BEDWELL v. AETNA HEALTH INSURANCE COMPANY

Filing 40

ORDER granting Defendants' 33 Motion to Dismiss for Failure to State a Claim and denying Plaintiff's 38 Motion for Oral Argument. Motion for leave to amend complaint should be filed on or before 8/10/15. Signed by Judge Richard L. Young on 7/23/2015. (TMD)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
EVANSVILLE DIVISION

ANDREW BEDWELL,

)
)
)
)
)
)
)
)
)
)
)
)

Plaintiff,
vs.

AETNA, INC., d/b/a AETNA HEALTH
INSURANCE COMPANY, and
MERITAIN HEALTH, INC.,
Defendants.

3:14-cv-00081-RLY-WGH

ENTRY ON DEFENDANTS’ MOTION TO DISMISS AND PLAINTIFF’S
REQUEST FOR ORAL ARGUMENT
Plaintiff, Andrew Bedwell, brings a denial of benefits claim under his employersponsored health insurance plan. The Defendants, Meritain Health, Inc. and Aetna, Inc.,
d/b/a Aetna Health Insurance Company, now move for dismissal pursuant to Rule
12(b)(6) for failure to state a claim. Plaintiff requests oral argument on the issue. For the
reasons set forth below, the court GRANTS Defendants’ Motion to Dismiss and
DENIES Plaintiff’s Request for Oral Argument.
I.

Background
On July 6, 2011, Plaintiff, was injured in a motor vehicle accident and was treated

for his injuries at Deaconess Hospital in Evansville, Indiana. (Am. Compl. ¶¶ 1, 2).
Plaintiff’s Amended Complaint alleges each Defendant breached the terms of his

1

employer-funded health insurance policy by “refus[ing] to make the contractually
mandated payment to Deaconess Hospital.” (Id. ¶¶ 6, 10).
At the time of the accident, Plaintiff was insured under an ERISA-governed plan,
entitled the “AmeriQual Group, LLC Group Health Plan” (the “Plan 1”). (Id. ¶ 3; Ex. A, §
1 at 1). A copy of the Plan documents is attached as Exhibit A to the Amended
Complaint. The Plan defines the Plan Administrator as “the Company” and the Plan
Supervisor as Meritain Health, Inc. (Ex. A, § 3.65; Ex. A, § 3.66, as amended by the
Sixth Amendment to January 2005 Restatement of AmeriQual Group, LLC Group Health
Plan). As Plan Supervisor, Meritain Health provides claims administration services. (Ex.
A, § 3.66, at 18). Defendant, Aetna, Inc., owns Meritain Health. (Am. Compl. ¶ 9).
II.

Request for Oral Argument
Plaintiff filed a request for oral argument. The court finds oral argument is not

necessary for a full and fair resolution of this case. Accordingly, Plaintiff’s Request for
Oral Argument is DENIED.
III.

Discussion
“To survive a motion to dismiss under Rule 12(b)(6), a complaint must ‘state a

claim to relief that is plausible on its face.’” Adams v. City of Indianapolis, 742 F.3d 720,
728 (7th Cir. 2014) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A
claim is plausible when it “allows the court to draw the reasonable inference that the

1

The word—“plan”—is admittedly confusing. A plan for ERISA purposes is not the document but the
employee-benefits plan. Larson v. United Healthcare Ins. Co., 723 F.3d 905, 911-12 (7th Cir. 2013).

2

defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009).
Defendants argue there is no contract between Plaintiff and Meritain and Plaintiff
and Aetna; therefore, they cannot be held liable for breach of contract. Plaintiff does not
dispute the fact that a contract does not exist between Plaintiff and Defendants. Instead,
Plaintiff argues that he is a third-party beneficiary to a contract alleged to exist between
Meritain and AmeriQual.
The resolution of this motion turns on the law of ERISA. “[T]he ERISA civil
enforcement mechanism is one of those provisions with such ‘extraordinary pre-emptive
power’ that it ‘converts an ordinary state common law complaint into one stating a
federal claim for purposes of the well-pleaded complaint rule.’” Aetna Health, Inc. v.
Davila, 452 U.S. 200, 209 (2004) (quoting Metropolitan Life Ins. Co. v. Taylor, 481 U.S.
58, 65–66 (1987)). Thus, “claims by a beneficiary for wrongful denial of benefits (no
matter how they are styled) have been held by the Supreme Court to ‘fall [ ] directly
under § 502(a)(1)(B) of ERISA, which provides an exclusive federal cause of action for
resolution of such disputes.’” Vallone v. CNA Fin. Corp., 375 F.3d 623, 638 (7th Cir.
2004) (quoting Taylor, 481 U.S. at 62-63). Plaintiff’s claims, whether styled as breach of
contract claims or third party beneficiary claims, seek benefits due under an ERISAgoverned plan. Accordingly, Plaintiff’s claims are preempted.
Having so found, the court must determine whether the facts, as alleged by
Plaintiff, “support any kind of relief.” McDonald v. Household Intern, Inc., 425 F.3d
424, 429 (7th Cir. 2005). The facts as alleged in Plaintiff’s Amended Complaint give rise
3

to the plausible inference that a party is liable for the denial of benefits under ERISA.
For purposes of a denial of benefits claim, the proper defendant is the party having the
obligation to pay. Larson v. United Health Ins. Co., 723 F.3d 905, 913 (7th Cir. 2013)
(“[A] cause of action for ‘benefits due’ must be brought against the party having the
obligation to pay.”). Normally, that party is the ERISA plan itself. Id. (citing Feinberg
v. RM Acquisition, LLC, 629 F.3d 671, 673 (7th Cir. 2011)).
Plaintiff correctly points out that Meritain, as Plan Supervisor, provides “claims
administration services,” (Ex. A, § 3.66 at 18), and is “responsible for adjudicating
Claims for Benefits,” (id., § 14.03 at 66). But under the terms of the Plan documents,
only the Plan has the ultimate obligation to pay. (Ex. A, § 6 at 34) (“On receipt of
satisfactory proof of claim, the Plan will pay benefits up to the maximum shown in the
Schedule of Benefits for Major Medical Benefits”); see also id., § 14 at 65 (“Benefits will
be paid under this Plan only if the Plan Administrator decides, in its discretion, that the
Covered Person is entitled to them.”). The proper defendant in this case is, therefore, the
Plan itself.
In the alternative, Plaintiff seeks leave to amend his Amended Complaint. As he
has sued the wrong defendant, Plaintiff must satisfy the requirements of Federal Rule of
Civil Procedure 15(c)(1)(C). See Krupski v. Costa Crociere S. p. A., 560 U.S. 538
(2010). If Plaintiff reasonably believes he can satisfy those requirements, his motion for
leave should be filed on or before August 10, 2015.

4

IV.

Conclusion
Plaintiff’s claim for breach of contract premised on a denial of benefits under his

ERISA-governed Plan is preempted by ERISA. As such, Plaintiff should have brought
his action against the Plan. Accordingly, Defendants’ Motion to Dismiss (Filing No. 33)
is GRANTED, and Plaintiff’s Request for Oral Argument (Filing No. 38) is DENIED.

SO ORDERED this 23rd day of July 2015.

RICHARD L. YOUNG, CHIEF JUDGE
United States District Court
Southern District of Indiana

Distributed Electronically to Registered Counsel of Record.

5