A physician sued Verizon Communications after the claims administrator for Verizon's health benefits plan denied her claims for payment based on medical services she provided to certain plan participants. The plan provided that "[t]he coverage and any benefits under the plan are not assignable by any covered member without the written consent of the Plan ...." An exception existed where "required by a ‘Qualified Medical Child Support Order' as defined by ERISA or any applicable state or federal law ...."
The physician asserted claims for benefits, breach of fiduciary duty, and the failure to provide plan documents. The district court dismissed the case on the ground that the physician lacked standing under ERISA because of the plan's anti-assignment provision.
On appeal, the Eleventh Circuit agreed. The court recognized that a healthcare provider could "acquire derivative standing ... by obtaining a written assignment ... of his right to payment of benefits under an ERISA-governed plan." The court also recognized that "an anti-assignment provision in a plan, which limits or prohibits a plan participant or beneficiary from assigning her right to payment of benefits, is valid and enforceable." As a result, such a provision could prevent a healthcare provider from acquiring a cause of action under Section 502(a).
Although the physician had obtained assignments from her patients, they were void because of the anti-assignment provision. Nor had the physician alleged or provided evidence that written consent to the assignments had been given by the plan, according to the court.
The court rejected an argument that a Georgia statute, O.C.G.A. § 33-24-54(a), rendered the anti-assignment provision invalid or required that insureds assign their claims to the physician. The statute required that an insurer pay a non-network provider directly pursuant to an assignment where the insurer pays participating providers directly.
According to the Eleventh Circuit, "nothing in this statute requires an insured to assign her benefits to a medical provider" nor "prohibits a health benefits plan from barring assignments."
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