No CrossRef data available.
Article contents
Hospital Collections: Can Hill-Burton Noncompliance Be Raised by Former Patients as an Affirmative Defense?
Published online by Cambridge University Press: 28 April 2021
Extract
The Hill-Burton Program was enacted in 1946 to provide federal assigtance to communities for the purpose of constructing and modernizing health care facilities. As a condition of Hill-Burton funding, the contracting hospital is required to assume obligations of “uncompensated care” and “community service.” Indigents eligible for Hill-Burton free care can, after exhausting administrative remedies, obtain injunctive relief to enforce compliance with the Program's regulations. However, it is unsettled today whether a hospital's noncompliance with these obligations to provide free care can be raised as an affirmative defense in a hospital collection action. Until recently, courts throughout the country have held that a patient could not raise the affirmative defense of Hill-Burton noncompliance. Yet, the 1979 Hill-Burton Regulations, as well as the recent decision in Hospital Center at Orange v. Cook, are indicators of the start of a contrary trend to allow the defense. This article examines the 1979 Regulations and court decisions on the affirmative defense and argues against allowing the defense.
- Type
- Article
- Information
- Copyright
- Copyright © 1982 American Society of Law, Medicine & Ethics
References
Public Health Service Act. Tit. VI, Pub. L. No. 79-75, 60 Stat. 1040 (1946), codified, as amended, at 42 U.S.C. §§291-291o (1976)Google Scholar
See 42 C.F.R. §§124-501-607 (1979). When hospitals accepted Hill-Burton funds, they gave assurances that they would make available a “reasonable volume” of charity care and would not discriminate in making services available, i.e., the obligation of “uncompensated care” and “community service.”Google Scholar
See, e.g., Saine v. Hosp. Auth. of Hall County, 502 F.2d 1033 (5th Cir. 1974); Euresti v. Stenner, 458 F.2d 1115 (10th Cir. 1972); Cook v. Ochsner Foundation Hosp., 319 F. Supp. 603 (E.D. La. 1970).Google Scholar
An affirmative defense presents new facts and arguments for the defendant without denying the truth of the complaint made by the plaintiff.Google Scholar
42 C.F.R. §124. These Regulations were promulgated by the Secretary of Health, Education and Welfare. The Department was redesignated the Department of Health and Human Services [hereinafter referred to as HHS]. For convenience, the Department of Health, Education and Welfare will be hereinafter referred to as HHS.Google Scholar
426A.2d 526 (N.J. Super. 1981) [hereinafter referred to as Cook].Google Scholar
343 A.2d 661 (Conn. App. 1974), cert. denied, 423 U.S. 1024 (1975) [hereinafter referred to as Yale].Google Scholar
Id. at 664–65.Google Scholar
Id. at 668.Google Scholar
See, e.g., Valley Credit Service, Inc. v. Mair, 582 P.2d 47 (Or. App. 1978).Google Scholar
Cook, supra note 6.Google Scholar
See Freifeld, A., Hill-Burton: The Shape of Things Today and Yet to Come. Clearinghouse Review 15 (7): 567, 570 (November 1981) (an excellent discourse on Cook from the defendant's perspective).Google Scholar
Cook, , supra note 6, at 534 (also overturning Cooper Medical Center v. Joyner, 398 A.2d 606 (N.J. Super. 1979) which held that an affirmative defense could not be raised).Google Scholar
“We … recogniz[e] this jurisdiction's acceptance of the principle that the public policy and public interest intended to be promoted by remedial social legislation are ordinarily advanced by implying therefrom a judicially cognizable cause of action which enforces the legislative purpose. See Lally v. Copygraphics… .” Cook, , supra note 6, at 532 (citation omitted).Google Scholar
Id. at 533–34.Google Scholar
Manuel v. International Harvester Co., 502 F. Supp. 45, 48 (N.D. III. 1980) (former employee claimed to be third party beneficiary of executive order's “requirements incorporated in contracts between his employer and the federal government”).Google Scholar
Yale, , supra note 7. See also Koshetz, , Social Welfare—Medical Indigents Cannot Raise as Defense to Bill Collection Action Hospital's Failure to Honor Hill-Burton Obligation to Provide Uncompensated Services to the Poor, Rutgers Law Review 29:995, 1006 (1976) [hereinafter cited as Koshetz, ].Google Scholar
Falmouth Hosp. v. Lopes, 382 N.E.2d 1042 (Mass. 1978).Google Scholar
Id. at 1044. In contrast, the former patient may argue that he was personally entitled to free care under the facts of the specific case. He may then contend that once he raises the issue of personal entitlement, the burden of proof shifts to the hospital since the hospital has superior knowledge regarding entitlement. i.e., the defendant may attempt to formulate a res ipsa loquitur argument.Google Scholar
Valley Credit Service v. Mair, 582 P.2d 47-49 (Or App. 1978).Google Scholar
42 C.F.R. §124.511 (a)(4) (1979).Google Scholar
42 C.F.R. §124.511 (b)(2) (1979).Google Scholar
44 Fed. Reg. 29.396 (May 18, 1979). See Brown, , The Hill-Burton Act: Asynchrony in the Delivery of Health Care to the Poor, Maryland Law Review 39(2): 316 (1979). HHS's interpretation of the 1979 Hill-Burton Regulations “suggests that Hill-Burton non-compliance may now be considered a proper affirmative defense to a hospital collection suit;” however “it remains to be seen whether DHEW's interpretation of the new requirement means that this affirmative defense would now be accepted.” Id. at 374.Google Scholar
Peninsula General Hosp. v. Brummel, Civ. No. 3-5080CV27 (Dist. Ct., Talbot Cty., Md. 1980).Google Scholar
Yale, , supra note 7.Google Scholar
319 F. Supp. 603 (E.D. La. 1970). Plaintiffs charged ten New Orleans hospitals with failing to fulfill their uncompensated care obligation and asserted that the state health department had failed to enforce the hospital's compliance and preliminary ruling. The court held that indigents had a cause of action under the statute. Although the Hill-Burton Act contained no specific authorization for a civil action, the court held that indigents were beneficiaries of the Hill-Burton legislation and because of this, it was unnecessary to delve into the legislative history of the Hill-Burton Act.Google Scholar
42 U.S.C.A. §300s-6 (1979) grants a private right of action to compel compliance if the Secretary of HHS dismisses the complaint or the Attorney General has not brought an action for compliance within six months from the date that the complaint was filed.Google Scholar
Neither the Hill-Burton Act nor 42 U.S.C.A. §300s-6 (1979) creates this right.Google Scholar
442 U.S. 560, 578 (1979).Google Scholar
444 U.S. 11 (1979).Google Scholar
450 U.S. 754 (1981).Google Scholar
Davis v. Ball Memorial Hosp., 640 F.2d 30 (7th Cir. 1980) [hereinafter referred to as Davis].Google Scholar
42 U.S.C.A. §300p-2(c).Google Scholar
Cort v. Ash, 422 U.S. 66 (1975).Google Scholar
Davis, , supra note 34, at 44.Google Scholar
See Note, Implied Causes of Action: A New Analytical Research Framework, John Marshall Law Review 14:141 (Fall 1980).Google Scholar
42 U.S.C.A. §300s-6 (1979).Google Scholar
See Pennhurst State School & Hosp. v. Halderman, 451 U.S. 1 (1981).Google Scholar
Mather Memorial Hosp. v. Marco, 413 N.Y.S.2d 88.89 (N.Y. App. Div. 1979) (case did not rely upon the 1979 Regulations).Google Scholar
See Sinai Hosp. of Detroit v. Aldridge, note 61 infra and accompanying text.Google Scholar
Brief of Appellant, Braun v. Ada County, Civ. No. 13526, 38 (4th Dist. Idaho 1980).Google Scholar
42 C.F.R. §124.603(d)(3) (1979).Google Scholar
42 C.F.R. §124.503(a) (1979). Previously, hospitals had the option of an “open door” policy.Google Scholar
42 C.F.R. §124.503(b) (1979).Google Scholar
42 C.F.R. §124.504(a) (1979).Google Scholar
42 C.F.R. §124-505 (1979).Google Scholar
This notice requirement, in addition to posing evidentiary problems in showing proof of actual notice to the patient, is quite complex. A number of hospitals are not implementing the requirement due to administrative burdens, costs and/or lack of awareness of the extent of the notice requirements.Google Scholar
42 C.F.R. §§124.506(a), (b) (1979).Google Scholar
42 C.F.R. §124.508 (1979). This is a new requirement. Previously, determinations were made prior to services being rendered except in emergencies. A request can now be made at any time, including at time of collection or legal action.Google Scholar
42 C.F.R. §124, 603 (1979).Google Scholar
Defense attorneys may argue, however, that inconvenience alone is insufficient for limiting a patient's rights. Moreover, as one author has argued, prolonged noncompliance “should be readily ascertainable by inspecting hospital records… .[T]o disallow the defense because some cases might be difficult to adjudicate is illogical and unfair.” Koshetz, , supra note 18, at 1008–09.Google Scholar
Since the 1979 Regulations were promulgated, a number of hospitals have dropped suits against former patients. See, e.g., St. Anne's Hosp. v. Tsanakas, Civ. No. 79M1 128694 (Cir. Ct., Cook Cty., III. October 31, 1981).Google Scholar
42 C.F.R. §124.603(d) (3) (1979).Google Scholar
See Simon v. Eastern Kentucky Welfare Rights Org., 426 U.S. 26, 37 (1976).Google Scholar
Magic Valley Credit Bureau v. Baker, Civ. No. 3639 (5th Dist. Ct., Idaho Nov. 6, 1979).Google Scholar
42 U.S.C.A. §300s-6 (1979).Google Scholar
For defendant's arguments, see Schneider, A., Recent Developments in Defending Hospital Collection Actions, National Health Law Program, p. 4 (March 8, 1976) (the six month waiting period provision “is designed to promote grantee compliance with the ‘free services’ obligation, not to stifle enforcement efforts by intended beneficiaries in the context of a collection action”).Google Scholar
Sinai Hosp. of Detroit v. Aldridge, Civ. No.80-011-317-AV (Cir. Ct., Wayne Cty., Mich. 1981). See also Action Collection Service v. Walsh, No. 3L-21069 (4th Dist. Idaho 1980) (while defendants have a right to file a complaint with the Secretary of HHS and have this right prosecuted in federal court for a trial de novo after six months, the individual still does not have a right to raise Hill-Burton noncompliance as a defense in a hospital collection action).Google Scholar
Sinai Hosp. v. Aldridge, , supra note 61, at 14.Google Scholar
Cook, , supra note 6, at 533. See generally, Freifeld, A., The Shape of Things Today and Yet to Come, Clearinghouse Review 15(7): 567 (November 1981). “It is dangerous and mistaken to ignore exhaustion or read Cook as holding that defendants never have to exhaust. Unique facts were involved, as well as the well-known tradition in New Jersey of a liberal judiciary.” Id. at 571.Google Scholar
A number of cases decided after the 1979 Regulations did not cite them as authority. Either defense attorneys did not realize their significance or thought that they would be inapplicable to their case. See. e.g., Cook, supra note 6. Whether the 1979 Regulations would apply retroactively, however, has not as yet been litigated in reported case law.Google Scholar
42 C.F.R. §124.502 (1979).Google Scholar
Huddleston, M.L., Due Process for Hill-Burton Assisted Facilities, Vanderbilt Law Review 32: 1469, 1499 (1979).Google Scholar
527 F. Supp. 551 (D. Wyo. 1981).Google Scholar
American Hosp. Ass'n v. Harris, No. 79 C2669 (N.D. III. 1982], appeal filed sub nom. American Hosp. Ass'n v. Schweiker, No. 82-1295 (7th Cir. 1982).Google Scholar
See Appellant's Brief, American Hosp. Ass'n v. Schweiker, , supra note 68, at 47 (April 26, 1982). The 1979 Regulations were issued by the Secretary of HHS pursuant to Title XVI, which in part provided that hospitals “be required to comply with the assurances required to be made at the time such assistance was received… .” Pub. L. No. 93-641 (1974). Yet, for the most part, hospitals received Hill-Burton funding under Title VI.Google Scholar
Pennhurst State School & Hosp. v. Halderman, 451 U.S. 1 (1981).Google Scholar
Id. at 17.Google Scholar
It is unfair for certain groups in the private sector to subsidize Medicare/Medicaid shortfalls and, in some states, Blue Cross shortfalls. As Martin Drebin, a hospital vice president of finance stated in regard to his own institution, “we've done as much cost-shifting as we can do in good conscience.” Friedman, E., Shifting the Cost and the Blame. Hospitals 56(6): 97 (March 16, 1982).Google ScholarPubMed