FLORIDA SUPREME COURT DECLARES LEE MEMORIAL HEALTH SYSTEM’S LIEN LAW UNCONSTITUTIONAL.

Lee Memorial Health System v. Progressive Select Insurance Co., 43 Fla. L. Weekly S661 (Fla. December 20, 2018):

The Lee Memorial Health System lien law entitles the hospital to liens for charges for health care services, defines what actions constitute impairment of those liens, and creates a cause of action to recover damages against others for impairment of those liens by others including persons, firms or corporations, who are neither the providers nor the beneficiaries of the health care services at issue.

This lawsuit arose out of a challenge to the law made by Progressive for the impairment of two liens that Lee Memorial had filed based on the provision of medical treatment to an injured person. Lee Memorial alleged that Progressive impaired the liens by settling a claim with the injured person on behalf of Progressive’s insured, without the knowledge or consent of Lee Memorial and without the satisfaction or release of the hospital’s liens.

Progressive argued that the lien law was unconstitutional as a special law, in violation of Article III, § 11(a)(9) of the Florida Constitution. Progressive made other arguments regarding unconstitutionality, but because it did not apprise the attorney general pursuant to rule 1.071, the trial court was barred from considering the issue that could result in the striking of a state statute as unconstitutional.

The court affirmed the Second District’s ruling that the law was unconstitutional under a special law, Article III, § 11(a)(9), but did not consider the other bases (namely Article I, § 10, which violates the constitutional prohibition against the impairment of contracts). Article III, § 11(a)(9) states there should be no special law or general law of local application that pertains to the creation, enforcement, extension or impairment of liens based on private contracts.