Tenet Healthsystem Desert, Inc. v. Eisenhower Med. Ctr. — May 2016 (Summary)

ERISA

Tenet Healthsystem Desert, Inc. v. Eisenhower Med. Ctr.
D069296 (Cal. Ct. App. May 3, 2016)

The California Court of Appeal affirmed in part and reversed in part a number of fraud claims brought because an ERISA trust did not reimburse a hospital for medical services for a patient who was a member of a medical center’s plan but was denied coverage by the ERISA trust.

The hospital contended that the medical center failed to disclose that the patient had a blood alcohol level far exceeding the legal limit, which would adversely implicate his ability to obtain coverage for his injuries. This resulted in an improper authorization of approximately 50 days of services for the patient as medically necessary, because the hospital was not notified until it was too late to seek other avenues of reimbursement or alternative places of treatment for the patient.

The trial court determined that the amended complaint lacked the necessary specificity to survive a demurrer and was otherwise defective. The court of appeal agreed with many of the claims dismissed by the trial court. However, it reversed the dismissal of negligent misrepresentation and unfair competition law claims. The court reasoned that these claims stated sufficient factual allegations.