February 28, 2023

O'Melveny allegedly tricked a surgical center into accepting its cheap medical insurance

       Before performing surgery on an O'Melveny employee, a prestigious Beverly Hills surgical center called the firm to confirm that its plan would pay their rate. O'Melveny allegedly responded that it would, and so the doctors took their word for it and operated the next day.

       Then after the operation was complete, O'Melveny said its plan would only pay about 10% of the $200,000 bill. The center expected to be paid based on the promise. After waiting a few years, they assigned the bill to their debt collector who filed suit. O'Melveny has responded by removing the case to federal court, seemingly to try and avoid payment via an ERISA technicality. It did not hire a firm to defend the lawsuit; it's using its own internal attorneys: staff attorney James Kidder and partner Catalina Vergara.

       As I understand, unless it's an emergency, when a patient's insurance won't pay for a doctor's services, the patient simply goes to another provider. This happens all the time in the United States, which has tiers of medical providers, each with a commensurate cost. If you have really cheap insurance, many doctors will not accept you as a patient. And this doesn't seem to have been an emergency as, according to the complaint, the surgery was performed a day after the center spoke with O'Melveny. 

       I can't imagine the center would make all this up so, assuming they're telling the truth . . . O'Melveny doesn't seem to provide employees with good medical insurance. Excerpt from the complaint below:
27. On February 27, 2020, Medical Provider conducted surgery and provided services on and for patient for the benefit of Patient and DEFENDANT.

28. On February 26, 2020, Medical Provider’s representative Y.P. spoke with Defendant’s representative Shelly.

29. Defendant represented to Medical Provider that Patient’s deductible is and was $5,000.00 and that the deductible had been met and Patient’s Max Out of Pocket (“MOOP”)expense is and was $7,000.00 and that to date for the calendar year Patient had paid $257.73.

30. Defendant represented to Medical Provider that Medical Provider would be paid for medical services at one hundred (100) percent of the UCR amount.

31. DEFENDANT further represented that payment would not be made at a rate based on Medicare.

32. All of the information obtained in said conversation was documented by Medical Provider at the time of the phone conversation as part of Medical Provider’s policy and practice.

33. At no time prior to the provision of services to Patient by Medical Provider, during conversations between Medical Provider and DEFENDANT did DEFENDANT advise Medical Provider that Patient’s policy or certificate of insurance was subject to certain exclusions, limitations, or qualifications, which might result in denial of coverage, limitation of payment or any other method of payment unrelated to the UCR rate.

34. DEFENDANT did not make reference to any other portion of Patient’s plan that would put Medical Provider on notice of any reduction in the originally stated payment percentage.

35. Despite representing that payment would be made at the UCR rate, DEFENDANT knew or should have known that it would not be paying Medical Provider at the UCR rate.

36. Despite representing that payment would not be made at a Medicare rate, DEFENDANT knew or should have known that it would be paying Medical Provider at a Medicare rate.

37. Medical Provider relied and provided services solely based on DEFENDANT’s statements, promises and representations. Statements which had no relation to DEFENDANT and Patient’s plan document, as the statements may or may not have been based in the DEFENDANT or Patient’s plan documents, but that bore no consideration when Medical Provider agreed to provide medical services. Medical Provider took DEFENDANT at its word and promises and provided services based solely on those promises and representations. . . . 

40. Under either scenario, following the procedure, Medical Provider submitted to DEFENDANT any and all billing information required by DEFENDANT, including a total bill for $200,009.00.

41. DEFENDANT paid $21,573.14 to Medical Provider. The amount paid was well below the billed amount and well below a UCR amount.

42. As of the date of this complaint, DEFENDANT has still refused to make the appropriate payment to Medical Provider and Medical Provider was and now HAMOC is entitled to that payment from DEFENDANT.
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