United States District Court, D. New Jersey
McNulty, United States District Judge.
case arises from a dispute over reimbursement for medical
services rendered by an out-of-network medical provider. The
plaintiff, East Coast Advanced Plastic Surgery
("ECAPS"), filed this action in New Jersey Superior
Court to recover payment from defendant Horizon Blue Cross
Blue Shield of New Jersey ("BCBS"). That
state-court complaint ("Cplt", DE
asserted claims for breach of an implied contract, promissory
estoppel, fraudulent inducement, and account stated. BCBS
allegedly reimbursed ECAPS for only a fraction of what it
owes for certain medically necessary surgeries that it
performed on a patient.
removed the state court action to this Court, claiming that
there is federal jurisdiction because the state law claims
are completely preempted by § 502 of the Employee
Retirement Income Security Act of 1974 ("ERISA").
BCBS then moved to dismiss the state law claims as preempted
under ERISA. (DE 4)
filed a motion (DE 5) to remand the matter to state court,
and that motion was referred to United States Magistrate
Judge Michael A. Hammer, Jr. The motion to dismiss was stayed
pending resolution of the motion to remand. (DE 15) Because
the motion to dismiss was stayed, ECAPS has not filed any
opposition to it.
September 17, 2018, Judge Hammer issued a Report and
Recommendation in which he ruled that this matter be remanded
to state court. Judge Hammer concluded that BCBS had not met
its burden under the First part of the two-part
Pascack test, which is used to determine whether a
state law claim is completely preempted by ERISA. See
Pascack Valley Hosp. v. Local 464A UFCW Welfare Reimbursement
Plan, 388 F.3d 393, 400 (3d Cir. 2004).
timely filed objections to the Report and Recommendation. (DE
23) Because the Report and Recommendation would essentially
dispose of this federal action, I have reviewed it de
reasons stated below, I adopt the Report and Recommendation
of Judge Hammer. This matter will be remanded to New Jersey
Superior Court, and BCBS's motion to dismiss will be
dismissed as moot. I write primarily to supplement Judge
Hammer's reasoning to address the objections raised by
BCBS on appeal.
is an out-of-network provider that provided a
medically-necessary surgery to a patient, A.R. (Cplt.
¶¶12, 16-24). A.R. had health benefits through UFCW
Local 464A Welfare Services Fund (the "Fund"),
which is a self-insured plan administered by BCBS.
(Id. ¶14). BCBS represented to ECAPS that it
was the authorized representative of the Fund. (Id.
had breast cancer. ECAPS claims that it contacted BCBS for
preauthorization to perform a double mastectomy and deep
inferior epigastric perforator ("DIEP")
reconstructive surgery. (Id. ¶27). According to
ECAPS, BCBS was aware that ECAPS was an out-of-network
provider. (Id.). BCBS told ECAPS that prior
authorization was not necessary for coverage. (Id.).
The Fund has denied that it authorized BCBS to approve the
surgery, and has stated that BCBS is not the Fund's
authorized representative. (Id. ¶29).
on BCBS's representations that preauthorization was not
necessary, ECAPS went forward with the surgery on January 29,
2015. (Id. ¶¶ 18-20). ECAPS billed BCBS
$470, 210.00 for the surgery. (Id. ¶24). BCBS
paid just $9, 306.63, leaving an outstanding balance of more
than $460, 903.37. (Id. ¶25).
first filed this action in the Superior Court of New Jersey,
Bergen County, on March 6, 2018. Its state-court complaint
alleges state-law claims of breach of contract, promissory
estoppel, account stated, and fraudulent inducement against
BCBS. ECAPS's breach of contract claim asserts that its
course of dealing with BCBS created an implied-in-fact
contract, and that by not requiring preauthorization of the
surgery, BCBS agreed to pay the "usual and customary
rates for the medical services" provided by ECAPS.
(Id. ¶¶32-33). ECAPS's promissory
estoppel count is likewise based on the alleged statement
that preauthorization was not required. (Id.
¶39). ECAPS's account-stated claim asserts that it
submitted bills to BCBS, that BCBS paid only a small portion
of those bills, and that it is owed the outstanding balance.
(Id. ¶¶44-47). Finally, ECAPS's
fraudulent- inducement claim alleges that BCBS induced ECAPS
to perform the surgery by telling ECAPS that preauthorization
was not required, and that inherent in that statement was a
representation that BCBS would pay the usual and customary
rate for the surgery. (Id. ¶¶49-51).
defendant may remove "any civil action brought in a
State court of which the district courts of the United States
have original jurisdiction." 28 U.S.C. § 1441(a).
District courts have "original jurisdiction of all civil
actions arising under the Constitution, laws, or treaties of
the United States." 28 U.S.C. § 1331 (concerning
federal question jurisdiction). A removed action must be
remanded "[i]f at any time before final judgment it
appears that die district court lacks subject matter
jurisdiction." 28 U.S.C. § 1447(c). Removal is
"strictly construed, with all doubts to be resolved in
favor of remand." Brown v. JEVIC,575 F.3d 322,
326 (3d Cir. 2009) (citations omitted); see also
Samuel-Bassett v. KIA Motors Am., Inc.,357 F.3d 392,
396, 403 (3d ...