IHC Hosp., Inc. v. Board of Com'rs

• Citation: 108 Idaho 136,697 P.2d 1150
• Decision Date: 04 February 1985
• Docket Number: Nos. 15302,15303,s. 15302
• Parties: IHC HOSPITALS, INC., a nonprofit Utah corporation, doing business as Primary Children's Medical Center, Plaintiff-Appellant, v. BOARD OF COMMISSIONERS, Defendant-Respondent. INTERMOUNTAIN HEALTH CARE, INC., a nonprofit Utah corporation, doing business as Primary Children's Medical Center, Plaintiff-Appellant, v. BOARD OF COMMISSIONERS OF TWIN FALLS COUNTY, Idaho, Defendant-Respondent.
• Court: United States State Supreme Court of Idaho

Page 1150

697 P.2d 1150

108 Idaho 136

IHC HOSPITALS, INC., a nonprofit Utah corporation, doing business as Primary Children's Medical Center, Plaintiff-Appellant, v. BOARD OF COMMISSIONERS, Defendant-Respondent.

INTERMOUNTAIN HEALTH CARE, INC., a nonprofit Utah corporation, doing business as Primary Children's Medical Center, Plaintiff-Appellant, v. BOARD OF COMMISSIONERS OF TWIN FALLS COUNTY, Idaho, Defendant-Respondent.

Nos. 15302, 15303.

Supreme Court of Idaho.

Feb. 4, 1985.

Larry Lee Goins, Idaho Falls, for plaintiff-appellant

Lloyd J. Webb, of Webb, Burton, Carlson, Pedersen & Paine, Twin Falls, for defendant-respondent.

SHEPARD, Justice.

These are consolidated appeals from the orders of the district court, which summarily affirmed rulings of the Board of Commissioners of Twin Falls County rejecting claims of IHC Hospitals, Inc. for costs allegedly incurred in caring for infant children of medically indigent parents. We affirm in part, reverse in part, and remand for additional proceedings.

The first issue presented for decision concerns the degree and nature of proof required from a hospital to sustain its claim for the costs of medical care to newborn infants whose parents are allegedly medically indigent. In the instant case, it appears that intransigence existed in the position of each party, the county commissioners asserting that claims for reimbursement must be supported by "expert" testimony, and on the other hand the hospital contending that its claim need not be established by expert proof of the medical necessity for the care or of the reasonableness of the charges therefor by testimony of persons competent to so testify. We conclude that neither party is completely correct in its position.

The second issue involves the burden of proof as between the parties here as to medical indigency. Substantially involved in both issues presented are Idaho's medical indigency statutes, Idaho Code Title 31, Chapters 34 and 35, and our Administrative Procedure Act, Idaho Code Title 67, Chapter 52.

IHC Hospitals, Inc. is the corporate owner of Primary Children's Medical Center, a hospital located in Salt Lake City, Utah, where three newborn infants were given extensive emergency medical treatment. Since the children had been born in Twin Falls, Idaho, plaintiff hospital requested reimbursement from the County of Twin Falls for the costs incurred, to the extent that such costs were not covered by federal Medicaid funds or by other available sources of money. Following a hearing, the county board of commissioners entered findings that the evidence tendered by IHC was not sufficient to establish the need for the care rendered by the hospital, nor sufficient to establish that the charges made for that care were reasonable. In two of the cases, the commission further held that the

proof was insufficient to establish the medical indigency of the infants' parents. Upon appeal to the district court, the rulings of the Board of Commissioners of Twin Falls County were summarily affirmed. The facts of each case, to the extent that they are contained in the record, are largely undisputed and are summarized below.

1. GARDOSKI CASE.

The infant Gardoski was one of twin children born in Twin Falls, Idaho, on October 7, 1982. Her parents already had four other children, and they had an annual income of $8,400, no health insurance, and minimal assets. In her first week of life, the infant developed abdominal distention, and she was transported to Primary Children's Medical Center at Salt Lake City for emergency surgery. She was released from the hospital on October 30 but returned again on December 5 for additional surgery. The charges for those hospital stays totaled approximately $17,000. The Gardoskis applied for assistance from Twin Falls County, and the Board of Commissioners, following a prehearing conference, initially denied that application.

Counsel for the county, by correspondence dated March 8, 1983, indicated that it was anticipated that the hospital would request an administrative review of the denial of the Gardoski claim, and that the commissioners felt the claim, or parts of it, did not reflect "regular hospital charges" within the meaning of I.C. § 31-3508. The letter further stated:

"During the course of that review, we will expect the Primary Children's Medical Center to be prepared to present testimony in detail and in depth as to the charges culminating in this claim. It will be necessary that there be presented testimony as to the reasonableness of the charges by someone qualified to speak to that subject. In view of the extent of this claim, I would anticipate that such a hearing would take the better part of a day...."

On May 10, 1983, a hearing was held, at which IHC tendered as evidence the Gardoskis' application for indigent assistance and a computerized hospital bill. The credit manager of the hospital testified to the effect that the charges stated on the computerized bill "were normally and necessarily made by Primary in connection with the care of the medically indigent patient;" that the hospital's billing procedure was that when an order for treatment is written by a nurse or doctor, the care so ordered is given, a charge slip is written by the person administering the care, the charge slips are collected and the charges posted nightly on the computer; that the rates charged for services rendered are set by the hospital administration and the hospital governing board, after recommendation from the department in charge of the treatment; that the charges imposed in the Gardoski case were normal and necessary, because "the physician ordered the treatment, and we have no--we have no way to--we do not question his, what he orders. If he feels she needs it, the treatment is given to her." The credit manager testified further that the hospital never refuses admission of a child who needs its care, that staff physicians have sole authority to admit patients, and that, because charity funds are limited, the hospital has a policy of exhausting all other sources of funds before turning for money to charitable institutions. Mr. Gardoski testified that, besides the twins born on October 7, 1982, the other four children in the family were children of a former marriage of Mrs. Gardoski to one Raymond Adams. Gardoski and his wife both indicated that the whereabouts of Adams or of his relatives was unknown, and that Adams had not been paying child support.

Following the hearing, the county commissioners denied IHC reimbursement for the care of the infant Gardoski, stating:

"I.

"The proof offered by the applicants was insufficient to establish that the hospital care, the expense of which is sought from Twin Falls County, was needed in the treatment of Bernadette Jo Gardoski.

No witnesses were called who were qualified to give testimony as to the need for the care rendered by the hospital, and there was no other legally acceptable evidence of the need for that care.

"II.

"The proof offered by the applicants was insufficient to establish that the charges made by Primary Children's Hospital, which are the subject of the application and claim, were reasonable charges. No witness was called who was qualified to give an opinion as to the reasonableness of the charges, and the reasonableness thereof was not otherwise established by legally acceptable evidence.

"III.

"The applicants were made aware of the need for acceptable proof of the foregoing elements of the claim by the letter of Lloyd J. Webb written on behalf of the Board of County Commissioners for Twin Falls County, Idaho, on March 8, 1983....

"IV.

"The proof offered by the applicants was insufficient to establish the indigency of Joseph Gardoski and Judy Gardoski according to the standards of indigency heretofore promulgated by the Board of County Commissioners for Twin Falls County, Idaho, it appearing that the Gardoskis would have sufficient income to respond to the hospital claim in question, assuming its validity, if Judy Gardoski was paid child support required to be paid by divorce decree entered by a Wyoming Court against her former husband. Judy Gardoski has seen fit not to enforce or attempt to enforce that child support provision for reasons which were unclear to the Board of County Commissioners, even though the County Commissioners, in informal conference on January 25, 1983, strongly urged Judy Gardoski to take advantage of the services of the Twin Falls County Prosecuting Attorney's staff for that purpose through a Uniform Reciprocal Support Action. At least on the state of the present record, there is no reason to believe that the child support obligation of Mrs. Gardoski's previous husband could not be enforced should Mrs. Gardoski see fit to attempt its enforcement."

2. CANDELARIA CASE.

The Candelaria infant was born two months premature on November 9, 1982, and was critically ill, suffering from complex respiratory system problems. He was transferred to Primary Children's Medical Center. The hospital made a claim for alleged costs not covered by Medicaid, in excess of $25,000. The county denied that claim, and an administrative hearing was held before the Board of County Commissioners.

The infant was the son of a single woman whom the county and hospital have, since the release of the infant from Primary, been unable to locate. Medical exhibits tendered by the hospital during the hearing indicate that the mother and father of the infant were separated, that the father lived in Las Vegas, and that the mother had resided in Idaho and was on welfare.

During the hearing before the county commissioners, the same credit manager of the hospital as testified in the Gardoski matter testified as to the hospital's procedure in ordering treatment and the nature of the hospital's charges. She admitted, however, that she had no expertise in setting costs of medical care. Following the hearing, the Board of County...