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U.S. Court In Texas Dismisses Charitable Care Action Against Tax-Exempt Hospital

 
 

HLD, v. 33, n. 6 (June 2005)

U.S. Court In Texas Dismisses Charitable Care Action Against Tax-Exempt Hospital

This case is one of numerous class action suits that have sprung up around the country on behalf of uninsured patients claiming that non-profit hospitals charged unreasonable and excessive fees for medical care to their uninsured patients. The plaintiffs argue that, because the hospitals are tax-exempt, they have a duty to provide discounted treatment to those unable to pay. In this case, plaintiff Yalonda Bobo moved to remand the case to state court after defendant Christus Health removed the case to federal court. The court denied Bobo's request and the parties cross-moved for dismissal.

            The U.S. District Court for the Eastern District of Texas, in a harshly worded opinion, held that Bobo should not be able to voluntarily dismiss her claims in order to avoid the "expected adverse result" that plaintiffs nationwide have thus far experienced in the courts. Therefore, the court refused to allow Bobo to voluntarily dismiss her claim and went on to consider the defendant's motion for judgment on the pleadings.

            Instead of detailing the issues in the case, the court adopted the reasoning in Kolari v. New York Presbyterian Hosp., No. 04 Civ. 5506 (S.D.N.Y. Mar. 29, 2005) another almost indistinguishable class action suit. In Kolari as in the instant case, the plaintiffs failed to state a claim upon which relief can be granted. Christus' tax-exempt status does not create a binding contract between it and the government, held the court, nor does it confer a private right of action on individuals to enforce that contract.

            The court also opted to exercise supplemental jurisdiction over plaintiff's state law claims as did the court in Kolari. Here, the court found that "plaintiff's state law claims, like her federal claims, are indispensably premised on the hospital's tax-exempt status." Therefore, the court dismissed plaintiff's federal and state law claims with prejudice.

Bobo v. Christus Health, No. 1:04-CV-626 (E.D. Tex. Apr. 26, 2005).

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