On Appeal from the 190th District Court Harris County, Texas Trial Court Cause No. 2019-10294 MAJORITY OPINION Appellee ACS Primary Care Physicians Southwest, P.A. (“ACS”) sued appellants Community Health Choice, Inc. and Community Health Choice Texas, Inc. (together, “Community Health”), for violations of the Texas Insurance Code, quantum meruit, breach of an implied-in-fact contract, and unjust enrichment. Specifically, ACS alleged that Community Health underpaid ACS for medical services provided by its doctors. Community Health filed a plea to the jurisdiction asserting it was immune as to ACS’s statutory tort claims. The trial court denied the plea and Community Health filed this interlocutory appeal. See Tex. Civ. Prac. & Rem. Code Ann. §§ 51.014(a)(8), 101.001. For the reasons below, we affirm the denial of Community Health’s plea to the jurisdiction. BACKGROUND Harris County Hospital District d/b/a Harris Health System (“Harris Health”) was created to “furnish medical aid and hospital care to indigent and needy persons residing in the district.” See Tex. Health & Safety Code Ann. § 281.002. Harris Health, in turn, created Community Health as a charitable organization to “facilitate the management of a district health care program by providing or arranging health care services, developing resources for health care services, or providing ancillary support services for the district.” See id. § 281.0565(b). Community Health is licensed as a health maintenance organization (“HMO”) by the Texas Department of Insurance. In 2014, Community Health entered the Federal Health Insurance Marketplace program and began providing health insurance plans pursuant to the Affordable Care Act. See Tex. Ins. Code Ann. § 1271.004(b) (“[a] health maintenance organization may provide an individual health care plan”). ACS is a Texas corporation that provides physician staffing to hospitals with emergency departments in the greater Houston area. According to ACS, in this role it provides emergency services to all patients regardless of insurance coverage or ability to pay — including patients with health insurance issued or underwritten by Community Health. ACS sued Community Health in February 2019, alleging that Community Health had underpaid ACS for medical services it rendered to members of Community Health’s insurance plans. Contending that Texas law requires HMOs to reimburse health care providers “at the usual and customary rate,” ACS alleged that Community Health “reimburs[ed] ACS at amounts far below the usual and customary rate for more than 16,000 individual healthcare claims.” Community Health filed a plea to the jurisdiction challenging all ACS’s claims on the basis of lack of standing. The trial court granted the plea as to ACS’s claim premised on section 1271.155 of the Texas Insurance Code and denied the plea as to ACS’s other claims. See Tex. Ins. Code Ann. § 1271.155(a) (an HMO “shall pay for emergency care performed by non-network physicians or providers at the usual and customary rate or at an agreed rate”). Community Health filed a second plea to the jurisdiction, asserting that immunity barred ACS’s claim based on section 541.060 of the Texas Insurance Code. See id. § 541.060 (unfair settlement practices). ACS filed a response and the trial court held a hearing on the plea. On September 10, 2021, the trial court signed an order denying Community Health’s second plea. Community Health filed this interlocutory appeal. ANALYSIS We begin by addressing our jurisdiction over this appeal.[1] I. Appellate Jurisdiction Our appellate jurisdiction generally is confined to appeals of final judgments. Rusk State Hosp. v. Black, 392 S.W.3d 88, 92 (Tex. 2012). However, the Legislature has specified circumstances in which a litigant may immediately appeal from an order that would otherwise be unappealable because a final judgment has not been rendered in the matter. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a); see also Cherokee Water Co. v. Ross, 698 S.W.2d 363, 365 (Tex. 1985) (orig. proceeding) (per curiam) (“Unless there is a statute specifically authorizing an interlocutory appeal, the Texas appellate courts have jurisdiction only over final judgments.”). Community Health relies on one of these provisions, which permits a litigant to appeal from a trial court’s interlocutory order that “grants or denies a plea to the jurisdiction by a governmental unit as that term is defined in [Texas Civil Practice and Remedies Code] Section 101.001.” See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8). Section 101.001 delineates the types of agencies, subdivisions, and organizations that may be considered a “governmental unit.” See id. § 101.001(3); see also Rosenberg Dev. Corp. v. Imperial Performing Arts, Inc., 571 S.W.3d 738, 747-48 (Tex. 2019) (“Rosenberg II“) (describing this definition of “governmental unit” as “broad[]“). This definition does not explicitly include a “charitable organization” like Community Health. But our statutory inquiry does not end there because “[a] charitable organization created by a district under this section is a unit of local government only for purposes of Chapter 101, Civil Practice and Remedies Code.” See Tex. Health & Safety Code Ann. § 281.0565(c) (emphasis added). Examining similar statutory language governing economic development corporations,[2] the Texas Supreme Court reasoned: Because the Legislature expressly expanded section 101.001′s governmental-unit definition to include economic development corporations, [appellant] is a governmental unit for purposes of the interlocutory appeal authorized by section 51.014(a)(8). Rosenberg II, 571 S.W.3d at 748. Guided by this holding, we also conclude that the Legislature expressly expanded section 101.001′s governmental-unit definition to include charitable organizations like Community Health. See Tex. Health & Safety Code Ann. § 281.0565(c); see also Rosenberg II, 571 S.W.3d at 748. Therefore, Community Health is a governmental unit for purposes of the interlocutory appeal permitted by section 51.014(a)(8), and we may exercise our jurisdiction over this appeal. See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8); see also Rosenberg II, 571 S.W.3d at 748. II. ACS’s Motion to Dismiss While the appeal was pending, ACS filed a motion to dismiss. Citing a recent decision from the Texas Supreme Court, ACS requested that we dismiss the appeal as moot because it “no longer has a cognizable claim against Community Health under section 541.060.” See Tex. Med. Res., LLP v. Molina Healthcare of Tex., Inc., 659 S.W.3d 424 (Tex. 2023). In Texas Medical Resources, LLP, emergency-medicine doctors sued an insurer, alleging that the insurer did not pay the doctors at the usual and customary rates for treating its insureds. Id. at 427. In this context, the supreme court examined whether the doctors could bring a claim for unfair settlement practices under chapter 541 of the Texas Insurance Code. See id. at 437-48. The Supreme Court focused on the language in section 541.060(a), which states that “[i]t is an unfair method of competition or an unfair or deceptive act or practice in the business of insurance to engage in the following unfair settlement practices with respect to a claim by an insured or beneficiary . . . .” Id. at 437 (quoting Tex. Ins. Code Ann. § 541.060(a)) (emphasis in original). Reasoning that the doctors were “neither insureds nor beneficiaries,” the supreme court concluded that the doctors could not pursue their section 541.060 claims for unfair settlement practices. Id. at 438. Relying on Texas Medical Resources, LLP, ACS asserts that this interlocutory appeal is moot because ACS is not “an insured or beneficiary” as necessary to pursue its section 541.060 claims against Community Health. In response, Community Health asserts that the issues raised in its interlocutory appeal are not moot. Because we conclude that the requirements necessary to assert a section 541.060 claim fall outside the scope of this interlocutory appeal, we deny ACS’s motion to dismiss. In Texas Medical Resources, LLP, the supreme court noted that the issues it addressed (including its conclusion that section 541.060 claims are limited to “insured or beneficiaries”) were each “a pure issue of law pertaining to the merits that should have been raised in the trial court by traditional motion for summary judgment or under Rule 91a — not in a plea to the jurisdiction.” Id. at 441. Continuing on, the Court held that “the satisfaction of a statutory or common-law prerequisite to a plaintiff’s filing suit or recovering on a claim is not an issue of standing but of merits.” Id. (emphasis added); see also Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 91 (1998) (“the failure of a cause of action does not automatically produce a failure of jurisdiction”). The court explained that it reached these issues only because “both parties agree that we can render a decision on the merits.” Tex. Med. Res., LLP, 659 S.W.3d at 441. Here, because this is an interlocutory appeal from the denial of Community Health’s plea to the jurisdiction, our appellate jurisdiction is limited to issues of subject matter jurisdiction. See, e.g., Houston Indep. Sch. Dist. v. 1615 Corp., 217 S.W.3d 631, 635 (Tex. App.—Houston [14th Dist.] 2006, pet. denied) (in an appeal from the denial of a plea to the jurisdiction, the court’s jurisdiction “is limited to the issues of subject matter jurisdiction”); see also Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(8) (permitting an interlocutory appeal from an order that “grants or denies a plea to the jurisdiction by a governmental unit”). The argument asserted in ACS’s motion to dismiss — i.e., that ACS lacks the statutory prerequisites necessary to pursue a section 541.060 a claim — is not relevant to an examination of subject matter jurisdiction. See Tex. Med. Res., LLP, 659 S.W.3d at 441. This argument was not raised in the trial court and, as shown in Community Health’s response to ACS’s motion to dismiss, it is not one that the parties agree is dispositive. Accordingly, it does not warrant the dismissal of Community Health’s interlocutory appeal challenging the trial court’s denial of its plea to the jurisdiction. For these reasons, we deny ACS’s motion to dismiss. III. Governmental Immunity In its interlocutory appeal, Community Health contends that the trial court erred by denying its second plea to the jurisdiction because it is entitled to governmental immunity.[3] A. Standard of Review and General Immunity Principles We review the trial court’s ruling on a plea to the jurisdiction de novo. Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 228 (Tex. 2004). A plea to the jurisdiction may challenge either the pleadings or the existence of jurisdictional facts. Id. When a plea to the jurisdiction challenges the claimant’s pleadings, we determine whether the claimant has pleaded facts that affirmatively demonstrate the trial court’s jurisdiction, construing the pleadings liberally and in favor of the claimant. Id.; see also Harris Cnty. Appraisal Dist. v. Braun, 625 S.W.3d 622, 626 (Tex. App.—Houston [14th Dist.] 2021, no pet.). If the moving party challenges the existence of jurisdictional facts, we consider relevant evidence submitted by the parties. Miranda, 133 S.W.3d at 227; see also Gillespie v. Galveston Cnty. Health Dist., 639 S.W.3d 815, 818-19 (Tex. App.—Houston [14th Dist.] 2021, no pet.). If the relevant evidence fails to raise a fact question on the jurisdictional issue, the court rules on the plea as a matter of law. Gillespie, 639 S.W.3d at 819. If the evidence instead creates a fact issue on the jurisdictional issue, the trial court must deny the plea and permit the factfinder to resolve the issue. Id. Likewise, if resolution of the jurisdictional issue requires interpretation of a statute, we review that statute under a de novo standard. Fort Bend Cnty. Toll Rd. Auth. v. Olivares, 316 S.W.3d 114, 119 (Tex. App.—Houston [14th Dist.] 2010, no pet.). When we construe a statute, our objective is to determine and give effect to the Legislature’s intent. Harris Cnty. Hosp. Dist. v. Tomball Reg’l Hosp., 283 S.W.3d 838, 842 (Tex. 2009). If the statutory language is unambiguous, we adopt the interpretation supported by the words’ plain meaning. Id. Though often used interchangeably, sovereign immunity and governmental immunity refer to two distinct concepts. Travis Cent. Appraisal Dist. v. Norman, 342 S.W.3d 54, 57-58 (Tex. 2011); Hyde v. Harrison Cnty., 607 S.W.3d 106, 108 n.3 (Tex. App.—Houston [14th Dist.] 2020, pet. denied). Sovereign immunity refers to a state’s immunity from suit and liability; this protection extends to the state itself and varying divisions of state government, including agencies, boards, hospitals, and universities. Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist. v. Tex. Pol. Subdivisions Prop./Cas. Joint Self-Ins. Fund, 212 S.W.3d 320, 324 (Tex. 2006). Governmental immunity protects political subdivisions of the state, including counties, cities, and school districts. Wichita Falls State Hosp. v. Taylor, 106 S.W.3d 692, 694 n.3 (Tex. 2003). Texas jurisprudence also delineates two separate applications of immunity: immunity from suit and immunity from liability. Tooke v. City of Mexia, 197 S.W.3d 325, 332 (Tex. 2006). Immunity from suit bars an action unless the Legislature expressly consents to suit. Tex. Dep’t of Transp. v. Jones, 8 S.W.3d 636, 638 (Tex. 1999) (per curiam). If a government defendant is immune from suit, the trial court has no subject matter jurisdiction and the defendant may properly challenge the suit in a plea to the jurisdiction. See Miranda, 133 S.W.3d at 225-26. In contrast, immunity from liability is a narrower form of protection that guards against a judgment even if the Legislature has expressly consented to the suit. Jones, 8 S.W.3d at 638. Immunity from liability acts as an affirmative defense — it must be pled and does not deprive the trial court of subject matter jurisdiction. Id. B. Common Law Immunity On appeal, Community Health asserts that it is entitled to common law immunity. Because immunity from suit is a common law creation, “[i]t remains the judiciary’s responsibility . . . to determine under what circumstances sovereign [or governmental] immunity exists in the first instance.” Reata Constr. Corp. v. City of Dallas, 197 S.W.3d 371, 375 (Tex. 2006); see also Rosenberg Dev. Corp. v. Imperial Performing Arts, Inc., 526 S.W.3d 693, 701 (Tex. App.—Houston [14th Dist.] 2017) (“Rosenberg I“), aff’d, 571 S.W.3d 738 (Tex. 2019). In undertaking this determination, we are guided by the nature of immunity and the doctrine’s purposes. See Univ. of the Incarnate Word v. Redus, 518 S.W.3d 905, 911 (Tex. 2017). First, as explained by the Texas Supreme Court, “[a]n entity claiming governmental immunity must ordinarily be a political subdivision.” Rosenberg II, 571 S.W.3d at 748. Here, Community Health is not a political subdivision — rather, according to its Articles of Incorporation and the amendments thereto, it is a non-profit corporation and a health maintenance and charitable organization organized pursuant to the Texas Health and Safety Code. See Tex. Health & Safety Code Ann. §§ 281.0515, 281.0565. Nothing in the applicable statutes suggests that these types of organizations are intended to operate as political subdivisions. See id.; see also Ben Bolt-Palito Consol. Indep. Sch. Dist., 212 S.W.3d at 324-25 (concluding that a self-insurance fund was entitled to governmental immunity, the court noted that the governing statute authorized the fund to include “a combination of political subdivisions”); Rosenberg I, 526 S.W.3d at 705 (concluding that an economic development corporation was not entitled to governmental immunity, this court noted that the authorizing statute explicitly stated that the corporation “‘is not a political subdivision . . . for purposes of the laws of this state’”) (quoting Tex. Loc. Gov’t Code Ann. § 501.055(b)). Our second inquiry is more amorphous and examines whether “the governing statutory authority demonstrates legislative intent to grant an entity the ‘nature, purposes, and powers’ of an ‘arm of the State government.’” Ben Bolt- Palito Blanco Consol. Indep. Sch. Dist., 212 S.W.3d at 325-26 (quoting Harris Cnty. Flood Control Dist. v. Mann, 140 S.W.2d 1098, 1101 (Tex. 1940)). If this showing is made, the entity “is a government unit unto itself” and is entitled to assert immunity in its own right as to the performance of governmental functions. Id. at 325. We conclude that Community Health, as a charitable organization created pursuant to section 281.0565 of the Texas Health and Safety Code, is not entitled to governmental immunity from suit. See id. (concluding the self-insurance fund was entitled to governmental immunity because it was performing a “governmental function” that each participating governmental entity was also authorized to perform individually and the “nature, purposes[,] and powers” demonstrated legislative intent that it “exist as a distinct governmental entity entitled to assert immunity in its own right for the performance of a governmental function.”); see also Rosenberg II, 571 S.W.3d at 749 (“the Legislature has expressly denied economic development corporations significant governmental characteristics — political-subdivision status and attributes of sovereignty.”). Charitable organizations created under section 281.0565 fall somewhere between the entities examined in Ben Bolt-Palito and Rosenberg II. Significantly, however, charitable organizations are subject to fewer governing statutes. Section 281.0565, entitled “Charitable Organization,” states as follows: (a) In this section, “charitable organization” means an organization that is exempt from federal income tax under Section 501(a) of the Internal Revenue Code of 1986 by being listed as an exempt organization in Section 501(c)(3) or 501(c)(4) of the code. (b) A district may create a charitable organization to facilitate the management of a district health care program by providing or arranging health care services, developing resources for health care services, or providing ancillary support services for the district. (c) A charitable organization created by a district under this section is a unit of local government only for purposes of Chapter 101, Civil Practice and Remedies Code. (d) A district may make a capital or other financial contribution to a charitable organization created by the district to provide regional administration and delivery of health care services to or for the district. (e) A charitable organization created by a district under this section may contract, collaborate, or enter into a joint venture or other agreement with a public or private entity, without regard to that entity’s for-profit or nonprofit status, and may hold an ownership interest in such an entity. (f) A charitable organization created by a district under this section remains subject to the laws of this state and the United States that govern charitable organizations. Nothing in this section may be construed as abrogating or modifying any other provision of law governing charitable organizations. Tex. Health & Safety Code Ann. § 281.0565. The parties did not cite — and our research did not find — any other statutory authority governing charitable organizations created in this context. Unlike the statutory scheme examined in Ben Bolt-Palito, section 281.0565 does not explicitly permit charitable organizations to undertake “government functions.” Compare Tex. Health & Safety Code Ann. § 281.0565(b) with Tex. Gov’t Code Ann. § 791.011(a). Rather, section 281.0565 authorizes charitable organizations to “provid[e] or arrang[e] health care services, develop[] resources for health care services, or provid[e] ancillary support services for the district.” Tex. Health & Safety Code Ann. § 281.0565(b). These services are not unique to governmental entities. Moreover, Community Health is estopped from making this argument because, as its Articles of Incorporation set out, it operates as a non-profit corporation in addition to its role as a charitable organization. Further, section 281.0565(e) specifically permits charitable organizations to contract with any other entity, whether private or public, and to hold an ownership interest in those entities. Id. § 281.0565(e). In contrast, the self-insurance fund examined in Ben Bolt-Palito was limited to contracting with other governmental entities. See Tex. Gov’t Code Ann. § 791.011. Although section 281.0565 authorizes charitable organizations like Community Health to provide valuable public health care services, “merely engaging in an act that serves a public purpose says nothing about the nature of the entity itself.” Rosenberg II, 571 S.W.3d at 750. Similar to the statutes analyzed in Rosenberg II, the acts authorized by section 281.0565 have “governmental flair” but are not “so uniquely or so definitely [governmental] that only a governmental entity would engage in those activities.” Id. This is particularly true in the underlying context, in which ACS alleges that Community Health underpaid ACS for medical services rendered to members of Community Health’s insurance plans. The provision of health insurance is not a uniquely governmental function.[4] Finally, the “nature and purposes” underlying the doctrine of immunity do not warrant extending it to charitable organizations created under section 281.0565. See Univ. of the Incarnate Word, 518 S.W.3d at 911. “[T]he doctrine of immunity for governmental entities is inherently connected to the public fisc and preserves separation-of-powers principles by preventing the judiciary from interfering with the Legislature’s prerogative to allocate tax dollars.” Rosenberg I, 526 S.W.3d at 704. Accordingly, immunity protects the public by preventing disruptions of key government services that may occur when government funds are substantially diverted by litigation. Brown & Gay Eng’g, Inc. v. Olivares, 461 S.W.3d 117, 121 (Tex. 2015). The parties did not produce any evidence suggesting any key government services are disrupted by funds Community Health will spend on the underlying litigation. Rather, the evidence Community Health submitted to support its plea tends to prove that Community Health is not solely reliant on taxpayer funds for its expenses. As stated in its Articles of Incorporation, Community Health has “the power to solicit grants and contributions for its corporate purposes, and including to have and to exercise all rights and powers conferred on non-profit corporations under the laws of the State of Texas.” Therefore, public fisc concerns do not warrant an extension of immunity in these circumstances. In sum, we conclude that the governing statutory authority does not demonstrate legislative intent to grant Community Health the “nature, purposes, and powers” of an “arm of the State government.” See Ben Bolt-Palito Blanco Consol. Indep. Sch. Dist., 212 S.W.3d at 325-26. Therefore, Community Health is not entitled to the protections afforded by the doctrine of governmental immunity. C. Statutory Immunity Relying on Texas Health and Safety Code section 281.0565(c), Community Health asserts that it is entitled to statutory immunity from suit or liability for torts. This subsection states: “A charitable organization created by a district under this section is a unit of local government only for purposes of Chapter 101, Civil Practice and Remedies Code.” Tex. Health & Safety Code Ann. § 281.0565(c). “Chapter 101, Civil Practice and Remedies Code” refers to the Texas Tort Claims Act (the “TTCA”). See Tex. Civ. Prac. & Rem. Code Ann. §§ 101.001-101.109; see also id. § 101.002 (“This chapter may be cited as the Texas Tort Claims Act.”). Reading these statutes together, Community Health asserts that it is a “unit of local government” under the TTCA and that it is therefore entitled to governmental immunity. Contending that ACS’s insurance-code claim is a tort claim that does not fall within the TTCA’s limited waiver of immunity, Community Health argues that its plea to the jurisdiction should have been granted. We reject this argument for two reasons. First, its foundation is shaky — the Texas Supreme Court has not definitely answered the question of “whether the Legislature can confer immunity by statute or only waive it.” See Fort Worth Transp. Auth. v. Rodriguez, 547 S.W.3d 830, 842 n.2 (Tex. 2018) (“[w]e do not answer the broader question of whether the Legislature has authority to confer (as opposed to waive) immunity); Brown & Gay Eng’g, Inc., 461 S.W.3d at 122 (stating that “[s]overeign immunity is a common-law creation” and its boundaries are delineated by the judiciary; “[b]y contrast . . . the Legislature determines when and to what extent to waive immunity”); LTTS Charter Sch., Inc. v. C2 Constr., Inc., 342 S.W.3d 73, 78 n.44 (Tex. 2011) (“we reserve judgment on . . . whether the Legislature in fact has the authority to confer (as opposed to waive) immunity, a common-law creature traditionally delimited by the judiciary”). Second, considering similar statutory language, the Texas Supreme Court declined to find that inclusion in the TTCA’s definition of “governmental unit” imbued an entity with governmental immunity. See Rosenberg II, 571 S.W.3d at 747. Raising a similar argument, the economic development corporation in Rosenberg II relied on the following statutory language to support its contention that it was entitled to governmental immunity: “For purposes of Chapter 101, Civil Practice and Remedies Code, a Type B corporation is a governmental unit and the corporation’s actions are governmental functions.” Id. (citing Tex. Loc. Gov’t Code Ann. § 505.106(b)). Rejecting this argument, the court reasoned: We also do not consider the existence vel non of [appellant's] statutory immunity under the Development Corporation Act because section 505.106 does not purport to grant immunity. . . . [S]ubsection (b) merely imports the Texas Tort Claims Act’s limitations on liability and damages. As we have observed, “the Tort Claims Act does not create sovereign immunity[;] it provides a limited waiver of that immunity,” such that an entity may be sued and damages had on the terms specified in the Tort Claims Act. Because section 505.106 merely purports to limit the remedies available when economic development corporations perform governmental functions, we need not consider whether the Legislature can confer immunity by statute or only waive it. Id. (quoting Brown & Gay Eng’g, Inc., 461 S.W.3d at 123 n.6). Therefore, we reject Community Health’s contention that its designation as a “governmental unit” under the TTCA renders it entitled to the protections afforded by governmental immunity. See id.; see also Fort Worth Transp. Auth., 547 S.W.3d at 842 n.2; Brown & Gay Eng’g, Inc., 461 S.W.3d at 122; LTTS Charter Sch., Inc., 342 S.W.3d at 78 n.44 CONCLUSION We affirm the trial court’s denial of Community Health’s second plea to the jurisdiction. Meagan Hassan Justice Panel consists of Justices Bourliot, Hassan, and Wilson (Wilson, J., dissenting).
