United States District Court, Southern District of New York
August 27, 2003
ERIC RUBIN-SCHNEIDERMAN, PLAINTIFF,
MERIT BEHAVIORAL CARE CORPORATION, SATI AHLUWALIA, M. D., EMPIRE BLUE CROSS AND BLUE SHIELD, DEFENDANTS
The opinion of the court was delivered by: John Martin, District Judge
OPINION and ORDER
This matter is before the Court pursuant to an order of the Second Circuit directing the Court to reconsider its prior decisions dismissing Plaintiff's claims in light of its decision in Cicio v. Vytra Healthcare, 321 F.3d 83 (2d Cir. 2003). Having now reviewed this action in light of Cicio, the Court adheres to its prior conclusion that the complaint should be dismissed.
Cicio involved a claim that an HMO had improperly denied a patient, who was diagnosed with multiple myeloma, treatment with high dose chemotherapy supported with peripheral blood stem cell transplantation in a tandem double transplant. The medical director of the HMO denied the treating physician's request to authorize this treatment on the ground that it was an "experimental/investigatory procedure" not covered by the plan. In response to the treating physician's request for reconsideration, the medical director replied that "[b]ased on the clinical peer review of the additional material, a single [ Page 2]
stem cell transplant has been approved" but "the original request for tandem stem cell transplant remains denied." See Cicio, 321 F.3d at 88.
This Court dismissed Plaintiff's malpractice claim on the ground that it was preempted by ERISA. In Cicio, the Second Circuit stated:
We conclude that a state law malpractice action, if
based on a "mixed eligibility and treatment decision,"
is not subject to ERISA preemption when that state law
cause of action challenges an allegedly flawed medical
judgment as applied to a particular patient's
Cicio. 321 F.3d at 102.
While, taken in isolation, the above language supports Plaintiff's argument that the malpractice claim alleged is not preempted, the crucial distinction is that the Plan Administrator here had no physician-patient relationship with the insured and its role "was confined to informing a patient before receiving treatment whether that treatment would be covered under the plan." Rubin-Schneiderman v. Merit Behavioral Care Corp., 163 F. Supp.2d 227, 231 (S.D.N.Y. 2001). In Cicio, however, the Circuit Court noted at the outset of its opinion that the Plan's subscriber agreement explains that the HMO provided enrollees with, "[d]iagnosis and treatment of disease, injury or other conditions." Cicio, 321 F.3d at 87.*fn1 [ Page 3]
Cicio was the first case in the Second Circuit, subsequent to Peqram v. Herdrich, 530 U.S. 211, 120 S.Ct. 2143, 147 L.Ed.2d 164 (2000), to consider whether ERISA preempted medical malpractice claims. In Peqram the Supreme Court held that "mixed eligibility decisions by HMO physicians are not fiduciary decisions under ERISA." Id. at 237, 120 S.Ct. at 2158.
However, in dismissing Plaintiff's negligence claim initially, this Court specifically rejected Plaintiff's argument that Peqram would preclude a finding of preemption in this case:
The problem with Plaintiff's argument is that both
Peqram and the Third Circuit line of cases [on which
Plaintiff relies] involved UR determinations by an
HMO's doctors or administrators, not by independent UR
agents for a more traditional fee-for-service plan.
Unlike an HMO, Empire Blue Cross never sought to
undertake responsibility for Plaintiff's treatment. In
providing UR services, Merit's role was confined to
informing a patient before receiving treatment whether
that treatment would be covered under the plan.
Merit's doctors were not Plaintiff's treating
physicians, nor did Merit purport to provide Plaintiff
with medical services. Thus, the UR determination
involved plan administration, not provision of medical
services. See Dukes, 57 F.3d at 360-61.
Rubin-Schneiderman v. Merit Behavioral Care Corp., 163 F. Supp. at 231. [ Page 4]
The fact that the Second Circuit in Cicio joined the Third Circuit in finding that ERISA did not preempt some negligence claims against HMOs does not cast doubt on this Court's decision that the reasoning in those cases does not apply to insurers like Blue Cross which never sought to undertake responsibility for its insureds' treatment. Marks v. Watters 322 F.3d 316, 324 (4th Cir. 2003). Indeed, the doctor who performed the utilization review in this case specifically advised the treating physician that: "Regardless of our decision you and the patient have the responsibility for determining the appropriateness of treatment." Def. Reply Mem. Ex. 3, Letter from Dr. Ahluwalia.
For the foregoing reasons the Court adheres to its prior determination that the complaint must be dismissed.