Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg
appeal from County Court at Law No. 1 of Cameron County,
Justices Benavides, Hinojosa, and Perkes
GREGORY T. PERKES JUSTICE
contract dispute between an out-of-network medical provider
and a self-insured school district, we previously held that
appellant South Coast Spine & Rehabilitation, PA, (South
Coast) could sue appellee Brownsville Independent School
District (BISD) as an assignee under BISD's Employee
Benefit Plan (Plan). South Coast Spine & Rehab. PA v.
Brownsville Indep. Sch. Dist., No. 13-11-00270-CV, 2014
WL 1789546, at *3-5 (Tex. App.-Corpus Christi-Edinburg Apr.
30, 2014, no pet.) (mem. op.). In doing so, we rejected
BISD's argument that a written contract between BISD and
South Coast was required to waive BISD's immunity under
Chapter 271 of the Texas Local Government Code. See
id. at *3 ("In its plea to the jurisdiction, BISD
asserted that it did not waive its immunity from the breach
of contract action because it never entered into a
contract with South Coast.") (emphasis added). On
remand, the trial court granted BISD's request for a
directed verdict based on the absence of a written contract
between South Coast and BISD. We reverse and remand.
Coast filed suit seeking payment for out-of-network medical
services provided to twenty-seven BISD employees. Before
performing these services, South Coast confirmed with
BISD's third-party administrator, American Administrative
Group (AAG), that each patient was eligible to receive
benefits under the Plan. Each patient executed an
"Assignment of Proceeds, Lien, and Authorization,"
assigning to South Coast the patient's benefits under the
Plan. South Coast submitted claims for these twenty-seven
patients and AAG refused payment, in whole or in part, on all
of the claims. In addition to BISD, South Coast named the
twenty-seven patients as defendants, seeking payment from the
patients to the extent the services were not covered under
the Plan. South Coast's claims sounded in both tort and
answer, BISD made the following admissions:
Defendant BISD provides medical benefits to its employees
pursuant [to] a self-funded employee medical benefits plan.
Such plan is adopted by the Board of Trustees of Brownsville
Independent School District and represents those benefits
provided by [BISD] to its employees. The plan is a detailed
explanation of benefits and limitation of those benefits and
includes but is not limited to, restrictive parameters such
as co-payments, co-insurance, limitation of coverage,
limitation of procedures, preferred provider networks, etc.
Employees are free to select medical providers of their
choosing. When employees select a medical provider, they
assign the benefits provided to them by [BISD] to the medical
provider. The medical provider thereafter treats and bills
the patient at its discretion. BISD's commitment is only
that it pay the provider the employee's assigned benefits
that the employee is entitled to as per the terms and
conditions of its benefit plan.
subsequently filed a plea to the jurisdiction, arguing it was
immune from all of South Coast's claims. BISD also filed
a motion to dismiss the claims against its employees under
the election-of-remedies provisions of the Texas Tort Claims
Act (TTCA). See Tex. Civ. Prac. & Rem. Code Ann.
trial court granted both motions, and we affirmed in part,
and reversed and remanded in part, holding BISD and the
individuals were immune from the tort claims, but not the
contract claims. South Coast, 2014 WL 1789546, at
*3-9. As to the contract claim against BISD, we concluded
that "under section 271.152 of the Texas Local
Government Code, BISD waived its governmental immunity by
entering into contracts to provide its employees with health
insurance." Id. at *3 (citing Tex. Loc.
Gov't Code Ann. § 271.152). We rejected BISD's
argument that there must be a written contract between South
Coast and BISD; instead, we held that South Coast "has a
right to sue as an assignee that was intended under the
employee benefits plan." Id. at *5 (citing
First- Citizens Bank & Trust Co. v. Greater Austin
Area Telecomms. Network, 318 S.W.3d 560, 568 (Tex.
App.-Austin 2010, no pet.)).
remand, a jury trial was commenced. After South Coast rested,
BISD moved for a directed verdict in open court, arguing that
"[b]ecause BISD never agreed, either by agreement or
practice, to enter into a contract with [South Coast], we
believe that that negates the existence of a contract."
The trial court agreed, granting a directed verdict for BISD
because "there was no contract [between BISD and South
Coast]." This appeal ensued.
Standard of Review
trial court grants a directed verdict, we review the evidence
in the light most favorable to the nonmovant and disregard
any contrary evidence. Prudential Ins. Co. of Am. v. Fin.
Review Servs., Inc., 29 S.W.3d 74, 82-83 (Tex. 2000). If
there was "some evidence" to raise an issue of
material fact on the question presented, the directed verdict
was improperly granted. Id. at 83.