Court Rejects Scripps Health Attempt to Dismiss Class Action Lawsuit for Overcharging Uninsured Patients
Posted on: Wednesday, 22 November 2006, 21:00 CST
By Order entered on November 20, 2006, the Hon. Judge Steven Denton substantially rejected an attempt by Scripps Health to dismiss a class action lawsuit that alleges that Scripps Health charges its uninsured patients unreasonable and unconscionable prices and uses aggressive and unfair collection practices against them.
On July 19, 2006, Phillip Franklin filed a class action cross-complaint against Scripps Health, a self-proclaimed not-for-profit hospital system based in San Diego, after Scripps sued Mr. Franklin through a collection agency. Mr. Franklin was uninsured at the time of treatment. Mr. Franklin alleged that he, like all other uninsured patients at Scripps, was charged unreasonable, unconscionable and excessive hospital bills. Scripps thereafter attempted to have the case thrown out of Court.
On November 20, 2006, the Court ruled that Mr. Franklin's claims that Scripps engaged in unfair and unlawful practices can go forward. The Court rejected Scripps' argument that existing law permitted the conduct Mr. Franklin challenges, finding that the law does not " ... provide Scripps with the express unfettered right to charge uninsured patients unconscionable rates that bear no relation to the actual services performed." The Court further found that Mr. Franklin's claim that " ... it is unfair to represent that Scripps is a not for profit charitable hospital, but at the same time allegedly charge exorbitant rates to unsuspecting patients in order to maximize profits, ... sufficiently alleges a claim premised on unfair business practices." While the Court sustained Scripps' motion with respect to Mr. Franklin's breach of contract claims, it also allowed Mr. Franklin the opportunity to further amend the complaint.
"We are pleased that the Court has recognized that Scripps does not have the right to price-gouge its most vulnerable patients. We intend to move forward and seek relief from Scripps' prices -- which we have alleged are unreasonable -- on behalf of all of Scripps' uninsured patients," said Kelly M. Dermody, a partner at Lieff, Cabraser, Heimann & Bernstein, LLP, attorneys for Mr. Franklin.
Mr. Franklin seeks relief on behalf of himself and a proposed class consisting of tens of thousands of uninsured patients treated at Scripps hospitals since July 19, 2002.
Source: Business Wire
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