This article originally appeared in the Journal Record’s Gavel to Gavel column on December 7, 2023.
Individuals injured by the fault of another are generally entitled to recover damages that would “make them whole” (i.e., place the injured plaintiff in the same place they would have been had the injury not occurred). When treating these patients, providers typically have negotiated rates with insurance carriers that are significantly lower than the “uninsured” price of medical services. Because of the stark difference in prices between insured and uninsured medical bills, the Oklahoma Legislature enacted Okla. Stat. tit. 12, § 3009.1, commonly referred to as the “paid versus incurred” statute, and it prohibits the admission of “billing” amounts for medical services where a party has paid a lower amount.
In the case of a Medicaid-eligible patient, the Oklahoma Health Care Authority requires that medical providers who contract with the OHCA accept reduced Medicaid rates and refrain from billing, or attempting to collect payment from, a Medicaid-eligible patient for covered services. However, when treating a patient injured by the fault of another, a provider may place a physician’s lien on the potential recovery of the patient for the total amount of their services under 42 O.S. § 46, while refraining from billing their amounts to OHCA. In essence, a provider could attempt to recover the total amounts of their services while avoiding accepting the pertinent Medicaid rate for the service. Arguably, a lien on the recovery of a patient does not constitute billing the patient or collecting from the patient. In turn, the physician’s lien may also lead to a larger recovery for the patient.
This approach, however, may be problematic. For example, there is a strong public policy behind Medicaid and reducing the impact of amounts patients are billed. Further, an injured plaintiff that recovers damages may then argue that their providers’ liens are unenforceable. If an injured plaintiff successfully argues that the physician’s lien is unenforceable, the plaintiff will, in effect, have recovered amounts that they were billed but not required to pay, negating the Oklahoma Legislature’s mandate in 12 O.S. § 3009.1. Conversely, it would be difficult for an Oklahoma court to permit a defendant not privy to the contract between the OHCA and the provider to enforce the contract, leaving administrative penalties as the only redress. These issues are continuing to develop and might have a large impact on an injured plaintiff’s recovery.
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