Category: Daily News

The federal Hospital Price Transparency Rule, which took effect on January 1, 2021, requires hospitals to post all prices online, easily accessible and searchable, in the form of (1) a single machine-readable standard charges file pricing for all items, services, and drugs by all payers and all plans, the de-identified minimum and maximum negotiated rates, and all discounted cash prices, as well as (2) prices for the 300 most common shoppable services either as a consumer-friendly standard charges display listing actual prices or, alternatively, as a price estimator tool.

Combined with requirements for disclosure of systemwide prices and historical claims in the Transparency in Coverage Rule and the Consolidated Appropriations Act of 2021 respectively, the Hospital Price Transparency Rule is intended to empower healthcare consumers – patients, employers, and unions as purchasers – with ease of access to compare prices.

The nonprofit Patient Rights Advocate (PRA) released its fifth semi-annual report, which found that only 36 percent of 2,000 surveyed hospitals were in complete compliance with the rule.

Its latest review was published on July 20, 2023, two and a half years after the Hospital Price Transparency Rule took effect. It analyzed the websites of 2,000 U.S. hospitals and found only 36% of them (721) to be fully compliant with all requirements of the rule.

Although the majority of hospitals have posted files, the widescale noncompliance of 64% of hospitals is due to most hospitals’ files being incomplete or not having prices clearly associated with both payer and plan.

In this report, 69 of the hospitals reviewed had no usable standard charges file.

Compliance varied widely among the largest hospital systems it reviewed.

– – None (0%) of the hospitals it reviewed which were owned by HCA Healthcare, Tenet Healthcare, Providence, Avera Health, UPMC, Baylor Scott & White Health, and Mercy were found to be fully compliant.
– – Consistent with prior reports, none of the hospitals owned by the largest hospital system in the country, HCA Healthcare, were found to be in full compliance, with a significant amount of its hospitals posting illegible, nonconforming files.
– – Substantial improvements since its last report include: 88% of hospitals owned by CommonSpirit Health, 97% of hospitals owned by Community Health Systems, and 98% of hospitals owned by Kaiser Permanente were found to be in full compliance.

The Health and Human Services (HHS) Department’s Centers for Medicare and Medicaid Services (CMS) are responsible for enforcing the rule. In June of 2022 (eighteen months after the rule’s inception), CMS imposed its first two civil monetary penalties (CMPs) on hospitals for not complying with the rule.

Both hospitals immediately came into compliance with exemplary files to date.

In February of 2023, CMS acknowledged in a blog post that 30% of hospitals (approximately 1,800) were still noncompliant. Yet, in April of 2023, only two more hospitals were fined. Both were still found to be noncompliant in this review.

As of the time of this report, a total of four hospitals have been penalized, 0.2% of the hospitals that CMS recognized as noncompliant. Clearly, CMS is not strongly enforcing the rule.

“Unfortunately, our findings show that the majority of hospitals across the country are still failing to comply with the Hospital Price Transparency Rule,” said Cynthia Fisher, Founder and Chairman of PatientsRightsAdvocate.org.

“When hospitals hide behind estimates or don’t post all real prices, they are leaving consumers in the dark. Making all actual prices available upfront will empower patients, employers, and unions to choose the best care at prices they know they can afford, and protect all Americans from overcharges, errors, and fraud.”

Robert Irving Slater was admitted to practice law in California since 1975. He was a solo practitioner who had handled workers’ compensation cases since at least the late 1990’s.

USA Photocopy, located in Santa Ana, provided attorney services, including photocopying and sending subpoenas for records for workers’ compensation cases. The company would then bill insurance carriers for its services. During the relevant time period, Edgar Gonzalez was the owner of USA Photocopy and Enrique Villagomez was the manager.

Peter Ayala worked as a “legal investigator performing intake services.” He learned that Villagomez had work in the form of “sign-up services available,” and subsequently had a meeting with Gonzalez and Villagomez at the USA Photocopy office. During the course of the conversation, it was brought up that Ayala would be working directly for one attorney – Robert Irving Slater. After working out a payment structure with Gonzalez and Villagomez, all three of them went to Slater’s office and met with him.

Ayala’s role was to meet with the potential “workers’ compensation client to fill out the intake retainer . . . and also get the retainer signed for the claim.” Ayala would also have the client, with his assistance, complete various forms, including the workers’ compensation appeals board application for adjudication, medical release forms, and fee disclosure forms, among others. With regard to copy services, there was a form signed by clients giving USA Photocopy permission to perform copy services “and the medical release forms as well.” Ayala would return the forms to Slater’s office in digital form, and returned the originals in person approximately every two weeks.

Ayala was told to send an invoice for his services every two weeks to USA Photocopy, which paid him for his services. Ayala had done similar work in the past for approximately 13 attorneys, and this was the first time he would be paid by a party other than an attorney.

Ayala was paid by USA Photocopy as an independent contractor. Between September 2012 and September 2015, Ayala invoiced a total of $196,280.00 to USA Photocopy. Over the six years his relationship with USA Photocopy and defendant lasted, Ayala estimated he performed intake services for about 2,000 clients for defendant, and USA Photocopy was the only copy service used for those clients. Ayala did not perform any service for USA Photocopy other than the services he performed for Slater.

Slater was charged with conspiracy (Pen. Code, § 182, subd. (a)(1), Lab. Code, § 32151 (count 1)); submitting a false and fraudulent claim (Pen. Code, § 549 (count 2)); and 21 counts of insurance fraud based on concealing or failing to disclose information that affects a person’s right to an insurance benefit (Pen. Code, § 550, subd. (b)(3) (counts 3-23)). The complaint also alleged that Slater had engaged in a pattern of related fraudulent conduct involving the taking of more than $100,000.00. A jury convicted Slater on all 23 counts, and also found the enhancement regarding the pattern of fraudulent conduct true.

The court sentenced Slater to serve a total of 183 days, with 182 of those days suspended on the successful completion of two years of supervised probation. Six months of the probation term was to be served with an ankle bracelet. The court also ordered him to pay $356,175.24 in victim restitution in addition to statutory fines and fees.

Slater appealed his conviction. The court of appeal affirmed the trial court in the unpublished case of People v Slater -G061331 (July 2023)

Slater’s sole contention on appeal is that he did not possess the requisite state of mind to violate Labor Code section 3215, which was an element of each of the crimes of which he was convicted with the exception of count 2, submitting a false and fraudulent claim under Penal Code section 549.

Section 3215 states: “Except as otherwise permitted by law, any person acting individually or through his or her employees or agents, who offers, delivers, receives, or accepts any rebate, refund, commission, preference, patronage, dividend, discount or other consideration, whether in the form of money or otherwise, as compensation or inducement for referring clients or patients to perform or obtain services or benefits pursuant to this division, is guilty of a crime.“

In reviewing his opening brief on appeal, the Court noted that he “included nothing that could possibly be interpreted as an even-handed account of the evidence presented. This violates rules 8.204(a)(2)(C) and 8.360(a) of the California Rules of Court.”

“It also violates the principles set forth in Sanghera, supra, 139 Cal.App.4th 1567: ‘Perhaps the most fundamental rule of appellate law is that the judgment challenged on appeal is presumed correct, and it is the appellant’s burden to affirmatively demonstrate error.’ “

The Court went to to say “How does a defendant make such a showing? Perhaps the best way to understand that point is to understand how a defendant does not make such a showing. He does not show the evidence is insufficient by citing only his own evidence, or by arguing about what evidence is not in the record, or by portraying the evidence that is in the record in the light most favorable to himself.”

After the Court of Appeal sad that “Defendant failed these requirements rather spectacularly” it concluded by finding “Even if defendant had adequately briefed this appeal, our own review of the record demonstrates substantial evidence to uphold the verdicts.”

Rigoberto Gonzalez claimed injury to his heart, upper extremities, spine, and lower extremities while employed by Team Infinity as a service technician/mechanic during the period from August 28, 2001, through March 25, 2010.

The parties agreed to use Steven Nagelberg, M.D., an orthopedist and Edward J. O’Neill, M.D., and internist as AMEs in their respective fields, and Gonzalez was additionally evaluated by a rheumatology qualified medical examiner (QME) Seymour Levine, M.D.

As to the issue of apportionment, Dr. Nagelberg stated that 100% of the cervical and lumbar spine impairment was caused by the cumulative work injury, that 50% of the right wrist and bi-lateral knee impairment was due to the cumulative work injury, and 50% of the right wrist and bi-lateral knee impairment was due to a pre-existing non-industrial arthritic condition.

Dr. O’Neill stated that the hypertension caused 49% WPI, the coronary artery disease caused 20% WPI, the upper GI/GERD caused 7% WPI, and that applicant had 7% WPI as a result of his obstructive sleep apnea. He later said he would apportion the hypertension in the same fashion as the arthritic condition; namely, 75% non-occupational and 25% occupationally related. Regarding the coronary artery disease and the obstructive sleep apnea is that neither of those conditions are occupationally related and any impairment or disability is non-occupationally related with no apportionment to occupational factors.

Gonzalez had a “Facetime meeting” with Vocational Rehabilitation Counselor Paul Broadus. Mr. Broadus concluded that applicant was “not amenable to rehabilitation, solely due to his industrial impairments” and that he no longer had “the ability to return to work in the open labor market.”

After commenting on the apportionment given by the medical evaluators, he concluded that “Mr. Gonzalez is in a rather unusual situation in that none of his impairments by themselves preclude him from working in the open labor market. However, he has so many separate issues that when combined, the industrial portions alone make him not amenable to rehabilitation.  Conversely, if he only had the non-industrial impairments, these would be labor-disabling and preclude him from working by themselves.

At the October 13, 2021 trial the parties stipulated that applicant sustained injury AOE/COE to his heart, upper extremits, spine, and lower extremities; that “Applicant asserts he is 100 percent permanently totally disabled” and “Defendant asserts that, Applicant’s permanent disability is 86%;”

The WCJ found that the injuries caused 100% permanent disability. The employer’s Petition of Reconsideration was granted, and the award was rescinded in the panel decision of Gonzalez v Team Infinity -ADJ7263865 (July 2023).

The issue on Reconsideration was apportionment of permanent disability. On this issue the WCAB panel noted that pursuant to Labor Code 4663 “The Appeals Board must rely on expert medical opinion in determining apportionment; apportionment is a medical determination, and a non-medical opinion is not substantial evidence.”

The WCAB panel then noted its recent en banc decision on this issue stating “Accordingly, ‘vocational apportionment’ offered by a non-physician is not a statutorily authorized form of apportionment. In addition, apportionment determinations that deviate from the mandatory standards described in section 4663(c) are not a valid basis upon which to determine permanent disability. (Grace Nunes v. State of California, Dept. of Motor Vehicles (2023) Cal.Comp.Cases … [2023 Cal.Wrk.Comp. LEXIS … [ADJ8210063; ADJ8621818] (Appeals Board en banc)”

Also, Dr. Nagelberg and Dr. O’Neill did not review the VR reports in this case.

“It appears that notwithstanding the apportionment described by Drs. Nagelberg and O’Neill, it is Mr. Broadus’ opinion that applicant is 100% disabled as a result of his industrial cumulative injury. Clearly, his opinion is not consistent with the statutory and case law discussed above.”

Aetna Health of California Inc. provides health insurance. For its preferred provider plans, Aetna contracts with a network of physicians and other medical providers who offer care to insured individuals at an agreed rate. Member patients can also see providers outside the network on referral from in-network physicians, but may bear a greater share of the cost.

Effective in 2009, Aetna adopted a “Network Intervention Policy” designed, according to its terms, to “reduce the number of non par [i.e., nonparticipating, or out-of-network] referrals by par providers and if necessary take further action against participating providers who refuse, after warning and education to comply with the terms of their contract.”

The California Medical Association (CMA) is a nonprofit professional organization, founded in 1856, that advocates on behalf of California physicians. By CMA’s count, it has more than 37,000 physician members.

In 2010, at least two years before it filed suit, CMA learned of Aetna’s Network Intervention Policy from its members and became concerned that in threatening termination or actually terminating participating physicians for their referrals to out-of-network providers, the policy’s implementation interfered with physicians’ exercise of their sound medical judgment.

CMA diverted 200-250 hours of staff time to respond to the policy. That time was spent on activities including: (i) investigation for the purpose of “advis[ing] physicians and the public regarding how to address Aetna’s . . . interference with the physician patient relationship in an effort to avoid litigation over this issue”; (ii) “prepar[ing] a 3-page document entitled the ‘Aetna Termination Resource Guide,’ which [CMA] publicized, advising . . . members about Aetna’s new policy . . . , including ways to proactively address and counteract Aetna’s policies”; (iii) engaging with physicians affected by Aetna’s policy and interacting with Aetna on physicians’ behalf; and (iv) “prepar[ing] a letter to California’s Department of Insurance and California’s Department of Managed Health Care requesting that they take action to address” Aetna’s change in policy.

In July 2012, CMA sued Aetna, alleging Aetna’s implementation of the Network Intervention Policy violated the unfair competition law (UCL; Bus. & Prof. Code, § 17200 et seq.) both because it was unfairly oppressive and injurious and because it violated specified sections of the Insurance Code, Business and Professions Code, and Health and Safety Code. CMA sought to enjoin Aetna from enforcing the policy.

The UCL confers standing on a private plaintiff to seek relief under the statute only if that plaintiff has “suffered injury in fact” and “lost money or property as a result of the unfair competition” at issue.

Aetna moved for summary judgment. It argued that CMA lacked UCL standing because CMA had not lost money or property as a result of the policy. Aetna emphasized that the policy applied to individual physicians – not to CMA. CMA countered that it had diverted resources in response to the policy. The trial court granted Aetna’s motion for summary judgment on standing grounds. The Court of Appeal affirmed. (California Medical Assn. v. Aetna Health of California Inc. I (2021) 63 Cal.App.5th 660).

The California Supreme Court agreed to hear the case, and reversed the dismissal in the case of California Medical Assn. v. Aetna Health of California Inc. II – S269212 (July 2023)

The issue between the parties is whether resources that an organization has spent to counter an unfair or unlawful practice constitute “money or property” that has been “lost . . . as a result of the unfair competition.” (§ 17204.)

The California Supreme Court held that the UCL’s standing requirements are satisfied when an organization, in furtherance of a bona fide, preexisting mission, incurs costs to respond to perceived unfair competition that threatens that mission, so long as those expenditures are independent of costs incurred in UCL litigation or preparations for such litigation.

When an organization has incurred such expenditures, it has “suffered injury in fact” and “lost money or property as a result of the unfair competition.” (§ 17204.)

In this case the record discloses a triable issue of fact as to whether the plaintiff association expended resources in response to the perceived threat the health insurer’s allegedly unlawful practices posed to plaintiff’s mission of supporting its member physicians and advancing public health.

The evidence was also sufficient to create a triable issue of fact as to whether those expenses were incurred independent of this litigation. For these reasons, the trial court erred in granting summary judgment for the defense. It therefore reversed the judgment of the Court of Appeal, which affirmed the grant of summary judgment.

Erik Adolph, was a driver for UberEATS, a meal delivery service. The company through which drivers are connected with those in need of UberEATS’ services is owned by Uber Technologies Inc.

Before he began making deliveries for UberEATS in March 2019, Adolph created an account to use the UberEATS app. In creating his account, Adolph accepted an arbitration agreement, which “is governed by the Federal Arbitration Act.”

In October 2019, Adolph filed a putative class action complaint against Uber, claiming that Uber had misclassified employees as independent contractors, and had therefore failed to reimburse the class members for necessary work expenses. The complaint was amended to include only a California Private Attorney General Act (PAGA) cause of action. Uber filed a petition to compel arbitration of Adolph’s individual claims, strike the class action allegations, and stay all court proceedings.

But the trial court denied Uber’s petition to compel arbitration citing California Supreme Court’s 2014 decision in Iskanian v. CLS Transportation Los Angeles, LLC 59 Cal.4th 348, 384 and the cases following it, In Iskanian the California Supreme Court held “that an employee’s right to bring a PAGA action is unwaivable,” and that “here . . . an employment agreement compels the waiver of representative claims under the PAGA, it is contrary to public policy and unenforceable as a matter of state law.”

Uber appealed the ruling of the trial court. On April 11, 2022 the Court of Appeal affirmed the trial court in the case of Adolph v Uber Technologies Inc. -G059860 (consol. w/ G060198). The case was unremarkable at the time, hence it was “unpublished.”

About two months later, The Supreme Court of the United States published its decision in Viking River Cruises, Inc. v. Angie Moriana, on June 15, 2022, agreeing with the employer who had appealed nearly the same issue as in Adolph v Uber. SCOTUS thus limited the application of Iskanian in California. It said “When an employee’s own dispute is pared away from a PAGA action, the employee is no different from a member of the general public, and PAGA does not allow such persons to maintain suit.” As a result, Moriana would lack statutory standing to maintain her non-individual claims in court, and the correct course was to dismiss her remaining claims.

The U.S. Supreme Court decision in Viking had – at least temporarily – disrupted the PAGA process against employer’s who have arbitration agreements in California. Hence, on July 22, 2022 the California Supreme Court granted Uber’s Petition for Review in the Adolph case. The Uber case which was unremarkable and unpublished, is now remarkable, since the timing make it the case chosen to decide how Viking will work in California.

The California Supreme Court agreed to hear Adolph v Uber Technologies Inc in order to consider whether an aggrieved employee who has been compelled to arbitrate individual claims “premised on Labor Code violations actually sustained by” the plaintiff (Viking River, supra, 596 U.S. at p. __ [142 S.Ct. at p. 1916]; see Lab. Code, § 2699, subd. (a)) maintains statutory standing to pursue non-individual “PAGA claims arising out of events involving other employees” (Viking River, at p. __ [142 S.Ct. at p. 1916]) in court.

In deciding Viking River the U.S. Supreme Court concluded that a PAGA plaintiff loses standing in this situation: “[A]s we see it, PAGA provides no mechanism to enable a court to adjudicate non-individual PAGA claims once an individual claim has been committed to a separate proceeding. Under PAGA’s standing requirement, a plaintiff can maintain non-individual PAGA claims in an action only by virtue of also maintaining an individual claim in that action.”

And SCOTUS reasoned that “When an employee’s own dispute is pared away from a PAGA action, the employee is no different from a member of the general public, and PAGA does not allow such persons to maintain suit.”

Nonetheless, the California Supreme Court in it’s Adolph v Uber Technologies -S274671 (July 2023) decision published today, disagreed with the Viking River interpretation of PAGA, a state law, because “[t]he highest court of each State . . . remains ‘the final arbiter of what is state law’ ” (Montana v. Wyoming (2011) 563 U.S. 368, 378, fn. 5), “we are not bound by the high court’s interpretation of California law.”

The centerpiece of PAGA’s enforcement scheme is the ability of a plaintiff employee to prosecute numerous Labor Code violations committed by an employer and to seek civil penalties corresponding to those violations.

“Uber makes several arguments in urging that a PAGA plaintiff loses standing to litigate non-individual claims in court when the plaintiff’s individual claims are subject to arbitration. None is persuasive.”

In sum, where a plaintiff has filed a PAGA action comprised of individual and non-individual claims, an order compelling arbitration of individual claims does not strip the plaintiff of standing to litigate non-individual claims in court. This “is the interpretation of PAGA that best effectuates the statute’s purpose, which is ‘to ensure effective code enforcement.’ ”  

“We reverse the judgment of the Court of Appeal and remand the case for further proceedings consistent with this opinion. We limited our review to the question of PAGA standing and express no view on the parties’ arguments regarding the proper interpretation of the arbitration agreement.”