PRESTIGE INSTITUTE FOR PLASTIC SURGERY, P.C. v. AETNA LIFE INSURANCE COMPANY et al
OPINION. Signed by Judge Renee Marie Bumb on 4/27/2021. (tf, )
[Docket Nos. 8, 17]
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
PRESTIGE INSTITUTE FOR PLASTIC
SURGERY, P.C., on behalf of
Civil No. 20-10371 (RMB/AMD)
AETNA LIFE INSURANCE COMPANY,
RENÉE MARIE BUMB, United States District Judge
This matter comes before the Court on the Motion to Dismiss
brought by Defendants Aetna Life Insurance Company, Macquarie
Holdings, and Macquarie Holdings (U.S.A.) Inc. (collectively,
“Defendants”), [Docket No. 8], and the Motion to File Sur-Reply by
(“Plaintiff”), [Docket No. 17]. For the reasons expressed below,
the Court will grant Defendants’ Motion and deny Plaintiff’s
This suit stems from a dispute over a medical insurance claim.
Patient S.A., on whose behalf Plaintiff brought this suit, received
health benefits through Defendant Macquarie Holdings, via a selffunded
Administrator”). Defendant Aetna Life Insurance Company (“Aetna”)
is the Plan’s claims administrator. Plaintiff is a physician
practice group located in Voorhees, New Jersey, and led by Joseph
F. Tamburrino, M.D. Plaintiff is an out-of-network provider that
does not have a contract with Aetna or participate in Aetna’s
network of providers.
Defendants’ Motion to Dismiss does not require an in-depth
recitation of the facts of this case, so the Court will give only
a brief overview. On April 12, 2017, S.A. required surgery related
to her breast cancer treatment. Dr. Tamburrino performed the
surgery. Plaintiff then submitted an invoice on a CMS-1500 form to
Aetna in the amount of $76,626.42 for the surgery. Defendants only
reimbursed Plaintiff in the amount of $5,339.09. Plaintiff alleges
that this under-reimbursement violates the terms of the Plan, which
itself is subject to the Employee Retirement Income Security Act
of 1974, 29 U.S.C. § 1001 et. seq. (“ERISA”).
The Plan includes a clause (the “Anti-Assignment Clause” or
“Clause”) that reads: “Coverage and your rights under this plan
may not be assigned. A direction to pay a provider is not an
assignment of any right under this plan or of any legal or
equitable right to institute any court proceeding.” [Docket No. 83, at 74.] Plaintiff, to which the Plan was not issued, seeks to
Representative” form (the “DAR”) that S.A. executed. [Docket No.
1, ¶¶ 31-32.] The DAR states, in relevant part:
I hereby convey . . . to the Designated Authorized
Representative [Plaintiff] to the fullest extent
permissible under the law and under any applicable
employee group health plan(s) . . . any claim, cause of
action or other right I may have to such group health
plans . . . with respect to medical expenses incurred as
a result of the medical services I received from the
provider(s) and to the full extent per permissible under
the law to claim or lien such medical benefits,
settlement, insurance reimbursement and any applicable
remedies, including but not limited to . . . any
administrative and judicial actions . . . by the
Designated Authorized Representative to pursue such
claim, chose in action or right against any liable party
or employee group health plan(s), including, if
necessary, to bring suit by the Designated Authorized
Representative against such liable party or employee
health plan in my name with derivative standing but at
such Designated Authorized Representative’s expenses.
[Id., ¶ 31.]
Plaintiff’s Complaint alleges three causes of action. Counts
I and III allege “unpaid benefits under employee benefit plan
governed by ERISA” under 29 U.S.C. § 1132(a)(1)(B). [Docket No. 1,
¶¶ 46-51, 59-65.] Count II alleges breach of fiduciary duty under
29 U.S.C. § 1104(a)(1)(B). [Id., ¶¶ 52-58.] Defendants’ Motion to
Dismiss, however, does not rely on the merits of the case itself,
but rather Plaintiff’s standing to bring the case. [See Docket No.
Defendants filed their Motion to Dismiss on September 9,
[Id.] Plaintiff timely responded on October 19, 2020.
[Docket No. 14.] Defendants timely replied on October 20, 2020.
[Docket No. 15.] Plaintiff filed a Motion to File Sur-Reply, which
included its proposed sur-reply brief, on November 1, 2020. [Docket
The Court exercises subject matter jurisdiction pursuant to
28 U.S.C. § 1331.
Defendants’ Motion argues that Plaintiff lacks standing to
bring this suit. “Standing is a jurisdictional matter.” Davis v.
Wells Fargo, 824 F.3d 333, 346 (3d Cir. 2016). “A motion to dismiss
for want of standing is . . . properly brought pursuant to Rule
12(b)(1), because standing is a jurisdictional matter.” Ballentine
v. United States, 486 F.3d 806, 810 (3d Cir. 2007). Where, as here,
“[a] challenge to subject matter jurisdiction under Rule 12(b)(1)”
is “facial,” it requires the court to ‘consider the allegations of
The Court notes that Defendants did not follow this Court’s
Individual Rules & Procedures, which require that, “before
bringing a motion to dismiss, . . . a party must submit a letter,
not to exceed three (3) single-spaced pages, requesting a premotion
MarieBumb.pdf (emphasis in original). Nevertheless, the Court will
address Defendants’ Motion without requiring compliance with that
the complaint as true.’” Id. (quoting Petruska v. Gannon Univ.,
462 F.3d 294, 302 n.3 (3d Cir. 2006)). Furthermore, in this
instance the Court may consider the Plan itself “without converting
the motion to dismiss into one for summary judgment” because the
Plan is “integral or explicitly relied upon” in the Complaint. In
re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d
ERISA provides that “[a] civil action may be brought by a
participant or beneficiary to recover benefits dues to him under
the terms of the plan.” 29 U.S.C. § 1132(a)(1)(B). A “participant”
is “any employee or former employee of an employer, or any member
or former member of an employee organization, who is or may be
eligible to receive a benefit of any type from an employee benefit
plan.” Id. § 1002(7). A “beneficiary” 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.” Id. § 1002(8).
Here, Defendants argue that the Plan’s Anti-Assignment Clause
precludes Plaintiff from bringing this suit on S.A.’s behalf (that
is, as a beneficiary). The Clause states, “Coverage and your rights
To the extent that this Motion should have been filed under Rule
12(b)(6), the Court notes that “a motion for lack of statutory
standing,” as here, “is effectively the same whether it comes under
Rule 12(b)(1) or 12(b)(6).” See N. Jersey Brain & Spine Ctr. v.
Aetna, Inc., 801 F.3d 369, 371 n.3 (3d Cir. 2015) (citing Warren
Gen. Hosp. v. Amgen Inc., 643 F.3d 77, 83 n.7 (3d Cir. 2011)).
under this plan may not be assigned. A direction to pay a provider
is not an assignment of any right under this plan or of any legal
or equitable right to institute any court proceeding.” [Docket No.
8-3, at 74.] The Third Circuit has held that “anti-assignment
clauses in ERISA-governed health insurance plans as a general
matter are enforceable.” Am. Orthopedic & Sports Med. V. Indep.
Blue Cross Blue Shield, 890 F.3d 445, 453 (3d Cir. 2018).
Plaintiff does not dispute the validity and enforceability of
the Anti-Assignment Clause. Rather, it argues that the Clause does
not apply here because “Plaintiff . . . received a Designation of
Authorized Representative” from S.A., which Plaintiff argues is “a
cannot be contractually excluded and must be included in every
insurance plan.”3 [Docket No. 15, at 4.] In other words, Plaintiff
argues that it is bringing this suit not via assignment, but as a
Plaintiff makes an unconvincing argument that Defendants’ failure
to explicitly move to dismiss the Complaint “on the basis that
Representative” means that they waived that argument. [Docket No.
15, at 4.] Defendants repeatedly alluded to the DAR in their
initial Motion and it is clear to the Court that their standing
argument contemplated that aspect of Plaintiff’s case. Therefore,
the Court will not deny Defendants’ Motion on this basis. See Ross
Cooperman, M.D., LLC v. Horizon Blue Cross Blue Shield, Case No.
2-19-cv-19225, 2020 WL 5422801, at *3 (D.N.J. Sept. 10, 2020)
(denying the same argument). For the same reason, the Court will
deny Plaintiff’s Motion to File a Sur-Reply, which is based in
part on the above argument and is otherwise irrelevant.
The Honorable William J. Martini recently addressed this line
of arguments. As the Court noted in that case, 29 C.F.R. 2560.5031(b) states that “[e]very employee benefit plan shall establish
and maintain reasonable procedures governing the filing of benefit
claims, notification of benefit determinations, and appeal of
adverse benefit determinations.” Ross Cooperman, M.D., LLC v.
Horizon Blue Cross Blue Shield, Case No. 2-19-cv-19225, 2020 WL
5422801, at *3 (D.N.J. Sept. 10, 2020) (quoting 29 C.F.R. 2560.5031(b)). The regulation continues,
The claims procedures for a plan will be deemed to be
reasonable only if . . . [t]he claims procedures do not
preclude an authorized representative of a claimant from
acting on behalf of such claimant in pursuing a benefit
claim or appeal of an adverse benefit determination.
Nevertheless, a plan may establish procedures for
determining whether an individual has been authorized to
act on behalf of a claimant.
29 C.F.R. 2560.503-1(b)(4).
As the Cooperman Court noted, “[t]his Court has repeatedly
held that this regulation applies only to internal claims and
appeals, not to federal lawsuits brought after the plan member
exhausts those appeals.” Cooperman, 2020 WL 5422801, at *4; see,
e.g., Menkowitz v. Blue Cross Blue Shield of Ill., No. CIV. 142946, 2014 WL 5392063, at *3 (D.N.J. Oct. 23, 2014); Prof’l
Orthopedic Assocs., PA v. Excellus Blue Cross Blue Shield, No.
CIV.A. 14-6950 FLW, 2015 WL 4387981, at *8 (D.N.J. July 15, 2015).
Plaintiff offers no argument that Courts in this District have
wrongly decided this issue.4
Therefore, the Court finds that
Plaintiff does not have standing to bring this suit. The Court
will grant Defendants’ Motion to Dismiss.5
Defendants’ Motion to Dismiss and deny Plaintiff’s Motion to File
a Sur-Reply. An accompanying Order shall issue.
April 27, 2021
s/Renée Marie Bumb
RENÉE MARIE BUMB
United States District Judge
The Court notes that Plaintiff attempts to argue that, under §
502 of ERISA, a DAR “is not limited to internal appeals and is
entitled to bring a § 502(a) claim on behalf of a patient.” [Docket
No. 15, at 5.] Plaintiff cites two cases to support this argument,
but its reliance is misplaced. One of the cases held that a
healthcare provider had standing to bring an ERISA action on behalf
of a patient; however, no anti-assignment clause existed in that
case. See Outpatient Specialty Surgery Partners, Ltd. v.
UnitedHealth Ins. Co., CIVIL ACTION NO. 4:15-CV-2983, 2016 U.S.
Dist. LEXIS 82312 (S.D. Tex. June 24, 2016). The other found that
an anti-assignment clause would not preclude a healthcare provider
from bringing an ERISA claim on behalf of a patient; however, that
case turned on a Louisiana statute that invalidated the antiassignment clause. Omega Hosp., LLC v. United Healthcare Servs.,
345 F. Supp. 3d 712, 727 (M.D. La. 2018). No such state law exists
here. Therefore, these arguments are unavailing.
Because the Court’s decision relies on Plaintiff’s lack of
standing, it will not address Defendant’s alternative argument
that Count II should be dismissed because it is redundant to
Plaintiff’s other claims. [See Docket No. 8-1, at 5-6.]
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