Daughters of Charity Health Services of Waco v. Linnstaedter

OPINION

BILL VANCE, Justice.

This appeal involves a question of first impression: Do the limits on amounts a health care provider can charge for services rendered to a workers’ compensation claimant under the Labor Code preclude the provider from attempting to collect additional sums by filing a hospital hen under the Property Code?

Donald Linnstaedter and Kenneth Bolen (the Employees) were injured in their employer’s vehicle while in the course of their work. Both were treated at Providence *668Health Center. The driver of the other vehicle was John Paul Jones.

Providence filed a “hospital lien” for the balance it claims was owed for its services. See Tex. Peop.Code Ann. §§ 55.001-008 (Vernon Supp.2004). Providence was then paid by the workers’ compensation carrier the amounts due under the Labor Code for the services provided. See Act of May 22, 1993, 73d Leg., R.S., ch. 269, § 1, sec. 413.011, 1993 Tex. Gen. Laws 987, 1223-24 (current version at Tex. Lab.Code Ann. § 413.011 (Vernon Supp.2004)). The Code prohibits Providence from attempting to collect additional sums directly from the Employees. See id. § 413.042 (Vernon 1996). The relevant amounts are:

Total Amt. Amt.

Employee Claimed Hosp. Lien Camer Paid Linnstaedter $13,406.85 $12,777.85 $5,797.72

Bolen $ 9,297.40 $ 8,889.00 $3,939.82

The Employees sued Jones’s Estate for their injuries. Following a settlement, Jones’s insurer reimbursed the compensation carrier for amounts it had paid to Providence and paid Providence amounts necessary to discharge the hospital liens. The Employees then sued Providence for a declaratory judgment that the filing of the hospital liens violated the Property Code, seeking recovery of sums paid Providence by virtue of the liens. The case was submitted to the judge for decision on a joint motion based on an agreed statement of facts. The court entered judgment for the Employees.

On appeal, Providence says that the Legislature’s intent in passing the hospital lien statute was to give hospitals a separate cause of action, so that accident victims will be treated and hospitals paid for their services. The Employees say that the Labor Code fixes the maximum that a hospital can charge for services to a compensation claimant and therefore, because the Employees could not be charged more than the compensation carrier paid, there were no debts owed by them to Providence that would support the filing of the liens.

We agree with the Employees. The Labor Code fixes the amount to which Providence was entitled for the services it rendered. It could not collect more from the Employees. Thus, it had no right to file hospital liens under the Property Code. See Satsky v. United States, 993 F.Supp. 1027, 1029 (S.D.Tex.1998) (prepaid health care plan between insurance company and hospital; a lien can only legally attach if there is an underlying debt secured by the lien); see also Dorr v. Sacred Heart Hospital, 228 Wis.2d 425, 597 N.W.2d 462, 468-70 (App.1999, pet.dism’d) (payment agreement between hospital and HMO; no debt by person receiving medical services, so lien precluded).1

We affirm the judgment.

Chief Justice GRAY dissenting.

. The Employees also call our attention to Parnell v. Adventist Health System/West, 131 Cal.Rptr.2d 148, 160 (Cal.Ct.App. 5th Dist. Feb. 25, 2003, pet.granted) ("[W]e conclude a hospital that has received full payment for services under the terms of its contract with a medical insurance provider is not entitled to file a lien to recover the difference between that payment and the hospital's 'usual and customary’ charges for similar services.”). We note, however, that the grant of review includes the notation "Opinion Superseded.”