Falkenberg Ives is pleased to report that the Court of Appeals of Indiana affirmed dismissal of claims against its payer client based on Medicare preemption in the case of Steve Snyder v. Prompt Medical Transportation, Inc.; Humana Insurance Company; and St. Joseph Regional Medical Center, No. 18A-CT-3112.
Plaintiff alleged that the payer caused or contributed to the death of a member by failing to authorize an air ambulance transport for a lung transplant and sought millions in wrongful death damages. We argued that the authorization decision for the air ambulance was necessarily a Medicare coverage decision and, as such, all state law claims relating to such decision were preempted by the Medicare Advantage express preemption provision. The trial court dismissed on Medicare preemption grounds. Plaintiff appealed and the appellate court agreed with our preemption analysis and found that the state law claims were preempted and properly dismissed.
Prior to this decision, there was no Medicare preemption precedent in Indiana. As such, this case can serve as favorable future precedent for Medicare Advantage and Part D plans in both Indiana and elsewhere.
A copy of the opinion can be found at: https://www.in.gov/judiciary/opinions/pdf/07251901jgb.pdf.
Falkenberg Ives is proud to report that the Illinois Appellate Court has affirmed the dismissal of a suit against one of its accountant clients in Mitchell v. Stonecasters et al, 2018 IL App (2d) 180127. The opinion addressed two important aspects of accountants' liability in Illinois: the scope of "accounting activities" for purposes of application of the two-year statute of limitations and the proper accrual date for the statute.
The suit was a claim for negligence against an accounting firm relating to the performance of a business valuation which the plaintiff claimed failed to properly consider prior sales, resulting in a value that was too low. After suit had been filed against the business, the plaintiff claimed that during a deposition is when he first learned that the valuation was too low based on the accountant failing to consider information of which he should have been aware. The plaintiff amended the suit to add the claim against the accountant.
Falkenberg Ives filed a motion to dismiss the complaint under the two-year statute of limitations period governing actions against licensed accountants in Illinois. The motion was granted. The plaintiff appealed, arguing that the work in question was an appraisal and should have been governed by the general five-year statute of limitations. Additionally, the plaintiff argued that even if the two-year statute applied, he did not know of the accountant's negligence until he took the accountant's deposition, and he filed suit within months of the deposition.
On appeal, the court first found that because valuation work is the type of work that can be performed by an accountant, even though it is not specifically included as "accounting activities" under the statute, it is still covered. Valuations involve financial analysis that when performed by licensed accountants have specific standards in the accounting field with which the accountant must comply. The fact that persons other than licensed accountants can also perform valuations was not controlling. Non-accountants can also perform services such as tax preparation. Having found the two-year statute of limitations for actions against accountants applied, the court next agreed with Falkenberg Ives that the plaintiff knew or should have known of a claim at least as of the time when he sued the business, and therefore when he named the accountant more than two years later it was too late. The court confirmed that the statute begins to run when a plaintiff discovers he was injured and that it may have been wrongfully caused, not when the plaintiff becomes aware of specific negligent conduct. The plaintiff had all of the information necessary to start the running of the statute at the time he first filed suit against the business, and when he sued the accountant more than two years later, it was untimely.
A copy of the opinion can be found at: http://illinoiscourts.gov/Opinions/AppellateCourt/2018/2ndDistrict/2180127.pdf.