DENVER — The state Supreme Court has ruled that a Colorado woman will not have to pay hundreds of thousands of dollars in medical bills after a Westminster hospital charged her for an out-of-network surgery.
Lisa French went to St. Anthony North Health Campus for a spinal fusion surgery in 2014 after getting into a serious car accident.
French was T-boned and was having issues with her neck and back. Doctors determined she needed a spinal fusion, telling French she could be paralyzed if she was injured in the same area again without the surgery.
She went to St. Anthony North, filled out paperwork promising to pay all charges, gave them her insurance card and was told her patient responsibility for the procedure would be roughly $1,337.
“I was happy. I mean, that's reasonable to me,” French said. “I'm not very savvy when it comes to insurance so I kind of rely on the hospital or, you know, insurance, whoever I'm talking to, to kind of help me through that.”
It was only after the surgery, though, that French was told the hospital had made a mistake; it had misread her insurance card and she was determined to actually be an out-of-network patient.
She was then sent a bill for $229,112. The total bill, including the portion owed by her insurance, was $303,709.
“I was scared. My husband was scared. You know, first thing we talked about was bankruptcy,” she said.
Roughly $197,000 of the charges were for the hardware that went into her back, which French says she and her lawyers found actually cost around $30,000.
The couple eventually did end up filing for bankruptcy, but she spoke with her insurance plan and ELAP Services, a hospital bill auditing company, and decided to fight the charges.
After years of legal filings, a five-day trial and appeals, last week, the Colorado Supreme Court ruled in French’s favor.
It ruled that none of the paperwork she signed spoke about chargemasters in the service agreements, that she was unaware of that billing and hadn’t agreed to the terms so she shouldn’t be held responsible.
“Chargemaster is basically the entire inventory of prices that hospitals charge for the various clinical services they deliver and it's really... it's a large database of prices,” said Glen Mays, a professor of health policy at the University of Colorado School of Public Health.
Chargemasters are difficult for consumers to decipher; they often involve tens of thousands of lines of code of individual prices that are meant to be read by computers.
In recent years, Colorado and the federal government have passed laws to add more transparency around hospital pricing and end surprise billing; however, Mays says even they might not have helped in this case.
“Even with those laws in place it’s very difficult for individual patients or consumers to get meaningful information out of these chargemasters,” Mays said.
In court filings, Centura Health argued that that chargemaster is a proprietary and trade secret. Hospitals negotiate different prices and discounts with individual health insurance companies and public programs like Medicare and Medicaid to determine those prices.
Even with the chargemasters, the justices ruled it would have been impossible for her to understand.
“Centura has conceded that she would not have been able to understand or interpret the chargemaster’s over 50,000 codes, and thus, access to the chargemaster would not have established mutual assent to any of the rates contained therein,” the Colorado Supreme Court decision read.
Mays says the system makes it difficult for consumers to shop around for the best deal like they are able to do with other goods and services. He also blames it for a lot of the waste in the healthcare system.
“This is a fundamental weakness of the U.S. healthcare system, that there's really no good way for individual patients, in advance, to get a reasonable estimate of the cost of their health care,” Mays said.
In its ruling, the state supreme court said chargemasters have become increasingly arbitrary and have, over time, lost any direct connection to hospitals’ actual cost.
French is happy the lawsuit is finally over and hopes that it will set a precedent for others in the future. She’s now responsible for paying the balance of the original bill she owed, $776 in total.
“I just think the hospitals should be there to help patients and help us understand what's going on and not keep things hidden and secretive,” she said.
Mays, meanwhile, says the laws that have recently passed on a state and federal level are a start, but it might take even more for hospital prices to truly be transparent. For now, he encourages patients to ask questions and shop around when they can.
Denver7 reached out to Centura Health for a statement on the case but did not hear back.