Colorado Supreme Court rules in favor of woman who expected to pay $1,337 for surgery but was charged $303,709

A woman who expected to pay $1,337 for surgical procedure at a Westminster hospital nearly a decade in the past but was billed $303,709 might lastly be off the hook for the massive invoice after the Colorado Supreme Court dominated in her favor Monday.

The justices unanimously discovered that the contracts affected person Lisa French signed before a pair of back surgical procedures in 2014 at St. Anthony North Health Campus do not obligate her to pay the hospital’s secretive “chargemaster” value rates, as a result of the chargemaster — a list of the hospital’s sticker costs for varied procedures — was never disclosed to French and she had no idea the chargemaster existed when she signed the contracts.

On the time, the hospital had represented to French that the surgical procedures were estimated to price her $1,337 out of pocket, along with her medical health insurance supplier overlaying the rest of the invoice.

However the hospital’s estimate was primarily based on French’s insurance supplier being “in-network” with the hospital, which it was not. A hospital employee gave a mistaken estimate after apparently misreading French’s insurance coverage card.

After her surgeries, the hospital billed $303,709 for French’s care; her insurance coverage paid about $74,000 and the remaining steadiness of $228,000 was disputed in a civil case.

Attorneys for Centura Well being, which operates the nonprofit hospital, had argued that the contracts, which required French to pay “all costs of the hospital” for her care, implicitly included the hospital’s then-secret pricing schema.

The state Supreme Court docket justices rejected that argument, finding that “long-settled principles of contract regulation” show that French didn't conform to pay the chargemaster prices when she signed the contracts, which never mention or reference the chargemaster.

“(French) assuredly could not assent to terms about which she had no information and which have been by no means disclosed to her,” Justice Richard Gabriel wrote within the courtroom’s opinion.

The justices also famous that chargemaster prices are divorced from actual prices for care. Few patients actually pay the chargemaster’s sticker costs for care, as a result of insurance firms negotiate decrease prices with the hospital to turn out to be “in-network.”

“…Hospital chargemasters have become increasingly arbitrary and, over time, have lost any direct connection to hospitals’ actual costs, reflecting, instead, inflated charges set to supply a focused amount of profit for the hospitals after factoring in discounts negotiated with personal and governmental insurers,” Gabriel wrote.

Colorado lawmakers in 2017 passed a legislation requiring hospitals to make some self-pay prices public, and in 2019, a federal agency required hospitals to make their chargemaster costs public. None of these protections were in place when French underwent her surgeries in 2014.

Monday’s determination overturns the Colorado Court docket of Appeals, which had present in favor of the hospital. The Court of Appeals’ ruling famous that hospitals cannot all the time precisely predict what care a patient will need, and to allow them to’t lock in a agency value, and concluded that the term “all fees” in French’s contract was “sufficiently definite” as a result of the chargemaster charges were pre-set and fixed.

The state Supreme Court docket justices instead upheld the trial court docket’s ruling, wherein a judge found the contracts have been ambiguous and despatched the case to a jury to determine whether or not French breached her contract with the hospital and, if that's the case, how a lot she ought to pay.

Jurors decided she did breach her contract but solely owned the hospital an extra $767. The state Supreme Court docket’s ruling reinstates that verdict, said Ted Lavender, an lawyer for French.

“This should be the top of the road for her,” he said of French. “This opinion reinstates the jury verdict, which was a win for her, and (the case) will now revert back to that win. I've spoken together with her at this time and he or she is very pleased with the consequence.”

A spokeswoman for Centura Health did not immediately remark Monday.