Lane Begnaud v. Blue Cross & Blue Shield Fdn, et al

Filing 511079141

Case: 09-30408

Document: 00511079141

Page: 1

Date Filed: 04/14/2010

IN THE UNITED STATES COURT OF APPEALS United States Court of Appeals FOR THE FIFTH CIRCUIT Fifth Circuit FILED
April 14, 2010 N o . 09-30408 S u m m a r y Calendar Lyle W. Cayce Clerk

L A N E BEGNAUD P l a in t i f f - A p p e l l a n t v. B L U E CROSS & BLUE SHIELD FOUNDATION, formerly known as L o u is i a n a Child Care Foundation Inc, formerly known as Louisiana Health S e r v ic e & Indemnity Co PAC; HMO LOUISIANA INC; LOUISIANA H E A L T H SERVICE & INDEMNITY CO, doing business as Blue Cross & B lu e Shield of Louisiana Defendants-Appellees

A p p e a l from the United States District Court fo r the Western District of Louisiana U S D C No. 6:06-CV-1137

B e fo r e JONES, Chief Judge, and DAVIS and WIENER, Circuit Judges. P E R CURIAM:* J a m e s Begnaud ("Begnaud"), on behalf of his son Lane Begnaud, appeals t h e district court's grant of summary judgment in favor of appellees' ("Blue C r o s s ") partial denial of health insurance benefits. Because the plan

Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

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a d m in is t r a to r did not abuse its discretion, the judgment is AFFIRMED, for e s s e n t ia lly the reasons stated by the district court. W h ile she was pregnant, Begnaud's wife, Erin, received prenatal medical c a r e from the Pediatrix Medical Group ("Pediatrix"). Blue Cross provided Erin's m e d i c a l insurance under Begnaud's employee benefit plan. When she first b e g a n using Pediatrix it was a "participating provider" with Blue Cross. H o w e v e r , due to a merger with another medical group, Pediatrix was a nonp a r tic ip a t in g provider for approximately three months, including June 3, 2006, w h e n Erin Begnaud required an emergency delivery and neonatal services p r o v i d e d by Pediatrix. The Begnauds were charged $6,356 for these services, b u t Blue Cross reimbursed only $1,660.70. F o r each covered procedure, Blue Cross negotiates an "allowable charge" w it h a medical service provider. If the medical provider is a participating p r o v id e r with Blue Cross, then the medical provider holds the member (the B e g n a u d s ) harmless for any amount in excess of the allowable charge. If the m e m b e r uses a non-participating provider, he is completely liable for any a m o u n t in excess of the allowable charge that the provider chooses to assess. In e it h e r case, Blue Cross requires a copayment by the member pursuant to a fo r m u la based partially on whether the medical provider is a participating p r o v id e r . U n d e r Begnaud's plan, Blue Cross normally pays fifty percent of the a llo w a b le charge for services from non-participating providers. Begnaud

a p p e a le d this reimbursement to Blue Cross's plan administrator. In response, B lu e Cross did not enforce the provision and, in the exercise of its discretionary a u th o r it y , paid seventy percent of the allowable charge. This is equivalent to the r e im b u r s e m e n t rate paid for services from participating providers. Moreover, B lu e Cross increased the allowable charge for each service by twenty percent,

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fu r t h e r increasing the reimbursement.

Because Pediatrix was a non-

p a r tic ip a t in g provider during the emergency delivery, Begnaud is liable for the a m o u n t s in excess of the allowable charge. This excess amount accounts for m o s t of Begnaud's personal liability. Begnaud's subsequent administrative a p p e a l was unsuccessful. B e g n a u d sued, contending that Blue Cross's failure to pay the full amount o f the claim for medical services is contrary to his insurance contract. The d i s tr ic t court granted summary judgment in favor of Blue Cross. Begnaud now a p p e a ls and seeks attorney's fees. W e review a dismissal on summary judgment de novo applying the same s ta n d a r d as the district court. Daniels v. City of Arlington, 246 F.3d 500, 502 (5 th Cir. 2001). A motion for summary judgment should be granted if there is n o genuine issue of any material fact. FED. R. CIV. P. 56(c); Celotex Corp v. C a tre tt, 477 U.S. 317, 322, 106 S. Ct. 2548 (1986). W h e n , as here, the ERISA plan at issue grants the administrator "full d is cr e tio n a r y authority," the administrator's interpretation of the facts and law is reviewed for abuse of discretion. Wade v. Hewlett-Packard Dev. Co. LP Short T e r m Disability Plan, 493 F.3d 533, 537-38 (5th Cir. 2007). Further, when the b e n e fit plan at issue is self-administered, the court must consider the conflict of in t e r e s t as a factor in determining whether the administrator abused its d is c r e tio n , employing a "sliding scale" standard of review. Id. The court will act w it h less deference to the administrator in proportion to the evidence of conflict b e fo r e it. Id. I n the present case, Begnaud has failed to demonstrate that the Blue C r o s s administrator abused its discretion. Begnaud believes the following

p r o v is io n in his policy entitles him to a full reimbursement:

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W h e n A Member Uses Nonparticipating Providers [...] H o w e v e r , the Member has the right to file an Appeal with the C o m p a n y to receive Benefits based on a higher Allowable Charge, if the Member received Covered Services from a Nonparticipating P r o v id e r who was the only Provider available to deliver the Covered S e r v ic e within a seventy-five (75) mile radius of the Member's home o r if the Covered Service that the Member received from the N o n p a r tic ip a t in g Provider was an Emergency Medical Service. (em p h a sis added). P la in ly , as the court held, the "Emergency Medical Services" provision d o e s not entitle Mr. Begnaud to a 100 percent reimbursement rate for emergency s e r v ic e s . Rather, the provision provides the member an opportunity to appeal t h e size of the allowable charge. Begnaud was afforded the opportunity to a p p e a l and, further, was successful. With no contractual obligation to do so, B l u e Cross paid at the higher participating provider rate (seventy percent) and in c r e a s e d the allowable claim amount by twenty percent. Blue Cross refused to p a y any amounts in excess of the allowable charge, which is its policy. The a d m in is t r a to r correctly, indeed generously, interpreted and applied the plan. B e c a u s e this appeal is meritless, Bernaud is not entitled to attorney's fees. T h e judgment of the district court is AFFIRMED.

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