Paul's Blog Topic: Medical Malpractice

“No Surprises Act” Lawsuit Raises Fiduciary Duty Questions

Posted on June 6, 2022, byPaul Napoli

The “No Surprises Act,” a federal law passed as part of the Consolidated Appropriations Act of 2021, establishes new federal protections against surprise medical bills, which usually arise when insured patients receive care from out-of-network providers, often without realizing that doing so will trigger additional out-of-pocket expenses. Opponents of the Act have argued that the language in the bill protects insurance companies more than it does consumers. Now, a long-shot lawsuit by a physician is challenging the Act on different grounds, raising questions about medical professionals’ fiduciary duty.

The lawsuit, filed by Dr. Daniel Haller, argues that the Act unfairly disadvantages him because most of the emergency care patients he sees are out-of-network, and the Act limits his ability to charge them for his services. Instead of arguing that the Act will adversely affect patients, he argues that it will adversely affect his ability to provide care by imposing guidelines on his ability to charge his preferred rates for it.

But that raises a question of a doctor’s obligations under the concept of fiduciary duty. In a fiduciary relationship, such as the one between a doctor and a patient, the doctor possesses skill, knowledge, and experience of a subject about which the patient knows little or nothing, leaving the patient wholly dependent upon the doctor’s recommendations. In that relationship the patient’s needs must be paramount: if doctors must lose money to provide adequate care for their patients, it’s their obligation to do so.

Dr. Haller’s lawsuit suggests a point of view in which the doctor’s need to charge his preferred rates are paramount. When a federal judge rules on the lawsuit on June 22, 2022, a finding in favor of Dr. Haller could lead more doctors away from strict adherence to their fiduciary duty. As this blog post discusses, if doctors order fewer tests because they aren’t certain insurance will pay for them, or if they discriminate between patients based on billing considerations, that could lead to an increase in medical malpractice occurrences.

Already, many patients experience medical professionals and hospital chains reducing their standard of care for economic reasons. If your care has been impacted by a doctor, clinic, or hospital making choices based on their bottom line, that is a breach of their fiduciary duty. Speaking to a qualified medical malpractice attorney can be an important first step in determining whether you’re owed damages for the harm caused by that breach.