Payne & Fears LLP Hospital Clients Obtain Major Victory Over Health Plan

Payne & Fears has LLP obtained a major reimbursement victory for its clients, a group of nonprofit hospitals, against Blue Shield of California, a major health plan.  For years Blue Shield had denied reimbursement to the hospitals under the parties’ contracts by “disallowing” certain hospital charges.  The Los Angeles Superior Court recently ruled that, because Blue Shield violated Health & Safety Code section 1371 in disallowing the charges, it did not have the right to contest payment and is legally obligated to pay the charges with statutory interest, notwithstanding any contractual defenses.