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Hospital must pay fines for billing injured worker


A hospital must pay fines for sending bills for treatment related to a workers compensation injury to the injured worker and a collection agency.

In Delta County Memorial Hospital v. Industrial Claim Appeals Office, the Colorado Court of Appeals, Division IV on Thursday affirmed a decision by a panel from the industrial Claim Appeals Office citing a hospital for violating provisions of the state’s Workers Compensation Act.

Edith Keating worked for Bob Adams Trucking & Towing and sustained serious injuries in 2017 while loading a pickup onto a tow truck. She sought workers compensation benefits and an administrative law judge awarded her medical and disability; her employer, however, lacked required workers compensation insurance.

The judge ordered the company deposit $130,000 with the Colorado Division of Workers Compensation to secure payment of unpaid compensation and benefits awarded and file a bond with the division in the same amount. However, it is unclear whether he has paid any funds to medical providers.

Ms. Keating provided a copy of the order to the Delta County Memorial Hospital, where she had been treated, but the hospital — having received no payments for its services — attempted to collect from Ms. Keating. Her attorney notified the hospital that once a claim is found compensable, it is unlawful in the state “for a medical provider to bill an injured worker” for services treating the work injury. Although the hospital received that letter in April 2019 and made a note of it in May, it continued its collection attempts via billing statements in June and September 2019.

An administrative law judge concluded that the hospital violated the state’s Workers Compensation Act by sending Ms. Keating medical bills despite being informed of the decision on the compensability of her case and imposed penalties of $750 per day for the period between the first bill in June 2019 through October 2019.

The panel affirmed the decision except for the penalty amount, determining that the hospital should only be fined for the days it improperly billed Ms. Keating, which amounted to eight occasions, $6,000 in penalties.

The hospital appealed, and Ms. Keating cross-appealed the panel’s decision, arguing that the penalty should have been greater.

The appellate court held that the panel correctly limited the penalty and affirmed the penalties for the dates in which the hospital billed Ms. Keating.

Although the hospital argued it was deprived due process when the administrative judge considered and ruled on Ms. Keating’s request for penalties, the appellate court dismissed this argument.

Likewise, the court dismissed Ms. Keating’s appeal that the panel should have the billing by the hospital for continued violations with penalties totaling $89,000, but the appellate court disagreed. However, the court did add two additional billing violations to the total for two instances that the hospital forwarded bills to a collection agency.

The appellate court reversed and remanded the case, instructing the administrative judge to add two days of penalties at $750 each to the total.