On October 12, 2011, the Indiana Court of Appeals reversed a Marion County Superior Court judge’s dismissal of a complaint against a hospital that the Superior Court had granted pursuant to Indiana Trial Rule 12(B)(6).  The Indiana Court of Appeals held that the plaintiff’s complaint did sufficiently state a claim for breach of contract based upon the reasonableness of fees that the hospital charged to uninsured patients.  See Allen v. Clarian Health Partners, Inc., No. 49AOZ-1011-CT-1174.

The plaintiffs filed a breach of contract claim against the hospital alleging that the hospital breached its contract with them and other uninsured patients by charging them unreasonable amounts for their medical care.  The plaintiffs signed a contract with the hospital prior to their medical treatment that stated that the plaintiffs agreed to pay their medical bills for the hospital’s medical care.  However, these contracts did not explicitly include or refer to a fee schedule for the hospital’s medical services to be received by the plaintiffs.

The Indiana Court of Appeals stated that if a contract does not include or refer to a fee schedule for medical services to be received by an individual, then it is inferred that the hospital may only charge a reasonable fee for such services.

The plaintiffs in this case were charged the hospital’s chargemaster rates for the medical services they received.  The plaintiffs contend that the chargemaster rates were unreasonable.  Thus, the plaintiffs contend that the hospital breached its contract with the plaintiffs by not charging them reasonable charges.

The Indiana Court of Appeals remanded this case for further proceedings.