Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

WellCare Health Insurance Co. of Kentucky, Inc. v. Trigg County Hospital, Inc.

Court of Appeals of Kentucky

September 29, 2017

WELLCARE HEALTH INSURANCE COMPANY OF KENTUCKY, INC. APPELLANT
v.
TRIGG COUNTY HOSPITAL, INC. APPELLEE

         APPEAL FROM JEFFERSON CIRCUIT COURT HONORABLE MITCHELL PERRY, JUDGE ACTION NO. 16-CI-001547

          BRIEFS FOR APPELLANT: Pierre H. Bergeron Felix Maximilian Czernin Cincinnati, Ohio

          BRIEF FOR APPELLEE: Stephen R. Price, Sr. John W. Woodard, Jr. Allison L. Brown Louisville, Kentucky

          BEFORE: JONES, J. LAMBERT, AND STUMBO, JUDGES.

          OPINION

          LAMBERT, J., JUDGE.

         WellCare Health Insurance Company of Kentucky, Inc., has taken an interlocutory appeal pursuant to Kentucky Revised Statutes (KRS) 417.220[1] from the portion of the Jefferson Circuit Court's December 2, 2016, opinion and order denying its request to enforce an arbitration agreement between it and Trigg County Hospital, Inc. Because we agree that WellCare did not waive its right to invoke or enforce the arbitration agreement and that, accordingly, the circuit court erred as a matter of law in denying the motion to dismiss, we reverse.

         WellCare is a Medicaid managed care organization (MCO), and Trigg County Hospital (the Hospital) provides health care items and services to WellCare's plan enrollees in exchange for payments from WellCare pursuant to a Participating Provider Agreement (the Provider Agreement). An issue arose between the parties related to WellCare's payment of fees to the Hospital. The Hospital disputed WellCare's payment of only a $50.00 "triage" fee, or denial of the claim, when its members presented to the emergency room but did not have any emergency medical issues.

         The Provider Agreement, effective March 12, 2015, included a Dispute Resolution section. That section set forth administrative remedies, including an arbitration agreement, and reads, in relevant part, as follows:

8.1 Provider Administrative Review and Appeals. Where applicable, a Provider shall exhaust all Health Plan's review and appeal rights in accordance with the Provider Manual before seeking any other remedy. Where required by Laws or Program Requirements, administrative reviews and appeals shall be subject to and resolved in accordance with administrative law.
8.2 Except as prohibited by State Laws, all claims and disputes between Health Plan and a Provider related to this Agreement must be submitted to arbitration within one year of the act or omission giving rise to the claim or dispute, except for claims based on fraud, which must be brought within the State statute of limitation governing fraud claims. The failure to initiate arbitration within the foregoing time period will constitute waiver of such claims and dispute.
8.3 Negotiation. Before a Party initiates arbitration regarding a claim or dispute under this Agreement, the Parties shall meet and confer in good faith to seek resolution of the claim or dispute. If a party desires to initiate the procedures under this section, the Party shall give notice (a "Dispute Initiation Notice") to the other providing a brief description of the nature of the dispute, explaining the initiating Party's claim or position in connection with the dispute, including relevant documentation, and naming an individual with authority to settle the dispute on the Party's behalf. Within 20 days after receipt of a Dispute Initiation Notice, the receiving Party shall give a written reply (a "Dispute Reply") to the initiating Party providing a brief description of the receiving Party's position in connection with the dispute, including relevant documentation, and naming an individual with the authority to settle the dispute on behalf of the receiving Party. The Parties shall promptly make an investigation of the dispute, and commence discussions concerning resolution of the dispute within 20 days after the date of the Dispute Reply. If a dispute has not been resolved within 30 days after the Parties have commenced discussions regarding the dispute, either Party may submit the dispute to arbitration subject to the terms and conditions herein.
8.4 Arbitration. Except as barred or excepted by this Agreement, all claims and disputes between the Parties shall be resolved by binding arbitration in Louisville, Kentucky. The arbitration shall be conducted through the American Arbitration Association ("AAA") pursuant to the AAA Commercial Arbitration Rules then in effect, subject to the following. . . . The decision of the arbitrator or panel shall be final and binding on the Parties.

         The Hospital did not seek relief through the dispute resolution process set forth in the Provider Agreement, but rather filed a complaint on April 4, 2016, in Jefferson Circuit Court to contest WellCare's payment, or failure to pay, these fees. The Hospital alleged causes of action for breach of contract, statutory prompt-pay violations, unfair claims settlement practices, and declaratory relief. These claims had been raised earlier in a federal court action with other providers in Bourbon County Hospital v. Coventry Health and Life Ins. Co., Civil Action No. 3:15-cv-455-JHN, but that case was dismissed due to lack of federal jurisdiction after the court determined the claims should have been filed in state court.

         In lieu of filing an answer, WellCare filed a motion to dismiss the Hospital's complaint. WellCare argued that the Hospital failed to exhaust the administrative remedies set forth in the Provider Agreement, that Kentucky's prompt pay laws did not have any bearing on the issue in this case and did not confer a private right of action, that the declaratory judgment action was subsumed by the claims in chief, and that the lawsuit was filed in the wrong forum based upon the arbitration agreement. Therefore, WellCare sought dismissal of the complaint or that the Hospital be compelled to comply with the arbitration agreement. In response, the Hospital claimed that WellCare's use of a computerized, proprietary algorithm to reduce or deny payments by deeming them not medically necessary was illegal and in breach of their contract. The Hospital argued that it did not have a duty to exhaust internal administrative remedies prior to bringing the lawsuit and that it was not required to bring its claims via arbitration because WellCare had waived its right to seek arbitration by litigating the state law claims in the federal action on the merits. The Hospital asserted ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.