Aetna, the giant healthcare insurer, has won an $8.4 million judgment in a yearlong federal court case against three free-standing emergency centers and a small Houston-area hospital to which the centers claimed affiliation to charge vastly higher fees.
The ruling issued Wednesday by U.S. District Judge Lynn N. Hughes in Houston was a rare legal victory against the proliferating ER centers. But the partial judgment covers only Aetna’s demand to recoup millions and doesn’t address its demand for exemplary damages for alleged fraud and conspiracy. Another ruling is expected later.
Critics claim that the fast-growing ER centers, often in or near strip centers in affluent suburbs, charge far more than similar-looking urgent-care centers or retail clinics. Fewer than half are “in network” with major insurers, often adding to the expense for patients. Fans of the centers cite convenience, fast service and skilled staff.
Aetna was seeking to recoup $8.4 million of more than $9.2 million billed over two years by three clinics, Trinity Healthcare Network, ER DOC 24/7 and the now-defunct Premier Emergency Room & Imaging.
Aetna spokeswoman Anjanette L. Coplin said the company used findings from a “favorable” out-of-court settlement with First Street Hospital of Bellaire, and St. Michael’s Emergency Center, also in the Houston area. The settlement with First Street was confidential, but court records show that St. Michael’s agreed to repay Aetna more than $500,000 in November 2012. The insurer claimed that St. Michael’s entered into a “sham” arrangement with First Street so it could charge unwarranted “facilties fees.” The center argued it was entitled to charge them, regardless of its ties to First Street.
Wednesday’s ruling found that Cleveland Imaging and Surgical Hospital of Cleveland, a Houston suburb, received 15 percent of each bill for allowing three ER centers to use its state hospital license number.
This made “it look like the clinics’ treatment happened at a full-service hospital, rather than an unlicensed clinic,” Hughes wrote.
“The clinics rights to the money [paid by Aetna] depends entirely on the accuracy, fidelity and legality of their billing. Their title is non-existent — a thief’s title,” the judge added.
The clinics had argued that they don’t need to be a hospital to charge facilities fees and higher rates.
Trinity Healthcare said it will appeal.
“We maintain that every sentence of the law was followed when establishing what constitutes an emergency service facility and that distinction was ignored in the ruling by the court,” Trinity said in a statement to the Star-Telegram.
“Aetna has decided to increase their profits on the backs of low-cost community facilities like Trinity Healthcare that is designed to decrease cost to their patients. Trinity Healthcare will be appealing this decision without hesitation.”