Rodriguez v. Eisenhower Medical Center CA4/2 ( 2022 )

Filed 2/3/22 Rodriguez v. Eisenhower Medical Center CA4/2
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION TWO
LEONOR RODRIGUEZ,
Plaintiff and Appellant, E075172
v. (Super.Ct.No. PSC1706058)
EISENHOWER MEDICAL CENTER, OPINION
Defendant and Respondent.
APPEAL from the Superior Court of Riverside County. Sunshine S. Sykes, Judge.
Affirmed.
McCune Wright Arevalo, Richard D. McCune, Michele M. Vercoski, Steven A.
Haskins and Tuan Q. Nguyen for Plaintiff and Appellant.
Jones Day and Nathaniel P. Garrett for Defendant and Respondent.
1
Plaintiff Leonor Rodriguez appeals from a judgment dismissing her complaint
against defendant Eisenhower Medical Center after the trial judge granted the hospital’s
motion for summary judgment. Rodriguez alleged Eisenhower violated California’s
Unfair Competition Law (UCL) (Bus. & Prof. Code, § 17200 et seq.) by failing to
adequately disclose the facility fee associated with her outpatient procedure. She alleged
she would have gone elsewhere for the procedure had she known of the fee.
In granting Eisenhower’s motion, the judge concluded the evidence indisputably
demonstrated the hospital complied with the applicable pricing disclosure obligations
contained in Health and Safety Code section 1339.511 (part of the “Payers’ Bill of
Rights”) and thus had acted both lawfully and fairly under the UCL. Rodriguez argues
the judge misinterpreted the evidence and dismissed her lawsuit in error. We disagree and
affirm.
I
FACTS
A. The Payers’ Bill of Rights
A hospital’s duty to inform patients about anticipated pricing before they receive
treatment is defined by a series of statutes in the Health and Safety Code called the
Payers’ Bill of Rights. (§ 1339.50 et seq.) Enacted in 2003, the Payers’ Bill of Rights
recognizes the importance of pricing transparency and endeavors to strike a balance
between a consumer’s right to make informed choices and the burden of disclosure on
1 Unlabeled statutory citations refer to the Health and Safety Code.
2
hospitals. In this vein, the Payers’ Bill of Rights does not require hospitals to directly
disclose anticipated fees and charges to patients in all circumstances. Rather,
pretreatment disclosures are required only when an uninsured patient seeks a
nonemergency service. (§ 1339.585.)2
In all other circumstances, a hospital meets the Legislature’s standard of pricing
transparency by giving patients access to a “uniform schedule of . . . its gross billed
charge for a given service or item, regardless of payer type.” (§ 1339.51, subd. (b)(1).)
This schedule is called a “charge description master” or “chargemaster,” and should
contain a “list of all the billable medical goods or services” a hospital provides. (Sarun v.
Dignity Health (2019) 41 Cal.App.5th 1119, 1125.)
There are two requirements for providing adequate chargemaster access under the
Payers’ Bill of Rights—availability and notice. A hospital must make “a written or
electronic copy of its charge[master] available, either by posting an electronic copy . . .
[on its] Web site, or by making one written or electronic copy available at the hospital
location.” (§ 1339.51, subd. (a)(1).) A hospital must also “post a clear and conspicuous
notice in its emergency department, if any, in its admissions office, and in its billing
office that informs patients that the hospital’s charge[master] is available in the manner
described in subdivision (a).” (§ 1339.51, subd. (c).) The Legislature imposed these
disclosure obligations with the goal that “making public the chargemaster . . . will bring
2 While this appeal was pending, the Legislature amended section 1339.585 to
remove the condition that the uninsured patient request the fee disclosure. (See former
§ 1339.585.) Now, a hospital must provide the disclosure whether or not the patient
requests it.
3
more transparency to hospital billing practices.” (Assem. Com. On Appropriations, 3d
reading analysis of Assem. Bill No. 1637 (2003-2004) as amended May 23, 2003, p. 2.)
B. Rodriguez’s Lawsuit
Eisenhower is a licensed hospital that provides 24-hour inpatient care at its main
campus in Rancho Mirage and also maintains a number of outpatient facilities in the low
desert area. In 2014, 2015, and 2016, Rodriguez underwent elective hyaluronic acid knee
injections for the treatment of arthritis at one such outpatient facility, the Desert
Orthopedic Center (DOC) in La Quinta.
In November 2018, Rodriguez filed the operative complaint in Riverside Superior
Court, a putative class action lawsuit alleging that she and others similarly situated who
received treatment at the DOC were charged a “facility fee” which Eisenhower failed to
adequately disclose under section 1339.51. Specifically, she alleged the hospital failed to
post a copy of their chargemaster on their web site and failed to post chargemaster
notices in the required areas (emergency, administrative, and billing departments) as well
as in the DOC. She alleged these violations of section 1339.51 constituted both unlawful
and unfair business practices under the UCL.
According to the factual allegations in her complaint, Rodriguez received three
knee injections in 2014 and another three in 2015. On each of those occasions, DOC staff
provided her with a “Conditions of Admissions” form advising she would be billed both a
“provider” fee and a “facility” fee for each visit. At that time, she was covered by an
4
HMO insurance policy through Healthnet under which she paid a minimal copay amount
for each visit.
In 2016, Rodriguez switched to a PPO insurance policy through Anthem Blue
Cross. She informed DOC staff about the change, and, after looking into her new policy,
they contacted her to let her know the injections were still covered. That year, the total of
Rodriguez’s out-of-pocket medical bills for the three injections was $3,810, and she
believed the facility fees made up about $3,489 of that total.
Rodriguez alleged she was harmed by Eisenhower’s failure to adequately disclose
their facility fee, because had she known the amount she was going to be responsible for
under her new insurance policy, she would have either switched back to her previous
policy or “sought medical care at a medical office not owned by a hospital,” as facility
fees are unique to hospitals.
C. Eisenhower’s Motion for Summary Judgment
After the parties engaged in discovery, Eisenhower filed a motion for summary
judgment, arguing Rodriguez’s UCL claim failed because the undisputed evidence
showed they had complied with section 1339.51’s disclosure requirements. In support of
their argument, Eisenhower attached a declaration from Hallary Scheideman, their
chargemaster coordinator and analyst, who is responsible for maintaining and updating
their chargemaster. Scheideman said she prepared Eisenhower’s chargemaster in 2016,
5
submitted it to the Office of Statewide Health Planning and Development (OSHPD), and
“arranged for a copy of it to be available for viewing at the hospital.”3
Eisenhower also submitted a declaration from their director of patient access,
Michael Sythe, who is responsible for posting the hospital’s chargemaster notices. Sythe
said in 2016, Eisenhower had notices alerting patients to the availability of their
chargemaster in their “admitting area,” “emergency department,” and “billing office.”
Eisenhower also submitted a copy of the notice entitled “Payer’s Bill of Rights
Chargemaster.” The notice contains the following message in English and Spanish: “The
Payer’s Bill of Rights requires that hospitals make available to the public a master listing
of retail prices for its services, known as the chargemaster. [¶] This facility’s
chargemaster is available for your inspection. To make an appointment to view the
hospital’s chargemaster or obtain a list of the 25 most common outpatient procedures,
please contact the Admissions Manager at 760-837-8974.”
Rodriguez opposed Eisenhower’s motion and attached deposition testimony from
Scheideman and Sythe that she argued undercut the hospital’s claim of section 1339.51
compliance. During her deposition, Scheideman elaborated on how she had “arrange[d]
for a copy of the Chargemaster to be available for viewing at the hospital.” She explained
she had placed an electronic copy of the document in the hospital’s shared drive. She said
the admissions department employees have access to the shared drive and can open the
3 The Payers’ Bill of Rights also requires hospitals to submit their chargemasters
to the OSHPD on an annual basis. The OSHPD then makes those documents available to
the public by posting them on their web site. (§§ 1339.55 & 1339.56, subd. (a).)
6
chargemaster with their login credentials (username and password). During his
deposition, Sythe wasn’t able to elaborate on precisely what would happen if a person
followed the directions on Eisenhower’s chargemaster notice and called the admissions
manager to make an appointment to view the chargemaster. This was because it had
never happened before; no patient had ever asked to see the chargemaster. Sythe’s
testimony also made it clear that Eisenhower posted only two copies of the notice in their
hospital or main campus—one in the emergency department and one in the
“admissions/billing area.”
Rodriguez also submitted the deposition testimony of Lilian Hoag, Eisenhower’s
Director of Operations, who said there is no chargemaster notice posted at the DOC.
In reply, Eisenhower submitted deposition testimony from Sythe explaining they
posted only two notices (as opposed to three) because of the main campus’s layout. Sythe
said Eisenhower’s billing area is located within the admissions area. He also said that any
patient who visits billing would necessarily walk past the chargemaster notice in the
admissions area because you can’t reach billing without going through admissions.
After a hearing on Eisenhower’s motion, Riverside Superior Court Judge Sunshine
S. Sykes concluded Rodriguez’s claim failed under both theories, unlawful business
practices and unfair business practices. As to unlawful practices, the judge found the
undisputed evidence showed the hospital had complied with both the availability and
notice requirements in section 1339.51. As to unfair practices, the judge concluded the
theory failed because it was based on the same alleged conduct as the unlawful practices
7
theory. Whether Eisenhower should have posted their chargemaster notice in more
locations than required by section 1339.51, the judge reasoned, was “for the Legislature
to determine.”
The judge granted Eisenhower’s motion and, on March 19, 2020, entered
judgment in their favor. Rodriguez timely appealed.
II
ANALYSIS
Rodriguez contends the trial judge incorrectly determined there was no triable
issue of fact on her UCL claim. She argues she presented triable issues of fact in the
following three areas: (1) whether Eisenhower’s chargemaster was truly “available”
within the meaning of section 1339.51, subdivision (a); (2) whether the practice of
posting only one chargemaster notice in a combined admissions/billing area satisfies the
notice requirement in section 1339.51, subdivision (c); and (3) whether Eisenhower’s
disclosure methods constitute unfair practices, even if not unlawful.
A. General Legal Principles
1. Standard of review
A trial court properly grants summary judgment when there are no triable issues of
material fact and the moving party is entitled to judgment as a matter of law. (Code Civ.
Proc., § 437c, subd. (c).) “The purpose of the law of summary judgment is to provide
courts with a mechanism to cut through the parties’ pleadings in order to determine
8
whether, despite their allegations, trial is in fact necessary to resolve their dispute.”
(Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 (Aguilar).)
A defendant who moves for summary judgment bears the initial burden to show
the action has no merit—that is, “one or more elements of the cause of action, even if not
separately pleaded, cannot be established, or that there is a complete defense to the cause
of action.” (Code Civ. Proc., § 437c, subds. (a), (p)(2).) If they clear this initial hurdle,
the burden shifts to the plaintiff to demonstrate a triable issue of material fact. (Aguilar,
supra, 25 Cal.4th at pp. 850-851.) We independently review an order granting summary
judgment, and if the issue involves a question of fact, we view the evidence in the light
most favorable to the nonmoving party. (Miller v. Department of Corrections (2005) 36
Cal.4th 446, 460.)
2. The UCL
The purpose of the UCL is “to safeguard the public against the creation or
perpetuation of monopolies and to foster and encourage competition, by prohibiting
unfair, dishonest, deceptive, destructive, fraudulent and discriminatory practices by
which fair and honest competition is destroyed or prevented.” (Bus. & Prof. Code,
§ 17001.) To achieve this goal, the law prohibits “any unlawful, unfair or fraudulent
business act or practice and unfair, deceptive, untrue or misleading advertising.” (Bus. &
Prof. Code, §§ 17200, 17203, 17204.) An “unlawful” act or practice is “anything that can
properly be called a business practice and that at the same time is forbidden by law.”
9
(Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20
Cal.4th 163, 180 (Cel-Tech), italics added.)
As for what constitutes an “unfair” act or practice, the Cel-Tech court found the
definitions in prior cases “too amorphous and provid[ing] too little guidance to courts and
businesses” and so articulated a more concrete definition of unfair in actions between
competitors (as opposed to cases, like this one, brought by a consumer).4 (Cel-Tech,
supra, 20 Cal.4th at p. 185.) “When a plaintiff who claims to have suffered injury from a
direct competitor’s ‘unfair’ act or practice invokes section 17200, the word ‘unfair’ in
that section means conduct that threatens an incipient violation of an antitrust law, or
violates the policy or spirit of one of those laws because its effects are comparable to or
the same as a violation of the law, or otherwise significantly threatens or harms
competition.” (Id. at p. 187.) In other words, the alleged unfair act must be “tethered to
some legislatively declared policy.” (Id. at p. 186.)
After Cel-Tech, a split of authority developed among the Courts of Appeal for the
appropriate unfairness test in a consumer action. This district uses the definition of unfair
articulated in Gregory v. Albertson’s, Inc. (2002) 104 Cal.App.4th 845, 854, which
essentially imports Cel-Tech’s competitor test. “[W]here a claim of an unfair act or
practice is predicated on public policy, . . . the public policy which is a predicate to the
4The prior cases used concepts like “immoral, unethical, oppressive, unscrupulous
[and] substantially injurious to consumers” to define unfair. (E.g., People v. Casa Blanca
Convalescent Homes, Inc. (1984) 159 Cal.App.3d 509, 530.)
10
action must be ‘tethered’ to specific constitutional, statutory or regulatory provisions.”5
(See Graham v. Bank of America, N.A. (2014) 226 Cal.App.4th 594, 613; Scripps Clinic
v. Superior Court (2003) 108 Cal.App.4th 917, 940.)
B. Unlawful Practices
As we’ve seen, section 1339.51 requires a hospital to make a written or electronic
copy of their chargemaster available online or at their hospital location, with notices
posted in the emergency department, admissions office, and billing office, that the
schedule is so available. Where, as here, a hospital chooses to use an electronic copy, the
hospital must either post the document on their web site or make it “available at the
hospital location.” (§ 1139.51, subd. (a).)
1. Availability
Beginning with the availability requirement, it’s undisputed that Eisenhower kept
an electronic version of the chargemaster at their main campus or “hospital location.”
Scheideman said she created the chargemaster and placed it in Eisenhower’s internal
shared drive, where admissions department employees can access it with their login
5 Other courts apply a pre-Cel-Tech balancing test that weighs the utility of the
company’s practice against the gravity of harm to the victim. (E.g., Smith v. State Farm
Mutual Automobile Ins. Co. (2001) 93 Cal.App.4th 700, 718-719; Davis v. Ford Motor
Credit Co. LLC (2009) 179 Cal.App.4th 581, 595.) Others adopt the test from section 5 of
the Federal Trade Commission Act (15 U.S.C. § 45(n)): “(1) [t]he consumer injury must
be substantial; (2) the injury must not be outweighed by any countervailing benefits to
consumers or competition; and (3) it must be an injury that consumers themselves could
not reasonably have avoided.” (E.g., Camacho v. Automobile Club of Southern California
(2006) 142 Cal.App.4th 1394, 1403.)
11
credentials. Rodriguez argues this evidence does not sufficiently demonstrate the
document was available to the public because it was password-protected. We disagree.
When a statutory provision does not define the term at issue, we look to “the plain
meaning of a word as understood by the ordinary person, which would typically be a
dictionary definition.” (Hammond v. Agran (1999) 76 Cal.App.4th 1181, 1189.)
Section 1339.51 does not specify what it means to make a chargemaster “available,” but
our Supreme Court has described the plain meaning of the word as “‘capable of being
made use of, at one’s disposal, within one’s reach,’” or “‘obtainable.’” (People v.
Rodriguez (2016) 1 Cal.5th 676, 686.)
The record contains no evidence suggesting a patient would be incapable of
viewing Eisenhower’s chargemaster by following the instructions in the notice, that is, by
contacting the admissions manager and asking to see the document. The fact an employee
would need to enter their login credentials upon such a request does not change the nature
of the document. These days, one would be hard-pressed to think of a document or
application that doesn’t require login credentials. Considering that many people need
them just to watch TV—and an admissions department employee would likely need them
to simply log on to a hospital computer—we don’t think login credentials qualify as the
kind of obstacle that would make something unavailable under a common understanding
of the word. In this context, the extra step is minimal, likely adding a few seconds to the
patient’s request.
12
Rodriguez’s argument appears to be that an electronic copy of a chargemaster is
not truly available unless it is stored on a public-facing terminal, but if that were the case
section 1339.51 wouldn’t have given hospitals any options for making an electronic copy
available other than posting it to their web site. Because the statute does not specify the
manner in which a hospital can make an electronic copy available “at the hospital
location” (§ 1139.51, subd. (a)), and because Rodriguez hasn’t produced any evidence
suggesting the chargemaster was in fact unobtainable (such as evidence an employee was
unable to access the document or refused to show it to a patient who asked), we conclude
she hasn’t demonstrated a factual dispute. In other words, the trial judge’s assessment of
the evidence was correct.
2. Notice
Next, Rodriguez argues Eisenhower’s failure to post a chargemaster notice in their
billing area constitutes a violation of section 1339.51’s notice requirement.
The facts concerning this issue are undisputed. Eisenhower posted one notice in
their emergency department and one notice in their combined admissions and billing
area. In addition, Eisenhower’s billing area is located within its admissions department
such that anyone who visits billing must walk through admissions and past the notice
posted there. The dispute is whether this practice satisfies the hospital’s statutory
obligation. Rodriguez argues section 1339.51 requires three notices, no exceptions.
Eisenhower contends the statute requires notices in three areas, which, depending on a
hospital’s layout, may require less than three notices.
13
We think Eisenhower has the better argument. In our view, the purpose of section
1339.51’s notice requirement is plain: to ensure that patients have a reasonable
opportunity to see a chargemaster notice on any given visit to the hospital. The statute
achieves this purpose by requiring notices in the areas of a hospital a patient is most
likely to visit. Thus, if by virtue of a hospital’s layout any of those three areas share the
same space, we think the hospital satisfies its statutory obligation by posting a notice in
the one area a patient will necessarily pass. Because the evidence demonstrates
Eisenhower did that, we conclude the trial judge was right to find they complied with the
notice requirement in section 1339.51, subdivision (c).
C. Unfair Practices
Finally, Rodriguez argues the trial judge erred by granting summary judgment on
the unfair practices theory of her UCL claim. She asserts two grounds for the error—
(i) that Eisenhower failed to provide adequate notice they were moving on this theory and
(ii) the evidence demonstrates Eisenhower’s disclosure methods are unfair even if lawful.
We disagree on both points.
According to Rodriguez, the trial judge was obligated to deny summary judgment
because Eisenhower’s motion focused on the lawfulness of their conduct and didn’t
address fairness. But that is not the test for whether an issue is properly before a judge on
summary judgment. Rather, a judge “may grant summary judgment on a ground not
specifically tendered by the moving party, so long as the opposing party has notice of and
an opportunity to respond to that ground.” (Bacon v. Southern Cal. Edison Co. (1997) 53
14
Cal.App.4th 854, 860.) A nonmoving party will be considered to have notice and an
opportunity to respond where they address the issue in their opposition and attempt to
show the existence of a factual dispute. (Ibid.)
That was the case here. Rodriguez raised the unfair practices theory in her
opposition and argued the evidence she presented to show Eisenhower violated section
1339.51 “constitutes both ‘unlawful’ and ‘unfair’ business practices under the UCL,” and
Eisenhower then responded to this argument in their reply. Plus, both parties addressed
the unlawful practices theory at length during the summary judgment hearing. Under
these circumstances, it cannot be said the issue wasn’t properly before the judge. In any
event, Rodriguez hasn’t identified any evidence she could have produced on the issue had
Eisenhower raised it in their opening brief. Her argument is premised solely on the
hospital’s failure to address her alternate theory in their moving papers. But the law in
this area is clear, “[t]o require the trial court to close its eyes to an unmeritorious claim
simply because the operative ground entitling the moving party to summary judgment
was not specifically tendered by that party would elevate form over substance and would
be inconsistent with the purpose of the summary judgment statute.” (Juge v. County of
Sacramento (1993) 12 Cal.App.4th 59, 69.) We therefore conclude the issue was properly
before the judge and she was correct to rule on it.
Turning to Rodriguez’s second challenge—whether the substance of that ruling
was correct—we conclude it was. Rodriguez’s complaint bases both the unlawful and
unfair theories of liability on the same conduct: Eisenhower’s alleged failure to make its
15
chargemaster available to the public and post notice about that availability. During the
summary judgment hearing, Rodriguez argued Eisenhower’s failure to post chargemaster
notices at their outpatient facilities constitutes an unfair business practice, even if
technically lawful. The trial judge concluded this was an issue for the Legislature, and we
agree.
Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401 is instructive.
In that case, the patient alleged a hospital engaged in unfair business practices in
violation of the UCL by failing to affirmatively disclose, before treatment, the existence
and amount of a facility fee. Like here, the plaintiff had not alleged the facility fee itself
was unlawful, only that the hospital’s failure to directly disclose it to him before his
treatment constituted an unfair business practice. (Nolte, at pp. 1407-1408.) The appellate
court disagreed, concluding that when a hospital complies with the disclosure obligations
under section 1339.51, failing to directly disclose a facility fee to the patient,
pretreatment, doesn’t amount to the kind of “‘sharp practice’” the UCL targets. (Nolte, at
pp. 1407-1408, quoting Searle v. Wyndham Internat., Inc. (2002) 102 Cal.App.4th 1327,
1334.)
That conclusion applies with equal force here. Section 1339.51 represents a
considered judgment from our lawmakers about a hospital’s duty to make pretreatment
disclosures about anticipated or potential charges. Expanding the scope of that duty to
include outpatient facilities would upset the balance the Legislature chose to strike
between a consumer’s right to information and a hospital’s burden of providing it, and we
16
decline to substitute our judgment for the Legislature’s. (See Superior Court v. County of
Mendocino (1996) 13 Cal.4th 45, 53 [“The judiciary, in reviewing statutes enacted by the
Legislature, may not undertake to evaluate the wisdom of the policies embodied in such
legislation; absent a constitutional prohibition, the choice among competing policy
considerations in enacting laws is a legislative function”].) Pricing transparency is
important and we are not unsympathetic to Rodriguez’s claim that Eisenhower’s
disclosure methods do not, in practice, do enough to alert the public to the availability of
their chargemaster. But whether Eisenhower should be required to do more in this area is
not an issue the UCL was designed to address; it is an issue better directed toward our
Legislature.
III
DISPOSITION
We affirm the judgment. In the interests of justice, the parties shall bear their own
costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
SLOUGH
Acting P.J.
We concur:
FIELDS
J.
MENETREZ
J.
17