Mazowiecki Regional Health Fund v. Healthcare Institution in Z

Mazowiecki Regional Health Fund v. Healthcare Institution in Z, Case No. I ACa 1/04 2004, Appellate Court (1st Civil Div.)
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The dispute concerned the correct interpretation of healthcare statutes. In December of 1988, the Healthcare Institution in Z (the plaintiff) contracted with the Mazowiecki Regional Health Fund (the defendant) to provide healthcare benefits. (The defendant was an entity charged under the Act on Universal Health Insurance (the “Act”) to carry out certain obligations arising from the social insurance). The defendant required price rates for each patient consultation as a requirement of the entering into the contract. During the next year, the plaintiff Z provided services that went above the limits set by the contract. The defendant sent over the limit invoices to the plaintiff, along with a warning that the services provided were inconsistent with the terms of the contract. The defendant sued the plaintiff for the over-the-limit benefits it had provided. The plaintiff claimed there were no legal grounds for the payment of installments for over the limit benefits.

The Circuit Court found that the amount of the over the limit benefits requested by the plaintiff had been accepted by the defendant, and required no further legal backing. The payment was due on the date of service, and therefore interest had been accruing while the defendant was not paying the over the limit benefits. The defendant appealed, arguing that, inter alia, the plaintiff was not entitled to request defendant to pay benefits without a legal basis, and that the Circuit Court had erroneously interpreted in the relevant law regarding health care payments.

The Court determined that under Art. 4(2) of the Act, a contract entered into with the defendant was the only basis for reimbursement by a healthcare institution and it was therefore unjustified to look to extra contractual grounds for such reimbursement.  Moreover, the benefits provided were not those specified in Art. 7 of the Act (which mandated a statutory duty for the defendant to immediately provide certain healthcare benefits without any contractual limitations). The Court also noted that the plaintiff had failed to notify the defendant of the over the limit charges although it was obliged to do so; and that the plaintiff had not acted within the bounds of the contract to increase the number of installments  payments by the defendant where the benefits provided exceeded the contracted benefits.

The Court also held that the plaintiff had not proven “that the principle of equality of parties to a legal relationship had been violated.” It was true that the plaintiff was required to provide healthcare benefits to persons in life-threatening situations and entitled to reimbursement from the defendant in such situations, however, there was no evidence that the over the limit healthcare benefits provided concerned such situations. Finally, the Court noted that, considering that the Act provided for a medical queuing procedure for cases of limited financial resources, it was clear that the financial liability of the defendant for healthcare benefits was not unlimited (which would have rendered the quantitative limits in contracts irrelevant).

Ultimately, the Court held that the Circuit Court had incorrectly applied the  law, and its judgment was reversed.

“On the other hand, pursuant to Art. 4(2) of this Act, a contract entered into with the Health Fund is the only basis for requesting a payment from the Health Fund for benefits provided by a Healthcare Institution within the public health insurance (except for the cases provided for by the law). Therefore, it would be unjustified to concur with the opinion of the Court of First Instance that there are other, extra contractual, grounds for requesting payment from the Health Fund” Page 4.

“In the case at issue, the plaintiff also failed to notify the Health Fund of the existing situation, despite being obliged to do so.” Page 4.

“Moreover, as to the contracts on provision of outpatient specialised healthcare benefits and on provision of inpatient benefits, the parties to the contract foresaw the possibility of increasing the amounts of installments if the number of actually provided benefits exceeded the number of contracted benefits by over 2% in a given period for clearing of accounts. A condition for such an increase was that the healthcare provider presented a written, content-based substantiation for the provision of an increased number of healthcare benefits and that this substantiation was accepted by the Health Fund. …. The plaintiff has not proved to have fulfilled these duties imposed on him by the contracts, as he has failed to present to the Health Fund a written substantiation for exceeding the set limits.” Page 5.

“In the opinion of the Appellate Court, the plaintiff also failed to prove that the principle of equality of parties to a legal relationship had been violated. In his testimony the witness M. did in fact mention that the Healthcare Fund "imposed" its rates on the plaintiff, but this was not proved within the meaning of the provisions of Art. 6 of the Civil Code.” Page 5

“Therefore, where this is allowed by medical considerations, the legislator has directly provided for the admissibility of the so-called "medical queue" due to limited financial resources. Hence, the financial liability of the Health Fund for healthcare benefits provided to entitled patients may not be unlimited, which would render irrelevant the contracts and their quantitative and amount limits. “ Page 6.

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