Nassau surgeon's suit against patients' No Surprises Act tossed

A federal court judge Wednesday threw out a Nassau-based surgeon's lawsuit seeking to overturn a federal statute shielding patients from surprise emergency medical bills.

Dr. Daniel Haller, a surgeon with Long Island Surgical PLLC in Rockville Centre, filed the lawsuit Dec. 31. He had argued that elements of the No Surprises Act, signed into law in 2020, were unconstitutional.

The law prohibits hospitals and other providers from billing insured patients for out-of-network services at higher than in-network rates under certain circumstances — for instance, in an emergency, or if a patient scheduled a procedure at an in-network facility but received care from an out-of-network doctor.

In a 26-page decision and order, U.S. District Judge Ann M. Donnelly in the Eastern District denied Haller's motion for a preliminary injunction and granted the federal government its motion to dismiss.

Haller had said in his 18-page complaint that the law “takes the physicians’ property without just compensation by prohibiting physicians from recovering the balance of the fair value of their services from their patients.”

He also contended that the No Surprises Act imposes tougher restrictions than those in a similar New York State law, is unfair to providers and "deprives physicians of the right to a jury trial guaranteed to them by the Seventh Amendment.”

In an emergency, when the patient “has not agreed with the physician on the physician’s fee,” under New York law, the doctor is entitled “to be paid for the services he or she has rendered on the basis of an implied contract with the patient,” Haller argued. 

The court denied the injunction request in part because “the Act does not violate their constitutional rights,” Donnelly wrote in the decision. Haller's arguments, she wrote, were "unpersuasive" and he "cannot show irreparable harm or a likelihood of success on the merits."

The decision said, in part, that to be subject to a court trial, the lawsuit would need to demonstrate "a real, substantial controversy, not a mere hypothetical question.”

Haller and his attorney, Edward A. Smith of White Plains, did not respond to requests for comment Thursday. 

Haller and Long Island Surgical filed the lawsuit against the federal Department of Health and Human Services and other agencies and officials the day before the No Surprises Act took effect Jan. 1.

In April, federal officials argued in a 50-page response to the complaint that the law is constitutional and the suit should be dismissed. Before the No Surprises Act, patients faced “staggering, and sometimes ruinous" charges for out-of-network care, such as a bill for $101,000 sent to a spinal surgery patient, even though the patient had confirmed that her surgeon was in-network, federal officials wrote.

The No Surprises Act received bipartisan support and was signed by President Donald Trump in 2020.

The law has been the target of numerous lawsuits, including five that are still making their way through the federal courts, said Katie Keith, director of the Health Policy and the Law Initiative at Georgetown University Law Center’s O’Neill Institute for National and Global Health Law. 

If Haller's lawsuit had succeeded, the consequences would have been "devastating," she said. New York has a similiar law that protects patients from surprise medical bills, but it does not apply to patients whose employers are self-insured, paying for employees’ medical costs out of their own budgets, she said. 

The federal law "protects the patient from getting those surprise bills, which can be very substantial," said Janine Logan, a spokeswoman for the Hauppauge-based Suburban Hospital Alliance of New York State, which represents hospitals on Long Island and in the Hudson Valley. "We’re glad to see that the law was upheld and that consumer protections prevail." 

With Maura McDermott