US Appeals Court backs WakeMed in fight over car crash victims’ benefits | Eastern North Carolina Now

    Publisher's Note: This post appears here courtesy of the Carolina Journal. The author of this post is CJ Staff.

    Aunanimous federal Appeals Court panel has upheld a lower court's ruling favoring WakeMed in a dispute with car crash victims. Appellate judges ruled that the hospital did not deceive patients when asking them to sign certain forms in exchange for treatment.

    The 4th U.S. Circuit Court of Appeals released its opinion in Elrod v. WakeMed Tuesday afternoon. As an unpublished opinion, the case does not set a precedent for future cases.

    "Peggy Elrod, Yvonne Bertolo, and Janine Palmer on behalf of her minor son, Justin Palmer ... sued WakeMed and Argos Health, Inc., alleging that an assignment of benefits ("AOB") that Patients signed with WakeMed is unenforceable," according to the unsigned 4th Circuit opinion.

    "Following unrelated car accidents, Patients sought emergency medical treatment from WakeMed," the opinion explained. "WakeMed required Patients to execute a general consent form ("GCF") to obtain emergency treatment. The GCF indicated that, by executing the form, the patient 'consent[ed] to the provision of all medical treatment and other health care that [his or her] physician(s) or other caregivers consider[ed] necessary, which may include diagnostic, radiology, and laboratory procedures.'"

    The consent form included the disputed AOB, which assigned insurance benefits to the hospital.

    Bertolo had "severe pain" and "foggy memory" when arriving at the emergency room after her car accident, according to the court opinion. Elrod "was terrified and in a panicked state because of potential internal bleeding complications" when she signed her form. Palmer signed the form after she "arrived at the ER to witness employees cutting off Justin's clothing and removing shards of glass" from his skin.

    "Patients assert that WakeMed and Argos took advantage of their compromised state to force them to sign the GCFs to obtain medpay benefits to which WakeMed was not otherwise entitled," according to the opinion. "Patients claim that they 'simply had no choice but to sign,' even though they had no intention of assigning their rights under their insurance policies."

    The patients filed suit, eventually submitting a class-action complaint in November 2020. "Patients sought a declaratory judgment that the AOB was void based on unconscionability, lack of mutual assent, lack of consideration, unilateral mistake, fraud, imposition, and public policy. Patients also brought a claim for breach of fiduciary duty against WakeMed and claims for fraud, conversion, and violations of the North Carolina Unfair and Deceptive Trade Practices Act ... against WakeMed and Argos."

    U.S. District Judge Louise Flanagan dismissed the lawsuit. Appellate Judges Robert King and Steven Agee, sitting with District Judge Henry Hudson of Virginia, also sided with WakeMed.

    "[T]he district court correctly concluded that Patients failed to allege a lack of mutual assent. Signing a document establishes a manifestation of assent to enter a written contract. ... Patients signed the GCFs, and therefore their argument that they 'never made an objective manifestation of their consent to the terms of the contract' fails," according to the 4th Circuit ruling.

    "Patients further argue that by signing the GCF, they intended to receive emergency services but did not intend to assign their medpay benefits. This argument is a non-starter because assent to a contract is determined by a person's 'outward expressions and excludes all questions in regard to his unexpressed intention.'"

    "Patients claim that WakeMed concealed that they 'were signing away their rights to their Med Pay,' according to the unpublished opinion, "but do not plausibly allege that WakeMed intended to deceive them. In addition, Patients have not alleged that they reasonably relied on this concealment in signing the GCF."

    "Rather, Bertolo and Elrod alleged that if they had known of the AOB, 'they would not have known what to do,' and Janine Palmer said that 'she would have signed anything she was directed to sign,' Further, Patients failed to meet the heightened ... pleading standard that applies to fraud claims because they failed to plead the identity of the individuals who concealed information from them."
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