billing Act, of a health
care provider‘s collection policy of filing medical liens to recover its full rate for
services from an insured‘s settlement or judgment with a third-party tortfeasor.
Finding no manifest error in the trial court concluding all remaining elements for
class certification—numerosity, commonality, typicality, adequacy, and
23
definability—have been satisfied by the named plaintiffs, we reverse the judgment
of the Court of Appeal and reinstate the District Court‘s certification of the class
herein.3
DECREE
For these reasons, we reverse the judgment of the Court of Appeal and
hereby reinstate the judgment of the District Court. This case is remanded to the
District Court for further proceedings
REVERSED; JUDGMENT OF THE DISTRICT COURT REINSTATED
AND REMANDED.
3Because our review has answered all the issues raised in the Court of Appeal, a remand to that
court is not necessary.
24
05/05/15
SUPREME COURT OF LOUISIANA
NO. 2014-C-2243
PRENTISS BAKER AND SHERYL WIGINTON, INDIVIDUALLY
AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED
VERSUS
PHC-MINDEN, L.P. D/B/A MINDEN MEDICAL CENTER
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL,
SECOND CIRCUIT, PARISH OF WEBSTER
GUIDRY, Justice, additionally concurs and assigns reasons.
I additionally concur in the majority’s holding that the class action is the
superior procedural method for resolving the legal issue presented in this case, and
that the plaintiffs satisfied the requirements of La. Code Civ. Proc. art. 591. As the
majority properly notes, class action certification is a purely procedural issue, and
does not impinge upon the merits of the underlying litigation. Ante, pp. 17-18.
Notwithstanding my agreement with the resolution of the procedural issue in the
case before us, I adhere to my view that Anderson v. Ochsner Health Sys., 13-2970
(La. 7/1/14), ___ So.3d ___, 2014 WL 293710, was wrongly decided. The medical
lien alone does not create a private right of action in favor of the insured against
the health care provider under the “Balance Billing Act,” La. Rev. Stats. 22:1871 et
seq., which clearly sets forth the exclusive remedies for a violation thereof.
Anderson, ___ So.3d at ___, 2014 WL 2937101 at *8-*9 (Guidry, J., dissenting).
1