Texas Supreme Court Denies Review of Stop-Loss Case

MyHealthGuide Source: StreetInsider.com, 6/2/2010, StreetInsider Article
AUSTIN, TX — The Texas Supreme Court has declined to review a case involving the amount some hospitals marked up workers’ compensation-related bills under rules in effect until 2008.
“Texas employers realized a great victory today,” Mary Barrow Nichols, general counsel and senior vice president for Texas Mutual, said. “A small number of hospitals were marking up a $4,000 item to $40,000 or more, or they’d turn a two-day admission into a $120,000 bill. These inflated charges could have cost the system hundreds of millions of dollars and continued to affect the workers’ compensation premiums of every Texas employer.”
The interpretation issue in this case between Texas Mutual and Vista Medical Center affects any remaining fee disputes under the stop-loss exception to the now-repealed rule.
Hospitals that treat workers’ compensation patients in Texas are reimbursed under the state’s workers’ compensation in-patient fee schedule. The 1997 fee schedule, which was repealed in 2008, included a stop-loss exception. Under the stop-loss exception, hospitals could be paid more than the fee schedule if they met certain criteria. The dispute between Texas Mutual and Vista centered on those criteria.
Texas Mutual argued that the stop-loss exception should be applied to admissions involving charges of more than $40,000 and “unusually extensive services.” Vista countered that the exception applied to all admissions for which they charged more than $40,000. The 353rd Judicial District Court of Travis County ruled for Vista. Texas Mutual appealed to the Austin Court of Appeals, which reversed the lower court. Vista then asked the Supreme Court to review the case.
About Texas Mutual Insurance Company
Austin-based Texas Mutual Insurance Company is the state’s leading provider of workers’ compensation insurance, with approximately 29% of the market. Since 1991, the company has provided a stable, competitively priced source of workers’ comp insurance for all Texas employers. Preventing workplace accidents and minimizing their consequences is a major part of Texas Mutual’s mission. Visit www.texasmutual.com.