Menorah Park Ctr. for Senior Living v. Rolston

• Citation: 164 Ohio St.3d 400,173 N.E.3d 432
• Decision Date: 15 December 2020
• Docket Number: No. 2019-0939,2019-0939
• Court: Ohio Supreme Court
• Parties: MENORAH PARK CENTER FOR SENIOR LIVING, Appellant, v. ROLSTON, Appellee.

164 Ohio St.3d 400

173 N.E.3d 432

MENORAH PARK CENTER FOR SENIOR LIVING, Appellant,

v.ROLSTON, Appellee.

No. 2019-0939

Supreme Court of Ohio.

Submitted August 4, 2020

Decided December 15, 2020.

Bonessi Switzer Polito & Hupp Co., L.P.A., Bret C. Perry, Brian F. Lange, Cleveland, and Jay Clinton Rice, for appellant.

Ciano & Goldwasser, L.L.P., Andrew S. Goldwasser, and Sarah E. Katz, Cleveland; Powers Friedman Linn, P.L.L., and Robert G. Friedman, Beachwood; and Paul W. Flowers Co., L.P.A., Paul W. Flowers, and Louis E. Grube, Cleveland, for appellee.

Dinkler Law Office, L.L.C., Lynette Dinkler, and Carin Al-Hamdani, urging reversal for amicus curiae Ohio Association of Civil Trial Attorneys.

Bricker & Eckler, L.L.P., Elizabeth A. Kastner, Victoria Flinn McCurdy, and Bryan M. Smeenk, Columbus, urging reversal for amici curiae Ohio Hospital Association, Ohio State Medical Association, and Ohio Osteopathic Association.

Tucker Ellis, L.L.P., Susan M. Audey, Raymond Krncevic, and Emily J. Johnson, Cleveland, urging reversal for amicus curiae Academy of Medicine of Cleveland & Northern Ohio.

Kennedy, J. {¶ 1} In this appeal from a judgment of the Eighth District Court of Appeals, we address the interplay between the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), Pub.L. No. 104-191, 110 Stat. 1936, the subsequent HIPAA Privacy Rule promulgated in 45 C.F.R. 160 and 164, and Ohio's common-law cause of action for the unauthorized, unprivileged disclosure by a medical provider to a third party of nonpublic medical information recognized by this court in Biddle v. Warren Gen. Hosp. , 86 Ohio St.3d 395, 715 N.E.2d 518 (1999). We hold that HIPAA does not preclude a claim under our decision in Biddle when the limited disclosure of medical information was part of a court filing for the purpose of obtaining a past-due payment on an account for medical services.

{¶ 2} However, we also hold that there is an exception to liability under our decision in Biddle when a medical provider makes a reasonable effort to limit the disclosure of the patient's medical information to the minimum amount necessary to file a successful complaint for the recovery of unpaid charges for medical services. We conclude that a provider of medical services acts reasonably to limit the release of health information to the minimum amount necessary to file a successful complaint for payment on a past-due account for medical services when the medical provider attaches to the complaint, pursuant to Civ.R. 10(D), medical bills that disclose the medical provider's name and address, the patient's name and address, the dates on which services were provided, billing or procedure codes, a description of the general category of services provided, and the amounts charged, paid, and due.

{¶ 3} Because the medical provider in this case limited its disclosure of information to the minimum amount necessary for it to assert a cause of action to recover from the patient payment for unpaid medical bills, the patient has failed to state a claim under our decision in Biddle . Therefore, we reverse the judgment of the court of appeals on that claim.

I. FACTUAL AND PROCEDURAL BACKGROUND

{¶ 4} Appellant, Menorah Park Center for Senior Living ("Menorah Park"), filed a small-claims complaint against appellee, Irene Rolston, in the Shaker Heights Municipal Court on March 21, 2018. Menorah Park alleged that Rolston had failed to pay a debt in the amount of $463.53 "for therapy services [that] were provided by Menorah Park" when Rolston "was at Menorah Park for rehabilitation." Attached to Menorah Park's complaint were copies of two billing statements. Civ.R. 10(D)(1) provides, "When any claim or defense is founded on an account or other written instrument, a copy of the account or written instrument must be attached to the pleading. If the account or written instrument is not attached, the reason for the omission must be stated in the pleading."

{¶ 5} The billing statements included a description of the medical services that Menorah Park had provided to Rolston, the dates on which the services were provided, medical-procedure codes, charges and credits, balances on Rolston's account, and the names and addresses of Menorah Park and Rolston. On the billing statements, the descriptions of the services provided to Rolston included "PT EVALUATION MOD COMPLEX," "PT-MANUAL THERAPY," "PT-PHYSICAL PERFORMANCE TE," and "PT THERAPEUTIC PROC-AQUATI[C]." (Capitalization sic.)

{¶ 6} Rolston successfully moved for the case to be transferred to the municipal court's regular docket, and on May 1, 2018, she filed an answer and class-action counterclaim against Menorah Park for breach of confidence for the disclosure to a third party of "nonpublic medical information that it learned within a physician-patient relationship." Menorah Park moved to dismiss the counterclaim under Civ.R. 12(B)(6), arguing that HIPAA allows the disclosure of protected health information for the purpose of a medical provider's obtaining payment for medical services. Menorah Park argued that its actions had met the requirements under HIPAA and that even if it had failed to meet those requirements, HIPAA does not allow for a private cause of action for HIPAA violations.

{¶ 7} In responding to the motion to dismiss, Rolston countered that Menorah Park's disclosure of her medical information was not authorized under HIPAA, because HIPAA provides that when a medical provider seeks payment, the provider is required to make reasonable efforts to limit the disclosure of information to the minimum amount necessary to obtain payment. Rolston also argued that HIPAA does not preclude a common-law claim under our decision in Biddle , in which this court recognized that "an independent tort exists for the unauthorized, unprivileged disclosure to a third party of nonpublic medical information that a physician or hospital has learned within a physician-patient relationship," 86 Ohio St.3d 395, 715 N.E.2d 518, at paragraph one of the syllabus.

{¶ 8} The trial court granted Menorah Park's motion to dismiss Rolston's counterclaim, determining that "th[e] claim does not fall under the tort law claim established in Biddle * * * and the Defendant cannot sue on HIPAA grounds." In a nunc pro tunc entry, the trial court determined that its judgment dismissing Rolston's counterclaim was a final, appealable order and that there was no just cause for delay.

{¶ 9} The Eighth District reversed the trial court's judgment, holding that Rolston had not failed to state a claim upon which relief can be granted. Construing the allegations in Rolston's complaint in her favor, the court concluded that Rolston had a potential claim under Biddle and that HIPAA does not preempt such a state common-law claim. 2019-Ohio-2114, 137 N.E.3d 682, ¶ 23.

{¶ 10} This court accepted Menorah Park's jurisdictional appeal on two propositions of law:

1. The Health Insurance Portability & Accountability Act (HIPAA) preempts a common law claim brought under Biddle v. Warren Gen. Hospital , 86 Ohio St.3d 395, 715 N.E.2d 518 (1999), for disclosure of protected health information where the limited disclosure was for the purpose of obtaining payment on a past due account, which is an "authorized disclosure" under HIPAA regulations.

2. A claimant's reliance on a HIPAA regulation to determine whether the release of protected health information was "unauthorized" for the purpose of pursuing a common law claim under Biddle would allow private enforcement of HIPAA regulations, which is contrary to overwhelming legal authority that HIPAA does not provide a private right of action for improper disclosures of medical information but rather provides civil and criminal penalties which must be enforced by the Department of Health and Human Services.

(Emphasis sic.) See 157 Ohio St.3d 1427, 2019-Ohio-4003, 131 N.E.3d 977.

{¶ 11} After oral argument, this court sua sponte ordered the parties to brief the following issue:

Should this court overturn or modify the holding in Biddle v. Warren Gen. Hospital , 86 Ohio St.3d 395, 715 N.E.2d 518 (1999), in light of the enactment of Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), Pub.L. No. 104-191, 110 Stat. 1936, and the subsequent promulgation of the HIPAA Privacy Rule, 45 C.F.R. Parts 160 and 164?

See 159 Ohio St.3d 1405, 2020-Ohio-3206, 146 N.E.3d 582.

II. LAW AND ANALYSIS

A. Standard of Review

{¶ 12} This court applies a de novo standard of review to orders granting a Civ.R. 12(B)(6) motion to dismiss. Lunsford v. Sterilite of Ohio, L.L.C. , 162 Ohio St.3d 231, 2020-Ohio-4193, 165 N.E.3d 245, ¶ 22. "In reviewing a motion to dismiss for failure to state a claim upon which relief can be granted, we accept as true all factual allegations in the complaint." Id. , citing Mitchell v. Lawson Milk Co. , 40 Ohio St.3d 190, 192, 532 N.E.2d 753 (1988). "A complaint should not be dismissed unless it appears ‘beyond doubt from the complaint that the plaintiff can prove no set of facts entitling him to recovery.’ " Id. , quoting O'Brien v. Univ. Community Tenants Union, Inc. , 42 Ohio St.2d 242, 327 N.E.2d 753 (1975), syllabus.

B. Biddle v. Warren Gen. Hosp.

{¶ 13} In Biddle , this court recognized an independent tort for the unauthorized, unprivileged disclosure to a third party of nonpublic medical information that a physician or hospital obtained from a physician-patient relationship. 86 Ohio St.3d 395, 715 N.E.2d 518, at paragraph one of the syllabus. In Biddle , the hospital had given its patients' medical information to a law firm so that the firm could determine whether the hospital's patients who had unpaid medical bills could be eligible for Supplemental Security Income disability benefits, meaning that their unpaid medical bills could possibly be paid by the Social Security Administration. Id. at 395-396, 715 N.E.2d 518. The firm informed the hospital that in order to perform that service and screen the patients, it would be...