United States District Court, E.D. Kentucky, Southern Division, London
MEMORANDUM OPINION & ORDER
Gregory F. Van Tatenhove United States District Judge.
law requires an employer to pay for treatment when an
employee sustains an injury while on the job. KRS §
342.020. When a medical provider submits a claim for payment
for such treatment, the provider is subject to the fee
schedule promulgated by the Department of Workers Claims of
the Kentucky Labor Cabinet. Doctors Hospital of Augusta, LLC,
believes this structure is unconstitutional and has sued to
recover the full payment resulting from treating a Kentucky
employee. That employee, Mr. Marcus Hobbs, was also named as
a defendant to this suit, and has filed a motion to dismiss.
For the reasons below, this motion is
Marcus Hobbs worked for Mr. Mark Daniels in Bimble, Kentucky
at the time of his accident. [R. 1 at ¶¶ 8-10.] Mr.
Daniels has a coverage policy through Kentucky Employers'
Mutual Insurance (KEMI) that covers Mr. Hobbs's
workers' compensation. [R. 18-1 at 3.] On November 21,
2016, while helping Mr. Daniels move a mobile home into
position, Mr. Hobbs touched a live electric service line,
suffering life-threatening burns. [R. 1 at ¶ 10.] He
initially received treatment from the Emergency Department at
Holston Valley Medical Center in Kingston, Tennessee, after
which he was airlifted to Doctors Hospital in Augusta,
Georgia, for continued care. Id. at ¶ 11. At
the time of filing the Complaint in this matter, Doctors
Hospital claimed Mr. Hobbs continued accepting care from
their facility. Id.
treatment of Mr. Hobbs, Doctors Hospital submitted a bill to
KEMI requesting $4, 325, 252.10 for services rendered.
Id. at ¶ 12. KEMI then applied the
cost-to-charge ratio outlined in KRS Chapter 342 of 16.55%
and submitted payment in the amount of $708, 878.41. [R. 18-1
at 4.] Doctors Hospital refused this payment. Id.
Instead, Doctors Hospital filed a Medical Fee Dispute with
the Kentucky Department of Workers' Claims, stating that
the laws relating to compensation of medical services were
Administrative Law Judge Douglas Gott was assigned to handle
the Medical Fee Disputes. Id. Doctors Hospital then
filed this action on July 25, 2017, against the Kentucky
Labor Cabinet, Derrick Ramsey in his official capacity as
Secretary of the Kentucky Labor Cabinet, Robert Swisher in
his official capacity as Commissioner of the Department of
Workers' Claims, Andy Beshear in his official capacity as
Attorney General of the Commonwealth of Kentucky, and Mr.
Hobbs. [R. 1.] Accordingly, on August 1, 2017, Administrative
Law Judge Gotts placed the Medical Fee Dispute in abeyance
pending the outcome of this action. [R. 18-1 at 4.] Doctors
Hospital then filed an Amended Complaint on August 31, but
only as to Defendants Andy Beshear, Robert Swisher, and the
Kentucky Labor Cabinet. [R. 15.] KEMI moved to intervene as a
defendant [R. 13] and this Court granted that motion on
September 25 [R. 26]. Since then, Defendant Beshear [R. 29]
and the Kentucky Labor Cabinet [R. 33] were dismissed upon
agreement of the parties from this action. Mr. Hobbs also
filed a motion to dismiss, claiming KEMI, not he, is the
proper party for this matter. [R. 18.]
Rule of Civil Procedure 12(b)(1) provides that a defendant
may assert lack of subject-matter jurisdiction as a defense.
A motion to dismiss under Rule 12(b)(1) is different from a
motion to dismiss under Rule 12(b)(6) because it challenges
the Court's power to hear the case before it. When
jurisdiction is challenged under this rule, the burden is on
the plaintiff to prove that jurisdiction exists. RMI
Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125,
1134 (6th Cir. 1996). In answering this question, the Court
is “empowered to resolve factual disputes” and
need not presume that either parties' factual allegations
are true. Id.
motion to dismiss pursuant to Rule 12(b)(6) tests the
sufficiency of a plaintiff's complaint. In reviewing a
Rule 12(b)(6) motion, the Court “construe[s] the
complaint in the light most favorable to the plaintiff,
accept[s] its allegations as true, and draw[s] all inferences
in favor of the plaintiff.” DirecTV, Inc. v.
Treesh, 487 F.3d 471, 476 (6th Cir. 2007) (citation
omitted). The Court, however, “need not accept as true
legal conclusions or unwarranted factual inferences.”
Id. (quoting Gregory v. Shelby County, 220
F.3d 433, 446 (6th Cir. 2000)). The Supreme Court explained
that in order “[t]o survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.'” Ashcroft v. Iqbal, 129 S.Ct.
1937, 1949 (2009) (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)); see also Courier
v. Alcoa Wheel & Forged Products, 577 F.3d 625, 629
(6th Cir. 2009).
Hobbs filed a motion to dismiss pursuant to both Fed. R. Civ.
Pro. 12(b)(1) and 12(b)(6). [R. 18.] First, Mr. Hobbs asserts
that he cannot be held responsible for the balance owed to
Doctors Hospital, and that only KEMI is responsible for
payment. [R. 18-1 at 5-7.] Additionally, Mr. Hobbs claims
that this matter is not ripe for review by this Court, as the
parties have ongoing matters pending before the Kentucky
Department of Workers' Claims administrative law judge.
Id. at 8.
Mr. Hobbs relies on KRS §§ 342.020 and 342.035 to
demonstrate that he would not be the party responsible for
paying the balance claimed by Doctors Hospital. [R. 18-1 at
5- 7.] KRS § 342.020 requires an employer to pay for the
medical care of an injured employee, but such fees cannot
exceed the limitations provided in KRS § 342.035. KRS
§ 342.035 directs the Commissioner of the Department of
Workers' Claims to promulgate regulations adopting a