Alabama Attorney General Troy King filed a petition in federal court arguing that the plaintiffs who filed a class-action lawsuit against Birmingham, Ala.-based Baptist Health System over uninsured billing practices have no standing to sue the system.
King's argument, if accepted by the court, could lead to dismissal of the lawsuit. The development marked the first time a state attorney general has entered the fray in the increasingly contentious 44 class-action lawsuits against tax-exempt health systems and the American Hospital Association. The move was welcomed by Baptist and the AHA.
Baptist spokeswoman Kaye Sutley praised King for supporting "our position that the plaintiffs have no legal right to pursue their claims." An AHA spokeswoman agreed, saying: "We welcome the attorney general's clarification and share his concern about these lawsuits."
The litigation, led by Oxford, Miss.-based plaintiff attorney Richard Scruggs, was filed on behalf of uninsured patients. The lawsuits generally allege that Baptist and the other hospitals overcharge uninsured patients and employ unfair and aggressive debt-collection methods.
In a three-page petition filed in U.S. District Court in Birmingham, King asked to intervene in the lawsuit as a friend of the court. "Alabama taxpayers are not vested with the right to bring actions to collect taxes purportedly owed by another taxpayer," King argued. He said the lawsuit, if successful, "would threaten the provision of charitable nonprofit healthcare in Alabama" and added that the lawsuit would not ensure the availability of healthcare to the indigent, but rather would "destroy the system by which it is currently offered."
Scruggs disputed King's reasoning. "These lawsuits aim to hold hospitals accountable for the provision of charitable nonprofit healthcare in Alabama and other states, which has been abused by the management of hospitals and the AHA to the point where uninsured patients are being grossly overcharged for healthcare," he said in a news release.
While no other attorneys general have intervened in the lawsuits, Mississippi Attorney General Jim Hood intervened in a settlement struck between Scruggs and Tupelo, Miss.-based North Mississippi Health Services. The system settled with Scruggs before getting sued (Aug. 9, p. 6).