Under The Hospital Lien Act, Hospital Failed To Meet Its Burden Of Proof In Order To Collect On Its Lien.

Plaintiff suffered serious injuries in an accident and was taken to a hospital where he received treatment for seven days, incurring $34,320.86 in bills which he did not pay. A jury awarded plaintiff $356,587.92. Shortly after the verdict, a collection agency acting on behalf of the hospital sent the third party’s insurance company a lien under the Hospital Lien Act [Civil Code section 3045.1]. Faced with conflicting claims for the money, the insurance company interpleaded the funds. In the interpleader trial, four witnesses testified. The hospital’s accounting department employee authenticated a copy of the hospital bill. A financial counselor who spoke with plaintiff while he was hospitalized testified plaintiff told him to bill the person who was responsible for the accident. The general manager of the collection agency said he served the insurance company with a notice of the unpaid bill, and said what the current balance was. The last witness was the lawyer who represented plaintiff against the third party, who testified he introduced the hospital’s bill into evidence. The trial court entered judgment in favor of the hospital for $34,320.86. On appeal, plaintiff argued the judgment must be reversed because the trial court erroneously relieved the hospital of its burden under the Hospital Lien Act to prove the charges were reasonable and necessary. The appellate court discussed how many patients pay discounted rates and concluded that because the hospital had a full and fair opportunity at trial to prove it was entitled to the interpleaded funds but did not do so, and because plaintiff’s judgment against the third party shows he is entitled to the funds, plaintiff is entitled to judgment in his favor. The judgment for the hospital was reversed and the trial court was ordered to enter judgment in favor of plaintiff.  State Farm v. Huff and Pioneers Memorial Healthcare District  (Cal. App. Fourth Dist., Div. 1; June 11, 2013) 216 Cal.App.4th 1463, [157 Cal.Rptr.3d 863].