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April 19, 2014

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Hospitals stuck when indigent victims need pricey care

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James Paul Schmidt

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Lt. George Castro of Metro Police's Violent Crimes division speaks with the news media at 4750 W. Oakey Blvd. on Wednesday afternoon to discuss James Paul Schmidt, a homeless man who was beaten into a coma in November. Police have exhausted leads in the case and are hoping family or friends of Schmidt will step forward to help.

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Two hours before sunrise on Nov. 30, a police officer and a police dog stumbled upon 60-year-old James Paul Schmidt suffering from a severe head injury in a Central Las Vegas alley.

Schmidt, a homeless man, had been beaten. He was taken to University Medical Center, where police said he suffered a brain injury and was in a coma.

Due to federal law intended to protect patient privacy, hospital officials won’t say how high the medical bills are for Schmidt or whether he has insurance, which is unlikely, but, given the circumstances, his hospital bill is bound to be huge.

Even weeklong hospital stays for severe brain-injury victims can run up bills in excess of $100,000. Schmidt has been at the county hospital for seven weeks and counting, and police said they have been unable to find his next of kin.

It begs the question: Can whoever caused his injuries be held responsible for his hospital bills so that taxpayers aren’t?

It may sound cold to be concerned about the cost, but the county hospital is facing an $82 million deficit, and as a top-tier trauma center, it takes care of many of the region’s most severely injured crime victims, many of whom are uninsured.

If a victim recovers or has relatives willing to pursue a lawsuit, that could possibly force some money out of the person who inflicted the injuries, of course. But what about a case in which a crime victim does not recover and has no relatives stepping forward?

Legal experts say there is at least an outside chance that UMC could successfully recoup its costs from a perpetrator, provided a Nevada court found that the hospital was justified in filing the lawsuit and the criminal offender had money or other assets worth pursuing.

But UMC does not sue the criminals who cause injuries to uninsured patients because the hospital believes it does not have legal standing to do so. Instead, the hospital resorts to other sources in an attempt to recover at least some of its costs.

“If the victim did not have insurance, we would help them by trying to get them covered either under social services or Medicaid,” UMC spokeswoman Danita Cohen says. “If those pay sources were not available, the state has a Victims of Crime fund.”

That fund will pay up to $20,000 per patient, so it stands to reason that the fund covers only a small percentage of the costs UMC incurs for treating indigent victims of crime, Cohen says. The hospital does not keep track of the amount of unpaid bills it absorbs each year for treating victims of crimes.

UMC does have the option under state law to attach a lien on any judgment that the victim — or his estate, should he die — receives after successfully suing the perpetrator.

“If the victim sues the perpetrator and there is a settlement, we will try to recoup money to pay for the bills,” Cohen says.

But UNLV Boyd School of Law Professor Keith Rowley said there may be little incentive for the victim or his estate to sue if they know that most of the money would go to the hospital.

“Why do all the legwork if the hospital will end up with the money?” Rowley said. “Likewise, if the perpetrator is ‘judgment-proof’ — that is, he or she has insufficient assets to pay a judgment or a settlement — it may not be worth the victim’s or the personal representative’s time and effort to sue the perpetrator.”

Rowley also said the hospital should never be allowed to force the victim to sue or compel the patient to assign that right to the hospital.

The last resort is for the hospital to sue the perpetrator on its own if the victim declines to do so. This is where UMC draws the line because, as Cohen says, “we don’t go after them (perpetrators) because there is no legal basis for us to go after them.” Mark Rothstein, a professor who specializes in health law at the University of Louisville Brandeis School of Law, said he is unaware of any public hospital suing a perpetrator, though he found the possibility intriguing. He said several things would have to fall into place for such a lawsuit to succeed.

One, of course, is that the perpetrator would have to have money, a house or other assets to help pay for the medical bills — or the strong possibility of making enough money in the future to make sufficient payment on the judgment. Another is that state laws would have to be favorable toward the hospital.

“Public hospitals have all sorts of patients who can’t pay their bills because they are the health care provider of last resort,” Rothstein says. “It’s one of those bad debts that public hospitals have to swallow.”

Another health law expert, attorney Thomas Elcock of the Boston firm Prince Lobel Glovsky and Tye, says public hospitals might be able to make a valid claim against the perpetrator if a large amount of unpaid medical bills is at stake.

Rowley and fellow Boyd professors say they are unaware of any written opinions from the Nevada Supreme Court indicating that the court has taken a position on whether a hospital can sue a perpetrator for unpaid medical bills.

But Rowley says UMC could argue “unjust enrichment” on the part of the perpetrator.

“Not making the perpetrator pay for the medical bills lets him or her off the hook too easily at the expense of the hospital,” Rowley says.

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