Schnader Secures Appellate Victory for MRO Corp.

A Schnader team recently secured an appellate victory for Firm client, MRO Corp. on a question of first impression regarding interpretation of the Pennsylvania Medical Records Act. On August 11, 2011, in Wayne M. Chiurazzi Law Inc. v. MRO Corp., a divided state Superior Court ruled that health care providers can base their charges for providing hard copies of medical records on the maximum charges spelled out in the statute.

Plaintiffs filed a class action lawsuit against MRO, a private company that handles medical record requests for hospitals, alleging that it charged amounts in excess of its actual costs to provide copies of hospital medical records. Allegheny County Common Pleas Court Judge R. Stanton Wettick Jr. declined to dismiss complaint, ruling that charges for medical records under the state Medical Records Act should be based on actual costs, not the maximum charge spelled out in a price schedule in the Act. If it had been affirmed, his ruling raised the possibility that for-profit medical record companies like MRO would be unable to recover profits as part of their prices, thus threatening the continued viability of that industry.

On August 11, 2011, the Superior Court reversed the trial court, stating that “the calculation of estimated actual and reasonable expenses for paper copies is not required by the statute and that the statutory schedule creates safe harbor rates for the estimated actual and reasonable expenses of producing such paper copies.” The three-judge panel was split, with Superior Court Judges Jack A. Panella and Jacqueline O. Shogan ruling in favor of MRO Corp. and Senior Judge Robert E. Colville in dissent for the plaintiffs’ lawyers.

David Smith, John K. Gisleson, and Jennifer A. Callery handled the case in the trial court. Carl A. Solano handled the Superior Court appeal with the assistance of Deena Jo Schneider.

News of the case was covered by The Legal Intelligencer on August 18.