Bell v. Blue Cross of California

In Bell v. Blue Cross of California, 131 Cal.App.4th 211, 217 (2005), a California appellate court held that an "out-of-network" or non-contracting physician had the right to pursue a common law claim for quantum meruit against a health plan or insurance company.

[T]he health care plans' duty to reimburse arises out of the providers' duty to render services without regard to a patient's insurance status or ability to pay. Because Blue Cross's interpretation of “reimburse” would render illusory the protection the Legislature granted to the providers, the duty to reimburse must be read as a duty to pay a reasonable and customary amount for the services rendered. (Cf. Stevenson v. San Francisco Housing Authority (1994) 24 Cal.App.4th 269, 283 [29 Cal.Rptr.2d 398]; Stoneson Development Corp. v. Superior Court (1987) 197 Cal.App.3d 178, 180 [242 Cal.Rptr. 721].)

Second, Blue Cross's interpretation would mean the emergency care providers could be reimbursed at a confiscatory rate that, aside from being unconscionable, would be unconstitutional. (Cooley v. Superior Court (2002) 29 Cal.4th 228, 252 [127 Cal.Rptr.2d 177, 57 P.3d 654] [a statute should be interpreted to avoid constitutional difficulties]; Cunningham v. Superior Court (1986) 177 Cal.App.3d 336, 348 [222 Cal.Rptr. 854] [a professional cannot be forced to give away a portion of his livelihood]; California Gillnetters Assn. v. Department of Fish & Game (1995) 39 Cal.App.4th 1145, 1156 [46 Cal.Rptr.2d 338].) In short, the statute must be read to require reasonable reimbursement.

Bell v. Blue Cross of Cal., 131 Cal. App. 4th 211, 220, 31 Cal. Rptr. 3d 688, 695 (2005).

Put another way, section 1371.4 of the Knox-Keene Act requires an insurer to reimburse a reasonable sum, not "any amount it chooses, no matter how little," and the reasonableness of that reimbursement can be determined in court. Bell v. Blue Cross of California, 131 Cal. App. 4th 211, 214, 217-18, 222, 31 Cal. Rptr. 3d 688 (2005).