King & Spalding’s Healthcare Team secured a victory in Idaho Supreme Court for St. Alphonsus Medical Center, a hospital owned by Trinity health, in a putative class action brought by self-pay emergency room patients. The self-pay patients, each of whom signed the hospital’s standard Conditions of Admission agreement, alleged that the pricing term in the agreement was an “open price term” and therefore the hospital could not collect more than the “reasonable value” of the emergency medical services provided. The hospital moved to dismiss the case on the grounds that plaintiffs lacked standing and the agreements signed by the patients did not contain an “open price term” and were not unconscionable. Pursuant to Idaho procedural rules, the trial court converted the motion to dismiss into a motion for summary judgment and dismissed the lawsuit on the grounds that the plaintiffs lacked standing because there was no likelihood that the plaintiffs’ alleged injuries would be redressed by a ruling in plaintiffs’ favor. The Idaho Supreme Court affirmed on July 15, 2020, holding that plaintiffs did not have standing because their lawsuit “is merely hypothetical.”
This is one of dozens of lawsuits throughout the country brought by plaintiffs’ attorneys seeking to invalidate the standard pricing terms in hospital admission agreements. This decision is one of the few cases to reach a state Supreme Court. That the Idaho Supreme Court issued a published decision on the merits will be helpful to hospitals around the country fighting these lawsuits and will assist other state courts grappling with the same and similar questions.