By Nancy Peterman, Sherri Morissette, and Suzanne Koenig
Originally published in the ABI Journal, Vol. XXVI, No 6, July/August 2007
It has been almost two years since the enactment of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) and its health care bankruptcy provisions. Both before and after enactment of the provisions, many articles highlighted certain perceived pitfalls and concerns of these new health care bankruptcy provisions, in particular the provisions relating to the appointment of a patient care om-budsman. Two years later, we surveyed the implementation of the patient care ombudsman provisions. Below, we identify the top 10 issues facing the patient care ombudsman two years after BAPCPA’s enactment.
The Appointment of an Ombudsman: Individual or Firm?
Under §333(a)(2)(A) of the Bankruptcy Code,1 the Office of the U.S. Trustee is to appoint one disinterested person to serve as the patient care ombudsman. The statute does not specify whether the disinterested person must be an individual or could be a firm. However, consistent with the appointments of trustees and examiners, the U.S. Trustee’s office has appointed one individual, rather than the individual’s firm, as the ombudsman. In certain orders appointing an ombudsman, the U.S. Trustee has authorized the individual appointed as ombudsman to delegate specific duties to the ombudsman’s firm. Generally, an individual would prefer that his or her firm be appointed as ombudsman for liability reasons. An individual may also need the assistance of others within his or her firm to perform the duties of an ombudsman. The ombudsman has attempted to address both of these issues by limiting an Ombudsman’s liability in orders terminating the ombudsman’s appointment and by hiring professionals. As discussed below, both of these actions have come under attack.