Abby Allen and Walter Moore v. Clairian Health Partners, Inc.

By: Chris Simpkins
BleekeDillonCrandall Attorneys

On October 12, 2011, the Indiana Court of Appeals issued its opinion in Abby Allen and Walter Moore v. Clarian Health Partners, Inc, an interesting case regarding whether a hospital breaches its contract with uninsured patients by not including the exact price of medical services within the executed contract. According to the Court of Appeals, failure to include the price of medical services within the contract amounts to an unenforceable contract.

Because the undiscounted rates of the hospital were not disclosed prior to the uninsured patient’s signing contracts agreeing to pay for medical services, Indiana contract law only provided the hospital with a “reasonable charge.” Moreover, the Court of Appeals stated that the undiscounted rates, some of which were double what an insured patient would have to pay through his insurer, were “unreasonable” as a matter of law and amounted to a breach of contract. The Court of Appeals paid little attention to the hospital’s argument that courts were ill-equipped to determine the reasonable price of medical services, stating “it has long been the judiciary’s function to determine a reasonable charge when a contract lacks a definite provision for payment.”

This case will undoubtedly have broad implications for both hospitals and insurers throughout Indiana. At this time, it is unclear whether or not the hospital will appeal the decision to the Indiana Supreme Court. We will continue to monitor this case for any developments.