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Ahmad v. Yale-New Haven Hospital

Connecticut Superior Court, Judicial District of Waterbury Complex Litigation Docket at Waterbury
Sep 29, 2004
2004 Ct. Sup. 14527 (Conn. Super. Ct. 2004)

Opinion

No. (X02) CV 04-0183725-S

September 29, 2004


RULING ON MOTIONS TO DISMISS AND STRIKE


In this purported class action, the nine named plaintiffs allege that they were hospital patients who were eligible for "bed funds" that would have entitled them to free hospitalization and medical care. The plaintiffs claim that the defendant hospitals and related entities — Yale-New Haven Hospital, Yale-New Haven Health Services Corporation, and Bridgeport Hospital — violated statutory provisions governing these bed funds and engaged in unlawful collection activities. The defendants move to dismiss portions of the complaint and to strike all fifteen counts.

THE MOTION TO DISMISS I

The gravamen of the plaintiffs' claims under the bed funds statute, General Statutes § 19a-509b (2003), is that the defendants failed to provide the plaintiffs adequate notice of the existence of these funds and that the plaintiffs were thereby deprived of an opportunity to apply for and receive them. These claims arise in count one, charging a direct violation of the statute, counts nine and ten, alleging fraudulent nondisclosure, and counts thirteen, fourteen, and fifteen, alleging violations of the Connecticut Unfair Trade Practices Act ("CUTPA"), General Statutes § 42-110a. Defendants move to dismiss these counts on the ground that the plaintiffs lack standing.

Public Acts 2003, No. 03-266, § 2 amended the statute. Because the claims in this case arose before the amendment, the operative version of the statute is General Statutes § 19a-509b (2003), which provided as follows:

a) As used in this section, (1) "hospital bed fund" means any gift of money, stock, bonds, financial instruments or other property made by any donor for the purpose of establishing a fund to provide medical care to patients at a hospital. A hospital bed fund may be established by inter vivos gift, bequest, subscription, solicitation, dedication or any other means; (2) "hospital" means hospital as defined in section 19a-490.

(b)(1) Each hospital which holds or administers one or more hospital bed funds shall post or cause to be posted in a conspicuous public place in each patient admitting location, including but not limited to, the admissions office, emergency room, social services department and patient accounts or billing office, information regarding the availability of its hospital bed funds, in plain language in a forty-eight to seventy-two point type size. Such information shall include: (A) Notification of the existence of hospital bed funds and the hospital's program to administer them and (B) the person to contact for application information.

(2) Each hospital which has a hospital bed fund shall train staff, including but not limited to, hospital social workers, discharge planners and billing personnel concerning the existence of such fund, the eligibility requirements and the procedures for application. (c) Each hospital which holds or administers one or more hospital bed funds shall make available to individual members of the public, a one-page summary describing hospital bed funds and how to apply for them. This summary shall clearly distinguish hospital bed funds from other sources of financial assistance. The summary shall be available in the patient admissions office, emergency room, social services department and patient accounts or billing office. If during the admission process or during its review of the financial resources of the patient, the hospital reasonably believes the patient will have limited funds to pay for any portion of the patient's hospitalization not covered by insurance, the hospital shall provide the summary to each such patient.

(d) Applicants for assistance from hospital bed funds shall be notified in writing of any award or any rejection and the reason for such rejection. Patients who cannot pay any outstanding medical bill at the hospital shall be allowed to apply or reapply for hospital bed funds.

(e) Each hospital which holds or administers one or more hospital bed funds shall maintain and annually compile, at the end of the fiscal year of the hospital, the following information: (1) The number of applications for hospital bed funds; (2) the number of patient accounts receiving hospital bed fund grants and the actual dollar amounts provided to each patient; (3) the fair market value of the principal of each individual hospital bed fund, or the principal attributable to each bed fund if held in a pooled investment; (4) the total earnings for each hospital bed fund or the earnings attributable to each hospital bed fund; (5) the dollar amount of earnings reinvested as principal if any; and (6) the dollar amount of earnings available for patient care. The information compiled pursuant to this subsection shall be permanently retained by the hospital and made available to the Office of Health Care Access upon request.

Defendants do not move to dismiss one paragraph in each of the three CUTPA counts (¶¶ 186, 194, and 202) that is premised on violations of General Statutes § 19a-673, or what the defendants refer to as the "collecting at cost" statute.

"Standing is established by showing that the party claiming it is authorized by statute to bring suit or is classically aggrieved." Steeneck v. University of Bridgeport, 235 Conn. 572, 579, 668 A.2d 688 (1995). With respect to the possibility of standing authorized by statute, there is no dispute that § 19a-509b does not expressly create a right of action to enforce its provisions. The question here is whether it impliedly does so. The leading modern case addressing whether a statute creates an implied right of action is Napoletano v. CIGNA Healthcare of Connecticut, Inc., 238 Conn. 216, 680 A.2d 127 (1996), cert. denied, 520 U.S. 1103 (1997). In that case, our Supreme Court identified three relevant factors: "First, is the plaintiff one of the class for whose . . . benefit the statute was enacted? Second, is there any indication of legislative intent, explicit or implicit, either to create a remedy or to deny one? Third, is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff?" (Internal quotation marks omitted.) Id., 249.

Defendants contend that, notwithstanding Napoletano, our Supreme Court's subsequent decision in Carl J. Herzog Foundation, Inc. v. University of Bridgeport, 243 Conn. 1, 699 A.2d 995 (1997), should govern the implied right of action analysis. In Herzog, the Court held, without applying or even citing the Napoletano test, that a donor did not have an implied right of action under the Connecticut Uniform Management of Institutional Funds Act ("CUMIFA"), General Statutes § 45a-526 et seq., to enforce the restrictions in a charitable gift to a university. The Herzog Court relied on the fact that the common law rule was that a donor had no standing to enforce the restrictions of a completed charitable gift and that the CUMIFA statute had not clearly expressed an intention to abrogate the common law rule. Id., 5-16.

Herzog is not, however, the latest expression of our Supreme Court on the implied right of action issue. This spring, in Pane v. Danbury, 267 Conn. 669, 841 A.2d 684 (2004), the Court applied the Napoletano test to hold that the Freedom of Information Act, General Statutes § 1-200 et seq., does not give rise to an implied private right of action for money damages. Id., 678-81. While it is not clear why Herzog created a lacuna in the application of the Napoletano test, the court is bound by the latest expression of our Supreme Court and therefore must apply the Napoletano test. See United States v. Balsys, 524 U.S. 666, 711 (Breyer, J., dissenting).

The court rejects the defendants' argument that it should apply a revised Napoletano test that reflects the evolution of the United States Supreme Court precedent from which the Napoletano test originally derived. Napoletano, supra, 238 Conn. 249-50 (citing Cort v. Ash, 422 U.S. 66 (1975)). This court is bound by the current decisions of the Connecticut Supreme Court on a question of state law, such as the one here, and is not free to assume that our Supreme Court will modify its case law. But see pp. 7-8 infra. This court initially applied the revised federal test in Asylum Hill Problem Solving Revitalization Association v. King, Superior Court, judicial district of Waterbury, Docket No. (X02) CV 03-0179515S (January 5, 2004, Schuman, J.) ( 36 Conn. L. Rptr. 422), because it was interpreting a federal statute. The court also discussed the revised federal test in rejecting the argument that Napoletano creates a presumption in favor of an implied right of action, an argument that the plaintiffs do not make here. Finally, the state housing statute at issue in Asylum Hill was similar to a federal statute and hence justified some reliance on federal case law. Asylum Hill, supra, p. 19 n. 14. Thus, this court's use of the revised federal test in Asylum Hill does not mandate its use here.

The first question to resolve, then, is whether the plaintiffs are members "of the class for whose . . . benefit the statute was enacted?" Napoletano, supra, 238 Conn. 249. General Statutes § 19a-509b(a)(1) defines "hospital bed fund" to mean "any gift of money, stock, bonds, financial instruments or other property made by any donor for the purpose of establishing a fund to provide medical care to patients at a hospital." The statute requires hospitals to post notice of and inform appropriate patients about the availability of bed funds, train staff regarding eligibility and application procedures, give reasons for the denial of any applications, and make an annual report concerning bed funds. Given these provisions, it is hard to deny that the plaintiffs are the intended beneficiaries and, at oral argument, the defendants did not do so.

The second issue is whether there is "any indication of legislative intent, explicit or implicit, either to create a remedy or to deny one?" Napoletano, supra, 238 Conn. 249. There is no such indication in the language of the statute, the title, or the related statutes. The legislative history is also unenlightening. The statute became law as a result of the passage of Public Acts 1991, No. 91-348. The plaintiff relies on the following excerpt from the floor debates on the act's passage:

Representative Ward: I'm having trouble finding out what the penalty is for a hospital to abide by the requirements, and I wonder . . . if there is intended to be a penalty [sic] not abiding by the requirements.

Representative Dillon: [T]here is no stated penalty here, no. It would be the same as any other theoretically, some sort of implied ability to go to court, but it's not expressed in the bill as it is before us.

34 H.R. Proc., Pt. 7, 1991 Sess., p. 7700. While Representative Dillon was the proponent of the bill in the House of Representatives, see 34 H.R. Proc., supra, p. 7769, caution must be exercised in equating the statements of an individual representative with the will of the legislature. See Sillman v. Sillman, 168 Conn. 144, 148, 358 A.2d 150 (1975). Moreover, the comments in question are simply too vague to justify reliance on them. To say that there is "some sort" of ability to go to court, "the same as any other theoretically," is in reality to say very little about whether there is an implied private right of action for this statute. Thus, the second factor does not tip the balance in either direction.

The third inquiry is whether it is "consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff." Napoletano, supra, 238 Conn. 249. It is true that the commissioner of public health has statutory authority to enforce the requirements established under chapter 368v of the General Statutes, of which § 19a-509b is a part. General Statutes § 19a-494. In addition, subsection (e) of the statute requires hospitals to make information about bed funds available to the state office of health care access and thus gives that agency an oversight role. Finally, the state attorney general, pursuant to his authority under General Statutes § 3-125 to "represent the public interest in the protection of any gifts, legacies or devises intended for public or charitable purposes . . ." has filed a common law action seeking to enforce notice and application rights similar to those found in the bed funds statute. Blumenthal v. Yale-New Haven Hospital, Inc., Superior Court, judicial district of Waterbury, Docket No. CV (X02) 03-0823629 (filed March 3, 2003).

Despite these executive branch remedies, there is no inconsistency in recognizing a private right of action. None of the executive branch remedies purports to be exclusive. See Napoletano, supra, 238 Conn. 251-52 (noting that the legislature had not expressly limited authority to the commission on hospitals and health care to enforce statute concerning managed care.) Thus, there is no necessary conflict between private and governmental enforcement of the statute. In fact, a private remedy would supplement and perhaps strengthen the governmental ones. An implied right of action, therefore, is consistent with the legislative scheme.

Because the factors in the Napoletano test either are neutral or tip in favor of interpreting the statute to include an implied private right of action, the court concludes that § 19a-509b impliedly includes a private right of action. Accord Yale-New Haven Hospital v. Mitchell, 44 Conn.Sup. 274, 281-82, 662 A.2d 178 (1995). This conclusion necessarily stems from application of the Napoletano test as it now stands.

The court adds that, if the Supreme Court reviews this case, it should consider revising the Napoletano test. For one thing, the test derived from a United States Supreme Court standard — first crafted in Cort v. Ash, 422 U.S. 66 (1975) — that that court has substantially modified. See Napoletano, supra, 238 Conn. 249-50. The high court has now revised the first factor to address whether the statute has "right- or duty-creating language," which would favor a private right of action, or whether its concern is with "the person regulated rather than the individuals protected." (Internal quotation marks omitted.) Gonzaga University v. Doe, 536 U.S. 273, 284 n. 3, 287 (2002). This approach has the advantage of focusing more precisely on the language used by the legislature in the statute in question.

A related concern is that the process of recognizing an implied right of action conflicts with the traditional Connecticut rule that "[i]f the language of a statute is plain and unambiguous, we need look no further than the words themselves because we assume that the language expresses the legislature's intent." (Internal quotation marks omitted.) Macdermid, Inc. v. Department of Environmental Protection, 257 Conn. 128, 154, 778 A.2d 7 (2001); American Universal Insurance Co. v. DelGreco, CT Page 14531 205 Conn. 178, 193, 530 A.2d 171 (1987). Although our Supreme Court sought to abandon this plain language rule in State v. Courchesne, 262 Conn. 537, 816 A.2d 562 (2003), the Court affirmed that, in statutory construction, "the language of the statute is the most important factor to be considered . . ." Id., 563. The legislature has now attempted to reinstate the plain language rule. Public Acts 2003, No. 03-154 (providing that "[t]he meaning of a statute shall, in the first instance, be ascertained from the text of the statute itself and its relationship to other statutes.") The application of these rules weighs strongly against construing a statute to include a private right of action not expressed in the statute's language.

The Napoletano Court did not cite and apparently did not consider prior case law holding that "[w]hen the legislature has authorized supplementary private causes of action, it has generally done so expressly." Middletown v. Hartford Electric Light Co., 192 Conn. 591, 596, 473 A.2d 787 (1984). Accord Holly Hill Holdings v. Lowman, 30 Conn.App. 204, 220, 619 A.2d 853, aff'd, 226 Conn. 748, 628 A.2d 1298 (1993).

A final related concern is that the finding of an implied right of action places judges in the position of legislators. The legislature is perfectly capable of drafting statutes that expressly create a private right of action. Indeed, two neighboring statutes within chapter 368v do so. General Statutes § 19a-532 ("Notwithstanding any other provision of the general statutes, any nursing home facility which violates any provision of this section shall be liable to the injured party for treble damages."); General Statutes § 19a-550(e) ("Any [nursing home or chronic disease] facility that negligently deprives a patient of any right or benefit created or established for the well-being of the patient by the provisions of this section shall be liable to such patient in a private cause of action for injuries suffered as a result of such deprivation.") It is difficult to imagine that a majority of legislators intended to create something so significant as a private right of action but chose not to express it in the statute. For the court to interpret this legislative silence as the creation of a new species of lawsuits is to legislate judicially in a way contrary to the apparent desire of legislators who were duly elected by the people.

II

The court turns next to the question of whether the plaintiffs are classically aggrieved The defendants do not dispute that the plaintiffs have a "specific, personal and legal interest in the subject matter of the decision, as opposed to a general interest that all members of the community share" and that the plaintiffs can show that the defendants' decision has "specially and injuriously affected that specific personal or legal interest." (Internal quotation marks omitted.) Terese B. v. Commissioner of Children and Families, 68 Conn.App. 223, 228, 789 A.2d 1114 (2002). The defendants instead posit that the plaintiffs are seeking to enforce charitable gifts and rely on the rule that "beneficiaries of a charitable trust may not bring suit to enforce the trust, but rather are represented exclusively by the attorney general." CT Page 14532 Steeneck v. University of Bridgeport, supra, 235 Conn. 588. Accord Herzog, supra, 243 Conn. 6. See also General Statutes § 3-125.

Neither side disputes that, although this case may involve charitable gifts not in the form of charitable trusts, the same case law applies. See Herzog, supra, 243 Conn. 1, 5, n. 2 ("The law governing the enforcement of charitable gifts is derived from the law of charitable trusts.")

The court, for several reasons, disagrees that this rule governs the case. The bed funds statute undeniably lies near the frontier between hospital regulation and charities regulation. Interestingly, the legislature chose to locate the statute in chapter 368v, entitled "Health Care Institutions," rather than chapter 598a, entitled "Charitable Corporations and Trusts," or chapter 802c, entitled "Trusts." Of critical importance in this case is the fact that the plaintiffs do not ask the court to construe, administer, enforce, modify, or even examine the terms of any charitable gift. Rather, the bed funds statute component of the case focuses on statutory requirements of hospitals — such as giving notice of bed funds and responding to applications for such funds — that do not depend on the language of any particular trust or gift. Largely for these reasons, the attorney general's office has taken the position that this aspect of the plaintiffs' case does not infringe on its exclusive power to enforce charitable trusts. Given the attorney general's position and the underlying rationale for it, the court concludes that the rule barring private enforcement of charitable gifts does not negate the plaintiffs' classical aggrievement under the bed funds statute.

The attorney general does express particular concern about the plaintiffs' prayer for relief requesting the appointment of an independent board of trustees to, among other things, "[c]ontrol the investment, expenditure, and distribution of all free bed funds . . ." (Complaint, prayer for relief, ¶ 7(a)). The court shares this concern and expresses no opinion at this time about the validity of the components of the prayer for relief not at issue in this decision. The court also expresses its appreciation to the office of attorney general for assisting the court as amicus curiae in this case.

III

The defendants contend that, because the plaintiffs lack standing to enforce the bed funds statute, they also lack standing to challenge the defendants' alleged failure to carry out duties imposed by the statute as alleged in counts nine and ten charging fraudulent nondisclosure, and counts thirteen, fourteen, and fifteen charging CUTPA violations. Because the court has found that the plaintiffs have standing to enforce the bed funds statute, the basis for the defendants' standing challenge on the other counts disappears. See also Yale-New Haven Hospital, Inc. v. Mitchell, supra, 44 Conn.Sup. 282-85 (absence of a private right of action in underlying statute does not necessarily preclude CUTPA action based on violations of that statute.) Accordingly, the motion to dismiss is denied.

THE MOTION TO STRIKE

In their motion to strike, the defendants launch an attack on every count in the fifteen-count complaint and at least one prayer for relief. This situation is an example of how overpleading by the plaintiff leads to lengthy motion practice by the defendants, running up the costs of litigation for all parties and the court.

A motion to strike tests whether the allegations of a complaint state a claim upon which relief can be granted. See Novametrix Medical Systems, Inc. v. BOC Group, Inc., 224 Conn. 210, 214-15, 618 A.2d 25 (1992). The court must construe the allegations in a light most favorable to the plaintiff. See Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997). The motion admits all facts well pleaded, but does not admit legal conclusions or the truth or accuracy of opinions stated in the pleadings. See Mingachos v. CBS, Inc., 196 Conn. 91, 108, 491 A.2d 368 (1985). The court will not grant a "surgical" motion to strike that seeks to eliminate only part of a count or request for relief. See Bennett v. Hamburg, Superior Court, judicial district of Waterbury, Docket No. (X02) CV 01-0167682-S (January 2, 2003, Sheldon, J.) ("a motion to strike must be denied if any facts provable under a challenged count would support a valid claim or cause of action . . .").

I

The defendants first attack paragraph one in the prayer for relief, which requests that "the Court vacate all previous judgments against the Plaintiffs relating to any alleged debts incurred as a result of services provided by the Defendants." The defendants also move to strike the substantive counts of the complaint to the extent that they seek to open prior judgments. The defendants assert that the plaintiffs' claims are barred because they did not file motions to open within four months of the entry of judgments against them in compliance with General Statutes § 52-212a and Practice Book § 17-4, and because of the doctrine of resjudicata.

General Statutes § 52-212a provides as follows:

Unless otherwise provided by law and except in such cases in which the court has continuing jurisdiction, a civil judgment or decree rendered in the Superior Court may not be opened or set aside unless a motion to open or set aside is filed within four months following the date on which it was rendered or passed. The continuing jurisdiction conferred on the court in preadoptive proceedings pursuant to subsection (o) of section 17a-112 does not confer continuing jurisdiction on the court for purposes of reopening a judgment terminating parental rights. The parties may waive the provisions of this section or otherwise submit to the jurisdiction of the court, provided the filing of an amended petition for termination of parental rights does not constitute a waiver of the provisions of this section or a submission to the jurisdiction of the court to reopen a judgment terminating parental rights.

Practice Book § 17-4(a) has similar wording.

In response, the plaintiffs rely heavily on Kim v. Magnotta, 249 Conn. 94, 733 A.2d 809 (1999). In Kim the Supreme Court held that CUTPA was a statute that fell within the "otherwise provided by law" exception to the four-month rule of § 52-212a and that therefore a party could seek recission of a stipulated judgment resulting from a CUTPA violation more than four months after entry of the judgment. The defendants would confine Kim to its facts and argue that the present case does not involve plaintiffs who were induced through unfair trade practices to assent to stipulated judgments. The court need not resolve whether the present case is factually distinguishable, because the defendants read Kim too narrowly. As the Kim Court observed, CUTPA is a remedial statute that should receive a generous interpretation. Id., 108. The Court framed the issue before it in general terms as whether "the remedial authority under § 42-110g of CUTPA was significantly limited by § 52-212a?" Id., 104. Similarly, the Appellate Court has described Kim as providing "a trial court with authority to revisit a prior judgment under the `otherwise provided by law' provision of § 52-212a, after a party prevails on a CUTPA claim, even though the party seeking to change that prior judgment had not timely filed a motion to open the judgment within four months of its rendition." Wren v. MacPherson Interiors, Inc., 69 Conn.App. 349, 363, 794 A.2d 1043 (2002). Given these descriptions of Kim as a case holding that, as a matter of law, CUTPA falls within the "otherwise provided by law" exception to § 52-212a, the plaintiffs here can rely on the CUTPA counts (counts thirteen through fifteen) to overcome the four-month rule.

The defendants acknowledge the allegations that two or possibly three of the plaintiffs entered into stipulated judgments. (Complaint, count one, ¶¶ 69, 82, 106.)

The same is not true, however, with regard to the other counts. The plaintiffs do not argue that the bed funds statute (count one), the collecting at cost statute, General Statutes § 19a-673 (counts two through four), or any of the common law counts (counts five through twelve) fall under the "otherwise provided by law" exception or any other exception to § 52-212a. Indeed, the Appellate Court has ruled that the holding in Kim with regard to CUTPA does not apply to a breach of contract claim. Wren v. MacPherson Interiors, Inc., supra, 69 Conn.App. 360-64. Thus, to the extent that the counts other than those alleging CUTPA violations seek to open judgments more than four months old, they may not do so.

Given this bar to opening judgments, it is unnecessary to reach the res judicata arguments with regard to the non-CUTPA counts. Further, as the defendants acknowledge, res judicata is not normally raised on a motion to strike. See Statewide Grievance Committee v. Presnick, 216 Conn. 135, 137 n. 3, 577 A.2d 1058 (1990) (describing the consideration of res judicata on a motion to strike as a "procedural irregularity.") To the extent that res judicata might provide a defense to the CUTPA counts, the defendants can raise it by special defense and possibly by summary judgment. See Labbe v. Pension Commission, 229 Conn. 801, 816, 643 A.2d 1268 (1994).

The res judicata defense was not before the Supreme Court in Kim. Kim, supra, 249 Conn. 97 n. 7.

The net effect of this discussion is to deny this portion of the defendants' motion to strike. Because the plaintiffs, at this point in the case, can attack prior judgments under CUTPA, there is at least some basis for the plaintiffs' prayer for relief seeking to have "the Court vacate all previous judgments against the Plaintiffs relating to any alleged debts incurred as a result of services provided by the Defendants." The existence of one valid cause of action that can vacate the prior judgments as sought in paragraph one of the prayer for relief renders that prayer sufficient as a matter of law. See Bennett v. Hamburg, supra, Superior Court, Docket No. (X02) CV 01-0167682-S. Similarly, although the plaintiffs may not seek to open prior judgments in the non-CUTPA counts, to the extent that these counts survive the other grounds for the motion to strike discussed below, these counts may still provide the basis for the injunctive and other relief that the plaintiffs have sought as remedies. (E.g., complaint, prayer for relief, ¶ 6.) See Bennett v. Hamburg, supra, Superior Court, Docket No. (X02) CV 01-0167682-S. Thus, these counts survive this portion of the motion to strike.

II

The defendants launch their attack on the specific counts of the complaint by challenging the sufficiency of the statutory bed funds allegations in count one. The fact that two of the plaintiffs allege hospitalizations before the enactment of the bed funds statute in 1991 does not help the defendants at this point. The rule against granting a surgical motion to strike prevents the court from striking those portions of count one. There is also no need to consider the defendants' arguments that the plaintiffs have pleaded various matters — such as an obligation to provide ongoing notice of the existence of beds funds or to cease collections efforts — that the statute did not expressly require at the time, or still does not require. It suffices that the plaintiffs have pleaded that the defendants failed to provide them adequate notice of the availability of free bed funds and failed to process properly any bed funds applications. (E.g., complaint, count one, ¶¶ 30, 62.) These specifications would, if proven, constitute violations of the statute. See note 1, supra. Therefore, the plaintiffs have pleaded a cause of action upon which relief can be granted. The defendants argue that the bed funds statute represents an unconstitutional violation of the separation of powers principle because only the judiciary, and not the legislature, can prescribe the form of notice to potential recipients of charitable funds. The test for whether a statute violates the separation of powers principle is whether the legislature has effected: "(1) an assumption of power that lies exclusively under the control of another branch; or (2) a significant interference with the orderly conduct of the essential functions of another branch." Massameno v. Statewide Grievance Committee, 234 Conn. 539, 552-53, 663 A.2d 317 (1995). In evaluating the defendants' argument, the court must presume the statute constitutional. See Rudy's Limousine Service, Inc. v. Department of Transportation, 78 Conn.App. 80, 89, 826 A.2d 1161 (2003). The court has already decided that the bed funds statute constitutes a hospital regulation, rather than an interference with the administration of charities. Because there can be no dispute that the legislature has authority to regulate hospitals, the court must reject the defendants' constitutional challenge.

III

The key provision of the collecting at cost statute, which the plaintiffs allege the defendants have violated in counts two, three, and four of the complaint, provides that "[n]o hospital that has provided health care services to an uninsured patient may collect from the uninsured patient more than the cost of providing services." General Statutes § 19a-673(b). Although the statute does not expressly create a private right of action, the defendants do not challenge the plaintiffs' apparent belief that the statute embodies an implied right to sue. The defendants instead move to strike on the ground that the plaintiffs have not sufficiently pleaded that the defendants collected — as opposed to billed for — more than the cost of providing services.

The full statute provides as follows:

(a) As used in this section: (1) "Cost of providing services" means a hospital's published charges at the time of billing of an uninsured patient, multiplied by the hospital's most recent relationship of costs to charges as taken from the hospital's most recently available audited financial statements. (2) "Hospital" means an institution licensed by the Department of Public Health as a short-term general hospital. (3) "Poverty income guidelines" means the poverty income guidelines issued from time to time by the United States Department of Health and Human Services. (4) "Uninsured patient" means any person whose income is at or below two hundred per cent of the poverty income guidelines who (A) has applied and been denied eligibility for any medical or health care coverage provided under the general assistance program or the Medicaid program due to failure to satisfy income or other eligibility requirements, and (B) is not eligible for coverage for hospital services under the Medicare or CHAMPUS programs, or under any Medicaid or health insurance program of any other nation, state, territory or commonwealth, or under any other governmental or privately sponsored health or accident insurance or benefit program including, but not limited to, workers' compensation and awards, settlements or judgments arising from claims, suits or proceedings involving motor vehicle accidents or alleged negligence.

(b) No hospital that has provided health care services to an uninsured patient may collect from the uninsured patient more than the cost of providing services.

The plaintiffs plead that the defendants have improperly "billed each plaintiff for hospital charges at the regular published rates and not at a discounted rate on the basis of the cost of providing care as required by C.G.S. § 19a-673." (Complaint, ¶¶ 129, 134, 139.) The plaintiffs also incorporate the allegations of count one which, in pertinent part, assert that the plaintiffs incurred various hospital charges and that the hospital has engaged in collection efforts to obtain those amounts, as well as interest and costs in some cases. (E.g., complaint, count one, ¶¶ 24-29; 36, 40-46; 51, 59-61.) The court, however, agrees with the defendants that, while the plaintiffs allege that the defendants have billed for more than the permitted costs, the relationship between the amounts collected and the cost of services, which relationship is the focus of the statute, is not clear.

The plaintiffs express the concern that the statute may be unworkable if the plaintiffs could not redress overcharging by a hospital until it has actually collected more than the cost of services. But the court cannot change the language of the statute. It may be that the statute serves only as a defense in a collection action. Alternatively, the statute may represent public policy that can be addressed by CUTPA, or it may form the basis for injunctive relief based on imminent action by a hospital or a past history of violations. On the other hand, the plaintiffs may be able to maintain a private right of action for damages if they can allege that the defendants actually collected more than the cost of services. At this point, however, the court must grant the motion to strike counts two, three, and four.

The plaintiffs have in fact sought an injunction to require the defendants to "fully comply with all aspects of applicable State laws regarding free bed funds and the charging of uninsured patients (Complaint, prayer for relief ¶ 6.)

IV

The defendants also contend that the CUTPA counts (thirteen through fifteen) do not state a claim upon which relief can be granted. In these counts and the counts they incorporate by reference, the plaintiffs allege that the defendants engaged in aggressive debt collection practices — such as wage garnishments, collection calls, capias arrests, placement and foreclosure of liens, and seizure of assets — despite their actual or constructive knowledge that the plaintiffs were eligible for free beds under the bed funds statute or discounted care under the collecting at cost statute. These allegations sufficiently state a case that the defendants' practices offended public policy established by statutes or were "immoral, unethical, oppressive, or unscrupulous" so as to satisfy the "cigarette rule" test of unfair trade practice. See Hartford Electric Supply Co. v. Allen-Bradley Co., 250 Conn. 334, 367-68, 736 A.2d 824 (1999). See also Suffield Development Associates Limited Partnership v. National Loan Investors, L.P., 260 Conn. 766, 782, 802 A.2d 44 (2002) (CUTPA applies to bill collection). Moreover, and contrary to the defendants' contentions, the plaintiffs have sufficiently pleaded an "ascertainable loss," as required under § 42-110g(a) of the CUTPA statutes, by alleging that the defendants enforced judgments against them for medical care despite the fact that they were eligible for bed funds. (Complaint, count one, ¶¶ 22, 37, 54, 66, 81, 92, 103, 118.) Accordingly, the plaintiffs have stated a valid cause of action under CUTPA.

Section 42-110g(a) provides:

Any person who suffers any ascertainable loss of money or property, real or personal, as a result of the use or employment of a method, act or practice prohibited by section 42-110b, may bring an action in the judicial district in which the plaintiff or defendant resides or has his principal place of business or is doing business, to recover actual damages. Proof of public interest or public injury shall not be required in any action brought under this section. The court may, in its discretion, award punitive damages and may provide such equitable relief as it deems necessary or proper.

V

The court addresses the motion to strike the remaining counts summarily. The court grants the motion to strike counts five and six, charging breach of contract because the plaintiffs do not allege that the defendants agreed to charge the plaintiffs the established rates for third-party payors. See Emerick v. Kuhn, 52 Conn.App. 724, 749 n. 18, 737 A.2d 456, cert. denied, 249 Conn. 929, 738 A.2d 653, cert. denied, 528 U.S. 1005 (1999). The court also grants the motion to strike the recission counts (seven and eight). The plaintiffs cannot and do not allege that they can refund their medical services and this case is not one in which the "clearest and strongest equity imperatively demands" recission in the absence of such restoration. (Internal quotation marks omitted.) Shoreline Communications, Inc. v. Norwich Taxi, LLC, 70 Conn.App. 60, 74, 797 A.2d 1165 (2002). Finally, the court grants the motion to strike the tortious interference counts (eleven and twelve). There are no alleged facts showing that the defendants knew about the potentially beneficial relationships the plaintiffs purportedly had with financial institutions or that the defendants communicated any credit information or did anything else that revealed an intention to interfere with these relationships. See Solomon v. Aberman, 196 Conn. 359, 364, 493 A.2d 193 (1985).

CONCLUSION

The motion to dismiss is denied. The motion to strike is granted as to counts two, three, four, five, six, seven, eight, eleven, and twelve, and denied as to the remaining counts.

It is so ordered.

Carl J. Schuman

Judge, Superior Court


Summaries of

Ahmad v. Yale-New Haven Hospital

Connecticut Superior Court, Judicial District of Waterbury Complex Litigation Docket at Waterbury
Sep 29, 2004
2004 Ct. Sup. 14527 (Conn. Super. Ct. 2004)
Case details for

Ahmad v. Yale-New Haven Hospital

Case Details

Full title:LABEEBAH AHMAD ET AL. v. YALE-NEW HAVEN HOSPITAL, INC. ET AL

Court:Connecticut Superior Court, Judicial District of Waterbury Complex Litigation Docket at Waterbury

Date published: Sep 29, 2004

Citations

2004 Ct. Sup. 14527 (Conn. Super. Ct. 2004)
38 CLR 238

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