Judge certifies class action suit against UR hospitals, contractor

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A federal judge has certified a class action lawsuit claiming patients were overcharged for copies of their medical records in violation of New York state law.

The defendants are the University of Rochester, Strong Memorial Hospital and Highland Hospital — both operated by UR Medicine — and Verisma Systems Inc., which manages UR Medicine’s medical records.

“Defendants have systematically violated New York law by manipulating charges for medical records, and by charging artificially inflated amounts to plaintiffs and other class members,” according to the complaint.

“These artificially inflated amounts exceed the actual cost of producing such records and include built-in kickbacks from Verisma to the health provider defendants and other health care providers in New York,” according to the complaint.

In a 21-page decision issued July 28, Senior U.S. District Court Judge Michael S. Telesca certified the class to include all patients who requested medical records from a health care facility owned or operated by the UR and were charged through Verisma on or after May 14, 2011.

Telesca also certified two subclasses: People who sought and received records from Highland and Strong hospitals on or after May 14, 2011.

According to the complaint, the classes include hundreds of people.

The plaintiffs are seeking actual damages, treble damages, attorneys’ fees and expenses.

The class representative plaintiffs are: Ann McCracken, of Rochester; Joan Farrell, of Avon, Livingston County; Sarah Stilson, of Canandaigua; Kevin McCloskey, of Brockport; Christopher Trapatsos, of Fairport; and Kimberly Bailey, of Shortsville, Ontario County.

“The University makes no profit from the copying of medical records, and does not control what Verisma charges for records. The certification of the class is one step in a lawsuit the University intends to continue to defend vigorously,” Chip Partner, spokesperson for the University of Rochester Medical Center, said in an email.

New York law caps the amount of money that can be charged for copies of medical records at the actual cost to produce the records or 75 cents per page, whichever is less. The suit claims patients are charged the maximum and the profit is split between Verisma and the company’s clients.

“Verisma has reaped most of the economic benefit of their scheme, but the University of Rochester has also received a big indirect economic benefit in the form of free services from Verisma, and that’s what we intend to prove at trial,” said Kathryn Lee Bruns, an attorney with Faraci Lange LLP, the firm Telesca named class counsel.

For example, in 2011 and 2012, McCracken was charged $431.70 for 569 pages of medical records, which was 75 cents per page, plus shipping and handling fees, according to the complaint.

Verisma provided 148 pages of records on paper, printed from electronic files. The other records were provided in electronic format through an online portal.

“We’re in the process of working through an expert analysis of what we believe the actual costs were. At this point we believe it’s at least less than half of 75 cents per page,” Bruns said.

Verisma officials did not immediately respond to a request for comment.