Dicarlo v. St. Mary Hosp.
| Decision Date | 24 June 2008 |
| Docket Number | No. 06-3579.,06-3579. |
| Citation | 530 F.3d 255 |
| Parties | Justin DiCARLO, On Behalf of Himself and All Others Similarly Situated, Appellant v. ST. MARY HOSPITAL; Bon Secours New Jersey Health System, Inc.; Bon Secours Health System, Inc. |
| Court | U.S. Court of Appeals — Third Circuit |
Ronald J. Aranoff, Brian S. Cohen, Bernstein, Liebhard & Lifshitz, New York, NY, for Appellant.
Michael R. Griffinger, Gibbons, Newark, NJ, for Appellees.
David S. Rosenbloom, McDermott, Will & Emery, Chicago, IL, for Apellees.
Before: FUENTES, CHAGARES, and ALDISERT, Circuit Judges.
Appellant Justin DiCarlo appeals the District Court's decision to grant appellees' motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). We will affirm the District Court's decision and adopt its well-reasoned opinion in full.
DiCarlo brought a class action lawsuit against St. Mary Hospital ("St. Mary's"), Bon Secours New Jersey Health System, Inc. ("BSNJ"), and Bon Secours Health System, Inc. ("BSHSI") alleging breach of contract, breach of the duty of good faith and fair dealing, unjust enrichment, breach of fiduciary duty, and violation of the New Jersey Consumer Fraud Act. See N.J. STAT. ANN. §§ 56:8-1 et seq. St. Mary's is an acute care medical/surgical hospital located in Hoboken, New Jersey, and operated by BSNJ. BSHSI is a not-for-profit Catholic health care system comprised of various facilities, including St. Mary's. St. Mary's accepts a variety of discounted payments from various payers, including Medicare, Medicaid, and insurance or managed care plans that have negotiated discounts with the hospital. St. Mary's also provides free or discounted care to patients eligible for the New Jersey Charity Care Program. See N.J. STAT. ANN. §§ 26:2-H18.51 et seq.
DiCarlo was admitted to St. Mary's on August 13, 2004, after experiencing an increased heart rate. At the time he was admitted, DiCarlo was uninsured and did not qualify for Medicare, Medicaid, or the New Jersey Charity Care Program. Upon his arrival at the hospital, DiCarlo signed the following consent form:
I hereby consent to the administration of such treatment, medication or anesthesia and the performance of such surgery as deemed necessary or advisable on myself or minor dependent. I also guarantee payment of all charges and collection costs for services rendered, and grant permission for release of information to my insurance company. I authorize payment directly to the hospital of the hospital benefits otherwise payable to me.
(App. 183 emphasis added.) A separate "Payment Agreement," which DiCarlo signed, further provided, "I understand that I am responsible for the charges for the treatment I receive." (App. 185.)
Following his treatment and release, St. Mary's charged DiCarlo $3,483, excluding separately billed physicians' fees. It is undisputed that these charges are far greater than the hospital would have been paid by privately insured patients, Medicare or Medicaid patients, or patients eligible for the New Jersey Charity Care Program.
In the District Court, DiCarlo's primary argument was that the practice of charging uninsured patients significantly higher rates than insured patients and patients covered under Medicare, Medicaid, or the New Jersey Charity Care Program, for the same services and supplies, is wrongful and discriminatory. The District Court granted the defendants' motion for judgment on the pleadings and dismissed DiCarlo's complaint with prejudice. The District Court discussed the policy concerns about the rising cost of healthcare at length and found that the courts are ill-equipped to determine what reasonable hospital costs are, or to make a policy determination on behalf of the legislative branch. The District Court also dismissed the breach of contract claim and the breach of the duty of good faith and fair dealing claim because the consent form contained a definite price term. In dismissing the New Jersey Consumer Fraud Act claim, the District Court found that the hospital's billing practices were not covered by the Act. Finally, the District Court found that it was unlikely that New Jersey courts would expand St. Mary's fiduciary duty to its billing practices, analogizing it to the debtor-creditor relationship, and dismissed the breach of fiduciary duty claim.
We have jurisdiction over DiCarlo's appeal pursuant to 28 U.S.C. § 1291. We review de novo the District Court's grant of a motion for judgment on the pleadings pursuant to Rule 12(c). Oxford Assocs. v. Waste Sys. Auth., 271 F.3d 140, 144-45 (3d Cir.2001). Judgment will only be granted where the moving party clearly establishes there are no material issues of fact, and that he or she is entitled to judgment as a matter of law. Id.
On appeal, DiCarlo asserts that the District Court erred in dismissing his contract claim because his allegations were sufficiently pled to survive defendants' motion. He further argues that the District Court erred in finding that the price term was definite and dismissing the implied duty of good faith and fair dealing claim. DiCarlo also claims that defendants' practice of price gouging uninsured patients and charging unfair and unreasonable prices constitutes unconscionable commercial conduct under the New Jersey Consumer Fraud Act. Finally, he asserts that the District Court's refusal to extend St. Mary's fiduciary duties to its billing practices was error.
Defendants assert that state and federal courts have rejected theories similar to DiCarlo's and dismissal here is additionally supported by the New Jersey legislative landscape, wherein the New Jersey Charity Care Program expressly rejected the type of rate-setting regime DiCarlo's seeks to reimpose judicially by this lawsuit. They also assert that his claims must fail on the merits for various independent reasons including: 1) the consent form he signed was unambiguous; 2) he failed to allege actual damages, an essential element to his contract claim; 3) billing is within the professional services exception to the New Jersey Consumer Fraud Act and such practices were not unconscionable; and 4) New Jersey law does not recognize a hospital-patient fiduciary duty, and if such were recognized it was not breached by defendants.
The District Court's opinion was thorough and did an excellent job of addressing DiCarlo's claims. While we are sympathetic to the burdens on uninsured patients who need medical care and recognize the severe economic hardships that the lack of insurance imposes on them, we find that the District Court's rigorous and persuasive analysis correctly states the law with respect to DiCarlo's claims. Accordingly, we attach a copy of the District Court's opinion, adopt that opinion as our own, and affirm the District Court's decision to grant defendants' motion for judgment on the pleadings.
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW
JERSEY
Justin DiCarlo, on Behalf of Himself and
All Others Similarly Situated, Plaintiff,
v.
St. Mary's Hospital, Bon Secours New
Jersey Health System, Inc., and Bon Secours
Health System, Inc., Defendants.
LAW OFFICES OF JAN MEYER
Jan Meyer, Esq.
1029 Teaneck Road
Teaneck, New Jersey 07666
BERNSTEIN LIEBHARDT & LIFSHITZ,
LLP
Keith M. Fleischman, Esq.
Robert J. Berg, Esq.
Robert J. Aranoff, Esq.
Brian S. Cohen, Esq.
10 East 40th Street, 22nd Floor
New York, N.Y. 10016
Attorneys for Plaintiff and the Class
GIBBONS, DEL DEO, DOLAN, GRIFFINGER
& VECCHIONE, P.C.
Michael R. Griffinger, Esq.
Anthony M. Gruppuso, Esq.
One Riverfront Plaza
Newark, New Jersey 07102
McDERMOTT WILL & EMERY, LLP
David S. Rosenbloom, Esq.
Rachel M. Trummel, Esq.
227 Monroe Street
Chicago, IL 60606-5096
Attorneys for Defendants
Civil Action No. 05-1665 (DRD-SDW).
Plaintiff, Justin DiCarlo, brought this class action against Defendants, St. Mary's Hospital ("St. Mary's"), Bon Secours New Jersey Health System, Inc. ("BSNJ"), and Bon Secours Health System, Inc. ("BSHSI"). Plaintiff alleges that on August 13, 2004, suffering from an increased heart rate, he received an EKG and underwent blood tests at St. Mary's. He had no health insurance and did not qualify for Medicare or Medicaid. At the time of admission he agreed to pay "all charges" associated with the care St. Mary's provided to him. St. Mary's charged him $3,483.04 in accordance with its uniform Charge Master charges. These charges were far greater than those that would have been paid by a privately insured patient, or one covered by Medicare or Medicaid, and, according to Plaintiff, were unreasonable.
Plaintiff's complaint alleges breach of contract, breach of the duty of good faith and fair dealing, violation of the New Jersey Consumer Fraud Act ("NJCFA"), unjust enrichment, and breach of fiduciary duty on the part of Defendants. Because Plaintiff seeks to prosecute this claim as a class action, and because the proposed class would include residents of multiple states, this Court has jurisdiction over these state law claims by the terms of the Class Action Fairness Act of 2005, which grants district courts original jurisdiction over "any civil action in which the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interests and costs, and is a class action in which ... any member of a class of plaintiffs is a citizen of a State different from any defendant." 28 U.S.C. § 1332(d)(2). Defendants answered and moved for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c).
Plaintiff, Justin DiCarlo, is a resident of Huntington Station, New York. (Compl.¶ 15.) Defendant St. Mary's Hospital ("St. Mary's"...
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