Tennessee Supreme Court Says Car Accident Litigants Stated a Claim Against Hospitals Under Consumer Protection Act

Those who have never been involved in an East Tennessee car accident probably do not realize all of the possible complications that can arise as a lawsuit progresses from an initial claim filed against the responsible party’s insurance company to the ultimate collection of money damages via a negotiated settlement or a judgment in court. Because the amount of money that the injured party ultimately receives hinges in part on the amount of medical expenses that were necessitated by injuries he or she suffered in the collision, there are sometimes disagreements about medical costs, such as whether a certain medical expense was reasonable, necessary, and/or related to the accident. In some cases, medical providers themselves can become entangled in the litigation.

Facts of the Case

In a recent case ultimately considered by the state’s highest court, the original plaintiff was a man who was injured in an automobile accident that was allegedly caused by the negligence of the original defendant. A collection service acting on behalf of the hospital at which the plaintiff had been treated following the accident filed a hospital lien in the lawsuit filed by the plaintiff against the defendant, seeking to collect the full amount of the hospital bill. Notably, the hospital did not file a claim with the plaintiff’s health insurance company. The second plaintiff was injured in a different accident and was treated at a different hospital; however, the same collection service filed a lien for the full amount of her hospital bill; again, the (second) hospital did not file a claim with the second plaintiff’s health insurance company.

The first plaintiff added the second plaintiff to his suit and added the hospitals and collection service as defendants, asserting a claim that the defendants violated the Tennessee Consumer Protection Act of 1977, Tennessee Code Annotated §§ 47-18-101 et seq (hereinafter “the Act”), by filing hospital liens under the Hospital Lien Act for the full, undiscounted amount of the hospitals’ charges rather than billing plaintiffs’ health insurance companies and accepting the negotiated discounted charges. The Circuit Court for Madison County granted the hospitals’ motion for judgment on the pleadings as to the first plaintiff’s claim and dismissed the second plaintiff’s claim for lack of venue. The Tennessee Court of Appeals affirmed the dismissal of the first plaintiff’s claim and remanded the second plaintiff’s claim to the trial court with instructions to dismiss the case for failure to state a claim under the Act.

Decision of the Court

On further appeal, the Tennessee Supreme Court reversed and remanded. Accepting the plaintiffs’ factual allegations as true for purposes of the appeal, the state’s high court found that the plaintiffs had stated a cause of action under the Act. In so holding, the court noted that the plaintiffs had alleged that they were injured by the hospitals’ unfair and/or deceptive acts and that these actions affected the conduct of trade and/or commerce. By deciding the issue in the plaintiffs’ favor, the Tennessee Supreme Court joined several other jurisdictions across the country that have held that their respective states’ consumer protection laws applied to health care providers when the providers were acting in their business capacities.

Contact a Knoxville Injury Attorney

Having an experienced attorney can make a big difference in the outcome of a personal injury case. To schedule an appointment with a knowledgeable East Tennessee car accident attorney about your specific situation, call the Hartsoe Law Firm at (865) 804-1011 and schedule a free consultation. Please note that we are open during the COVID-19 crisis; if you are not comfortable coming into our office for an in-person interview, we will be glad to make alternative arrangements.