United States District Court, D. New Jersey
McNulty United States District Judge.
The Center for Sport Medicine and Wellness LLC, Sammy I.
Masri, LLC, and SUM Holdings, LLC (collectively, "Masri
Sports"),  bring this action against Horizon
Healthcare Services, Inc. ("Horizon"), Non-New
Jersey BCBS Plans 1-10, and John Does 1-10. Masri Sports
seeks to recover no less than $411, 932.00 in denied
reimbursements arising from medical services provided to
Horizon insureds. (AC ¶ 3.)
revisions of positions have resulted in a shifting set of
issues. The six currently operative counts are:
Count I: Claim for benefits under ERISA;
Count II: Breach of the fiduciary duties under ERISA;
Count III: Failure to comply with ERISA claims regulations;
Count VI: Breach of contract;
Count VII: Breach of the covenant of good faith and fair
Count X: Quantum meruit.
has moved under Fed.R.Civ.P. 12(b)(6) to dismiss those six
currently operative counts. Horizon contends that Masri
Sports, a provider of medical care, lacks statutory
derivative standing to pursue its claims, and also asserts
that certain of the individual claims are insufficiently
pled. For the reasons stated herein, I will grant
Horizon's motion to dismiss Count III, but deny it as to
Counts I, II, VI, VII, and X.
allegations of the amended complaint are taken as true for
the purposes of Horizon's motion. See Section II.a,
Sports specializes in the diagnosis and treatment of
non-surgical sports and other musculoskeletal injuries. It
operates out of three locations in northern New Jersey. (AC
¶¶ 6-9.) Horizon is a not-for-profit health service
corporation that underwrites or administers the health
insurance benefits of more than 3.6 million insureds in New
Jersey, a majority of which are governed by the Employment
Retirement Income Security Act of 1974 ("ERISA"),
29 U.S.C. § 1001 etseq. (Id. ¶¶ 18,
20.) Horizon provides its insureds with access to covered
services primarily (though not exclusively) by utilizing a
network of health care providers who have contractually
agreed to participate on a fixed-fee basis. It reimburses its
insureds for these covered services, subject to the terms,
conditions, and benefit limitations set forth under its
various plans. (Id. ¶¶ 18, 22.)
plans at issue in the complaint, however, also provide for
"out-of-network" benefits, under which the insured
have a right to insurance benefits for services provided by
healthcare providers who have not entered into
"Participating Provider" agreements with Horizon.
These out-of-network providers have not agreed to accept
Horizon's contractual fee schedule when providing covered
servicers to Horizon insureds, but are still entitled to be
reimbursed at "usual, customary, and reasonable"
rates. (Id. ¶ 23.)
Sports was an out-of-network or "Non-Participating"
provider when it treated the Horizon-insured patients at
issue in the complaint. (Id. ¶ 24.) Masri
Sports provided health care services to these insureds and
expected to be paid by Horizon for providing these services.
(Id. ¶ 25.)
Sports required each of those insured patients to sign an
assignment of benefits ("AoB") form. (Id.
¶ 27.) The AoB form reads as follows:
1. I hereby assign to MASRI Sports Medicine 8& Wellness
my rights to receive payments from negligent parties or from
insurance companies responsible for my claim.
2. I also hereby authorize direct payments to MASRI Sports
Medicine & Wellness of any sum I now or hereafter owe you
by my attorney our [sic] of any proceeds of any settlement of
my case and by any Insurance company obligated to make
payment to my [sic] or you based in whole or in part upon the
charges made for your services.
3. I also hereby assign to MASRI Sports Medicine 86 Wellness
all of my rights to obtain payment under the personal injury
protection provisions of an automobile insurance policy or
any other health insurance policy of any medical bills
incurred as a result of my treatment, including the option to
submit any dispute in my name to binding arbitration under
the auspices of the National Arbitration Forum or any other
forum that the provider deems appropriate.
4. I acknowledge and understand that although this office
will file claims with my insurance carrier as a courtesy, I
am ultimately responsible to pay for the services rendered. I
am responsible for any coinsurance, deductibles, out of
network costs or those services which my carrier deems
non-covered. I permit a copy of this authorization to be used
in place of the original for the purpose of obtaining payment
from my insurance company.
5. Attention Insurance Carrier: If
applicable under your policy, you are hereby asked for your
consent to the form and content of this Assignment
Authorization and the resulting legal rights insured to MASRI
Sports Medicine 8s Wellness. Failure to deny your approval on
reasonable grounds within 72 hours of receipt of this request
constitutes your approval of this Assignment. THIS IS A
DIRECT ASSIGNMENT OF MY RIGHTS AND BENEFITS UNDER THIS
services at issue that Masri Sports rendered to its patients
include, among other things, EMG/NCV testing, surgical
procedures, office visits, and injections. Horizon denied the
requests of Masri Sports to be reimbursed for those services
(Id. ¶¶ 46-47.) Masri Sports claims that
Horizon has failed to provide it with information it
requested, including the following: contact information for
the plan administrator, claims administrator, fiduciaries,
and third party administrators involved in the claims
process, copies of the insurance policy, the Summary Plan
Description, and the Plan, the Evidence of Coverage, and plan
claims procedures. (Id. ¶¶ 55-56.) Masri
Sports alleges that it appealed these denials of claims
within Horizon ...