Winninger v. Scott

Background

Mollie Winninger was a beneficiary of Medi-Cal, California’s Medicaid program. She enrolled by telephone in the Kaiser Foundation Health Plan, Inc. Medi-Cal Managed Care Plan, with coverage beginning May 1, 2018. Winninger alleged that Cassius Scott, an obstetrician practicing at the Kaiser Permanente Medical Center in San Rafael, sexually assaulted her during a medical examination in June 2018.

Winninger filed this lawsuit in June 2021. Kaiser Foundation Hospitals and The Permanente Medical Group, Inc., together referred to as Kaiser, moved to compel arbitration, and Scott joined that motion. The defendants argued that the health plan’s member handbook and evidence of coverage contained a mandatory arbitration provision covering Winninger’s claims.

The arbitration provision

The court found that the health plan document contained an arbitration agreement. The provision required binding arbitration for claims related to the member handbook or membership when the claim involved malpractice, delivery of health care services or items, or premises liability; was brought by the member against Kaiser or by Kaiser against the member; and could not be settled in small-claims court. The document stated that “Kaiser” included Kaiser Foundation Hospitals, The Permanente Medical Group, Inc., and its doctors, among others.

Waiver

Winninger argued that the defendants waived arbitration by waiting more than six months to file their motion. The court applied a test requiring her to show that the defendants knew of an existing right to compel arbitration, acted inconsistently with that right, and caused her prejudice through those actions.

The court found no waiver. The defendants had raised the arbitration provision in a September 2021 joint case-management statement and said the motion was delayed while they gathered necessary documents from Winninger and Partnership HealthPlan of California. The court had not decided any motions addressing the merits of the case. Although the parties had conducted discovery, the court noted that the arbitration process allowed similar discovery and found that Winninger had not shown prejudice.

Validity and enforceability

The court held that the arbitration agreement was valid, enforceable, and broad enough to cover the dispute.

Winninger argued that her enrollment did not comply with Section 6470 of Title 10 of the California Code of Regulations, which requires specific arbitration disclosures and a signed and dated agreement for certain health-plan enrollments. The court concluded that Section 6470 applied only to enrollment through Covered California. Because Winninger enrolled by telephone through Partnership HealthPlan of California rather than through Covered California, the court held that Section 6470 did not apply.

The court also ruled that, even if Section 6470 applied, federal law would preempt it to the extent it conflicted with federal requirements for simplified Medicaid enrollment, including enrollment by telephone. The court found that the California disclosure and signature requirements were inconsistent with that federal enrollment process.

Winninger also argued that the arbitration provision was unconscionable, meaning so unfair in its formation or terms that a court should not enforce it. The court found that the provision was not procedurally unconscionable because Medi-Cal and Partnership HealthPlan of California negotiated health-plan options on a system-wide basis, Winninger could choose among available plans, and the arbitration provision was presented in clear language and could be located through the document’s table of contents and headings.

The court also found no substantive unconscionability in the fee provision. It noted that, under the arbitration rules described by Kaiser, Kaiser would pay the neutral arbitrator’s fees and expenses if Winninger agreed to use one neutral arbitrator or waived the right to select a party arbitrator. The court therefore concluded that Winninger could participate in arbitration without paying those arbitrator fees.

Disposition

The court GRANTED Defendants’ motion to compel arbitration. It STAYED the case pending completion of arbitration, directed the parties to file a joint status report 120 days after the order and every 120 days afterward unless otherwise ordered, and required notice to the court within 48 hours after arbitration ended. The Clerk was directed to administratively close the case.