JUSTICE GABRIEL delivered the Opinion of the Court.
¶1 These cases require us to examine the interplay between Colorado's hospital lien statute, § 38-27-101, C.R.S. (2020) (the "Lien Statute"), and the federal Medicare Secondary Payer statute, 42 U.S.C. § 1395y (2021) (the "MSP Statute"). Specifically, we must decide whether, under our Lien Statute, a hospital must bill Medicare before it can file a lien against a patient who has been injured in an accident and whose primary health insurance is provided by Medicare.
¶2 The Lien Statute provides that before a lien is created, every duly licensed hospital that treats a person injured through the
¶3 The parties dispute whether when, as here, Medicare is a person's principal source of health coverage, Medicare can be considered a "primary medical payer of benefits" under the Lien Statute (such that a hospital must bill Medicare before asserting a lien), or if such an interpretation is barred by the MSP Statute, which designates Medicare as a "secondary payer." § 1395y(b)(2).
¶4 We now conclude that when Medicare is a patient's primary health insurer, the Lien Statute requires a hospital to bill Medicare for the medical services provided to the patient before asserting a lien against that patient. Such an interpretation is consistent with the language of the Lien Statute, which distinguishes between "the property and casualty insurer," on the one hand, and "the primary medical payer of benefits," on the other, and also reflects our legislature's intent to protect insureds from abusive liens. Moreover, this interpretation yields no conflict between the Lien Statute and the MSP Statute. Hospital liens are governed by state, not federal, law, and merely enforcing our Lien Statute does not make Medicare a primary payer of medical benefits in violation of the MSP Statute.
¶5 Accordingly, we reverse the decisions of the division below in Harvey v. Centura Health Corp., 2020 COA 18M, 490 P.3d 564, and of the district court in Manzanares v. Centura Health Corp., No. 19CV30025 (D. Ct., Pueblo Cnty. July 16, 2019).
I. Facts and Procedural History
¶6 The facts in these two cases are similar and, in pertinent part, undisputed. Peggy Harvey and Eileen Manzanares were injured in separate car accidents when their cars were struck by other drivers. Each was then taken to a Centura-affiliated hospital (along with Centura Health Corporation, "Centura") for treatment. At the time they were treated by Centura, both women's health insurance was solely through Medicare and Medicaid. And both women's injuries resulted in hospital stays, with Harvey incurring $15,611.39 in medical expenses and Manzanares incurring $154,553.25 in such expenses.
¶7 In addition to the above-described health insurance, both Harvey and Manzanares had automobile insurance, Harvey through GEICO and Manzanares through State Farm. These policies included medical payment ("Med Pay") coverage for medical bills incurred as a result of a motor vehicle accident. In addition, the third-party tortfeasors who caused Harvey's and Manzanares's injuries also had automobile insurance.
¶8 Both Harvey and Manzanares advised Centura of all of the available health and automobile insurance policies. Centura then assigned the women's accounts to a collection agency, Avectus Healthcare Solutions, for processing, and Avectus apparently submitted Centura's medical expenses to each of the automobile insurers involved, including the automobile insurers for Harvey, Manzanares, and the third-party tortfeasors. Within two weeks after submitting these charges to the various automobile insurers (and within two months of the women's respective discharges from their hospital stays), Centura filed hospital liens against both of the women. These liens stated that they were in favor of the pertinent hospital
¶9 Both Harvey and Manzanares subsequently brought suit, alleging that Centura had violated the Lien Statute by not billing Medicare for the services provided to the women prior to filing the above-described liens.
¶10 Centura subsequently moved to dismiss both women's claims, the district courts treated Centura's motions as motions for summary judgment, and the courts ultimately granted those motions (the order in Harvey's case was issued approximately eight months earlier than the order in Manzanares's case). In so ruling, the district courts concluded that Centura had no obligation to bill Medicare before filing the liens at issue because (1) the Lien Statute requires only that hospitals bill primary medical payers of benefits if allowed under both state and federal law and (2) although the women's primary health insurer was Medicare, federal law required that Medicare be treated as a secondary payer.
¶11 Harvey appealed, but in a unanimous, published decision, a division of the court of appeals affirmed the district court's judgment in her case. Harvey, ¶ 1, 490 P.3d at 565. In so ruling, the division concluded that Centura did not violate section 38-27-101 because, although Medicare falls within the definition of a "payer of benefits" under that statute, it was not a primary payer of Harvey's benefits. Id. at ¶¶ 16, 27, 490 P.3d at 567, 569. Rather, it was a secondary payer because, in the division's view, under the MSP Statute, Medicare is a secondary payer whenever other insurers (here, the automobile insurers) are responsible for providing primary coverage. Id. at ¶ 20, 490 P.3d at 567-68. Harvey then filed a petition for a writ of certiorari in this court, and we granted that petition.
¶12 While Harvey's case was pending on appeal but before the division had issued its opinion in that case, Manzanares also filed a notice of appeal. After briefing had been completed in Manzanares's appeal, a division of the court of appeals requested certification of that case to this court pursuant to section 13-4-109(1), C.R.S. (2020), and C.A.R. 50, noting that the precise question raised by Manzanares was, by that time, pending before this court in Harvey's case. We granted the division's request and transferred Manzanares's case to this court.
¶13 We now resolve both cases together.
¶14 We begin by setting forth the applicable standards governing our review of motions for summary judgment and statutory construction. Applying those standards here, we conclude that the pertinent language of the Lien Statute is ambiguous, and thus we turn to our other tools of statutory construction. We then conclude that the Lien Statute required Centura to bill Medicare before filing liens against Harvey and Manzanares.
A. Applicable Legal Standards
¶15 We review orders granting motions for summary judgment de novo. Ryser v. Shelter Mut. Ins. Co., 2021 CO 11, ¶ 13, 480 P.3d 1286, 1288. When, as here, the material facts are undisputed, "summary judgment is appropriate only when the pleadings and supporting documents show that the moving party is entitled to judgment as a matter of law." Id., 480 P.3d at 1289.
¶16 We also review issues of statutory interpretation de novo. Id. at ¶ 14, 480 P.3d at 1289. "In construing a statute, our
B. The Lien Statute and the MSP Statute
¶17 The Lien Statute provides, in pertinent part:
§ 38-27-101(1) (emphases added).
¶18 By its plain language, the Lien Statute directs hospitals to bill both the property and casualty insurer and the primary medical payer of benefits. Id.; accord Garcia v. Centura Health Corp., 2020 COA 38, ¶ 15, 490 P.3d 629, 633; Harvey, ¶ 15, 490 P.3d at 567. In addition, the statute requires hospitals to submit the above-described charges only "to the extent permitted by state and federal law." § 38-27-101(1).
¶19 Because both Harvey and Manzanares were Medicare recipients, the MSP Statute also applies in this case and informs our analysis of what is "permitted" under federal law.
¶20 As pertinent here, in a subsection titled, "Medicare secondary payer," the MSP Statute provides:
§ 1395y(b)(2)(A) (emphasis added).
¶21 Subparagraph (B)(i), in turn, states:
¶22 And the Code of Federal Regulations specifies that "[p]rompt or promptly, when used in connection with primary payments,... means payment within 120 days after receipt of the claim." 42 C.F.R. § 411.21 (2021). During this so-called "promptly period," Medicare may not pay the medical expenses at issue if a liability or casualty insurer
¶23 Notably, the MSP Statute does not provide for the creation or filing of hospital liens. Instead, it leaves that question to the states. See U.S. Dep't of Health & Human Servs., Ctrs. For Medicare & Medicaid Servs., Medicare Secondary Payer (MSP) Manual (the "MSP Manual"), ch. 2, § 40.2F (2016) https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/msp105c02.pdf [https://perma.cc/6E59-7QDD] ("The MSP provisions do not create lien rights when those rights do not exist under State law. Where permitted by State law, a provider, physician, or other supplier may file a lien for full charges against a beneficiary's liability settlement.").
¶24 In the cases now before us, Harvey and Manzanares argue that Medicare was the primary medical payer of benefits in their cases and thus Centura could not properly file liens against them without first seeking payment from Medicare, which Centura could do under federal law after the promptly period. Centura, in contrast, asserts that the MSP Statute prohibited treating Medicare as a primary payer and that, therefore, it could not have been a "primary medical payer of benefits" under the Lien Statute. To resolve this dispute, we must determine the meaning of the phrase "primary medical payer of benefits," as that phrase is used in the Lien Statute.
¶25 The Lien Statute does not define this phrase. It does, however, define "payer of benefits" to mean:
§ 38-27-101(9). Centura does not dispute that both Medicare and Medicaid fall within this definition of "payer of benefits."
¶26 The question before us thus turns on the meaning of "primary medical." On this point, divisions of our court of appeals have reached different conclusions.
¶27 In Harvey's case, the division below concluded that, although the above-quoted definition of "payer of benefits" includes Medicare, "under federal law, Medicare is a secondary payer `when another insurer is responsible for providing primary coverage.'" Harvey, ¶¶ 16, 20, 490 P.3d at 567 (quoting Wainscott, ¶ 68, 351 P.3d at 527). Accordingly, the division stated, "Reading section 38-27-101(1) in the context of the MSP provisions, we conclude that the phrase `primary payer' did not require Centura to submit charges to Medicare because—given the existence of other insurance in this case—Medicare is considered a secondary payer under 42 U.S.C. § 1395y(b)(2)." Id. at ¶ 21, 490 P.3d at 568.
¶28 In Garcia, ¶¶ 16, 27, 490 P.3d at 634-35, the division decided otherwise. There, the division opined that "the descriptor `medical' narrows" the list of "payers of benefits" defined in the statute to only medical or health insurers, not liability insurers. Id. at ¶ 15, 490 P.3d at 633-34. The division added, "A patient's `primary' health insurer is, according to common usage, the first or principal health insurer to be billed for medical treatments." Id. at ¶ 16, 490 P.3d at 634. The division therefore concluded that "under the plain language of the statute, when Medicare is the patient's primary health insurer, the General Assembly intended hospitals to bill Medicare before filing a lien against the patient." Id.
¶29 In our view, both of these readings of the statute are reasonable, and therefore the statute is ambiguous. Accordingly, we must look to additional tools of statutory construction, including the Lien Statute's legislative history and the consequences of a given interpretation, to determine the proper meaning of "primary medical." Elder, ¶ 18, 477
¶30 Divisions of our court of appeals had historically understood the Lien Statute as intended "to protect hospitals that provide medical services to an injured person who may not be able to pay but who may later receive compensation for such injuries which includes the cost of the medical services provided." Rose Med. Ctr. v. State Farm Mut. Auto. Ins. Co., 903 P.2d 15, 16 (Colo. App. 1994); accord Wainscott, ¶ 29, 351 P.3d at 520. In 2015, however, Senate President Cadman and House Speaker Hullinghorst introduced a bill "[c]oncerning conditions that must be met before a hospital care lien is created." Ch. 260, sec. 1, § 38-27-101, 2015 Colo. Sess. Laws 981. In introducing this bill to the Senate Finance Committee, Senate President Cadman explained that the bill was intended to prevent hospitals from filing liens against patients before patients or their insurers have been given an opportunity to pay. Hearing on S.B. 15-265 before the S. Fin. Comm., 70th Gen. Assemb., 1st Sess. (Apr. 16, 2015) (statement of Senate President Cadman). Testimony revealed that, at that time, many hospitals had a practice of filing liens instead of billing patients' insurance plans. Id. (statements of Senate President Cadman, Summer Luther, and Mary Galloway). Several individuals described the impact that those liens had had on their lives, their businesses, and their credit. Id. (statements of Daniel Galloway, Mary Galloway, and Robert Shurtleff). Indeed, Senate President Cadman was one such impacted individual, and he told his colleagues about his personal experience facing a lien after his son had been involved in a car accident. Id. (statement of Senate President Cadman). Senate President Cadman stated:
Id. In addition, in presenting the bill to the full senate, Senate President Cadman told his colleagues "how egregious this can be. If you end up in a hospital ... in Colorado, literally before you get the bill and before any [insurance gets] the bill, a lien is filed against you personally." 2nd Reading on S.B. 15-265 before S., 70th Gen. Assemb., 1st Reg. Sess. (Apr. 21, 2015) (statement of Senate President Cadman).
¶31 In the House Judiciary Committee, Chairman Kagan likewise expressed the view that "[i]t shouldn't be legal" for a hospital to file a lien before billing insurance. Hearing on S.B. 15-265 before H. Judiciary Comm., 70th Gen. Assemb., 1st Sess. (Apr. 28, 2015) (statement of Chairman Kagan). He stated, "[W]ith this bill here, it won't be legal. You will not be able to just routinely file a lien. All you have to do to be able to file a lien is bill the insurance company first. Then you can file a lien." Id. "And if there are no insurers, you can file a lien under any circumstances." Id.
¶32 In our view, this history reveals the General Assembly's primary intent to protect accident victims from the aggressive lien practices that some hospitals had employed at that time and tends to support the statutory construction advanced by Harvey and Manzanares in this case. Although the statute continues to protect the right of a hospital to be paid for the care that it provides, the statute also manifestly protects individuals from a "second injury, the lien. That comes with the insult." 2nd Reading on S.B. 15-265 before S., 70th Gen. Assemb., 1st Reg. Sess. (Apr. 21, 2015) (statement of Senate President Cadman).
¶33 Our construction is further supported by the consequences that would result from Centura's proposed interpretation. See Elder, ¶ 18, 477 P.3d at 698 (noting that we consider the consequences that would result from particular constructions of an ambiguous statute). Centura suggests that in cases like these, the Med Pay coverage contained in the applicable automobile insurance policies renders the automobile insurers the primary medical payers of benefits. To draw such a conclusion, however, Centura appears
¶34 For all of these reasons, we conclude that when Medicare is a patient's primary health insurer, the Lien Statute requires a hospital to bill Medicare for the medical services provided to the patient before asserting a lien against that patient.
¶35 For several reasons, we are not persuaded otherwise by Centura's argument that this interpretation is preempted by federal law.
¶36 First, as noted above, the MSP Statute does not govern hospital liens; such liens are matters of state law. Moreover, nothing in the Lien Statute, or in our decision today, requires a hospital to bill Medicare at any point in time. To the contrary, a hospital is always free to forego that option and wait for payment from the liability and casualty insurer, recognizing that doing so presents a risk that the hospital might not be paid by the liability or casualty insurers. Accordingly, we perceive no conflict between the Lien Statute and the MSP Statute.
¶37 Second, Centura correctly observes that, subject to certain exceptions, the MSP Statute prohibits Medicare from paying any hospital bills to the extent that "payment has been made or can reasonably be expected to be made under ... an automobile or liability insurance policy or plan." § 1395y(b)(2)(A)(ii). But under our interpretation, nothing in the Lien Statute requires the hospital to bill Medicare if such payment will be made, or is expected to be made, by the property and casualty insurers. We merely conclude that under the Lien Statute, a hospital must bill any liability and casualty insurers—and thereafter, if the charges remain unpaid and the promptly period has expired, Medicare— before asserting a hospital lien.
¶38 In arguing to the contrary, Centura appears to conflate the terms in the Lien Statute with those in the MSP Statute, as, for example, by equating a "primary payer" under the MSP Statute with a "primary medical payer of benefits" under the Lien Statute. But a "primary payer" under the MSP Statute is not necessarily the same as a "primary medical payer" under the Lien Statute, and nothing in our interpretation changes the fact that under the MSP Statute, the liability or casualty insurer is the primary payer and Medicare is the secondary payer. Again, we decide in this case only who the Lien Statute requires a hospital to bill before the hospital may assert a lien.
¶39 Third, our construction of the Lien Statute in no way conflicts with Congress's purpose in passing the MSP Statute, namely, "to reduce the costs of the Medicare program by making Medicare the secondary payer in certain situations." Smith v. Farmers Ins. Exch., 9 P.3d 335, 338 (Colo. 2000). Under the MSP Statute, if Medicare pays an injured party's medical expenses in circumstances like those present here, then it is subrogated "to any right ... of an individual or any other entity to payment with respect to such item or service under a primary plan." § 1395y(b)(2)(B)(iv). Accordingly, in circumstances like those present here, a hospital would receive, at a minimum, the amount that it is entitled to receive from Medicare, and Medicare could seek to be made whole through its subrogation rights, thus reducing any costs to the Medicare program.
¶41 The out-of-state cases on which Centura relies do not mandate a different result. For the most part, those cases are either inapposite, distinguishable, or compatible with our reasoning. For example, Centura cites Meek-Horton v. Trover Solutions, Inc., 915 F.Supp.2d 486 (S.D.N.Y. 2013), in support of its contention that "[e]very other jurisdiction to consider this issue has concluded that state law
¶42 United States v. Rhode Island Insurers' Insolvency Fund, 80 F.3d 616 (1st Cir. 1996), is likewise inapposite. There, by statute, Rhode Island had created an Insurer's Insolvency Fund (the "Fund") to meet certain types of insurance claims filed against insurers that had become insolvent. Id. at 617-18. The litigation arose when, in paying the claims of certain beneficiaries of insolvent insurers, the Fund deducted the amounts paid to the beneficiaries by Medicare. Id. at 618. The United States sued, challenging those deductions on the ground that the statutory provisions allowing such deductions, which purported to shift primary insurance coverage from the Fund to Medicare, were inconsistent with federal law and were thus preempted. Id. The court agreed, concluding that, by the Rhode Island statute's own terms, the Fund was deemed the insurer to the extent of the obligations under the policy on the covered claims and thus was a "primary plan" under the MSP Statute and its regulation. Id. at 623. Again, the case did not present any question analogous to the one now before us.
¶43 And to the extent that some of the cases cited by Centura tend to support its arguments here, for the reasons set forth above, we disagree with those cases, none of
¶44 Finally, we are unpersuaded by Centura's arguments that (1) section 10-4-641, C.R.S. (2020), regarding Med Pay coverage, suggests the General Assembly's intent to define such coverage as the "primary medical payer of benefits" for purposes of the Lien Statute; and (2) our interpretation of the Lien Statute conflicts with section 10-4-641. Section 10-4-641(1), which appears in the statutes governing property and casualty insurance policies, provides, in part, "Medical payments coverage shall be primary to any health insurance benefit of a person injured in a motor vehicle accident...." As discussed above, in this case, the automobile insurance policies containing Med Pay coverage were primary to health insurance in the sense that Centura was required to bill those insurers before billing any health insurer. Moreover, section 10-4-641 itself recognizes that Med Pay coverage is not health insurance. Id. (distinguishing Med Pay coverage from an injured person's health insurance benefit). Accordingly, Centura's arguments regarding the Med Pay statute do not assist it here.
¶45 For these reasons, we conclude that when Medicare is a patient's primary health insurer, the Lien Statute requires a hospital to bill Medicare for the medical services provided to the patient before asserting a lien against that patient. This interpretation is consistent with the language of the Lien Statute and reflects the legislature's intent to protect insureds from oppressive hospital liens. In addition, this interpretation is consistent with the MSP Statute because hospital liens are governed by state, not federal, law and merely enforcing our Lien Statute does not make Medicare a primary payer of medical benefits in violation of the MSP Statute.
¶46 Accordingly, we reverse the decisions of the division below in Harvey and of the district court in Manzanares, and we remand these cases for further proceedings consistent with this opinion.