Wednesday, March 3, 2010

“Usual and Customary Provider Charges”

In Baker County Medical Services v. Aetna Health Management, LLC (1D08-0067), the First District addressed the following issues:
Baker County Medical Services, Inc. (BCMS), appeals a final judgment interpreting section 641.513(5)(b), Florida Statutes (2006). BCMS raises two issues on appeal. First, BCMS argues that the trial court erred in ruling that the term “provider” in section 641.513(5)(b) is not limited to any specific type of provider. We disagree and affirm on the first issue. Second, BCMS argues that the trial court erred in ruling that the phrase “usual and customary provider charges” in section 641.513(5)(b) includes consideration of the amounts billed by providers, as well as the amounts accepted by providers as payment. We agree in part and reverse with directions on the second issue.
The court held that the amount to be paid by an HMO to an emergency facility it does not have an agreement with should be determined by the fair market value and not based upon the amount charged.  The court stated:
BCMS asserts that the “usual and customary charges” include only the amounts billed or the charge master rates. The term “charges” is not defined in section 641.513(5). When a statute does not define a term, we rely on the dictionary to determine the definition. See Green v. State, 604 So. 2d 471, 473 (Fla. 1992). “Charge” is defined as a “[p]rice, cost, or expense.” BLACK’S LAW DICTIONARY 248 (8th ed. 2004). In paragraph (5)(a), the term “charge” is modified by the terms “usual” and “customary.” “Usual” is defined as “[o]rdinary; customary” and “[e]xpected based on previous experience.” Id. at 1579. “Customary” is defined as “[a] record of all of the established legal and quasi-legal practices in a community.” Id. at 413. In the context of the statute, it is clear what is called for is the fair market value of the services provided. Fair market value is the price that a willing buyer will pay and a willing seller will accept in an arm's-length transaction. See United States v. Cartwright, 411 U.S. 546, 551 (1973).
The oral argument that took place in the case on January 20, 2009 is below:

video

*Disclaimer: GrayRobinson, P.A. was involved in this action.

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