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and Kaiser ordered to pay woman more than $28 million
http://legalstuff.kaiserpapers.org/pdfs/Reporter's Transcript - 12-8-10.pdf
http://legalstuff.kaiserpapers.org/pdfs/Answer to Petition to Compel Arbitration.doc
for additional understanding of the situation:
Hillarie Levy Letter to the Los Angeles Times:
Arbitration to which Mrs Levy references:
The Anna Rahm vs Kaiser case was tried in open court. The Kaiser petition to compel arbitration was successfully resisted by citing violations of health and safety code section 1363.1.
As per our reading of the points and authorities in connection with the petition and the transcript of the oral argument Anna Rahm's
legal representation prevailed by presenting a thorough examination of California Health and Safety code section 1363.1 which does
show Kaiser to be not in compliance of said code.
Read the code here: http://www.leginfo.ca.gov/cgi-bin/displaycode?section=hsc&group=01001-02000&file=1359-1366.6
When reading it please read it slowly and re-read it to have a clear understanding as to what it states. It is somewhat lengthy and should
not be something that is quickly scanned. That statement is made for the readers understanding of the complexity of the code which is
clearly written but in such a manner that assumptions can be incorrectly made with a quick reading.
Synopsis of this to arbitrate or not arbitrate matter. Footnotes are not provided but references are in paragraph citations for the readers ease:
Anna Rahm and her parents received Kaiser insurance through the Police Protective League. They were not individual policyholders
but were part of a group policy.
The key points presented to the court in 2010 by attorney Michael Bidart were:
1. "On three signature documents there are no signatures on the agreements between the -- not the patient but the plan and the
Police Protective League, that are not prominently displayed." See Page 3 Reporter's Transcript of 12-8-10. This is in contradiction
of Health and Safety Code 1363.1.
2. There is no prominent display of the arbitration disclosure.
3. The language is undecipherable according to the Plaintiffs.
4. The legislature in enacting Health and Safety code 1363.1 specifically requires disclosure of notice of arbitration and that the
disclosure be immediately before the signature line. The mandatory disclosure is designed to ensure that the group representative
has knowledge that the agreement he or she is entering into requires binding arbitration and waives the right to a jury trial.
See Page 13, Reporter's Transcript - 12-8-10.
Mr. Bidart present to the court the following:
"What we are dealing with here is a young lady who has now the risk of having her very fundamental constitutional right to a jury trial taken away from her, so let's pause for a moment and think about what type of notice, what type of due process, what type of fairness are we encouraging by allowing a system where, number one, her father, a career LAPD detective who has been enrolled since 1979, paid his premiums in 1979, had arbitration clauses in all of the prior enrollments.
When he enrolled himself, he signed a clause which actually back in 1979 was more prominently displayed than it was as time went on. He signed up. He later married. He added his wife. He later had four children -- 1983,' 85, '89, and then finally our client in this case, Anna, in 1992.
In each of the successive years when he added his children, the arbitration clause got smaller and smaller, less and less legible to the point in time if you look at their own appendix of the exhibits, you will see we are relying on their own documents. It got to the point in time where when the third child was added, you couldn't even read it.
...........in Burks versus Kaiser, of course, the court agreed with us that the disclosure was hopelessly illegible and too small for anybody that is trying to give fair notice of the removal of a constitutional right to a trial by jury.
In this case, the point I am trying to make is by the time Anna comes along, 1992, there are no disclosures at all. There is no arbitration in the disclosure whatsoever in the enrollment form for Anna by 6 1992." See page 5 Reporter's Transcript - 12-8-10.
In 1992, Health and Safety Code 1363.1 had not yet been codified in California. So the Kaiser argument was based only on two letters sent to the employer of her father as the justification for their removing the 7th Amendment constitutional right to a trial by jury from Anna Rahm. Kaiser claimed that even though the Police Protective League did not sign the documents acknowledging the arbitration clause that because they had paid the premiums mandatory arbitration was enforceable.
"The reason 1363.1 exists, have some hope that by complying with the prominence requirements and the position requirement for the signature that people will be given fair notice of the rights that are being taken away from them in the form of a jury trial." See Page 10 of Reporter's Transcript - 12-8-10.
1363.1 requires that in subsection D --
"In any contract or enrollment agreement for a healthcare service plan, the disclosure required by this section shall be immediately before the signature line provided for the representative of the group contracting with the health service plan and immediately before the signature line provided for the individual enrolling in the healthcare service plan. "
"No where does it say, in California Health and Safety Code 1363.1, that you have complied with this section by virtue of paying premiums." See Page 12 of Reporter's Transcript - 12-8-10.
Previous to the Anna Rahm Case the court had already found the same , as presented in Case 2:07-cv-00520-MCE -KJM Document 18 Filed 08/30/07 CHARLES SCHLEGEL, Plaintiff, v KAISER FOUNDATION HEALTH PLAN, INC., a California corporation, KAISER FOUNDATION HOSPITALS, a California corporation; THE PERMANENTE MEDICAL GROUP, INC. Kaiser brought their Motion to Compel Arbitration under the Federal Arbitration Act, 9 U.S.C. § 2 (“FAA”), and under California Health and Safety code 1363.1.
On September 19, 1994, California added § 1363.1 to the Health and Safety Code “due to a concern ‘some health care service plans fail to adequately advise prospective enrollees that terms of the plan restrict or waive the right to a jury trial in medical malpractice cases.’”
Medeiros v. Superior Court, 146 Cal.App.4th 1008, 1017 (2007).
“The plain language of section 1363.1 is clear.” Id. at 1018. A health plan that wishes to impose arbitration on subscribers “must make the mandatory disclosures.” Id. The disclosure requirements of § 1363.1 “are necessary to create an enforceable arbitration provision in a health service plan, regardless of whether the subscriber actually had notice of the term requiring arbitration.” Id. at 1019. (1)
California Health and Safety Code § 1363.1 requires any health care service plan requiring binding arbitration to state “in clear and understandable language,” in a “prominently displayed,” “separate article,” immediately above the signature line, that the enrollee is waiving his or her right to a jury trial, using substantially the wording in subdivision (a) of California Code of Civil Procedure § 1295.
“‘Prominent’ is defined as ‘standing out or . . . readily noticeable.’” Robertson v. Health Net of California, Inc., 132 Cal.App.4th 1419, 1429 (2005). An arbitration provision that “does not stand out and [is] not readily noticeable from” other provisions is not prominently displayed. Malek v. Blue Cross of California, 121 Cal.App.4th 44, 61 (2004). Placing the arbitration clause immediately before the signature line does not by itself fulfill the requirement of prominence. Imbler v. Pacificare of California, Inc., 103 Cal.App.4th 567, 579 (2002). Further, placing the disclosure in a separate article and using bold typeface for the title of the provision do not by themselves fulfill the requirement of prominence. Robertson, 132 Cal.App.4th at 1429.
California Health and Safety Code § 1363.1 applies to all health care consumers, including those who enroll in an employee group plan, and not just individual subscribers. Medeiros, 146 Cal.App.4th at 1017. Non-compliance with § 1363.1 renders an arbitration provision in an enrollment form unenforceable. Malek, 121 Cal.App.4th at 62-63.
Some of the key points raised with this issue are:
1. Apart from the issue of legibility, the arbitration provisions signed by a Plaintiff or their representative must stand out or be readily noticeable from other provisions.
2. California Health and Safety Code § 1363.1 states that it applies to “[a]ny health care service plan.” Plan members that enroll via a form received from an employer are afforded no less protection than those that enroll directly with an insurance company. Medeiros, 146 Cal.App.4th at 1018.
On August 30, 2007, the US Court, Judge Morrison C England, Jr based on the above denied Kaiser's Motion to Compel Arbitration.
Case 2:07-cv-00520-MCE -KJM Document 18 Filed 08/30/07