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For over a decade, at least 15 different class action lawsuits have been filed against California hospitals for failing to disclose their facility fees before patients were treated. The suits claim that hospitals failed to advise patients arriving at their emergency rooms that they would be charged an “evaluation and management services fee” (EMS fee), which violated the state’s unfair competition law (Bus. & Prof. Code § 17200 et seq.) and Consumers Legal Remedies Act (Civ. Code § 1750 et seq.).
These lawsuits were brought even though each hospital had fully complied with both state and federal pricing transparency laws by disclosing the EMS fee in their chargemaster. While some of these lawsuits were settled or dismissed by the plaintiff after losing important rulings, other cases are on appeal or proceeding to trial.
Now, the California Supreme Court appears prepared to address whether hospitals in fact have a duty to disclose EMS fees beyond their statutory duty to make their chargemaster publicly available. On July 26, the court granted review in two different cases in which appellate courts had addressed this issue and come to different conclusions. The first is Naranjo v. Doctors Medical Center of Modesto (2023) 90 Cal.App.5th 1193, a published decision of the Fifth Appellate District in which the court had ruled that the hospital was required to further disclose the EMS fee prior to treating ER patients. The second case is Capito v. San Jose Healthcare System, an unpublished decision of the Sixth Appellate District holding that no additional disclosure was required.
CHA was previously involved as an amicus curiae (friend of the court) in both Naranjo and Capito (as well as several of the other cases addressing the EMS fee disclosure issue), given the importance of this issue to hospitals. In Naranjo, CHA submitted a letter brief supporting the hospital’s petition seeking Supreme Court review of the adverse Court of Appeal ruling that the hospital did have an obligation to make the disclosure plaintiff sought. In Capito, CHA filed a letter brief seeking publication of the Court of Appeal’s decision finding no duty on the part of the hospital to make the EMS disclosure plaintiff sought. CHA anticipates participating as amicus in the Supreme Court’s consideration of these cases.