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Galindo v. Crozier-Keystone Health System

January 8, 2009

VICTOR GALINDO, A MINOR BY HIS PARENTS AND NATURAL GUARDIANS, BRENDA GOMEZ AND JULIO GALINDO, AND BRENDA GOMEZ AND JULIO GALINDO, IN THEIR OWN RIGHT
v.
CROZIER-KEYSTONE HEALTH SYSTEM; CROZER CHESTER MEDICAL CENTER; DELAWARE VALLEY WOMEN'S HEALTH ASSOCIATES; DREXEL UNIVERSITY COLLEGE OF MEDICINE; HELEN KUROKI, M.D.; EMILY REEVES, M.D.; AND DOLORES TURSE, R.N.



Appeal of: Commonwealth of Pennsylvania, Department of Public Welfare.

Per curiam.

ORDER

NOW, March 10, 2009, it is ordered that the above-captioned Memorandum Opinion, filed January 8, 2009, shall be designated OPINION and shall be REPORTED.

BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge, HONORABLE JOHNNY J. BUTLER, Judge, HONORABLE JAMES R. KELLEY, Senior Judge.

The Department of Public Welfare (Department) appeals from an order of the Court of Common Pleas of Delaware County (trial court) that denied the Department's petition to intervene in a medical malpractice case brought by a minor who had received medical assistance benefits (MA) from the Department. At issue in this case is whether the Department may intervene in a personal injury case in which a minor's parents' claims have been dismissed and, if so, whether the five-year statute of limitations of Section 1409(b)(4) of the Fraud and Abuse Control Act (FACA)*fn1 applies. As these issues have recently been addressed in two decisions of this Court, Jordan v. Western Pennsylvania Hospital, ___ A.2d ___, No. 346 C.D. 2008, 2008 WL 4831303 (Pa. Cmwlth. Nov. 10, 2008), and Shaffer-Doan v. Department of Public Welfare, 960 A.2d 500 (Pa. Cmwlth. 2008), we reverse the trial court's order.

In December 1999, Victor Galindo (V.G.) suffered severe injuries during his birth as a result of alleged medical malpractice by several medical care providers. After his birth, V.G.'s parents applied for, and received, MA benefits from the Department for V.G. It appears, but is not entirely clear, that the Department began making MA payments to V.G.'s parents in December 1999 or early 2000. It is also not entirely clear when the Department first learned that V.G.'s condition was purportedly caused by medical malpractice. Slightly less than eight years after V.G.'s birth, in October 2007, V.G.'s parents filed a medical malpractice action in the trial court on their own behalf and on behalf of V.G. (collectively, Plaintiffs). Counsel for Plaintiffs notified the Department of the pending lawsuit. Thereafter, in February 2008, the Department provided a Statement of Claim Summary (Claim Summary) to Plaintiffs for MA paid, totaling in excess of $160,000.

In April 2008, the Department filed with the trial court a Petition to Intervene in Plaintiffs' medical malpractice case. Defendant medical providers filed a motion for judgment on the pleadings as to the parents' claims, which included claims for medical expenses incurred and to be incurred during V.G.'s minority. The trial court granted this motion on June 2, 2008, dismissing all of the parents' claims. Consequently, the trial court denied the Department's Petition to Intervene on June 6, 2008, relying on Bowmaster v. Clair, 933 A.2d 86 (Pa. Super. 2007), petition for allowance of appeal granted, ___ Pa. ___, 959 A.2d 900, No. 970 MAL 2007 (Oct. 15, 2008), to conclude that the Department's claim was derivative of the parents' claim and, thus, could not be pursued since the parents' claim had been dismissed. The trial court also rejected the Department's argument that Section 1409(b)(5) of FACA does not limit the time period for the Department to intervene in a case. The Department appealed the trial court's decision to this Court.*fn2

On appeal,the Department first argues that Section 1409(b)(1) of FACA, 62 P.S. § 1409(b)(1), gives the Department an independent and non-derivative cause of action against liable third parties for recovery of medical expenses that the Department has paid by MA. Under Section 1409(b)(1), "[w]hen benefits are provided or will be provided to a beneficiary under this section because of an injury for which another person is liable. the department shall have the right to recover from such person. the reasonable value of benefits so provided." The term "eligible person" is defined in FACA as "anyone who lawfully receives or holds a medical assistance eligibility identification card from the department." Section 1401 of FACA, 62 P.S. § 1401.

The trial court in this case relied on Bowmaster to conclude that the parents were the true beneficiaries of MA benefits. In Bowmaster, the Superior Court concluded that since parents bear financial responsibility for a minor's medical expenses, it was the parents, and not the minor, who were beneficiaries of MA benefits paid by the Department for the minor's medical expenses. Bowmaster, 933 A.2d at 90-91. Since the parents' claims were barred because the parents failed to bring them within the applicable statute of limitations, the Superior Court concluded that the Department was necessarily precluded from recovering for the MA benefits paid during the child's minority. Id. at 91. In the present case, consistent with Bowmaster, the trial court concluded that the Department's claim for reimbursement of MA benefits was barred because the parents' claims were barred. Subsequent to the trial court's decision in this case, this Court, in Shaffer-Doan, addressed the same issue as in Bowmaster, but reached a different conclusion.

In Shaffer-Doan, this Court concluded that the Department is permitted to pursue a claim for MA benefits paid during a child's minority, even if the parents have either failed to bring a claim, or if their claim is time-barred:

[W]e conclude that a minor is not prevented from seeking medical expenses incurred while he is a minor, so as to enable [the Department] to recover its lien for monies it has expended, as long as such a claim is not duplicated by the parents....

... [W]e find that as minors are the intended beneficiaries of MA, these provisions of FACA afford [the Department] a means to recover from third-party tortfeasors the amount [the Department] provided.

Shaffer-Doan, 960 A.2d at 516-17 (footnote omitted). While Shaffer-Doan was a declaratory judgment case in this Court's original jurisdiction that did not squarely address the issue of intervention, our decision in Jordan did address the issue.

In Jordan, we applied Shaffer-Doan to vacate a trial court's order that denied the Department's request to intervene in a case. Jordan, ___ A.2d at ___, 2008 WL 4831303, at *1. In doing so, we noted that the trial court erred in not considering the merits of the Department's intervention petition and remanded the matter for the trial court to consider the merits, ...


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