NEWTON MEDICAL CENTER V. D.B.

Annotate this Case

(NOTE: The status of this decision is Published.)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-5101-15T4

NEWTON MEDICAL CENTER,
APPROVED FOR PUBLICATION
Plaintiff-Respondent,
January 17, 2018
v.
APPELLATE DIVISION

D.B.,

Defendant-Appellant.

_______________________________

Argued October 26, 2017 – Decided January 17, 2018

Before Judges Simonelli, Haas and Rothstadt.

On appeal from Superior Court of New Jersey,
Law Division, Special Civil Part, Warren
County, Docket No. DC-1810-14.

Richard A. Mastro argued the cause for
appellant (Legal Services of Northwest
Jersey, Inc., attorneys; Richard A. Mastro,
on the briefs).

Anthony J. Iler argued the cause for
respondent (The Law Offices of Richard W.
Krieg, LLC, attorneys; Anthony J. Iler and
John T. Grogan, Jr., of counsel and on the
brief).

The opinion of the court was delivered by

ROTHSTADT, J.A.D.

In this appeal, we are asked to determine whether a patient

who requires emergent psychiatric treatment, resulting in his
involuntary commitment to a hospital, should be treated

differently for charity care purposes than a patient who suffers

a physical injury or illness. This issue of first impression

arises from a dispute regarding a hospital's attempt to recover

payment from an indigent mental health patient, who was

involuntarily committed to its facility after being screened by

a psychiatric emergency screening service (PESS), when the

hospital followed the charity care procedures applicable to a

non-emergent admission instead of those applicable to an

admission through the hospital's emergency room. The trial

court determined on summary judgment that the procedures

governing a regular admission applied, and the hospital was

entitled to recover from the patient based on a theory of quasi-

contract. We disagree and reverse.

For the reasons that follow, we hold that when a mental

health patient is admitted to a hospital on an emergent basis

through the referral of a PESS, the provisions of the charity

care regulations dealing with emergency room admissions apply.

The facts giving rise to plaintiff, Newton Medical Center's

claim for payment from defendant, D.B.,1 are undisputed.

Defendant, a diagnosed schizophrenic, was involuntarily

1
We use initials to protect defendant's privacy.

2 A-5101-15T4
committed to plaintiff's short-term care facility (STCF)2 on an

emergent basis after he experienced a psychotic episode and the

Warren County PESS determined that he was a danger to himself

and others. After receiving treatment at plaintiff's STCF from

February 19 to February 28, 2013, defendant accumulated a bill

of $6745.50,3 which he did not pay.

Defendant's reported income in 2013 was well below the

poverty level, making him eligible for uncompensated care under

New Jersey's Charity Care Program, N.J.A.C. 10:52-11.1 to

-11.17.4 Defendant filled out and signed a charity care

application, but was advised that the application could not be

N.J.S.A. 30:4-27.2(bb) defines an STCF as:

[A]n inpatient, community based mental
health treatment facility which provides
acute care and assessment services to a
person with mental illness whose mental
illness causes the person to be dangerous to
self or dangerous to others or property.
A[n STCF] is so designated by the
commissioner and is authorized by the
commissioner to serve persons from a
specified geographic area.
3
Defendant's actual bill totaled $65,639.02, but was reduced
pursuant to
N.J.S.A. 26:2H-12.52 because defendant was
uninsured.
4
The New Jersey Division of Mental Health Services (DMHS)
provides quarterly payments to STCFs throughout the State as a
component of the Charity Care Program. See N.J.A.C. 10:52-13.6.
The quarterly allocation to plaintiff for 2013 was $89,766, a
total of $359,064 for the year.

3 A-5101-15T4
processed because he did not provide all of the requisite

documentation. Due to his condition,5 defendant failed to

provide the documents within the allotted regulatory time

period. Plaintiff billed defendant, and subsequently sent four

letters demanding payment to defendant's mother's address, where

defendant was residing.6 After he defaulted, plaintiff filed

suit for recovery of the unpaid bill.

Before trial, the parties filed cross-motions for summary

judgment. Defendant argued that plaintiff's claim was barred by

the payments it received from the DMHS. He contended that the

express contract between the State and plaintiff barred

plaintiff from recovering from him on a theory of unjust

enrichment because plaintiff could not have expected

remuneration from defendant. Defendant also asserted that

plaintiff could not recover because it failed to follow the

charity care application provisions of N.J.A.C. 10:52-11.16,

which governs emergency admissions. Plaintiff opposed

defendant's motion, arguing that N.J.A.C. 10:52-11.16 was only

applicable to patients admitted through the emergency room, and

5
Defendant certified that his "schizoaffective disorder" made
"it difficult or impossible for [him] to attend to average,
every-day tasks[.]"
6
In his certification, defendant stated that he was unaware of
any demands for payment by plaintiff, and that his mother
handled the household mail.

4 A-5101-15T4
that the provisions governing regular admission were properly

followed in defendant's case. In its cross-motion, plaintiff

maintained that because the facts were undisputed and defendant

presented no valid defenses, it was entitled to judgment as a

matter of law.

Upon considering their submissions, the motion judge denied

defendant's motion and granted plaintiff's cross-motion. As a

threshold matter, the judge found that a quasi-contract existed

between plaintiff and defendant, which entitled plaintiff to

recover for the services it provided. Relying on the plain

meaning of the regulations, the judge rejected defendant's

argument that he should be afforded the benefit of the same

"stringent" regulations applied to charity care applicants

admitted to a hospital through its emergency room for treatment

of physical injuries or illnesses. In his written statement of

reasons, the judge noted "defendant . . . provided no evidence

that he was admitted through an emergency room[,]" which

relieved plaintiff of the screening requirements found in

N.J.A.C. 10:52-11.16. The judge entered orders on March 10,

20167 denying defendant's motion and granting plaintiff's cross-

motion.

7
Due to a clerical error, the order denying defendant's motion
was incorrectly dated April 10, 2016.
(continued)

5 A-5101-15T4
Defendant moved for reconsideration of the motion judge's

grant of summary judgment in favor of plaintiff and denial of

his motion for summary judgment. The judge entered an order

denying reconsideration on July 6, 2016.8 In his written

statement of reasons, the judge again explained:

The more stringent emergency room charity
care regulations apply only "[i]f a charity
care applicant is admitted through the
hospital's emergency room." [N.J.A.C.]
10:52-11.16. The plain language of the
regulation requires an admission through the
hospital's emergency room, in this case
[plaintiff’s]. It does not apply to [a]
transfer from an emergency screening service
or even from another hospital's emergency
room.

Defendant's appeal from the motion judge's grant of summary

judgment and denial of reconsideration followed.9

We review a trial court's order granting summary judgment

de novo, applying the same standard as the trial court. Conley

v. Guerrero,
228 N.J. 339, 346 (2017). That standard commands

that summary judgment be entered "if the pleadings, depositions,

(continued)
8
The order was incorrectly dated June 6, 2016.
9
Defendant does not indicate in his notice of appeal or case
information statement (CIS) that he is appealing from the denial
of his motion for summary judgment. However, he does indicate
in his CIS that he is appealing from the denial of his motion
for reconsideration, in which he asked the motion judge to
reconsider his denial of summary judgment.

6 A-5101-15T4
answers to interrogatories and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as

to any material fact challenged and that the moving party is

entitled to a judgment or order as a matter of law." R. 4:46-

2(c). When no issue of fact exists, and only a question of law

remains, we afford no special deference to the legal

determinations of the trial court. Manalapan Realty, L.P. v.

Twp. Comm. of Manalapan,
140 N.J. 366, 378 (1995). Because

there is no genuine issue of material fact before us, we review

de novo the trial court's conclusion that the provisions of

N.J.A.C. 10:52-11.16 did not apply to defendant's situation.

Defendant urges that we should reverse the motion judge's

entry of summary judgment in favor of plaintiff because his

emergent and involuntary commitment to an STCF, by statute, must

be made exclusively through a PESS, which "is the gateway for

entry to [an] STCF." He asserts that a PESS "deal[s] with

emergencies of a psychiatric nature[,]" while "[e]mergency rooms

deal with emergent matters of physical illness." Therefore,

defendant contends that admission to an STCF through a PESS is

equivalent to an emergency room admission. We agree.

We begin our analysis by recognizing that this case

requires us to interpret the charity care regulations. In our

review, we are guided by the following principles. "In

7 A-5101-15T4
interpreting regulations, we take the same approach we do in

construing statutes." In re N.J. State Funeral Dirs. Ass'n,
427 N.J. Super. 268, 273 (App. Div. 2012) (citing U.S. Bank, N.A. v.

Hough,
210 N.J. 187, 198-99 (2012)). "Determining the intent of

the drafter is our paramount goal. Generally, the drafter's

intent is found in the actual language of the enactment."

Hough,
210 N.J. at 199 (citations omitted). However, "[w]here

there is ambiguity, or where a literal reading would lead to an

absurd result, a court informs its interpretation with evidence

of the meaning the drafter has assigned. In the case of

regulations, that intent may be evidenced in the record of the

rulemaking process." In re N.J. State Funeral Dirs. Ass'n,
427 N.J. Super. at 274 (citations omitted).10

Hospitals in the State of New Jersey have a statutory duty

to provide care to anyone seeking treatment regardless of their

ability to pay.
N.J.S.A. 26:2H-18.64. To assist hospitals with

10
We observe that we, like the motion judge, do not have the
benefit of any input from the state agencies involved in
promulgating the charity care regulations. See, e.g., Hough,

210 N.J. at 199-200. If provided, we would have "give[n]
considerable weight to [their] interpretation of [the] statutory
scheme that the legislature . . . entrusted [them] to
administer[,]" and would have "defer[red] to [their]
interpretation of both [the] statute and implementing
regulation, within the sphere of [their] authority, unless the
interpretation [was] 'plainly unreasonable.'" In re Election
Law Enf't Comm'n Advisory Op. No. 01-2008,
201 N.J. 254, 262
(2010) (citations omitted).

8 A-5101-15T4
this effort, the Legislature authorized the Department of Human

Services,11 in conjunction with the Department of Health and

Senior Services (collectively, the Departments), to create the

New Jersey Charity Care Program. See
N.J.S.A. 30:4D-7.

Patients "determined to be eligible for charity care" will not

be billed "or be subject to collection procedures [and those]

determined to be eligible for reduced charge charity care [will]

not be billed or subject to collection procedures for the

portion of the bill that is reduced charge charity care."

N.J.A.C. 10:52-11.14.

Under the charity care regulatory scheme, a hospital

patient "or [a] responsible party may submit a completed

application for a hospital to make a determination for charity

care or reduced charge charity care at any time up to one year

from the date of outpatient service or inpatient discharge."
12 N.J.A.C. 10:52-11.13(b). A hospital then has "two years after

the date of patient discharge (inpatient) or date of service

(outpatient)" to submit a "clean charity care claim[,]" N.J.A.C.

11
More specifically, the Division of Medical Assistance and
Health Services.
12
"At the hospital's discretion, the hospital may [also]
accept a completed application within two years of the date of
service (outpatient) or date of discharge (inpatient)."
N.J.A.C. 10:52-11.13(b).

9 A-5101-15T4
10:52-12.1, in order for the claim to be documented and

considered in the Department of Health and Senior Service's

funding formula. See N.J.A.C. 10:52-13.4.

The charity care regulations relating to a patient's

application for financial assistance distinguish between

patients admitted to a hospital "through the hospital's

emergency room" and all other patient admissions. N.J.A.C.

10:52-11.4; compare N.J.A.C. 10:52-11.16 (providing procedure

governing charity care eligible patients admitted to a hospital

through the emergency room) with N.J.A.C. 10:52-11.5 to -11.10

(providing procedure governing charity care eligible patients

admitted to the hospital through regular admission). For

patients admitted through the emergency room, the onus is on the

hospital to secure the required information to process the

application. N.J.A.C. 10:52-11.16(h) provides:

[T]he hospital shall make the following
efforts to determine whether the applicant
is eligible for charity care. The hospital
shall:

(1) Make at least two attempts to
contact the patient by phone . . . to
try to schedule an in-person interview
to obtain information relevant to the
application. If such an interview can
be arranged, the hospital shall obtain
the relevant information and process
the application based on that
information. . . .;

10 A-5101-15T4
(2) Visit the address given by the
applicant, or otherwise obtained, and
attempt to verify that the applicant
lives there. . . . If the hospital is
able to achieve direct contact with the
applicant, the hospital shall try to
conduct or schedule an in-person
interview to obtain information
relevant to the application. If such
an interview can be arranged, the
hospital shall obtain the relevant
information and process the application
based on that information. . . .; and

(3) Attempt to determine the
applicant's income and assets, that
shall include observing the nature of
the applicant's housing, to determine
that there are no indications that the
applicant would not likely be eligible
for charity care, and obtaining
information from persons at the
applicant's address or from neighbors
regarding the applicant's employment or
other means of support. . . .

These procedures are in contrast to those applied to

patients admitted to a hospital through regular admission.

Those regulations provide that the patient is the one ultimately

responsible for completing his or her charity care application

and supplying the requisite documentation. See N.J.A.C. 10:52-

11.6 (requiring applicants to provide proper identification);

N.J.A.C. 10:52-11.7 (requiring applicants to provide "proof of

New Jersey residency"); N.J.A.C. 10:52-11.8 to -11.9 (requiring

applicants to provide documentation regarding their income);

11 A-5101-15T
4 N.J.A.C. 10:52-11.10 (requiring applicants to provide proof of

their assets).

Further, because "[t]he Charity Care Program [is] the payer

of last resort," patients are generally not eligible for charity

care unless they are ineligible for any other medical assistance

programs. See N.J.A.C. 10:52-11.5(k). The regulations

concerning regular admissions impose a three-month window for

uninsured patients who have made no payments at the time of

service to complete a medical assistance application, otherwise

the hospital "[m]ay bill the applicant, consistent with the

manner applied to other patients[.]"13 N.J.A.C. 10:52-

11.5(d)(1)(i). No similar obligation or timeframe exists for

patients admitted through the emergency room, as the hospital is

responsible for "correctly assess[ing] . . . the applicant's

eligibility for charity care," which includes "verify[ing] that

the applicant is not enrolled in a medical assistance program."

See N.J.A.C. 10:52-11.16(b) and (f).

Despite the regulations' distinction between emergency room

admissions and regular, planned admissions, the term "emergency

13
It is unclear from the record before us whether plaintiff
"refer[red defendant] to the appropriate medical assistance
program" as it was required to do, or if defendant "declined to
be screened for medical assistance[.]" See N.J.A.C. 10:52-
11.5(d). Regardless, our decision today is made on other
grounds.

12 A-5101-15T4
room" is not defined in the regulatory scheme. See N.J.A.C.

10:52-11.1 to -11.17.

The history of the charity care regulations provides

insight into the distinction. By distinguishing emergency room

admissions from regular admissions, the Departments were

concerned with a "patient's medical condition . . . prevent[ing

the hospital from] obtaining even basic eligibility-related

information at the time of admission, or at any time [before and

after] discharge."
32 N.J.R. 1123(a) (Apr. 3, 2000). According

to the Departments, "there are circumstances in which hospitals

cannot obtain the required documentation. One such

situation . . . involves patients who are admitted through the

hospital's emergency room." Ibid. The Departments explicitly

stated that "[t]he purpose of the eased documentation

requirements is to permit hospitals to establish charity care

eligibility in reasonably reliable fashion under difficult

circumstances, that is, when a patient is admitted through an

emergency room."
32 N.J.R. 2615(a) (July 17, 2000).

The Departments expressed their understanding that patients

in emergent situations may have trouble providing the requisite

documentation to receive uncompensated care. See ibid. They

explained:

Documentation requirements are eased . . .
for patients admitted through the emergency

13 A-5101-15T4
room, in recognition of the fact that it is
difficult to document charity care
eligibility in such circumstances. In
other, less emergent circumstances, patients
can and should provide the more stringent
documentation required by the existing
rules.

[Ibid.]

The Departments also recognized the possibility of an issue

"when a patient admitted through one hospital's emergency room

is subsequently transferred to, and admitted at, a second

hospital. [Therefore, the rules were] amended . . . to permit a

hospital admitting such a transferred patient to rely upon the

charity care determination of the transferring hospital in these

circumstances." Ibid.

Here, because of the absence of a definition of "emergency

room," the literal terms of the regulations could be interpreted

as requiring defendant to have applied for charity care as a

regular admission, despite his need for emergent treatment, just

because he was not admitted through an emergency room located in

a hospital, and even though his condition prevented him from

completing his application within the regulatory time period.

However, we do not view the use of the term "emergency room" as

imposing a requirement that involuntarily committed mental

health patients, who are admitted on an emergent basis through a

PESS, must pass through an actual hospital emergency room in

14 A-5101-15T4
order to trigger N.J.A.C. 10:52-11.16's procedures. Such a

reading would be completely contrary to the regulations' clear

purpose that individuals in emergent situations should be

relieved of the obligation to produce the necessary materials

and information and instead be properly screened for charity

care eligibility by the hospital.

The entry point for patients involuntarily committed to

STCFs is the PESS, rather than the emergency room attached to a

hospital. See N.J.A.C. 10:37G-1.2 ("All admissions to [STCFs]

must be referred through a designated emergency/screening mental

health service."). Notably, in a prior decision, we refused to

adopt an interpretation of the involuntary psychiatric

commitment law,
N.J.S.A. 30:4-27.1 to -27.23, to require PESS

units to operate out of the physical location of a hospital or

its emergency room. See Warren Hosp. v. Dep't of Human Servs.,

Div. of Mental Health Servs.,
407 N.J. Super. 598, 602, 616

(App. Div. 2009). In Warren Hospital, we recognized that "[a]s

the entry point, screening services were intended to provide

'accessible crisis intervention, evaluation and referral

services to mentally ill persons in the community' and

'alternatives to inpatient care . . . and when necessary, to

provide a means for involuntary commitment.'" Id. at 612

(second alteration in original) (quoting
N.J.S.A. 30:4-27.1(d)).

15 A-5101-15T4
We noted, "screening services and STCFs are designed to 'lessen

inappropriate hospitalization and reliance on psychiatric

institutions,' and afford the opportunity for treatment in the

least restrictive setting." Ibid. (citation omitted).

Regardless of the screening service’s location, a patient

referred to an STCF by a PESS faces similar emergent

circumstances as a patient admitted through the emergency room,

as a PESS deals with emergencies of a psychiatric nature. See

id. at 614 ("[T]he definition of a '[s]creening service' [is] an

'ambulatory care service' that provides 'mental health

assessment, emergency and referral services to persons with

mental illness[.]'" (second alteration in original) (quoting

N.J.S.A. 30:4-27.2(z)). In both situations, the hospital may be

unable to obtain "even basic eligibility-related information"

from the patient due to their physical or psychiatric impairment

at the time of admission and after discharge.
32 N.J.R.
1123(a).

Consistent with the Departments' intent, we hold that the

term "emergency room" within the meaning of the regulations

encompass a category of emergent admissions that incorporates

emergent transfers to STCFs from a PESS. We recognize that the

Departments rejected having the "requirements for patients

admitted through the emergency room be extended to patients

16 A-5101-15T4
admitted under all circumstances" because it wanted "to protect

the integrity of the charity care program."
32 N.J.R. 2615(a).

However, our interpretation today does not extend to all

patients, only those involuntarily committed on an emergent

basis after being assessed by an emergency screening service.

We do not believe that our reading of the regulations

compromises the integrity of the program. Rather, it assures

that a whole category of patients, specifically those

involuntarily committed due to emergent psychiatric issues, are

not excluded from the protections offered by N.J.A.C. 10:52-

11.16.

Accordingly, we conclude that consistent with N.J.A.C.

10:52-11.16, plaintiff was required to contact defendant by

phone at least twice, and schedule an in-person interview or

send a social worker to his address in order to obtain the

necessary information to process his charity care application.

See N.J.A.C. 10:52-11.16(h). Because plaintiff failed to do so,

it is barred from recovering from defendant. See, e.g., Hosp.

Ctr. at Orange v. Cook,
177 N.J. Super. 289, 303 (App. Div.

1981)14; see also N.J.A.C. 10:52-11.14.

14
In Cook, we considered whether "a medically indigent patient
who is sued by a hospital for recovery of its unpaid bill for
services may plead as a defense to the action the hospital's
noncompliance with its obligations under the Hill-Burton Act [42
(continued)

17 A-5101-15T4
The judgment of the trial court is reversed and the matter

is remanded for the entry of orders granting defendant's motions

for summary judgment and reconsideration, denying plaintiff's

cross-motion, and dismissing the complaint with prejudice. We

do not retain jurisdiction.

(continued)
U.S.C. §§ 291-291o-1; see also 42 U.S.C. §§ 300o-300t]." Cook,

177 N.J. Super. at 291. We answered that question in the
affirmative, holding that "the effect of the [h]ospital's
noncompliance . . . on its right to collect its bill . . . .
precludes it from so doing." Id. at 303. Although in Cook, we
dealt specifically with the plaintiff hospital's noncompliance
with the notice procedures in the Hill-Burton Act, we discern no
reason not to apply the same logic to the case at hand.

18 A-5101-15T4

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