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Troutman Sanders Helps Save North Carolina Businesses $100M

12.01.17

ATLANTA – A recent appellate court decision, which follows the reasoning of an amicus briefing prepared by Troutman Sanders, promises to save North Carolina businesses an estimated $100 million in insurance claims. In a victory for North Carolina employers, the N.C. Court of Appeals has upheld reimbursement rates adopted by the N.C. Industrial Commission (I.C.) that reduce spiraling charges for the treatment of injured workers by outpatient hospitals.

“We are pleased with the court’s decision and what it means for many North Carolina businesses that may have otherwise been on the hook for higher reimbursement rates,” said Partner Chris Browning, who along with Partner Gavin Parsons authored the amicus briefing. “The decision clearly spoke to the language of the statute and plain language of the word ‘hospital’ and is consistent with the intent of the General Assembly.”

The Nov. 21 decision in Surgical Care Affiliates v. N.C. Industrial Comm’n will save North Carolina businesses approximately $100 million in claims that would have otherwise been asserted by ambulatory surgical centers – who argued they were entitled to a retroactive increase in reimbursement rates based on a trial court’s finding. In reversing the trial court, the N.C. Court of Appeals adopted an argument from the amicus brief Troutman Sanders filed on behalf of 16 business and trade associations, self-insured employers, local government employers and workers compensation carriers, including the North Carolina Retail Merchants Association, N.C. Home Builders Association, N.C. Chamber, N.C. Farm Bureau, N.C. Automobile Dealers Association, N.C. Forestry Association, American Insurance Association and Property Casualty Insurers Association of America.

Although the General Assembly expressly authorized the I.C. to adopt new reimbursement rates for “hospitals” and dispensed with the need for a fiscal note, the trial court concluded that ambulatory surgical centers were not hospitals. The trial court incorrectly relied on a definition of “hospital” in the Hospital Licensure Act that distinguishes between hospitals and ambulatory surgical centers. Agreeing with Troutman Sanders’ briefing, the Court of Appeals concluded that the definition in the Hospital Licensure Act was inapplicable because it is expressly limited to the Act. The common definition of “hospital” includes facilities, such as ambulatory surgical centers, where surgeries are performed. As the Court of Appeals emphasized, “[w]hen a statute employs a term without redefining it, the accepted method of determining the word’s plain meaning is not to look at how other statutes or regulations have used or defined the term – but to simply consult a dictionary.”

“While the case could be taken up by the North Carolina Supreme Court, this is a major win that maintains predictability and protects against increased workers’ compensation costs,” said Gary J. Salamido, Vice President of Government Affairs at the North Carolina Chamber, in an announcement posted to the Chamber’s website.

About Troutman Sanders

With a diverse practice mix, workforce and footprint that includes 16 offices spanning the United States and China, Troutman Sanders has cultivated its reputation for a higher commitment to client care for over 120 years. Ideally positioned to help clients across sectors realize their business goals, the firm’s 650 attorneys transact for growth, resolve mission-threatening disputes and navigate complex legal and regulatory challenges. See troutman.com for more information.

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