USC and Kaiser in legal battle over payment for surgery

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Heart surgeon Dr. Mike Bauer and his team perform open heart surgery on Troy Sanders at St. Vincent Infirmary Medical Center, Feb. 1, 2007, in Little Rock, Ark. (AP Photo/Mike Wintroath)

Heart surgeon Dr. Mike Bauer and his team perform open heart surgery on Troy Sanders at St. Vincent Infirmary Medical Center, Feb. 1, 2007, in Little Rock, Ark. (AP Photo/Mike Wintroath)

LOS ANGELES (CNS) – Two medical giants in Southern California have begun a legal slugfest with each other.

Keck Hospital of USC has sued Kaiser Permanente, accusing California’s largest HMO of sending one of its patients to Keck for open-heart surgery and then refusing to pay the $544,000 hospital bill, the Los Angeles Times reported.

USC contends that Kaiser didn’t disclose that its patient had already exhausted a $75,000 annual cap on insurance benefits when it asked Keck Hospital to perform the October 2013 surgery. Kaiser could have handled the procedure with its own surgeons but opted to transfer the patient to save money, Keck Hospital said in the lawsuit cited by The Times.

Kaiser declined to comment except to insist that USC knew about the limitations of the patient’s insurance, The Times reported.

The battle between the healthcare heavyweights highlights Kaiser’s long- standing practice of using outside hospitals to see some patients who require more specialized care, according to The Times. It also provides a rare glimpse into the sometimes bitter disputes between health insurers and providers that are often handled behind closed doors.

Kaiser is both an insurer collecting premiums from customers and a medical provider treating them at Kaiser-run hospitals and physician offices. In some instances, Kaiser transfers patients to outside facilities for specialty care such as transplants, then covers the costs as any other insurer would.

In this case, Kaiser transferred the patient from the intensive care unit at its Los Angeles Medical Center to Keck Hospital knowing it would not cover the costs, USC said in the lawsuit, filed May 15 in Los Angeles County Superior Court, The Times reported.

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