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A hospital that received workers’ compensation insurance payments for treating two workers injured on the job in a 1996 traffic accident did not have the right to file hospital liens against those workers’ personal property to collect the balance it claimed it was owed for those services, a divided 10th Court of Appeals in Texas ruled recently. According to the Oct. 27 majority opinion in Daughters of Charity Health Services of Waco v. Linnstaedter, et al., the Texas Labor Code fixes the amount to which Providence Health Center was entitled for its services. The Daughters of Charity Health Services operates the hospital. “It could not collect more from the employees,” Justice Bill Vance wrote in the opinion in which Justice Felipe Reyna joined. Chief Justice Tom Gray disagreed, writing in his dissenting opinion, “The majority goes astray from its first sentence, in referring to “the limits on amounts a health care provider can charge for services it provides to a worker’s compensation claimant under the Labor Code.’” Gray wrote in the dissent that he found no authority for the proposition that the Labor Code limits charges for emergency hospital care. Donald Linnstaedter and Kenneth Bolen, the workers injured in the accident, alleged in their brief to the 10th Court that Providence received and accepted payment for their treatment under the fee schedule mandated by the Texas Workers’ Compensation Commission. Providence did not request a review of the medical charges or receive authorization from the commission to charge more than required by the fee schedule, the workers alleged in the brief. The majority and dissent also disagree on whether the case involves an issue of first impression. It does, according to the majority opinion. The question, Vance wrote, is whether the limits on amounts a health-care provider can charge for services rendered to a workers’ compensation claimant under the Labor Code preclude the provider from attempting to collect additional sums from a claimant by filing a hospital lien against a claimant’s property under the Texas Property Code. Gray wrote in his dissent that the question is not an issue of first impression. The “reasonable and necessary charges” for emergency care for the two injured workers exceeded the amount that their workers’ compensation insurance carrier paid, so the hospital’s liens attached to the proceeds of the workers’settlement with the estate of the driver of the other vehicle involved in the accident, Gray wrote in the opinion. NO DOUBLE RECOVERIES As noted in the majority opinion, Linnstaedter and Bolen suffered injuries on the job when another vehicle struck their employer’s vehicle. John Paul Jones, the other driver, died, and Linnstaedter and Bolen sued Jones’estate. According to the workers’ brief filed with the 10th Court, Providence treated Linnstaedter and Bolen and received payment from Royal Indemnity, the workers’ compensation carrier for the workers’employer. To obtain the balance of the amounts that Providence claimed it was owed, the hospital filed liens against the personal property of Linnestaedter and Bolen and received a portion of a confidential settlement that the workers obtained in their suit against Jones’ estate. At issue in Linnstaedter is about $13,000 that the hospital claims it was owed after the workers’ compensation carrier for the employer paid for the workers’ treatment. As noted in the majority opinion, Providence received $5,797 in payment for services to Linnstaedter and filed a lien for $12,777. The hospital received $3,939 for Bolen and filed a lien for $8,889. Linnestaedter and Bolen alleged in their brief that they were forced to pay Providence “a sum of money out of their respective settlements with Jones’estate in order to have the liens dissolved.” According to the workers’ brief, Linnestaedter and Bolen sued Providence for a declaratory judgment that filing the liens violated the Labor Code and misused the Texas Hospital Lien Statute, Texas Property Code 55.001-55.008. Vance noted in the majority opinion that Linnestaedter and Bolen sought recovery of the amounts that Providence received because of the liens. After the 74th District Court in McLennan County, Texas entered a judgment for the workers, the hospital appealed. In his dissenting opinion, Gray noted that the hospital argued that the Texas Legislature passed the hospital lien law to give hospitals a separate cause of action, so that accident victims will be treated and hospitals paid for their services. Vance wrote in the majority opinion that Labor Code 413.042 prohibits Providence from attempting to collect additional sums from the workers. For the two workers to receive a settlement in this way “is a windfall to them, if not fraud by them,” Gray wrote in the dissenting opinion. Rod Squires, the workers’ attorney and a partner in Waco’s Williams, Squires & Wren, says the settlement is not a windfall for the workers or fraud. “[Providence] essentially billed Mr. Linnstaedter and Mr. Bolen for what we would call the retail price of medicine,” Squires contends in an interview. Colin O’Neill, the hospital’s attorney and a partner in Waco’s Fulbright Winniford, declines comment. In his dissenting opinion, Gray wrote that the purpose of the Workers’ Compensation Act is to compensate injured workers and their dependents. The act was not intended to provide double recoveries, Gray wrote. Dallas attorney Peter Rogers, who represents hospitals, clinics and injured workers in workers’ compensation claims but is not involved in Linnstaedter, says he thinks the 10th Court’s majority opinion is correct. Rogers, a partner in Rogers, Booker & Trevino, says the Texas Workers’ Compensation Act, Labor Code 401 through 506, is an exclusive remedy. Under 413.042 of the code, a hospital is barred from pursuing a private claim against an individual. He says that if a hospital files a lien against somebody’s settlement, that would be pursuing a private claim. Notes Rogers, “I would say [Providence's] activity is prohibited.”

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