Court Victory For California ER Physicians

[CAL/AAEM News Service]

Court Victory For California ER Physicians 

Source: AAEM (http://www.aaem.org)
Date: February 21, 2006


In a major victory for emergency room (ER) physicians in California, the Second Appellate
District, California Court of Appeal issued an opinion on February 17, 2006 in Prospect
Medical Group v. Northridge Medical Group holding that physicians providing emergency
services are not prohibited from "balance billing" patients for fees not paid for by a
health plan or its contracting independent practice association (IPA).  The California
Medical Association (CMA) submitted an amicus brief, and the court's opinion was in
complete agreement on the points raised by CMA.


The court's decision addressed the three following issues:

•        Whether a California law prohibits non-contracted emergency room physicians from
balance billing individual patients for the balance of the physician's fee not paid by a
patient's health plan or delegate?  The court found that the California law does not
prohibit balance billing by non-contracted ER physicians because the law assumes the
existence of a voluntarily negotiated contract. 

•        Whether ER physicians must accept the Medicare rate as full reimbursement from a
health plan?  The IPA asked for a judicial declaration imposing the Medicare rate as the
"reasonable rate" for out-of-network ER physicians.  The court denied the request, noting
that the IPA provided no legal authority for this position.  It also noted that
California regulations include a six-part test to determine reimbursement for
out-of-network physicians, which makes it clear that adopting Medicare as an
across-the-board rate is inappropriate. 

•        Whether health plans may litigate the reasonableness of the amount charged by
emergency room physicians?  The court held that the IPA may litigate whether the rates
charged by the physicians were reasonable.  The court held that payers and physicians
both have a right to contest whether an ER physician's out-of-network charge or a health
plan's out of network payment for those services is reasonable.  

CMA is expecting the IPA to appeal.  This is a major victory for CMA with national
repercussions.  Congratulations to CMA!  



Cyrus Shahpar & Brian Potts 
Managing Editors, CAL/AAEM News Service
University of California, Irvine

The CAL/AAEM Archives are available at: http://maillists.uci.edu/mailman/public/calaaem/


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