Med mal dispute must go to arbitration: Ohio high court

A medical malpractice claims dispute between an urgent care provider and its insurer must be decided through arbitration rather than litigation, the Ohio Supreme Court ruled Thursday, overturning an appeals court.

The arbitration clause in the insurance policy is broad and covers bad faith claims disputes, the court ruled in U.S. Acute Care Solutions L.L.C. v. Doctors Co. Risk Retention Group Ins. Co.

The underlying claim arose from a 2020 med mal lawsuit filed against USACS. The company submitted the claim to The Doctors Company, but the companies disagreed on a settlement strategy.

In 2022, USACS self-funded a settlement with the claimant to avoid a potential trial verdict that exceeded its insurance policy limit. It then sued TDC seeking to recover the amount it paid to settle the case.

According to the ruling, the policy contained an arbitration clause stating: “Any dispute between [USACS] and [TDC] relating to this Policy (including any disputes regarding [TDC’s] contractual obligations) will be resolved by binding arbitration.”

A trial court ruled that the dispute should be sent to arbitration, but an appeals court ruled that a bad faith insurance claim constitutes a tort and an “extracontractual matter” that is not subject to the arbitration clause.

The Supreme Court disagreed: “USACS has not overcome the presumption of arbitrability in this case, because it has not identified an express exclusion or other forceful evidence that a claim for bad-faith insurance-claim handling falls outside the scope of the arbitration clause in the policy.”

It reinstated the trial court’s judgment compelling arbitration.