Under ERISA’s civil enforcement provision, 29 U.S.C. § 1132(a)(1), only two categories of persons may sue directly to recover benefits due them under the terms of an ERISA-governed plan, or to enforce their rights under the plan, or to clarify their rights to future benefits under the plan. Those persons are plan participants and plan beneficiaries.
Healthcare providers seeking to recover benefits under an ERISA-governed plan generally do not claim to be plan participants. See, e.g., Penn. Chiropractic Ass’n v. Indep. Hosp. Indem. Plan, Inc., 802 F.3d 926, 928 (7th Cir. 2015) (chiropractors conceded they are not “participants”). Rather, they claim to be plan beneficiaries. Id.
A “beneficiary,” as defined in ERISA, is “a person designated by a participant, or by the terms of an employee benefit plan, who is or may become entitled to a benefit thereunder.” 29 U.S.C. § 1002(8).
The circuit courts have long rejected the argument that healthcare providers are plan beneficiaries and continue to do so, thereby precluding such providers from bringing direct actions to recover benefits under ERISA. Hobbs v. Blue Cross Blue Shield of Ala., 276 F.3d 1236, 1241 (11th Cir. 2001).
Healthcare providers are “not ‘beneficiaries’ of an ERISA welfare plan by virtue of their in-network status,” or their provider agreements. Rojas v. Cigna Health and Life Ins. Co., 793 F.3d 253, 259 (2d Cir. 2015); Penn. Chiropractic Ass’n, 802 F.3d at 929.
“The fact that [a healthcare provider] may be entitled to payment from [an insurer] as a result of her clients’ participation in an employee plan does not make her a beneficiary for the purpose of ERISA standing.” Brown v. BlueCross BlueShield of Tenn., Inc., 827 F.3d 543, 545-46 (6th Cir. 2016), citing Rojas, 793 F.3d at 257 (plan provision entitling healthcare providers to receive payments directly from the insurer “does not a beneficiary make”); Grasso Enter., LLC v. Express Scripts, Inc., 809 F.3d 1033, 1040 (8th Cir. 2016) (citing Rojas, but stating “[t]he issue … is not whether [the health care providers] have standing but whether their claim comes within the zone of interests regulated by [ERISA]”).
Nonetheless, “a healthcare provider may acquire derivative standing to sue under ERISA by obtaining a written assignment from a ‘participant’ or ‘beneficiary’ of his right to payment of medical benefits.” Conn. State Dental Ass’n v. Anthem Health Plans, Inc., 591 F.3d 1337, 1347 (11th Cir. 2009); New Jersey Brain and Spine Ctr. v. Aetna, Inc., 801 F.3d 369, 373 (3d Cir. 2015); Spinedex Physical Therapy, USA, Inc. v. United Healthcare of Ariz., Inc., 770 F.3d 1282, 1289 (9th Cir. 2014), cert. denied, 136 S. Ct. 317 (2015).
“A healthcare provider-assignee ‘stands in the shoes of the beneficiary,’ and can only assert claims that could have been brought by the patients themselves.” Brown, 2016 WL 3606686, at *4; see also City of Hope Nat’l Med. Ctr. v. HealthPlus, 156 F.3d 223, 227-28 (1st Cir. 1998). Claims that implicate coverage and the right to recover benefits under a plan, often characterized as “right to payment” claims, are properly assignable to a healthcare provider. Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 325 (2d Cir. 2011); see, e.g., CardioNet, Inc. v. Cigna Health Corp., 751 F.3d 165 (3d Cir. 2014).
But plan participants and beneficiaries cannot assign “amount of payment” claims. For example, “claims regarding the computation of contract payments or the correct execution of such payments” cannot be assigned to a healthcare provider because those “are typically construed as independent contractual obligations between the provider and ... the benefit plan.” Montefiore, 642 F.3d at 331. See, e.g., Brown, 543 F.3d at 548; Merrick v. United Health Group Inc., 127 F. Supp. 3d 138, 150 (S.D.N.Y. 2015) (same). Such claims are properly the subject of a breach of contract action, not an ERISA action. CardioNet, 751 F.3d at 177-78
Anti-assignment clauses in ERISA plans are valid and enforceable. Physicians Multispecialty Group v. Health Care Plan of Horton Homes, Inc., 371 F.3d 1291, 1295 (11th Cir.), cert. denied, 543 U.S. 1002 (2004).
If a valid and enforceable assignment of a claim for payment of benefits has been made, the court will assess the scope of the assignment by applying rules of contract construction. See, e.g., Griffin v. Suntrust Bank, Inc., 2016 WL 1657973, at *4 (11th Cir. Apr. 27, 2016) (“Nothing in an assignment of benefits transfers the patient’s right to bring a cause of action for breach of fiduciary duty, to seek statutory penalties for failure to provide plan documents, or to seek equitable relief to redress a practice that violates ERISA or the terms of the Plan.”); Rojas, 793 F.3d at 258-59 (“By expressly assigning only their right to payment, [the] patients did not also assign any other claims they have under ERISA,” including an ERISA anti-retaliation claim); Montefiore Med. Ctr. v. Local 272 Welfare Fund, 2015 WL 7970026, at *3 (S.D.N.Y. Oct. 19, 2015) (assignment of patients’ rights to “monies and/or benefits ... to cover the costs of care and treatment” did not include patients’ rights to seek injunctive or other equitable relief under ERISA), order adopting report and recommendation of magistrate, 2015 WL 8073909 (S.D.N.Y. Dec. 4, 2015).
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