April 8, 2010
PRINCETON SURGICAL ASSOCIATES, PLAINTIFF-APPELLANT,
ABDUL AZIZ, DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, Middlesex County, Docket No. DC-025624-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: March 17, 2010
Before Judges Axelrad and Fisher.
Plaintiff Princeton Surgical Associates, P.A. (Princeton Surgical) appeals from the dismissal of its collection complaint, following a bench trial, alleging breach of contract for surgical services performed upon defendant. We reverse and remand for entry of a judgment.
The following facts, which were not in dispute, were presented during the Special Civil Part trial, in which testimony was presented by Princeton Surgical's billing representative, defendant, his wife and his son. On February 26, 2007, defendant was admitted to the emergency room of the University Medical Center at Princeton (UMCP) after experiencing intense abdominal pains. As defendant was in too much pain to personally fill out the requisite admission contract, his adult son did so on his father's behalf, expressly agreeing that defendant would be responsible for payment of services provided they were not covered by insurance. The contract further provided the patient might be obligated for medical bills in addition to those of the hospital as follows:
AUTHORIZATION TO PAY PHYSICIAN AND/OR SURGEON
In addition to your hospital bill, you may also receive separate bills from physicians for their professional services (i.e. Anesthesia, Emergency Services, Pathology, Radiology, etc.) I hereby authorize payment directly to any and all of my treating physicians and/or surgeons for benefits otherwise payable to me. I understand that I am financially responsible for any charges not covered by my health insurance benefits.
A medical examination revealed that defendant was suffering from a gangrenous gallbladder, for which he received treatment. Within two days of admission, it appeared defendant needed urgent surgery. Therefore, the staff at UMCP contacted Dr. Sae Hahm, the "on call" surgeon employed by Princeton Surgical, who performed a cholecystectomy (surgical removal of the gallbladder) on defendant.*fn1 Defendant saw Dr. Hahm at his office for post-operative visits on March 20 and April 9, 2007, which were included in the cost of the surgery. During the first visit, defendant completed a registration form, agreeing to be "financially responsible for all charges whether or not paid by insurance."
Defendant is a PPO participant with Blue Cross/Blue Shield of Alabama (BCBS-Alabama), which does not pay for out-of-network services. The hospital is a BCBS-Alabama participant and, although its claim was originally denied because it was not timely submitted, its bill was ultimately paid. However, none of the members of Princeton Surgical are participating physicians with BCBS-Alabama. Therefore, although Dr. Hahm's bill was submitted to BCBS-Alabama, and both the surgeon and defendant filed appeals with BCBS-Alabama, the carrier ultimately denied the claim because, pursuant to the Explanation of Benefits, the charges were "not eligible for coverage under [defendant's] contract."
Consequently, Princeton Surgical filed suit against defendant for the unpaid medical bill, including statutory counsel fees and costs, totaling $3,519.60. In his answer and during trial, defendant did not challenge or dispute the quality of work performed by Dr. Hahm or the reasonableness of the fee. The essence of his defense was that when he went to an in-network hospital, he assumed a hospital-employed, in-network surgeon was performing the procedure. Defendant claimed the hospital staff should have told him that Dr. Hahm was not a participating physician with BCBS-Alabama before the surgery was performed to allow him the opportunity to consider other alternatives.
The court dismissed Princeton Surgical's complaint with prejudice, concluding the hospital was the entity at fault, so Princeton Surgical's recourse was against the hospital. The court found the hospital mistakenly listed the wrong carrier, resulting in an apparent delay in the processing of the claim and its ultimate rejection. The court further found the hospital was at fault for not informing defendant that the surgeons it utilized were not in-network. This appeal ensued.
On appeal, Princeton Surgical argues the court made both errors of fact and law necessitating reversal. It further contends it is entitled to a judgment against defendant on the theories of breach of contract, unjust enrichment and quantum meruit. Princeton Surgical alternatively argues for a remand for the opportunity to conduct additional cross-examination of defendant, recall its witness and present closing arguments.
Princeton Surgical correctly points out the undisputed fact that defendant's insurance claim was denied on the merits, i.e., defendant's PPO does not pay out-of-network physicians, not because of any purported error or delay by either or both Princeton Surgical or the hospital in the processing of the claim. The court also placed an inappropriate and unfair burden on the surgeon to "have informed the defendant of the situation and perhaps gotten another surgeon." Dr. Hahm's primary responsibility was to respond to the emergency call and handle defendant's medical condition, not discuss his insurance coverage with him.
Additionally, although we are sympathetic to defendant's plight, the court penalized the surgeon, without basis, when it dismissed the collection claim against the patient, concluding that "[t]he hospital and the doctor should figure out a way for the doctor to be paid and it's beyond the ability of the defendant to do it." It is unfortunate that not a single surgeon at UMCP participates with defendant's insurance. However, although not as conspicuously stated as we would have liked, the hospital admission form did expressly inform the patient of potential personal responsibility for separate bills from physicians for services rendered in the hospital. Defendant, through his agent, agreed to be financially responsible for any charges not covered by health insurance. Thus, once defendant presented himself at the emergency room and required surgery, he was no longer entirely "blameless" and had to assume the risk that his PPO would not cover all services. Princeton Surgical attempted to obtain payment from BCBS-Alabama and even pursued an appeal, albeit unsuccessfully. The patient, not the hospital, is legally obligated to pay the bill and the court had no factual or legal basis to conclude otherwise.
When interpreting a contract, the paramount concern for the court is to "enforce the contract as written and not make a better contract for either party." Graziano v. Grant, 326 N.J. Super. 328, 342 (App. Div. l999). It is undisputed that Dr. Hahm performed services under the contract and that defendant did not question the quality of the medical services or the reasonableness of the bill. The defense that BCBS-Alabama should have paid Princeton Surgical's charges, which it is not required to do under the terms of the PPO, is not a valid defense to the contract between the surgeon and patient. Accordingly, Princeton Surgical is entitled to a judgment on its collection complaint. See Karl's Sales & Serv. Inc. v. Gimbel Bros. Inc., 249 N.J. Super. 487, 493 (App. Div.) (holding that where the terms of the contract are clear and unambiguous, "there is no room for interpretation or construction and the courts must enforce those terms as written"), certif. denied, 127 N.J. 548 (1991).
Princeton Surgical is also entitled to a judgment against defendant on the theories of unjust enrichment and quantum meruit. A cause of action for unjust enrichment requires a plaintiff to show that "defendant received a benefit and that retention of that benefit without payment would be unjust." VRG Corp. v. GKN Realty Corp., 135 N.J. 539, 554 (1994). "The most common circumstance for application of unjust enrichment is when a [party] has not been paid despite having had a reasonable expectation of payment for services performed or a benefit conferred." County of Essex v. First Union Nat'l Bank, 373 N.J. Super. 543, 550 (App. Div. 2004), aff'd, 186 N.J. 46 (2006). Similarly, in order to recover under the quasi-contract theory of quantum meruit, a plaintiff must establish: "(1) the performance of services in good faith, (2) the acceptance of the services by the person to whom they are rendered, (3) an expectation of compensation therefor, and (4) the reasonable value of the services." Starkey, Kelly, Blaney & White v. Estate of Nicolaysen, 172 N.J. 60, 68 (2002) (internal quotation omitted).
Dr. Hahm performed a surgical procedure which clearly benefited defendant. Defendant expressed no dissatisfaction regarding the quality of Dr. Hahm's work or the reasonableness of the fee. Defendant has failed to pay Princeton Surgical despite its reasonable expectation of payment. Defendant's avoidance of payment for the benefit he received would be unjust.
Reversed and remanded for the entry of judgment.