Alabama Court Certifies Class Action Against Hospital

posted on:
December 12, 2007

Jere Beasley


The Circuit Court of Barbour County, Alabama has recently certified a class action in a lawsuit that our firm Beasley Allen is handling against Community Health Systems, the previous owner of Lakeview Community Hospital, located in Eufaula, Alabama.

Allegations against the hospital overcharged uninsured patients for medical care and services as compared to patients of the hospital who have insurance. We will prove the hospital collects payments from uninsured patients that are hundreds times more than what they collect from insured patients.

The hospital takes the position that they must seek much higher reimbursement levels from uninsured patients because Medicare/Medicaid and private insurance carriers (such as Blue Cross Blue Shield of Alabama) either pay less than the costs of rendering services or just above costs.

This case is similar to a number of other class actions filed against various hospitals around the country that are overcharging uninsured patients.

Many guilty hospitals have reached settlements in order to compensate the uninsured for overcharges, offer charity care to those patients who are unable to afford the hospital prices, and/or changed their hospital billing practices and charge uninsured patients at a more reasonable level and more in line with what government insurance programs and private insurance carriers are charged.

The defendants in the Lakeview Hospital case have taken the position that they do not believe their billing practices for uninsured patients are inappropriate. The class sought a court declaration that the hospital admission contract, which patients must sign upon entering the hospital, does not spell out a price term for services.

The law in Alabama states that where no price term is defined in a contract, the court can supply a reasonable price. Since Lakeview’s overall patient population consists of roughly 85% insured patients and 15% uninsured patients, the position of the class members is that “a reasonable price” is more along the lines of what 85% of the patients pay, not 15%. The plaintiff class asked the court to certify the class based on a formula that would set charges for medical services at 15% above costs. The court granted the plaintiff’s request and certified the class.

This is a great victory for the working poor of this state who are unable to afford decent health care coverage for their families. Jay Aughtman and Jere Beasley from Beasley Allen law firm, along with Walter Calton of Eufaula, will handle this most important case.

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