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Fritzky v. Aetna Health

March 24, 2010

RE: RICHARD FRITZKY
v.
AETNA HEALTH, INC., ET AL



The opinion of the court was delivered by: William J. Martini Judge

MARTIN LUTHER KING JR. FEDERAL BLDG. & U.S. COURTHOUSE 50 WALNUT STREET, P.O. BOX 419 NEWARK, NJ 07101-0419 (973) 645-6340

LETTER OPINION

Dear Litigants:

This matter comes before the Court on the Motion to Dismiss the Amended Complaint brought by Defendants Aetna Health, Inc. ("Aetna") and Dr. Ira Klein, M.D. ("Klein") pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Fed. R. Civ. P. 12(b)(6). Oral argument was not held. Fed. R. Civ. P. 78. For the reasons stated below, Defendants' Motion to Dismiss is GRANTED and Plaintiff's Complaint is DISMISSED WITH PREJUDICE.

I. BACKGROUND

The facts of this case are well known to the parties and were set out in detail in this Court's previous letter opinion entered in this matter, dated September 3, 2009. Therefore, the Court will now briefly describe only the facts relevant to the instant Motion to Dismiss.

Plaintiff Richard Fritzky ("Fritzky") was a beneficiary of a health insurance policy issued by Defendant Aetna Health, Inc. ("Aetna"). (Am. Cmplt. ¶¶ 2-4). According to the terms of the health insurance plan (the "Plan"), Aetna was required to provide health insurance benefits and services to Plaintiff. (Am. Cmplt. ¶ 4). The Plan's coverage was limited to benefits that Aetna determined to be "medically necessary and appropriate." (See Certification of Tricia B. O'Reilly, Exh. B, pp. 11, 17). Plaintiff was covered by the Plan at all times relevant to this litigation. (Am. Cmplt. ¶ 4). The Plan meets the statutory definition of an "employee welfare benefit plan" under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 et seq.

Beginning in October 2005, Plaintiff was diagnosed with a series of medical conditions and was hospitalized. (Am. Cmplt. ¶ 5). During his hospitalization, he suffered from conditions requiring the amputation of several fingers, toes, and one leg. (Id.) Plaintiff was ultimately discharged from the hospital and sent to a variety of rehabilitative centers. (Am. Cmplt. ¶ 6). He was re-admitted to the hospital in early June 2006 for several weeks. (Am. Cmplt. ¶ 7). At the end of his hospital stay in late June, his treating physicians recommended that he receive acute rehabilitation. (Am. Cmplt. ¶¶ 8-9). However, Aetna and its medical designee Dr. Ira Klein ("Klein") concluded that acute rehabilitation was not medically necessary and denied the request for coverage. (Am. Cmplt. ¶ 10, 12). Instead, Aetna approved coverage for subacute rehabilitative care. (Am. Cmplt. ¶ 10).

Plaintiff began to receive the subacute care on June 29, 2006, while simultaneously appealing Aetna's decision internally. (Am. Cmplt. ¶ 11). Approximately seven weeks after the initial denial, Aetna reversed and found that Plaintiff was entitled to acute care. (Am. Cmplt. ¶ 15). Plaintiff began receiving the acute care on July 30, 2006. (Am. Cmplt. ¶ 11). Nevertheless, his condition deteriorated, and in late August 2006, he was readmitted to the hospital to undergo amputation of his remaining leg. (Am. Cmplt. ¶ 14).

Plaintiff filed his initial complaint in October 2008, in state court. (CM/ECF Docket Entry No. 1). The gravamen of his complaint at that time was that the initial decision of Aetna and Dr. Klein and temporary denial of acute rehabilitation constituted a wrongful denial of benefits resulting in the loss of his second leg. (Plaintiff's initial complaint ("Cmplt.") ¶¶ 21-22). The Complaint contained seven state law counts including breach of contract, breach of the covenant of good faith and fair dealing, breach of fiduciary duties, unjust enrichment, and tortious interference with medical care. (Cmplt. ¶¶ 25-30). The Complaint also requested compensatory, consequential, and exemplary damages, punitive damages, damages for pain and suffering, costs, and a jury trial. (Cmplt. ¶ 30). The Complaint made no mention of ERISA or any federal claims.

In November 2008, Defendants removed the case to federal court, based upon federal question jurisdiction arising out of ERISA. (Cmplt. ¶ 2). Defendants then moved to dismiss on the grounds of ERISA preemption. (CM/ECF Docket Entry No. 6). ERISA § 502(a) is the statute's civil enforcement mechanism and is the exclusive legal remedy for the denial of benefits. 29 U.S.C. § 1132(a). ERISA §502(a) preempts any state law cause of action that attempts to replicate, supplement, or replace it. Id.; Aetna Health Inc. v. Davila, 542 U.S. 200, 208-209 (2004). The Court examined Plaintiff's claims and found that although the Complaint was couched in terms of negligence and tort, Plaintiff was essentially complaining about the denial of benefits. (CM/ECF Docket Entry No. 20). Therefore, the Court concluded that Plaintiff's state law claims were attempting to replicate ERISA § 502(a) such that all of Plaintiff's state law claims were preempted and dismissal was warranted. (Id.) The Court also concluded that Plaintiff's claims would also be preempted by ERISA § 514(a), 29 U.S.C. § 1144(a), which preempts a state law claim that "relates to" an employee benefit plan, although it was not necessary to conduct this additional analysis. (Id.) Finally, the Court denied Plaintiff's request for damages and a jury trial, as such relief is not available under ERISA. (Id.)

The Court dismissed the complaint without prejudice and granted leave to amend, so that Plaintiff could have the opportunity to try and fit his claims into the ERISA framework. (Id.) Plaintiff filed an amended complaint with this Court in October 2009. (CM/ECF Docket Entry No. 23). The Amended Complaint contains nine counts, the first seven of which are state law claims virtually identical to those filed in the original Complaint. (Am. Cmplt. ¶¶ 24-38).*fn1 The Amended Complaint also contains two new counts purportedly brought pursuant to ERISA § 502(a): (1) Count Eight, which seeks "differential coverage costs," presumably the difference in cost between the acute rehabilitation and the subacute, for the month period that Plaintiff received only the subacute, and (2) Count Nine, which seeks "enforcement and redress, reparation and/ or rectification under § 502(a)(1)(B)" as well as differential coverage costs and attorneys' fees. (Am. Cmplt. ¶¶ 32-38). Plaintiff's opposition brief clarifies that these two counts were intended to allege breach of contract pursuant to § 502(a)(1)(B) and unjust enrichment. (Plaintiff's Opposition Brief ("Pl. Br.") at 4-6).

Defendants have filed a motion to dismiss the Amended Complaint pursuant to Fed. R. Civ. P. 12(b)(6) on the grounds that the first seven counts must be dismissed for the same reasons they were dismissed previously, and that the eighth and ninth counts ask for ...


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