Daughters of Charity's Hospital Lien Neither Charitable Nor Legal

Hospital may not impose lien on patient after having been paid by worker's compensation carrier. Texas Labor Code's reimbursement cap applies, and bars additional recovery.

Daughters of Charity Health Services of Waco v. Linnstaedter, No. 05-0108 (Tex. Jun. 1, 2007)(Brister)(workers compensation)

In a case stemming from a work-related automobile accident the Supreme Court addressed the question whether a hospital may file a lien against a patient's tort recovery based on the difference between the payment from the workers' compensation carrier and the full amount it billed for treatment of the injured worker. The hospital had been paid all it was due in worker's compensation under the Labor Code guidelines. The Court holds that the hospital cannot sue the patient for the discount, and may not place a lien on his tort damages either. Workers’ compensation fee guidelines in the Labor Code are intended to provide both fair and reasonable reimbursement and effective cost control. Anything beyond would amount to a windfall. If a hospital felt it was entitled to more money, it has the option to lodge an administrative contest. In holding that the hospital’s lien violated the Labor Code’s prohibition of private claims against workers compensation patients, the Texas Supreme Court affirmed the judgments of the courts below.