Abbott v. Banner Health NetworkAnnotate this Case
Patients filed suit to set aside accord and satisfaction agreements and to recover the amounts paid to release liens. Hospitals, health care providers who treated patients injured by third parties, were paid by the Patients' insurer, AHCCCS, which had negotiated reduced rates with the Hospitals. The Hospitals then recorded liens against the Patients pursuant to A.R.S. 33-931 and A.R.S. 36-2903.01(G) for the difference between the amount typically charged for their treatment and the reduced amount paid by AHCCCS. In order to receive their personal injury settlements with the third parties, Patients settled with the Hospitals by paying negotiated amounts to release the liens. At issue is the validity of these accord and satisfaction agreements. The court assumed, without deciding, that Arizona’s lien statutes are preempted by federal law. But, because there was a bona fide dispute about the enforceability of these liens when the Patients and Hospitals entered into settlement agreements to achieve lien releases, the agreements were supported by adequate consideration and addressed a proper subject matter. Therefore, the accord and satisfaction agreements are valid.