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Dephillips v. Hospital Service District No. 1

Court of Appeals of Louisiana, First Circuit

July 18, 2018

MATTHEW A. DEPHILLIPS, INDIVIDUALLY, AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED
v.
HOSPITAL SERVICE DISTRICT NO. 1 OF TANGIPAHOA PARISH, DOING BUSINES S AS NORTH OAKS MEDICAL CENTER NORTH OAKS HEALTH SYSTEM EARNEST WILLIAMS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED
v.
HOSPITAL SERVICE DISTRICT NO. 1 OF TANGIPAHOA PARISH D/B/A NORTH OAKS HEALTH SYSTEM AND NORTH OAKS MEDICAL CENTER, AND LOUISIANA HEALTH SERVICE & INDEMNITY COMPANY D/B/A BLUE CROSS BLUE SHIELD OF LOUISIANA

          On Appeal from the 21st Judicial District Court In and for the Parish of Tangipahoa State of Louisiana Trial Court No. 2015-0001261 Consolidated with Trial Court No. 2015-0001388 Honorable Robert H. Morrison, III, Judge Presiding

          J. Lee Hoffoss, Jr. Claude P. Devall Donald W. McKnight Lake Charles, Louisiana and Derrick G Earles David C. Laborde Marksville, Louisiana and Jeffery P. Berniard Scott R. Bickford Lawrence J. Centola, III Norman F. Hodgins, III New Orleans, Louisiana Attorneys for Plaintiffs/ Appellants, Matthew A. DePhillips and Earnest Williams, Individually, and on Behalf of All Similarly Situated

          Harry J. Philips, Jr. Amy C. Lambert Caroline K. Darwin Baton Rouge, Louisiana Attorneys for Defendant/Appellee, Hospital Service District No. 1 of Tangipahoa Parish, d/b/ a North Oaks Medical Center/North Oaks Health System

          BEFORE: HIGGINBOTHAM, HOLDRIDGE, AND PENZATO, JJ.

          PENZATO, J.

         This consolidated matter involves alleged violations of the Health Care Consumer Billing and Disclosure Protection Act (the "Billing Act"), La. R.S. 22:1871, et seq. Plaintiffs Matthew DePhillips and Earnest Williams attempt to appeal the trial court's judgments granting exceptions raising the objection of prescription filed by defendant Hospital District No. 1 of Tangipahoa Parish, doing business as North Oaks Medical Center/North Oaks Health System ("North Oaks"), finding that such claims are subject to a one year prescriptive period.

         FACTS AND PROCEDURAL HISTORY

         On April 28, 2015, DePhillips filed a putative class action against North Oaks. DePhillips alleged that he was treated at North Oaks as a result of a February 9, 2015 motor vehicle accident. He further alleged that at the time of the accident, he was insured by Blue Cross Blue Shield of Louisiana ("BCBS"). DePhillips, individually, and on behalf of all others similarly situated, sought damages arising from North Oaks' refusal to submit and/or accept payment from his insurer for such treatment, instead seeking to collect directly from DePhillips by maintaining an action at law for payment. DePhillips's petition asserted two causes of action: (1) a violation of the Billing Act; and (2) a breach of contract involving the Member Provider Agreement between North Oaks and BCBS.

         On May 8, 2015, Williams filed a similar class action petition for damages, naming as defendants both North Oaks and BCBS. Williams alleged that he was involved in a motor vehicle accident on February 26, 2011, for which he received medical treatment from North Oaks. According to the petition, Williams was insured under an insurance policy administered by BCBS at the time of the accident. Williams alleged that North Oaks filed a claim with BCBS and was paid for Williams's charges, then attempted to collect amounts from him in violation of its Member Provider Agreement and the Billing Act by asserting a lien against his liability insurance claim for the full and undiscounted charges. Williams, individually, and on behalf of all others similarly situated, asserted that North Oaks' actions violated the Billing Act, that BCBS was solidarity liable with North Oaks, and that Williams relied to his detriment on the promises of BCBS that North Oaks would perform in accordance with the insurance contract.

         On June 10, 2015, North Oaks filed a motion to consolidate the DePhillips and Williams matters. Prior to the hearing on the motion to consolidate, BCBS removed the Williams case to federal court.[1] North Oaks then filed peremptory exceptions in the DePhillips matter raising the objections of no right of action for breach of contract, no cause of action for claims arising before the effective date of the Billing Act, and prescription. Following a hearing on October 13, 2015, the trial court granted the exception raising the objection of no cause of action for claims arising before the effective date of the Billing Act, but denied North Oaks' exceptions raising the objections of no right of action for breach of contract and prescription. A judgment was signed on November 2, 2015. North Oaks filed an application for supervisory writs seeking review of this ruling. On March 8, 2016, this court granted the writ in part, finding that DePhillips did not have a right of action to assert a claim for breach of the Member Provider Agreement, as he was neither a party to the Member Provider Agreement or a third-party beneficiary. Accordingly, the judgment denying the exception raising the objection of no right of action for breach of contract was reversed, and the exception was sustained. The writ was denied with respect to the peremptory exception raising the objection of prescription.

          Thereafter, on March 31, 2016, North Oaks reasserted its peremptory exception raising the objection of prescription, contending that a one year prescriptive period applied to the claims of both DePhillips and Williams arising from the Billing Act.[2] The matter came for hearing on October 11, 2016, at which time the trial court granted the exception, and indicated that it would issue written reasons. The written reasons for judgment signed October 24, 2016, stated that the court was "bound by the First Circuit's ruling" of March 8, 2016, and accordingly, "that the DePhillips claims are confined to billings occurring within one year from the filing of his suit, and that the Williams claims are barred in their entirety by prescription." Two separate judgments were signed on November 16, 2016. The "Judgment on Exception of Prescription" provided that:

IT IS ORDERED ADJUDGED AND DECREED that North Oaks' Exception of Prescription be and is hereby GRANTED as claims arising from the Health Care Consumer Billing and Disclosure Protection Act, La. R.S. 22:1871 et seq., are subject to a one year prescriptive period, and accordingly, that any claims at issue are confined to acts or transactions that occurred within one year from the filing of suit by plaintiff, Matthew A. De[P]hillips.[3]

         Notice of judgment was mailed by the clerk on November 17, 2016. Another "Judgment on North Oaks' Exception of Prescription" stated:

IT IS ORDERED ADJUDGED AND DECREED that North Oaks' Exception of Prescription be and is hereby GRANTED as claims arising from the Health Care Consumer Billing and Disclosure Protection Act, La. R.S. 22:1871 et seq., are subject to a one year prescriptive period, and accordingly, that Earnest Williams' claims against North Oaks be and are hereby ...

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