## FOR PUBLICATION

ATTORNEY S FOR APPELLANT : ATTORNEY S FOR APPELLEE
SOUTHEASTERN INDIANA HEALTH
WILLIAM N. RILEY ORGANIZATION, INC. : JOSEPH N. WILLIAMS Price Waicukauski & Riley, LLC MARK D. GERTH Indianapolis, Indiana NICHOLAS W. LEVI Kightlinger & Gray, LLP Indianapolis , Indiana



## IN THE
COURT OF APPEALS OF INDIANA

COLUMBUS SPECIALTY SURGERY ) CENTER, ) ) Appellant

- Plaintiff

, ) )

vs. ) No. 03A01

- 1406

- PL

- 264 )
SOUTHEASTERN INDIANA HEALTH )
ORGANI Z ATION, INC., ) ) Appellee

- Defendant

, ) )
and ) )
COLUMBUS REGIONAL HEALTH d/b/a ) COLUMBUS REGIONAL HOSPITAL, ) ) Appellee

- Defendant. 1 )

APPEAL FROM THE BARTHOLOMEW SUPERIOR COURT

The H onorable James D. Worton , Judge
Cause No. 03D01

- 1309

- PL

- 4793

1 We note that although Col umbus Specialty Surgery Center does not raise any claim on appeal against Columbus Regional Health, a party below is a party on appeal.2 December 1, 2014

OPINION

- FOR PUBLICATION

BRADFORD , Judge

CASE SUMMARY

On September 3, 2013, Appellant

- Plaintiff the Columbus Specialty Surgery Center,

LLC (“CSSC”) filed a complaint all eging that insurance provider the Southeastern Indiana

Health Organization, Inc. (“SIHO”) committed defamation per se by allegedly informing the

Seymour Community School Corporation (“SCSC”) that CSSC had “ declined ” to participate

in SIHO’s network. The t rial court subsequently dismissed CSSC’s defamation claim against

SIHO without prejudice after determining that CSSC had failed to state a claim upon which

relief can be granted. We affirm.

FACTS AND PROCEDURAL HISTORY

The facts, as presented in CSSC’s co mplaint for damages, are as follows: SIHO was

founded in 1987 to provide comprehensive insurance services and health plan benefits to

businesses. SIHO is privately

- owned by Columbus Regional Hospital, Schneck Medical

Center, Multi County Physicians, and B loomington Hospital and Healthcare System. SIHO

provides claims administration, pre

- certification, case management, concurrent review,

utilization review, member services, benefit consulting, national pharmacy networking, and a

network of hospitals and ph ysicians in one orga nization.

CSSC is an ambulatory surgery center providing a full array of surgical services to

patients residing in the Columbus area. C SSC is physician

- owned. Part of the physician

ownership of CSSC is composed of local Columbus physi cians.3

SCSC uses SIHO as a third

- party benefit administrator. On April 2, 2013, the

employees received a notification from SCSC’s insurance committee that provided as

follows:

[ CSSC ] is an outpatient surgical facility located in Columbus. It is owned b y several Columbus area physicians and has been open since August of last year. Up to this point [CSSC] has declined to participate in the SIHO Network.

When SCSC first moved to SIHO we knew that their network was not quite as large as the Anthem network and we augmented the SIHO network with “wrap” networks. We have been treating providers in these wrap networks a s “in network providers” for benefit purposes. This had very little financial impact on the plan and had the effect of reducing the number of claims that were paid at the out of network benefit level, thereby saving [] you money, while providing a large number of network providers.

Unfortunately, utilizing this practice with [CSSC] has cost the SCSC plan in excess of $100,000 more than it woul d have otherwise spent just since last August.

Therefore effective April 15 th 2013, [CSSC] will be considered an out of network provider for the Seymour Community Schools plan.

IMPORTANT

– WHAT THIS MEANS TO YOU

· For procedures on or after April 15 th at [CSSC] , the facility charges will be paid at the out of network level of benefits. This means the facility charges will be subject to the deductible and the balance paid at 60%.

· The Plan will use the SIHO in

- ne twork amount as the allowable charge. This means that there could be a significant difference between the amount billed by the facility and the amount the plan considers eligible. You could be responsible to pay this entire amount.

· The facility could w rite off all or a portion of this balance amount, but is under no obligation to do so.

· If you choose to use this facility, be certain that you understand the amount you will be responsible to pay before you agree to use this facility

.

· This change only impacts the facility charges , not the physician fees (the doctors involved are members of the SIHO network).

· As these are local doctors, you still have the use of Schneck and Columbus Regional Hospital as in

- network facilities.4

If you have any questions , please contact Brandie Hall at the Administration Building.

Appellant’s App. p. 24 (emphases in original).

On September 3, 2013, CSSC filed a lawsuit against SIHO alleging that SIHO had

defamed CSSC. Specifically, CSSC alleged that the statement that it had decided not to

participate in the SIHO network was not true. In raising this allegation, CSSC claimed that it

had engaged in numerous efforts to be brought into the SIHO network, but that SIHO had

refused that entry. CSSC also alleged that SIHO co mmunicated the information regarding its

alleged unwillingness to participate in the SIHO network to SCSC. CSSC further alleged

that the communication was calculated to harm CSSC’s reputation in its trade, profession,

and business and, as a result, CSSC’s business reputation has been and continues to be

da maged.

On October 24, 2013, SIHO filed a Trial Rule 12(C) motion for judgment on the

pleadings. On this same date, SIHO also filed a brief in support of its motion for judgment

on the pleadings. CSSC f iled its response in opposition to SIHO’s motion for judgment on

the pleadings on November 25, 2013. The trial court conducted a hearing on SIHO’s motion

on February 21, 2014. Four days later, on February 25, 2014, the trial court granted SIHO’s

motion a nd dismissed CSSC’s defamation claim without prejudice.

On March 19, 2014, CSSC filed a motion to correct error. SIHO subsequently filed a

response in opposition to CSSC’s motion to correct error. The trial court scheduled a hearing

on CSSC’s motion for May 12, 2014. On May 15, 2014, the trial court denied CSSC’s5

motion to correct error. This appeal follows.

DISCUSSION AND DECISION

I. Standard of Review

CSSC contends that the trial court erred in dismissing its defamation claim against

SIHO.

A ju dgment on the pleadings pursuant to Ind. Trial Rule 12(C) is proper only when there are no genuine issues of material fact and when the facts shown by the pleadings clearly entitle the moving party to judgment. Wildman
v. National Fire and Marine Ins. Co. , 703 N.E.2d 683, 685 (Ind. Ct. App. 1998). A motion for judgment on the p leadings should be granted only when it is clear from the pleadings that the non

- moving party cannot in any way succeed under the facts and allegations therein. Id

. In reviewing t he grant of a Rule 12(C) motion, we accept as true the well

- pleaded material facts alleged in the pleadings, and our review is confined to information included in the pleadings. Id

. Where

... a motion for judgment on the pleadings raises a defense of
failur e to state a claim upon which relief can be granted, the motion for purposes of that defense should be treated in the same manner as an Ind. Trial Rule 12(B)(6) motion to dismiss for failure to state a claim. Anderson v.
Anderson , 399 N.E.2d 391, 405 (Ind

. Ct. App. 1979). Where no evidence outside the pleadings has been presented, Rule 12(B)(6) motions to dismiss a complaint for failure to state a claim are granted only where it is clear from the face of the complaint that under no circumstances could rel ief be granted.
Culver

- Union Tp. Ambulance Service v. Steindler , 629 N.E.2d 1231, 1235 (Ind. 1994). Similarly, where a Rule 12(C) motion for judgment on the pleadings raises the defense of failure to state a claim, without resort to matters outside the p leadings, judgment on the pleadings is appropriate only under the
same conditions. That is, the motion for judgment on the pleadings should be granted only where it is clear from the face of the complaint that under no circumstances could relief be grante d. Id

. In applying this test, we take as true
all well

- pled material facts alleged in the complaint. Id

. If, on either a Rule 12(B)(6) motion to dismiss or a Rule 12(C) motion for judgment on the pleadings, matters outside the pleadings are presented t o and not excluded by the court, the motion shall be treated as one for summary judgment under Ind.
Trial Rule 56. Ind. Trial Rule 12(b)(6); Ind. Trial Rule 12(C).

Bledsoe v. Fleming , 712 N.E.2d 1067, 1069

- 70 (Ind. Ct. App. 1999) . On the record before6

us, it does not appear that the trial court considered any evidence outside the pleadings in

reaching its decision. Rather, in dismissing CSSC’s defamation claim without prejudice, the

trial court treated SIHO’s motion as a Trial Rule 12(B)(6) motion for failure to state a claim

upon which relief can be granted. As such, we will review the judgment of the trial court as

an order granting a Trial Rule 12(B)(6) motion to dismiss.

II. Whether the Trial Court Erred In Dismissing CSSC’s Defamation Claim Again st SIHO

The law of defamation was created to protect individuals from reputational attacks. Journ al

- Gazette Co., Inc. v. Bandido’s, Inc. , 712 N.E.2d 446, 451 (Ind. 1999). A defamatory communication is defined as one that “‘tends so to harm the reputation of another as to lower him in estimation of the community or to deter a third person from associating or dealing with
him.’” Doe v. Methodist Hosp. , 690 N.E.2d 681, 686 (Ind. 1997) (quoting Restatement (Second) of Torts § 559 (1977)). To prevail on a ca use of action for defamation, a plaintiff must prove four elements: (1) a communication with defamatory imputation, (2) malice, (3) publication, and (4) damages. Hamilton

v. Prewett , 860 N.E.2d 1234, 1243 (Ind

. Ct. App. 2007), trans. denied

. While inter

preting Indiana’ s notice pleading provision in the context of a defamation claim, our Supreme Court has held that even under notice pleading, a plaintiff must still set out the operative facts of the claim. Indeed, hornbook law stresses the necessity of i ncluding the alleged defamatory statement in the complaint. See, e.g. , 53 C.J.S. §§ 128

- 163; 9 Indiana Practice §§ 28.3

- 28.14. There is sound reason for this policy, as the absence of a statement in the complaint works a detriment on
both the court and t he defendant. The court is handicapped without the statement since, without it, the court cannot actually determine if the statement is legally defamatory. [ Bandido’s

, 712 N.E.2d at 457 ]. T he defendant is placed on an unfair footing since the absence of the statement denies her the opportunity to prepare appropriate defenses.... Permitting defamation actions to proceed without the inclusion of the alleged statement would sanction claims brought by individuals who allege nothing more than that someone mu st have said something defamatory about them.... Trail v. Boys and Girls Clubs of Nw. Ind. , 845 N.E.2d 130, 136

- 38 (Ind. 2006).7

Newman v. Jewish Cmty. Ctr. Assn. of Ind pls. , 875 N.E.2d 729, 734

- 35 (Ind. Ct. App. 2007)

(footnote omitted). In Newman , we fu rther concluded that “[c]ontained within the Supreme

Court’s holding [in Trail ] that a plaintiff must identify the alleged defamatory statements in

his complaint is the implication that the plaintiff must also identify the speaker of those

statements.” Id . at 735

- 36.

CSSC alleges that SIHO communicated the information regarding CSSC’s alleged

unwillingness to participate in the SIHO Network to SCSC. Unlike the defendant in

Newman , we observe in the instant matter that CSSC levied its claim against SIHO itself and

not against unnamed representatives o r employees of SIHO. As such, we conclude that

because CSSC specifically alleged that SIHO made the alleged defamatory remarks, CSSC

adequately pled the identity of the speaker of those statements. However , we do not believe

that CSSC adequately pled a defamatory per se statement that was sufficient to set forth a

claim under which CSSC would be entitled to the requested relief.

CSSC alleged that SIHO’s alleged act of providing the above

- mentioned informa tion

to SCSC amounted to defamation per se. “A communication is defamatory per se if it

imputes: (1) criminal conduct; (2) a loathsome disease; (3) misconduct in a person’s trade,

profession, office, or occupation; or (4) sexual misconduct.” Newman , 875 N.E.2d at 739. In

alleging that SIHO committed defamation per se, CSSC claimed that the communication at

issue “is of a kind that tends to damage a reputation in the community and/or discourage

others from dealing or associating with CSSC” and was “calcul ated to harm [CSSC’s]

reputation in its trade, profession and business.” Appellant’s App. p. 21. The statement at8

issue here falls short of the type of statement covered by a claim of defamation per se

because the statement does not impute any misconduct in CSSC’s business or trade. Notably,

a health care provider may have a rational business reason for declining participation in an

insurance provider’s network

, and an unwillingness to participate does not, without more,

indicate any misconduct by the health care provider . Thus, even if the statement that CSSC

decided not to participate in SIHO’s network was false, it is not defamatory per se. As such,

we concl ude that CSSC has failed to state a claim upon which relief can be granted. We

accordingly affirm the trial court’s order dismissing CSSC’s claim against SIHO without

prejudice.

The judgment of the trial court is affirmed.

BARNES, J., and BROWN, J., concur.