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Connolly v. Aetna U.S. Healthcare

August 25, 2003


The opinion of the court was delivered by: Simandle, District Judge


Plaintiffs Debra Connolly and Douglas Connolly, the parents and natural guardians of Brooke Connolly, a minor, originally filed this complaint in New Jersey state court, alleging that defendants Aetna U.S. Healthcare, Health Maintenance Organization of New Jersey, Camden County Obstetrics and Gynecology, Larry S. Rosen, M.D., Paul J. Zinsky, M.D., and/or Richard C. Park, M.D., were negligent in rendering treatment to Debra Connolly while she was pregnant with Brooke Connolly, a quadriplegic, who now suffers from permanent disabilities, including cerebral palsy and brain damage. The issue before the Court is whether the claims of plaintiffs, who concede that they were not entitled to certain benefits under Debra Connolly's employee benefits plan, arising out of Aetna's medical decisions defining a course of treatment, are directed to Aetna in its capacity as an arranger of medical treatment, or as an administrator of benefits.

The case was previously removed to federal court by Aetna, and Judge Joel A. Pisano remanded back to state court on July 23, 2001. Though trial was to commence on May 12, 2003, the case was again removed to this Court by Aetna on April 24, 2003, after certain expert depositions were conducted. Presently before the Court is the motion to remand by plaintiffs. For the reasons stated herein, the motion to remand will be granted. *fn1


Plaintiff Debra Connolly received prenatal care from defendants Camden County OB/GYN, Dr. Larry S. Rosen, Dr. Paul J. Zinsky, or Dr. Richard C. Park, beginning in or around February 19, 1993 pursuant to her Macy's employee benefit plan under ERISA. (Second Amended Compl., Pl.'s Ex. A, ¶¶ 13, 22.) Defendant Aetna U.S. Healthcare, Inc., is a Pennsylvania corporation which owned a subsidiary corporation known as The Health Maintenance Organization of New Jersey, Inc. ("HMO New Jersey"). Plaintiff Debra Connolly received her medical treatment through HMO New Jersey, a health maintenance organization organized by Aetna U.S. Healthcare, as provided to plaintiff through her participation in an ERISA-covered welfare plan sponsored by her employer, Macy's. Debra Connolly received obstetric care directly from defendant physicians through HMO New Jersey and not from Aetna. (Second Amended Compl. ¶¶ 21-44.) Thus, Aetna plays two roles in this context: one as administrator of health benefits, the other as arranger of medical treatment through its wholly-owned subsidiary HMO New Jersey. Moving defendants Aetna and HMO New Jersey will hereinafter be referred to as "Aetna" or "defendant," unless otherwise specified.

On April 14, 1993, Debra Connolly was seen by either Dr. Rosen, Dr. Zinsky, or Dr. Park for a physical examination, which detected fetal heart tones. (Id. ¶ 23.) On May 14, 1993, defendant physicians saw plaintiff at Camden County OB/GYN, at the 20 weeks gestational age. (Id. ¶ 24.) At that visit, an ultrasound previously performed upon Debra Connolly showed that she was carrying twins, and no fetal abnormalities were noted. (Id. ¶ 25.) On May 27, 1993, plaintiff was seen by defendant physicians for an examination, where fetal heart tones were observed, and plaintiff's cervix was noted to be long and closed. (Id. ¶ 27.) Plaintiff also saw defendant physician on June 10, 1993 and June 18, 1993. (Id. ¶¶ 28, 29.) A week later, an ultrasound was conducted, which indicated Twin A to be 25.3 weeks gestation, and Twin B (Brooke Connolly) to be 26.2 weeks gestation. (Id. ¶ 30.) Twin A weighed 800 grams, and Twin B weighed 900 grams. (Id.)

On July 2, 1993, Debra Connolly complained to either Dr. Rosen, Dr. Zinsky or Dr. Park that she felt vaginal pressure. (Id. ¶ 31.) An examination was conducted, indicating that plaintiff had positive fetal movement, was at 34 weeks size, was unable to feel contractions, and her cervix was noted to be finger-tip dilated and 40% thinned out. (Id. ¶ 32.) Plaintiff was prescribed the medication Brethine 2.5 mgs every 6 hours. (Id. ¶ 33.)

On July 2, 1993, either Dr. Rosen, Dr. Zinsky, or Dr. Park called Aetna U.S. Healthcare to obtain a home uterine activity monitor for pre-term contractions and history of pre-term cervical dilation. Although Aetna did not approve the home uterine activity monitor for Debra Connolly because she did not fall within the exceptions of the Perinatal Policy, *fn2 it did approve Home Uterine Palpation through a nursing company called Baby Focus, Inc., which provided nurse visits to the patient's home to teach her to palpate her own uterus and feel contractions, as well as telephone contact on a daily basis to monitor signs of labor. *fn3 (Second Amended Compl. ¶¶ 35, 36.) On July 3 and 4, 1993, plaintiff and a nurse from Baby Focus, Inc., had telephone contact whereupon plaintiff attempted to palpate and count her contractions. (Second Amended Compl. ¶¶ 37, 38.) After counting an increased number of contractions on July 5, 1993, plaintiff was admitted to West Jersey Hospital on July 6, 1993 by defendant Dr. Zinsky with a principal diagnosis of pre-term labor precautions. (Id. ¶¶ 39, 40.) After treatment with tocolytic agents and IV fluids, Debra Connolly was discharged on July 6, 1993. (Second Amended Compl. ¶¶ 42, 43.) Dr. Rosen then called Aetna to obtain coverage under Macy's benefit plan for home uterine activity monitoring for Debra Connolly's preterm contractions. (Id. ¶ 44.) Aetna again did not approve the request because it was not a covered benefit under the plan.

On July 11, 1993, plaintiff reported to Baby Focus that she was having bloody secretions. (Id. ¶ 46.) Plaintiff alleges that she called Dr. Rosen at Camden County OB/GYN and was told not to come in for an examination until the next day. (Id. ¶ 47.) On July 12, 1993, plaintiff was examined and it was noted that she was fully dilated at 29 weeks. (Second Amended Compl. ¶ 48.) That same day, Debra Connolly was transferred to the West Jersey Hospital where she was in unstoppable labor and underwent a low forceps delivery of Twin A and a Caesarean section delivery of Twin B because of bradycardia and breach presentation. (Id. ¶ 49.) Twin A died after birth from necrotizing enterocolitis. (Id. ¶ 50.) Twin B, Brooke Connolly, had periventricular leukomalacia, respiratory distress syndrome and grade 1 intraventricular hemorrhage due to prematurity, and she continues to be treated for severe disabilities presently. (Id. ¶ 51.)

On or about February 15, 2001, plaintiffs filed a Complaint in New Jersey Superior Court, Camden County, Law Division, alleging state law claims of negligence, medical negligence and gross negligence. (Pls.' Motion to Remand, Pls.' Ex. D, at 1.) On April 6, 2001, defendant Aetna filed a Notice of Removal to federal court pursuant to 28 U.S.C. §§ 1331 and 1441(a)-(c), contending that plaintiffs' claim alleging that Aetna denied plaintiffs' request for benefits pursuant to an employee benefit plan presented a federal question falling within the scope of § 502(a) of ERISA. (First Notice of Removal, Pl.'s Ex. C, ¶¶ 6, 7.) The first removal was docketed at Civil Action No. 01-1643 (JAP). On May 4, 2001, plaintiffs filed a motion to remand based on the fact that plaintiffs' state law claims were directed to the quality of benefits provided and therefore were not completely preempted by ERISA. (Pls.' Motion to Remand, Pls.' Ex. D.) On July 23, 2001, Judge Pisano entered an Order remanding the case to New Jersey Superior Court. (J. Pisano Order, Pls.' Ex. F.) In an oral opinion, Judge Pisano stated the following: First of all, following the guidance in Pryzbowski discussing Pegram, going back to language I discussed, I need to determine whether or not this claim challenges the administration of or eligibility for benefits. And on the facts of this case, I find that it does not. This is a plan which provides for a benefit and the benefit was given. So, this is not a claim which challenges the eligibility for a benefit or administration of a benefit. Because it is clear that the . . . benefit for which Mrs. Connolly was eligible was administered. Rather there is a claim which is stated and I have to . . . read the plain language in the complaint under the well pleaded complaint rule, I have to determine whether or not the plaintiff has alleged a removable claim, a federal claim, and he has not. What he has alleged is that the policy was determined as a result of improper analysis. And in order - getting into your argument could this have been brought under 502(a). In order for me to have decided this in a 502(a) proceeding, I would necessarily have to get into the judgment that went into drafting and formulation of the plan. All of this being said, it seems to me that as it has been pled by the plaintiffs in this case, this is a claim which concerns the quality of medical treatment after you get to the essence of it, and for that reason, I do not find this case to be compelled by Pryzbowski. I find it to be distinguishable from Pryzbowski and, therefore, Motion for Remand is going to be granted on that basis.

(Tr. 7/23/01 in Civil Action No. 01-1643, Pl.'s Remand Mot. Ex. E (emphasis added).)

Plaintiffs then filed their Second Amended Complaint in New Jersey state court on June 19, 2002, alleging that defendants Aetna U.S. Healthcare and Health Maintenance Organization of New Jersey were negligent in the implementation and adoption of the policy for treatment of women having contractions and history of pre-term cervical dilation and are vicariously liable for the actions and conduct of defendant physicians (Count I); that Aetna and HMO New Jersey's actions constitute reckless indifference and provide grounds for punitive damages (Count II); that Aetna and HMO New Jersey were negligent in adopting policies regarding hospital utilization and in selecting, supervising, training and/or monitoring defendant physicians and Camden County OB/GYN (Count III); that defendants Camden County OB/GYN, Dr. Rosen, Dr. Zinsky, Dr. Park were negligent in ordering Home Uterine Palpation through "Baby Focus" and in failing to provide adequate medical advice and failing to advise plaintiff to go to the hospital to receive immediate medical attention (Count IV); and that such negligence by defendant physicians and Camden County OB/GYN constitutes grounds for punitive damages (Count V). *fn4 (Second Amended Compl., Pls.' Remand Mot. Ex. A.)

On December 2, 2002, the Superior Court entered a Consent Order signed by both parties indicating that partial summary judgment was entered in favor of defendant Aetna and HMO New Jersey with respect to the portion of Paragraph 58 of Count I of the Second Amended Complaint which contains the claim for "vicarious liability for the actions and conduct of Defendants Larry S. Rosen, M.D., Paul Zinsky, M.D., Richard C. Park, M.D. and/or Camden County OB/GYN who are acting as its agents." (Order, 12/2/02, Def.'s Sum. J. Ex. B.) The Order also entered summary judgment in favor of defendant on Count III of the Second Amended Complaint. (Id.) The Order specified that it was not determining or entering judgment with respect to plaintiffs' direct negligence claims in Count I and punitive damages in Count II. (Id.)

Following remand, the parties proceeded with discovery and a trial was scheduled to commence on Monday, May 13, 2003. During discovery, depositions of former medical directors, nurses and case managers were conducted. At the close of discovery, plaintiffs produced the expert report of John C. Morrison, M.D., dated November 26, 2002, which stated,

[I]t is my opinion, within a reasonable degree of medical certainty, that Aetna U.S. Healthcare was negligent in the creation, formulation and application of its `Perinatal Policy' resulting in the refusal to provide home uterine activity monitoring to Ms. Connolly. Furthermore, it is my opinion to a reasonable degree of medical certainty that, had she received home uterine activity monitoring as her physicians recommended, the pregnancy could have been extended for a significant period of time thus allowing both babies to survive intact and avoiding the death of one twin and the neurologic damage noted in the second child.

(Morrison Report, Pls.' Remand Mot. Ex. G.) At his deposition taken on April 14, 2003, when asked whether plaintiffs had requested coverage for a home uterine activity monitor, Dr. Morrison testified that they had done so twice. (Morrison Dep. Tr., Pls.' Mot. Remand Ex. K, at 10-11.) In addition, Dr. Morrison testified to the following:

Q: And is it your understanding that Aetna U.S. Healthcare denied coverage for the home uterine activity monitor?

A: Yes.

Q: And is it your opinion in this case that Mr. and Mrs. Connolly, or their infant child, suffered some damage as a result of Aetna U.S. Healthcare's denial of their request for coverage for a home uterine activity monitor?

A: Yes.

(Morrison Dep. Tr., Pls.' Mot. Remand Ex. K, at 11.) When asked whether he intended to testify to any opinions other than those set forth in his report, Dr. Morrison replied, "No. I think this outlines my opinions pretty succinctly." (Id. at 54.) At the end of the deposition, Dr. Morrison provided the following testimony:

Q: Doctor, I am correct, am I not, that you are not and you have not provided any opinions either in your report or here today regarding Aetna U.S. Healthcare's denial of a benefit. Correct?

A: Yes, sir.

Q: I am correct?

A: Yes.

Q: And, in fact, Doctor, isn't it true that you have provided the opinion here today to Mr. Wardell in response to his questions that Aetna U.S. Healthcare's perinatal policy was negligent and deviated from the accepted standard of care for failure to include home uterine activity monitoring for ...

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