California patients can sue if personal data are released during billing disputes

The California Supreme Court determines that physicians and others are liable if the information is given to credit agencies

By Alicia Gallegos

amednews.com

The Supreme Court of California has ruled that patients can sue doctors, debt collectors and others who disclose their medical information to credit agencies during billing disputes.

The ruling exposes California physicians to more lawsuits and hinders their ability to collect outstanding bills, said an attorney involved in the case.

In the past, the Fair Reporting Credit Act protected doctors from lawsuits over such disclosures. The law says if doctors or others receive notice that a debt is in dispute, they are required to furnish accurate and complete information about the debt to the requesting credit agency.

But in its June 16 opinion, the state's high court said a more stringent California law on patient privacy trumps the FRCA, preventing doctors from releasing any confidential information to creditors without patient consent.

"It really inhibits the ability of health care providers to document the basis for [debt] claims," said Charles Messer, an attorney who represented the bill collector, Stewart Mortenson. "It makes collecting medical debts much more difficult."

The decision stems from a billing dispute between Robert Brown and his dentist, Rolf Reinholds. In 2000, Brown was billed for a treatment he said he never received. The bill was referred to a debt collector, who contacted Reinholds for more information after Brown denied the debt, according to court records.

Reinholds sent Mortenson a copy of Brown's medical history. The record included medical histories of Brown's children, which were in the same file. As the billing dispute continued, Mortenson disclosed the medical information to three national consumer reporting agencies.

Brown sued Reinholds and Mortenson, alleging that he never consented to the record disclosure. Among other details, the information included Brown's Social Security number, address, date of birth and telephone number, court records show. Reinholds was dismissed from the suit after settling out of court, according to attorneys in the case.

Lower courts cited federal law

The trial and appellate courts ruled in favor of Mortenson. The lower courts said the confidential information provided was protected by the FRCA.

But the Supreme Court said the law is preempted by the stricter state measure, and that Brown's original claim could move forward. The court said the state privacy law also trumps the Health Insurance Portability and Accountability Act, which allows for certain administrative disclosures.

Brown, an attorney who represented himself, said the high court analyzed the facts carefully and came to the correct conclusion.

"It means people working with health care records in California have to be very careful they are not violating patients' confidentiality," he said. "Without patients' consent, medical information, including a patient's identifying [details], cannot be turned over to credit agencies."

The decision restricts the free flow of information needed for fair and accurate credit reporting, Messer said. Doctors are now subject to legal claims for complying with federal law and providing debt information, he added.

"It becomes a Catch-22 and exposes health care providers to liability," he said.

Messer is considering asking the U.S. Supreme Court to review the case.

Additional Information

Robert A. Brown v. Stewart Mortenson, Supreme Court of California, June 16 (www.courtinfo.ca.gov/opinions/documents/S180862.PDF)

Dealing With the Depressed or Dangerous

SAN FRANCISCO — How far can colleges go to stop students who are threatening to commit suicide?

It’s a fundamental question for college and university officials who work in the fields of student affairs, counseling and mental health -- and for the lawyers who may have to deal with the aftermath, and sometimes see mental health issues as a minefield of potential litigation.

At a session Tuesday here at the annual meeting of the National Association of College and University Attorneys, experts in legal affairs and mental health urged colleges to do all they can to get students who are threatening to harm themselves into treatment, or to get them off campus if the situation continues to deteriorate.

In the past decade, the number of college students with severe mental health issues has climbed. The development is often attributed to better early intervention and psychiatric drugs that enable students to function normally and attend college who wouldn’t have been able to do so in the past. “That’s a wonderful thing,” said Paul Lannon, an outside lawyer for several New England colleges who moderated the session.

But the increase has also been accompanied by several high-profile lawsuits, and the conclusion colleges and universities draw from those could be “damned if you do, damned if you don’t.”

After a Massachusetts Institute of Technology sophomore, Elizabeth Shin, committed suicide by setting her dorm room on fire in 2000, her family sued MIT for $28 million. They argued that the university’s counseling system failed Shin, who had a documented history of depression and threats before she killed herself. The suit was eventually settled confidentially.

In 2006, Jordan Nott, a former student, sued George Washington University, claiming that he had been forced to withdraw from the university after seeking help for depression. Nott also reached a confidential settlement.

The federal government has intervened in some similar cases through complaints students filed with the Department of Education’s Office of Civil Rights, which has come out against universities who force students to leave campus because of mental illness, including a case at Bluffton University, in Ohio, in 2004.

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The entire story can be found here.

Thanks to Ken Pope for this article.