SIIA Legal Defense Update – Hospital Billing Practices

SIIA Supports Litigation Effort to Protect Plans and Participants From Deceptive Hospital Billing Practices

August 17, 2020 -- The Colorado State Supreme Court has accepted an amicus brief submitted by the Self-Insurance Institute of America, Inc. (SIIA) focused on certain hospital billing practices that adversely affect self-insured group health plans and plan participants.

The Details
SIIA joined a Colorado appeal, French v. Centura Health Corporation, where Ms. French needed a surgery to stabilize her spine and the hospital, Centura, told her she would owe $1,336.90, but then later billed her $303,709.48 based on its chargemaster rates, arguing its initial estimate was wrong because it had misread her benefits card. Before surgery, Ms. French had signed a hospital services agreement stating that she would pay “all charges of the Hospital.” After the surgery, ELAP paid the hospital $74,957.35—more than the hospitals in-network rates—based on its determination of the value of the surgery, but the hospital sued Ms. French for the difference.

At trial, the jury found that Ms. French’s agreement to pay “all charges” was ambiguous, and thus limited to reasonable charges. It determined Ms. French owed an additional $776.74 beyond what ELAP had paid. The hospital appealed to the Colorado Court of Appeals, which reversed the trial court and held that because the health care industry is “complex,” it would not enforce traditional rules of contract interpretation. It found that “all charges” must unambiguously refer to the chargemaster rate, and Ms. French owed the remainder of the original $303,709.48 bill (more than $225,000).

SIIA’s amicus brief in support of Ms. French’s petition argues the Colorado Supreme Court should take the case, overturn the Court of Appeals decision, and reinstate the jury verdict so that out-of-network patients continue to have the same legal recourse to challenge unreasonable medical bills as they would in any other consumer transaction. If the Colorado Supreme Court agrees to hear the case, SIIA can file a full amicus brief describing its position on the merits.

The SIIA brief can be accessed here. Please watch for additional reporting on this case as developments warrant.

SIIA Legal Defense Initiative
This latest action is consistent with the association’s longstanding commitment to initiate and/or support litigation efforts to protect the ability employers to utilize self-insurance and/or captive insurance in ways that best fit their risk management needs.

SIIA Virtual National Conference & Expo
The upcoming SIIA Virtual National Conference & Expo will include several sessions covering a variety of regulatory content affecting self-insured health plans and their business partners. Sign up by Friday, August 21 and take advantage of discounted registration fees. Event details can be accessed at