Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

University Spine Center v. Aetna Inc.

United States District Court, D. New Jersey

March 21, 2018

AETNA INC. Defendant.


          KEVIN MCNULTY. U.S.D.J.

         This litigation is one of many in which out-of-network health care providers, purporting to sue on behalf of their patients, have sought to be reimbursed at (or at least closer to) in-network rates. Plaintiff University Spine Center ("University Spine"), an out-of-network provider, brings this Employment Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 et seq., action against defendant Aetna, Inc. ("Aetna"), the claims administrator for the health plan of University Spine's patient. University Spine sues as assignee of a patient, L.K., and seeks to recover $133, 320.98.

         Aetna now moves under Fed.R.Civ.P. 12(b)(6) to dismiss the Complaint for failure to state a claim upon which relief may be granted.

         For the reasons stated herein, I will deny the motion to dismiss.

         I. Background[1]

         A. Procedural History

         The Complaint was originally filed by University Spine in New Jersey Superior Court, Passaic County, on August 30, 2017. (Compl.) The Complaint contains three claims against Aetna: (1) breach of contract; (2) failure to make all payments pursuant to the member's plan under ERISA; and (3) breach of fiduciary duty under ERISA. (Id. at ¶¶ 17-40).

         On October 12, 2017, Aetna filed a Notice of Removal to federal court pursuant to 28 U.S.C. §§ 1441 and 1446. The Notice states three grounds for removal: "(1) Count II and Count III explicitly allege claims that arise under federal law; (2) the parties are completely diverse and the amount in controversy exceeds the jurisdictional threshold; and (3) Count I is completely preempted by ERISA Section 502(a)." (Id. at ¶ 5). (See also Id. at ¶¶ 6-8.) Aetna attached three Exhibits to the Notice, including the Complaint and its corresponding Exhibits, (ECF no. 1-1).

         One week later, on October 19, 2017, Aetna filed a motion under Federal Rule of Civil Procedure 12(b)(6) to dismiss the Complaint with prejudice for failure to state a claim. (Def. Brf.)

         On November 6, 2017, University Spine filed an opposition to Aetna's motion to dismiss. (PI. Brf.) One week later, on November 13, 2017, Aetna filed a reply. (ECF no. 7).

         On December 21, 2017, Aetna filed a notice of supplemental authority in support of its pending motion to dismiss. (ECF no. 10 (attaching ECF no. 10-1, a copy of Univ. Spine Ctr. v. Aetna, Inc., No. CV 17-7825 (JLL), 2017 WL 6514663 (D.N.J. Dec. 20, 2017)).

         The parties agree that the case is governed by ERISA. Therefore, University Spine has agreed to voluntarily dismiss Count I, a state law breach of contract claim. See (PI. Brf. 3). Accordingly, I will consider Aetna's motion to dismiss as to the ERISA-related claims, Counts 2 and 3.

         B. Facts[2]

         On December 30, 2016, University Spine provided medical services to L.K. (Compl. ¶¶ 3-4). The services consisted of a spinal surgery and related procedures. (Id. at ¶ 5).

         University Spine received an Assignment of Benefits from L.K. (Compl., Exh. B). The Assignment of Benefits[3] form states, in relevant part:

I, the undersigned, certify that I (or my dependent/s) have insurance coverage with __and assign directly to University Spine Center, all insurance benefits, if any, otherwise payable to me for the services rendered. I understand that I am financially responsible for all charges, whether or not paid by insurance. I hereby authorize the doctor to release all information necessary to secure the payment of benefits. I authorize the use of this signature on all insurance submissions.
Responsible Party Signature: [redacted] Relationship: self Dated: [redacted]


         At the time medical services were provided, L.K. was a member of Aetna Choice POS II, a self-funded health benefits plan. See (ECF no. 3-3, ¶ 3; ECF no. 3-4, Exh. 1; Def. Brf. 3). Aetna is the Claims Administrator for the Plan. (Compl. ¶ 14). The terms of the Plan are set forth in a booklet entitled "What Your Plan Covers and How Benefits are Paid." (ECF no. 3-4, Exh. A). As stated above, the parties do not dispute that the Plan is governed by ERISA.

         University Spine is an out-of-network health care provider as to the Plan. It sues pursuant to the Assignment of Benefits. (Compl. ¶¶ 26, 32). However, die Plan includes an anti-assignment clause. (ECF no. 3-4, Exh. A at 59). In a section entitled "Assignments, " it provides as follows: "Coverage and your rights under this Aetna medical benefits plan may not be assigned. A direction to pay a provider is not an assignment of any right under this plan or of any legal or equitable right to institute any court proceeding." Id. (emphasis in original).

         As assignee, University Spine submitted a Health Insurance Claim Form to Aetna for the services it provided to L.K. (Compl. ¶ 7)(citing Exh. C). It requested reimbursement in the amount of $137, 713.00. (Id.) However, only $4, 392.02 has been reimbursed by Aetna. (Id. at ¶ 8).

         In a letter dated February 28, 2017, University Spine requested that Aetna immediately reprocess the claim. (Compl., Exh. E). It also requested that if Aetna decided not to pay additional benefits, it provide a written explanation as to its decision. [Id.)

         Nearly three weeks later, in a letter dated March 20, 2017, University Spine sent Aetna a notice of appeal. (Compl. ¶ 9) (citing Exh. E). In the letter, University Spine once again requested that the claim be reprocessed for additional payment, and asked Aetna to provide "a written explanation citing applicable policy language, " pursuant to 29 C.F.R. § 2560.503-1, within 30 days if it denied the additional payment. (Compl., Exh. E). In the Complaint, University Spine alleges that it "requested, among other items, a copy of the Summary Plan Description, Plan Policy, and identification of the Plan Administrator/Plan Sponsor." (Compl. ¶ 10)(citing Exh. E).

         By letter dated May 10, 2017, Aetna informed University Spine that it was upholding its original benefits determination. (Notice of Removal, Exh. F). It explained that the reimbursement of University Spine's claim was based upon a reasonable and customary charge. (Id.)

         According to University Spine, Aetna failed to provide it with a copy of the documents it had previously requested. (Compl. ¶ 11).

         On or about August 30, 2017, University Spine filed this action in the Superior Court of New Jersey, Law ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.