Wake County Hospital System, Inc. v. North Carolina Industrial Commission

PARKER, J. By this action plaintiffs seek to challenge the validity of the schedule of hospital charges approved by defendant Commission in the treatment of compensation cases subject to the provisions of the North Carolina Workmen’s Compensation Act. That Act, in G.S. 97-91, provides: “All questions arising under this article if not settled by agreements of the parties interested therein, with the approval of the Commission, shall be determined by the Commission, except as otherwise herein provided.” Charges of hospitals for hospital and nursing services under [261] the Workmen’s Compensation Act are, by G.S. 97-90(a), expressly made subject to the approval of the Commission. G.S. 97-90(b) provides that any person who receives any fee or other consideration on account of services so rendered, unless such consideration is approved by the Commission, shall be guilty of a misdemeanor. It is, therefore, apparent that plaintiffs’ action presents ‘‘questions arising under” the North Carolina Workmen’s Compensation Act, which, by virtue of G.S. 97-91, “shall be determined by the Commission.” G.S. 97-91 is not limited in its application, as appellants contend, solely to questions arising out of an employer-employee relationship or in the determination of rights asserted by or on behalf of an injured employee. Clark v. Ice Cream Co., 261 N.C. 234, 134 S.E. 2d 354, did not so hold. On the contrary the North Carolina Supreme Court has held in Worley v. Pipes, 229 N.C. 465, 50 S.E. 2d 504, and in Matros v. Owen, 229 N.C. 472, 50 S.E. 2d 509, that the sole remedy of a physician to recover for services rendered to an injured employee in cases where the employee and his employer are subject to the Workmen’s Compensation Act is by application to the Industrial Commission in accordance with the Act, with right of appeal to the courts for review, and that this remedy is exclusive. These decisions are equally applicable to charges for hospital services rendered to employees in Workmen’s Compensation cases. Appellants further contend that, even if it be conceded that their action presents a question arising under the Workmen’s Compensation Act, they are nevertheless entitled to maintain their action because the allegations of their amended complaint establish that plaintiffs have exhausted their administrative remedies before the Commission. We do not agree. In their amended complaint plaintiffs alleged that “review of the North Carolina Industrial Commission rates was requested by the plaintiffs and a hearing was held at which time information was offered and additional information has been provided to the defendants,” and that the Commission “has refused and continues to refuse to make a decision in regard to said rates.” Even accepting these allegations as true, it is apparent from plaintiffs’ amended complaint that they have not sought and been denied Commission approval of any specific charge made by either of them for hospital services rendered in a Workmen’s Compensation cáse. Under the authority of G.S. 97-80(a), the Commission has adopted rules for carrying out the provisions of the Workmen’s Compensation Act. Rule VIII of the Industrial Commission refers to the adoption of fee schedules fixing maximum fees which may be fcharged for medical, surgical, hospital, nursing, dental and other treatment rendered to injured employees coming within the pro [262] visions of the Act. That rule expressly provides that: “Persons who disagree with the allowance of such fees in any case may make application for and obtain a full review of the matter before the Commission as in all other cases provided.” The rule further provides that the fees prescribed shall govern, “except that in special hardship cases where sufficient reason therefor is demonstrated to the Commission, fees in excess of those so published may be allowed.” Plaintiffs’ amended complaint contains no allegation indicating that they have, in this or any other case, followed, much less exhausted, the administrative procedures available to them. “[W]hen the legislature has provided an effective administrative remedy, it is exclusive.” King v. Baldwin, 276 N.C. 316, 172 S.E. 2d 12. For plaintiffs’ failure to exhaust available administrative remedies, defendants’ demurrer was properly sustained. Affirmed. MallaRD, C.J., and Beitt, J., concur.