Opinion
No. CV 05-4009103 S
October 27, 2011
MEMORANDUM OF DECISION
Preliminary Statement
This matter was commenced as a collection action for fees charged for medical services provided to David Rutkin in 1999 and 2000. The complaint sounds in breach of contract and quantum meruit. David Rutkin's wife is named in count three as being liable for the fees charged pursuant to Conn. Gen. Stat. § 46b-37. The defendants asserted a special defense of estoppel, as well as a counterclaim pursuant to Connecticut's Unfair Trade Practices Act. The case was tried to the court on July 28, 2011. The court heard the testimony of the plaintiff as well as the defendant, David Rutkin. The court received into evidence a number of exhibits as well. Post-trial briefs were filed on October 5, 2011. The court has reviewed all of these items as well as the transcript of proceedings.
Both plaintiff and defendant David Rutkin represented themselves. Mr. Rutkin, who is a licensed attorney, also filed an appearance on behalf of his wife, Elizabeth Rutkin.
Factual Findings
The court finds the facts set forth below to be proven by a fair preponderance of the evidence.
During the time period in question, the plaintiff was a physician, duly licensed by the State of Connecticut to practice medicine, which he did as a plastic surgeon. He first met and treated the defendant David Rutkin on August 8, 1999 in the emergency department of St. Vincent's Medical Center. Mr. Rutkin had health insurance through Physician Health Services (PHS). Although the plaintiff had previously been a network provider for PHS, a managed health care plan, at the time he treated the plaintiff, he was no longer a provider within that network. The defendant testified that St. Vincent's was a network provider for PHS. After his initial treatment, the defendant had follow up visits with the plaintiff on August 13, 1999, and March 7, 2000. The charges for services rendered total $8,945.00. The reasonableness of this amount is not in dispute.
The first follow up visit on August 13, 1999 occurred at the plaintiff's office. At that time, the defendant completed the "New Patient Information" form provided by the plaintiff. (Plaintiff's Exh. 3.) The defendant provided his name, address, employer and spouse's name. He further provided the name of his insurance plan, "Charter PHS" as well as his Identification number in that plan. Lastly, the defendant provided the name of his family doctor. At the bottom of this form, which was signed and dated by the defendant, is the following statement:
I hereby authorize Charles D. Gianetti, M.D. to furnish information to insurance carriers concerning my illness treatments. I understand that I am responsible for the payment of all fees regardless of insurance. In the event that payment of such fees is not made by me, I will be responsible for any reasonable costs of collection, including attorney fees.
The plaintiff, despite having the defendant's insurance information, did not seek payment for his services from the insurance carrier. The plaintiff advised the defendant that he was not a provider within his insurance carrier's network. On or about January 24, 2000, the plaintiff sent a bill to the defendants in the amount of $8,785.00 which covered the emergency room procedures at St. Vincent's as well as the August 13, 1999 follow up office visit. Thereafter, a copy of the same bill was provided to the defendant at his March 7, 2000 follow up office visit. (Plaintiff's Exhibit 5.) The plaintiff advised the defendant to submit the bill to his insurance carrier. It appears from the note entries in the plaintiff's records that a copy of the same bill was sent in May 2000 and marked "overdue," and that a subsequent bill was sent in June 2000 marked "seriously" overdue. (Plaintiff's Exhibit 5.) The defendants produced a bill they received dated May 8, 2000 in the amount of $8,785.00 which notes that it is "SERIOUSLY OVERDUE." Although the court does not have copies of every bill sent on the various days, it is clear that during the time period of May and June 2000, the plaintiff sent overdue bill notices to the defendants. Consistent with that course of conduct, the plaintiff's notes further reflect a "final" bill notice being sent in July 2000. The bill remains unpaid.
During this time, the defendants did not submit a claim for payment or reimbursement to the insurance carrier. The defendants made no effort to contact their insurance carrier or discuss the process or procedure for receiving payment for services provided by an out of network provider. The defendant did request that the plaintiff submit a claim for payment. The plaintiff did not do so.
Almost three years later, on or about May 28, 2003, the plaintiff sent another copy of the January 24, 2000 bill to the defendants. To the end of the bill he added a $160.00 charge for the March 7, 2000 office visit, thus bringing the total amount due in the bill to $8,945.00. In response to receiving this bill, the defendant wrote a note on the bottom and sent it back to the plaintiff. He wrote: "I went to a hospital that accepted PHS Health Insurance. If you were not an approved PHS Doctor, why did they send you? That's why we had health Insurance. This is not my problem, I'm sorry." According to the testimony of both parties, there was no further communications between the parties until the commencement of this action by the plaintiff in 2005.
The defendants claim that a member of the plaintiff's office staff told Mr. Rutkin that the plaintiff would submit a claim to the insurance carrier and that this representation was made after he received the January 2000 bill as well as the May 2000 bill. Such statements by the plaintiff or his staff however, would have been completely at odds with the plaintiff's records and conduct. Whether Mr. Rutkin misunderstood the response to his inquiry regarding insurance reimbursement or whether his recollection is simply faulty (the events occurring over 11 years before the trial of this matter), the court does not find these alleged representations proven by a fair preponderance of the evidence.
The plaintiff's repeated billing of the full amount due makes clear that there was never an intention to seek payment from the insurance carrier. A notice which states only "SERIOUSLY OVERDUE" sent in May of 2000 is consistent with this conclusion. Indeed, by June of 2000, it was abundantly clear that the plaintiff was not going to seek reimbursement from the insurance carrier and was looking to the defendants to satisfy the bill.
Of note, the defendants introduced two original identical bills dated January 24, 2000. Def. Exhibits E and F. These exhibits corroborate the plaintiff's testimony and the office record which indicates that the defendant was given a copy of the January 2000 bill at the time of his office visit on March 7, 2000. Such a practice is consistent with the plaintiff's testimony that he did tell the defendant he was not a network provider for PHS and that he further told the defendant to submit the bill for reimbursement. Also bearing on the accuracy of the defendant's recall is the fact that the note sent back to the plaintiff in 2003 nowhere references any alleged representation on the part of the plaintiff that he would submit the bill for payment.
Mr. Rutkin further testified that the plaintiff did not tell him he was not a network provider for PHS. His testimony is at odds with the evidence on this issue. The court finds that the plaintiff did tell the defendant he was not a PHS network provider. The content of the note sent back to the plaintiff in 2003 makes clear that the defendant was aware, at that time, that the plaintiff was not a PHS network provider. He was obviously aware of it when he asked the question, "if you were not an approved PHS doctor, why did they send you?" Further, insofar as both plaintiff and defendant testified that there was no contact between the two between June 2000 and May 2003, the court infers that the defendant did know, in 2000, that the plaintiff was not a PHS network provider.
In 2005, the plaintiff's office contacted PHS to see if any claim had been submitted by the defendant for the services rendered by the plaintiff. Thereafter, the instant action was commenced.
Discussion
The plaintiff's complaint alleges a breach of contract and quantum meruit. "The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages." (Internal quotation marks omitted.) Chiulli v. Zola, 97 Conn.App. 699, 706-07 (2006). The plaintiff relies upon the "New Patient Information" form signed by the defendant on August 13, 1999. This agreement is a written contract. However it only binds the defendant to pay for medical treatment provided on or after the date it was signed. The form makes no reference to prior treatment and an agreement to pay therefore, the bills for the two office visits, August 13, 1999 and March 7, 2000 remain unpaid. Therefore the plaintiff has established a contract and a breach thereof. The damages for this breach of contract are measured by the fees charged for those services, $320.00.
There is no evidence of any oral, written or express agreement or contract to pay for medical services in connection with the emergency department treatment rendered at St. Vincent's Hospital. These fees are recoverable however under the plaintiff's second count which sounds in quantum meruit. " Quantum meruit is a theory of contract recovery that does not depend upon the existence of a contract, either express or implied in fact." Gagne v. Vaccaro, 255 Conn. 390, 401 (2001). The equitable relief of quantum meruit arises out of an implied at law contract. This is an obligation which the law creates in certain circumstances even though a person did not expressly assume any particular obligation. Based upon equitable principles, it is to apply whenever justice requires compensation be made. Vertex, Inc. v. Waterbury, 278 Conn. 557, 573-74 (2006). For example, where a doctor has rendered emergency services under an expectation he was to be paid, and if the recipient knew, or as a reasonable person should have known, the doctor expected to be paid, a contract is implied. See, Clark v. Diedendorf, 109 Conn. 507, 512 (1929); Yale University School of Medicine v. Wurtzel, judicial district of New Haven, Dkt. No. CV 275314 (October 5, 1992, Healey, S.T.R.) " Quantum meruit literally means `as much as he has deserved . . .' Black's Law Dictionary (7th Ed. 1999)." Gagne v. Vaccaro, 255 Conn. 390, 401 (2001). Designed to prevent an injustice, quantum meruit, through the application of the broad principles of equity, guarantees that the party who has rendered services receives a reasonable sum for those services. Id.; Stewart v. King, 121 Conn.App. 64, 73 (2010). The court must conduct a factual examination of the circumstances as well as of the conduct of the parties. Rosick v. Equipment Maintenance Service, Inc., 33 Conn.App. 25, 40 (1993); Brighenti v New Britain Shirt Corp., 167 Conn. 403, 407 (1974).
Here, the circumstances under which the defendant received treatment at St. Vincent's Hospital are in many respects the classic scenario under which the doctrine of quantum meruit arises. The court finds that the plaintiff performed services with the expectation that he was to be paid and the defendant knew or should have know of this expectation. The fact that the defendant anticipated that the payment would be made by his insurance carrier does not eliminate his liability under the doctrine of quantum meruit.
There is no dispute as to the reasonable value of those services. The bill for the treatment at St. Vincent's totals $8,625.00.
Count Three — Liability of Elizabeth Rutkin
General statutes 46b-37 provides "(b) . . . it shall be the joint duty of each spouse to support his or her family, and both shall be liable for: (1) The reasonable and necessary services of a physician . . .; (2) hospital expenses rendered the husband or wife . . ." See also Dzenatis v. Dzenatis, 200 Conn. 290, 307 (1986). The defendants have admitted that they are husband and wife. There has been no claim that the treatment received was not reasonable or necessary. In light of the court's determination that the plaintiff has established the liability of the husband, the clear directive of the statute is that Elizabeth Rutkin is liable as well.
Thus, unless the defendants prevail on their special defenses, the plaintiff is entitled to the fees billed for the office visits as well as the reasonable value of the services rendered at the emergency room.
Special Defense and Counterclaim
By way of special defense, the defendants assert that the plaintiff's claims are barred by the doctrine of estoppel. Specifically, they assert that the plaintiff's failure to seek reimbursement from the insurance carrier, especially after advising them that he would do so, should estop him from seeking recovery directly from them. The defendants assert that the plaintiff is barred from seeking payment directly from them by virtue of Conn. Gen. Stat. § 20-7(f) as well as the holding of Gianetti v. Siglinger, judicial district of Fairfield, Dkt. No. CV 980349830, (April 24, 2004, Rush, J.) [ 36 Conn. L. Rptr. 869].
Although included within the estoppel special defense, it is unclear how these latter two arguments give rise to a claim of equitable estoppel. They are considered individually, in any event.
The Estoppel Claim
"The modern estoppel in pais is of equitable origin, though of equal application in courts . . . Its office is . . . to show what equity and good conscience require under the particular circumstances of the case." (Citations omitted.) Green v. Connecticut Disposal Service, Inc., 62 Conn.App. 83, 92 (2001). The doctrine of estoppel requires the defendant to prove two things: "the [plaintiff] must do or say something that is intended or calculated to induce another to believe in the existence of certain facts and to act upon that belief, and the [defendant], influenced thereby, must actually change his position or do some act to his injury which he otherwise would not have done." Reinke v. Greenwich Hospital Assn., 175 Conn. 24, 28 (1978). See also, Riscica v. Riscica, 101 Conn.App. 199, 205 (2007). "It is fundamental that a person who claims an estoppel must show that he has exercised due diligence to know the truth, and that he not only did not know the true state of things but also lacked any reasonably available means of acquiring knowledge." Riscica v. Riscica, supra, 101 Conn.App. at 205. See also, Green v. Connecticut Disposal Service, Inc., supra, 62 Conn.App. at 91.
The court finds that the defendants have not proven their equitable estoppel defense. The defendants' estoppel claim is premised, in part, on the factual assertion that the plaintiff's office personnel told the defendant that a bill would be submitted to the defendant's insurance carrier. It was with this understanding and in reliance upon this statement that the defendants claim to have taken no action with respect to this bill. As previously held, this court finds that allegation not proven. As such, the estoppel argument premised thereupon must fail. The defendants also appear to argue that the fact that the plaintiff could have submitted a claim to PHS but chose not to, should serve to estop him from seeking payment from them. This argument is not supported by any law or evidence. The plaintiff testified that he did not think he could submit a claim as an "out of network" provider. The court did not receive evidence as to the terms of the defendant's insurance plan on this issue. There was no testimony or evidence from PHS (now Healthnet) or the defendant that would take this issue out of the realm of speculation. In sum, based upon the evidence presented, this court cannot find, one way or the other, whether such a submission was permitted. Requiring even greater speculation is the argument that PHS would have paid, in whole or in part, the plaintiff's claim. The evidence on both of these issues is wholly lacking.
The defendant's conclusory statement that the "New Patient Information" form was an assignment of right to receive benefits is not supported by the record or the law. Permission to provide information is a far cry from the right to receive monies which would otherwise be paid to another. An assignment of benefits would normally include a proviso for, and directive to a carrier, to make payment directly to a provider. The form at issue was completely silent as to the payment of insurance benefits. See, e.g. Yale University School of Medicine v. Wurtzel, judicial district of New Haven, Dkt. No. CV 275314 (October 5, 1992, Healey, S.T.R.).
Moreover, when the plaintiff sent a "SERIOUSLY OVERDUE" notice to the defendants in May or June of 2000, it was then manifest that the plaintiff had not submitted a claim to the insurance carrier and was looking to the defendants to satisfy the bill. At the very least, at that juncture, the defendants should have and could have contacted their insurance company to "ascertain the truth" as to the status of this bill. They chose to do nothing and may not now avail themselves of an estoppel claim.
Conn. Gen. Stat. § 20-7(f) and the Siglinger decision.
Finally, the defendants assert that the plaintiff is precluded from seeking payment directly from them by virtue of Conn. Gen. Stat. § 20-7f(b) which provides in pertinent part: "It shall be an unfair trade practice in violation of chapter 735a for any health care provider to request payment from an enrollee, other than a copayment or deductible, for medical services covered under a managed care plan." The defendants allege that they were enrollees in a managed care plan with PHS and that the plaintiff was therefore required to seek payment from the insurer, and could only seek a copayment or deductible from them.
The defendants have misread the statute and the scope of the decisions that have applied the statute to the billing practices of the plaintiff. Under Section 20-7f(a)(1), to "request payment" is, among other things, to submit a bill for services "not actually owed." If the physician is a network provider, a bill for covered services as well as amounts over and above what is contractually agreed upon between the insurer and the physician would be a bill that is "not actually owed" by the patient. This is so by operation of the contract as well as Conn. Gen. Stat. § 38a-193(c). Here, because the plaintiff was not a network provider, the bill was for services that were owed and thus the plaintiff did not "request payment" in violation Section 20-7f(b). In sum, reading Section 20-7f in conjunction with Section 38a-193, this court finds that Section 20-7f does not apply to providers who have no contractual relationship with the managed care plan. Further, in the cases relied upon by the defendants in which this plaintiff was found to have violated Section 20-7f, to include the Siglinger decision, he was a network provider subject to the provisions of contractual agreements which were themselves subject to the requirements of Section 38a-193. For these reasons, the defendants' reliance upon the statute as well as the Siglinger decision fails.
The provisions of Section 20-7f were passed as part of the same Public Act by which Section 38a-193 came into existence. P.A. 98-163.
Though not dispositive, the court notes that Section 20-7f no longer applies to physicians and surgeons. At present, subsection (a)(2) defines a "health care provider" as a person licensed to provide health care services under [chapter 369], chapters 371-73, inclusive, chapters 375 to 383b, inclusive, chapters 384a to 384c, inclusive, or chapter 400j." Conn. Gen. Stat. § 20-7f(a)(2). The plaintiff, as a physician and surgeon, was licensed pursuant to chapter 370, a chapter specifically excluded from the definition of "health care provider," and so would not be currently subject to the provisions of the statute on which the defendants rely if he were still licensed. The legislative history and the timing of the change is unclear, but as indicated, not necessary to this court's determination.
Although there is some dicta to suggest the statute would have application irrespective of contractual obligations, the application of the statute to out of network providers was not raised, briefed or decided by the Siglinger court.
CUTPA
The defendant's counterclaim alleges a CUTPA violation. They have failed to meet their burden of proof. To the extent they rely upon Conn. Gen. Stat. § 20-7(f), their reliance is misplaced for the reasons set forth above. The remainder of the factual predicates for the CUTPA claim involve the timing of the billing and the bringing and maintaining of this lawsuit. While the bringing of an action without a proper basis may give rise to CUTPA liability under some circumstances, the court's findings above demonstrate that this litigation is not improperly brought, objectively baseless or otherwise brought in bad faith. See Ancona v. Manafort Bros, Inc., 56 Conn.App. 701, 715, cert. denied, 252 Conn. 953 (2000) ("filing a single non-sham lawsuit . . . cannot form the basis of a claim under CUTPA"); Cornerstone Family Services, Inc. v. Royce, Superior Court, judicial district of Stamford-Norwalk, Complex Litigation Docket, Docket No. X08 CV 01 0184443 (August 21, 2003, Adams, J.) ("the law in Connecticut is that the filing of a single non-sham lawsuit is not a basis for a CUTPA claim").
Damages
The plaintiff has proven a breach of contract as alleged in count one. He has further proven the elements of an action in equity for quantum meruit as contained in count two. The defendants have failed to prove their special defenses and counterclaim. Judgment will enter in favor of the plaintiff and joint and severally as against both defendants as follows:
8,625.00
Count One (Breach of Contract) $ 320.00 Count Two (Quantum Meruit) $ Total Damages $8,945.00The court further makes the equitable determination that prejudgment interest will not be awarded pursuant to Conn. Gen. Stat. § 37-3a. The lengthy passage of time between the services rendered and the commencement of the suit, coupled with the good faith nature of the defenses renders an award of prejudgment interest inappropriate. See, Hartford Steam Boiler v. Underwriters at Lloyds's, 121 Conn.App. 31 (2010); Ulrich v. Fish, 112 Conn.App. 837, cert. denied, 292 Conn. 909 (2009).
Costs to be taxed by the clerk.
SO ORDERED