in the Court of Appeals 30 January 2019.
by defendant from judgment entered 5 February 2018 by Judge
Walter H. Godwin, Jr. in Nash County No. 16-CVS-744 Superior
Law Firm, P.A., by Meredith S. Hinton, for
Teague, Rotenstreich, Stanaland, Fox & Holt, PLLC, by
Camilla F. DeBoard and Kara V. Bordman, for
Christopher R. Nichols; Kluttz, Reamer, Hayes, Adkins &
Carter, by Michael S. Adkins; and The Law Offices of James
Scott Farrin, by J. Gabe Talton, for amicus curiae North
Carolina Advocates for Justice.
Sykes was injured in a car accident and sought care at Nash
Hospital. After learning that another driver likely was
liable for Sykes's injuries, the hospital made a choice
that is the heart of this appeal: it chose not to bill
Sykes's health insurer for his medical care and instead
to rely on a statutory medical lien on any payments Sykes
received from the other driver.
choice matters because there is a statute prohibiting
hospitals from billing patients for charges that would have
been covered by health insurance if the hospital had timely
submitted a claim. See N.C. Gen. Stat. §
131E-91(c). The issue in this case is whether Section
131E-91(c) prevents a hospital from choosing to rely solely
on a medical lien on a future liability judgment, rather than
also billing the patient's health insurer.
explained below, we hold that hospitals may make this choice
without abandoning their medical liens. First, the text of
the applicable statutes permits it. Second, a contrary
interpretation would frustrate the purpose of Section
131E-91(c) by forcing patients to pay unnecessary deductibles
and other charges upfront-even though the hospital would have
been content to wait and recover those costs from a court
judgment or settlement later.
the trial court did not err by permitting Sykes to introduce
evidence of the hospital's lien and underlying medical
charges, and by rejecting counter-evidence seeking to show
that Section 131E-91(c) barred the hospital from billing
Sykes directly for those charges.
and Procedural History
September 2015, Plaintiff Derrick Sykes and Defendant
Emmanuel Vixamar were involved in a motor vehicle accident
when Vixamar failed to stop at a red light and collided with
the rear of Sykes's vehicle. Following the accident,
Sykes sought medical treatment at Nash Hospital. The charges
for Sykes's treatment at the hospital totaled $6, 463.
months later, the hospital sent Sykes a letter and
accompanying notice of medical lien informing Sykes that the
hospital asserted a lien on any liability recovery, medical
payments, or uninsured/underinsured motorist coverage. Sykes
had health insurance through Blue Cross Blue Shield but the
hospital did not submit the charges to Sykes's health
insurer and did not seek to collect the charges directly from
May 2016, Sykes filed this negligence action against Vixamar.
Progressive Universal Insurance Company, who insured the
owner of the vehicle that Vixamar was driving, later
intervened as a defendant.
discovery, the parties deposed Demetrius Hagins, a billing
clerk at Nash Hospital. Progressive asked Hagins a series of
questions concerning the hospital's decision to rely on
the medical lien to recover for its medical services, rather
than billing Sykes's health insurer:
Q. With that lien, it means you will obtain funds based on
the outcome of any lawsuit that he has or settlement,
. . .
Q. Okay. In the event that his recovery is less than the
amount you have in this lien, which is $6, 463, what happens
to the remainder of the balance?
A. If it's less, we accept a pro rata share at
settlement, and ...