Procedural Posture

Appellant patient sued respondent healthcare corporation, claiming that the corporation breached its admissions agreement and also its agreement with the patient’s health insurance company by accepting an additional payment from another insurer with whom the patient held a group health insurance policy. The Superior Court of Los Angeles County (California) granted summary judgment in favor of the healthcare corporation. The patient appealed.

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The patient also appealed from the trial court’s award of contractual attorney fees in favor of the healthcare corporation. The patient had two health insurance policies: an individual policy and a group policy. The patient contractually agreed with the individual provider to accept specified discounted rates for services rendered at its hospitals. The hospital at issue was a preferred provider hospital under the individual policy. That policy provided that nothing in the agreement would preclude a preferred provider from seeking reimbursement from other third party payers for the balance of billed charges. The appellate court held: (1) that no impermissible coordination of benefits occurred; (2) the patient was not entitled to direct payment of the amount due under his group policy, to the contrary, the group policy was obligated to pay the preferred provider hospital; (3) the contracts at issue specifically allowed the preferred provider hospital to accept payment from other insurers and because the hospital’s actions were permitted by California law; and (4) the award of attorney fees against the patient was not authorized under the individual policy/hospital contract.


The judgment in favor of the healthcare corporation was affirmed. However, the trial court’s order awarding attorney fees against the patient was reversed.