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McCulloch Orthopaedic Surgical Services, Pllc v. Aetna U.S. Healthcare

United States District Court, S.D. New York

May 11, 2015




On February 17, 2015, plaintiff McCulloch Orthopaedic Surgical Services, PLLC a/k/a Dr. Kenneth E. McCulloch ("plaintiff" or "McCulloch") brought this action against defendant Aetna Life Insurance Company ("defendant" or "Aetna") in New York Supreme Court. Plaintiff alleges that it is an out-of-network medical provider who performed surgery on a patient who is a beneficiary of an Aetnaadministered health care plan. Plaintiff brings this action seeking reimbursement from Aetna for such medical services. Plaintiff has cast its claim as one for promissory estoppel.

On March 17, 2015, Aetna timely removed this action to this Court on the ground that plaintiff's state-law claim is completely preempted by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 et seq. (ECF No. 1.) On March 24, 2015, Aetna answered the Complaint. (ECF No. 6.) On April 2, 2015, plaintiff timely filed a motion to remand. (ECF No. 9.) As the Court finds that plaintiff's claim is properly one for coverage under an ERISA plan, that motion is DENIED.[1] Plaintiff shall amend its complaint to assert ERISA cause(s) of action not later than Monday, May 25, 2015.


The following facts are drawn from the Amended Complaint, as well as other competent evidence before the Court, such as claim forms and plan documents. See Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 331 (2d Cir. 2011) (it is proper for a district court "to look beyond the mere allegations of the complaint to the claims themselves (including supporting documentation) in conducting its analysis" on a motion to remand).

Plaintiff alleges that Aetna "provide[s] health insurance coverage... or administers health insurance programs... for a fee and pay[s] money to persons like Plaintiff who provide medical services to persons covered by such plans." (Amended Verified Complaint ("Am. Compl.") ¶ 16 (emphasis added), ECF No. 10-1.) Plaintiff alleges that it performed surgery on a patient ("Patient V.A.") who is "a plan participant or beneficiary of a health care plan administered by Defendant." (Id. ¶ 17; see also id. ¶¶ 6-7.) Patient V.A. submitted an insurance card to plaintiff that "had a number for Providers to call to determine coverage and other subjects." (Id. ¶ 4.) Plaintiff alleges that prior to providing any medical services, plaintiff's staff contacted Aetna and "was assured that the Patient was covered by a health care plan administered by Defendant, that such plan provided for payment to outof-network physicians, that the plan covered the surgical procedures that Plaintiff would be providing for the Patient, and that Defendant would reimburse Plaintiff at 70% of usual and customary reasonable rates [("UCR")] for such procedures." (Id. ¶ 8; see also id. ¶ 18.) Plaintiff alleges that Aetna's "call representatives are trained to quote the benefits that might apply for proposed services." (Id. ¶ 10 (emphasis added)).

After providing medical services to Patient V.A., plaintiff submitted completed CMS 1500 claim forms to Aetna. (Attorney Certification of Neil V. Shah in Support of Defendant's Opposition to Plaintiff's Motion to Remand ("Shah Cert.") Ex. B, ECF No. 14; see also Shah Cert. Ex. C.) Both forms show that Patient V.A. assigned his or her claims to plaintiff by indicating "Yes" in the "Accept Assignment?" field in Box 27. (See id.) These forms further indicate in Box 13 that Patient V.A. authorized "payment of medical benefits to the undersigned physician or supplier for services described below." (See id.) Plaintiff billed Aetna a total of $66, 048 for the medical services; Aetna paid $15, 267.51.[3] (Am. Compl. ¶ 13.) While Patient V.A.'s plan has an anti-assignment provision (see Shah Cert. Ex. A at 54), Aetna asserts that it remitted payment directly to plaintiff based on the CMS 1500 forms. (Defendant's Sur-Reply Brief in Further Opposition to Plaintiff's Motion to Remand at 3, ECF No. 25 ("Plaintiff's claim forms represent that Plaintiff has obtained an assignment from the patient entitling it to receive direct payment, and in reliance on these forms, it is undisputed that Aetna remitted payment to the Plaintiff.").) Plaintiff's promissory estoppel claim seeks $30, 966.09-the difference between 70% of the billed charges and what Aetna paid. (Am. Compl. ¶ 13.)


A. Removal Standard

Removal of an action filed in state court to federal court is proper in "any civil action... of which the district courts of the United States have original jurisdiction." 28 U.S.C. § 1441(a). A case removed from state court shall, however, be remanded "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction." 28 U.S.C. § 1447(c).

"The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. Under the "well-pleaded complaint rule, " federal subject matter jurisdiction generally exists "only when the plaintiff's well-pleaded complaint raises issues of federal law, " and not simply when federal preemption might be invoked as a defense to liability. Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987) (citations omitted). However, a "corollary of the well-pleaded complaint rule" provides that "Congress may so completely pre-empt a particular area that any civil complaint raising this select group of claims is necessarily federal in character." Id. at 63-64; see also Montefiore, 642 F.3d at 327 ("Complete preemption permits removal of a lawsuit to federal court based upon the concept that where there is complete preemption, only a federal claim exists. Where Congress has clearly manifested an intent to make causes of action removable to federal court, the federal courts must honor that intent." (quoting In re WTC Disaster Site, 414 F.3d 352, 372-73 (2d Cir. 2005)) (internal quotation marks omitted)).

In resolving a motion to remand, the Court is not limited to the allegations in the pleadings and may also consider extrinsic evidence. See Montefiore, 642 F.3d at 329, 331 (reviewing claim forms in connection with a remand motion, and concluding that "it was proper for the District Court to look beyond the mere allegations of the complaint to the claims themselves (including supporting documentation) in conducting its analysis, " id. at 331). When the removal of an action to federal court is challenged, "the burden falls squarely upon the removing party to establish its right to a federal forum by competent proof.'" R. G. Barry Corp. v. Mushroom Makers, Inc., 612 F.2d 651, 655 (2d Cir. 1979) (citations omitted), abrogated on other grounds by Hertz Corp. v. Friend, 559 U.S. 77 (2010); see also Blockbuster, Inc. v. Galeno, 472 F.3d 53, 57 (2d Cir. 2006).

"[O]ut of respect for the limited jurisdiction of the federal courts and the rights of states, " the Court must "resolve any doubts against removability." In re Methyl Tertiary Butyl Ether ("MTBE") Prods. Liab. Litig., 488 F.3d 112, 124 (2d Cir. ...

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