SKELCY v. UNITEDHEALTH GROUP, INC et al

Filing 60

OPINION filed. Signed by Judge Anne E. Thompson on 9/24/2014. (kas, )

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
LINDA S. SKELCY, Individually and as
General Administrator and Administrator
ad Prosequendum of the Estate of James T.
Skelcy,

Civ. No. 12-1014
OPINION

Plaintiff,
v.
UNITEDHEALTH GROUP et al.,
Defendants.
THOMPSON, U.S.D.J.
The present matter comes before the Court upon Plaintiff Linda S. Skelcy’s Motion in
Limine seeking permission to present proof of non-economic damages at trial. (Doc. No. 54).
Defendants UnitedHealth Group, Inc., United Healthcare Services, Inc., Oxford Health Plans, 1
and Oxford Health Insurance, Inc., (collectively, “Defendants”) have opposed the Motion in
Limine. (Doc. No. 56). For the reasons stated herein, Plaintiff’s Motion in Limine will be
granted.
BACKGROUND
This action involves a claim under the New Jersey Health Care Carrier Accountability
Act (“HCCAA”), N.J.S.A. 2A:53A-30 et seq., which imposes liability on health insurance
carriers for “negligence with respect to the denial of or delay in approving or providing
medically necessary covered services.” N.J.S.A. 2A:53A-33.

1

This designation includes Oxford Health Plans, Inc., Oxford Health Plans, LLC, and Oxford
Health Plans (NJ), Inc.
1

Mr. James T. Skelcy, husband of Plaintiff, was diagnosed in July 2007 with
dermatomyositis, a connective tissue disease characterized by skin and muscle inflammation. He
also had interstitial lung disease secondary to the dermatomyositis. (Doc. No. 34 at 5). Under a
self-funded ERISA account called the JPMorgan Chase Medical plan, Mr. Skelcy had tried firstline drug therapies, which failed, then tried Rituxan (Rituximab) prescribed by his
rheumatologist, Dr. Pedra-Nobre, which was successful. (Id. at 5-7; Doc. No. 56 at 3).
Eleven months later in July 2010, Mr. Skelcy’s symptoms flared again, and Dr. PedraNobre again prescribed Rituxan. (Doc. No. 34 at 7). However, at this time Mr. Skelcy had
health insurance coverage through Defendants, and Defendants required pre-approval for the
drug. (Doc. No. 56 at 4). Dr. Pedra-Noble requested approval of Rituxan or IVIG, which
Defendants initially denied on July 13, 2010. (Doc. No. 34 at 10). Dr. Pedra-Nobre then
requested an expedited appeal, and on July 15, 2010, Defendants requested a peer review
assessment from an unrelated third party, Medical Evaluation Specialists, Inc. (“MES”). (Id. at
11). Dr. Denise Beighe of MES concluded that Rituxan was not the standard of care for Mr.
Skelcy’s condition, stating instead that IVIG would be proper. (Id. at 12). Subsequently on July
16, 2010, Defendants denied the request to treat Mr. Skelcy with Rituxan or IVIG. (Id. at 13).
At no time did Defendants communicate any approval or consideration of IVIG to Mr. Skelcy or
to Dr. Pedra-Noble. (Id.).
On July 30, 2010, and August 9, 2010, Dr. Pedra-Nobre spoke to Defendants but did not
inform Defendants that Mr. Skelcy’s condition was life threatening. (Doc. No. 56 at 5). On
August 9, 2010, thirty-two days after the initial request, Defendants reversed their decision,
approving Rituxan treatment for Mr. Skelcy. (Doc. No. 34 at 14). Dr. Pedra-Nobre scheduled
Mr. Skelcy’s Rituxan treatments to begin on August 16, 2010, but Mr. Skelcy died on August 11,

2

2010. (Doc. No. 56 at 6). The county medical examiner listed chronic dermatomyositis,
interstitial pulmonary fibrosis, endomyocardial fibrosis, and cardiac arrhythmia as the causes of
death. (Doc. No. 34 at 14).
In February 2012, Plaintiff filed this suit to recover damages for the wrongful denial and
delay of health insurance benefits that caused her deceased husband’s death. (Doc. No. 1). On
August 6, 2012, Defendants filed a Motion to Dismiss, which was granted in part and denied in
part in this Court’s December 5, 2012 order. (Doc. No. 11, 12, 25). In that order, the Court
dismissed Plaintiff’s claims against MES, Dr. Beighe, Dr. Dennis Sandoval (employee of
Defendant UnitedHealth Group), and Dr. Gail Wilder (employee of Defendant UnitedHealth
Group). (Doc. No. 25). In light of this ruling, Plaintiff’s Fourth Amended Complaint now
asserts four counts against Defendants: (1) negligence, (2) breach of contract, (3) negligence per
se under the HCCAA, and (4) breach of the covenant of good faith and fair dealing. (Doc. No.
34 at 14-42).
On June 6, 2014, Plaintiff filed a Motion in Limine requesting permission to present
evidence of non-economic damages at trial. (Doc. No. 54). Defendants oppose this motion
(Doc. No. 56). Plaintiff asserts that the HCCAA permits plaintiffs to seek economic and noneconomic damages while Defendant asserts that non-economic damages are barred because the
HCCAA must be interpreted in conjunction with the New Jersey Wrongful Death Act (“WDA”),
N.J.S.A 2A:31-5, which is limited to economic damages only.
DISCUSSION
a. Legal Standard
“As a general rule, in limine motions are inappropriate if they require the court to engage
in an analysis of credibility or evidence yet to be presented.” Sculler v. Sculler, 348 N.J. Super.

3

374, 376 (Ch. Div. 2001) (citing Bellardini v. Krikorian, 222 N.J. Super. 457, 464 (App. Div.
1988)). Instead, in limine motions are used to “clarify legal issues in advance of trial.” Kelly v.
Berlin, 300 N.J. Super. 256, 270 (App. Div. 1997). Statutory interpretation is an issue of law.
See State in Interest of K.O., 217 N.J. 83, 91 (2014).
b. Analysis
Here, the issue of entitlement to non-economic damages depends upon interpretation of
the HCCAA, WDA, and Survivor’s Act. 2 Thus, it is a matter of law appropriate for in limine
review.
The operative provision of the HCCAA states:
Notwithstanding the provisions of any other law to the contrary, a carrier or organized
delivery system shall be liable to a covered person for economic and non-economic loss that
occurs as a result of the carrier’s or organized delivery system’s negligence with respect to
the denial of or delay in approving or providing medically necessary covered services, which
denial or delay is the proximate cause of the covered person’s: (1) death; (2) serious and
protracted or permanent impairment of a bodily function or system; (3) loss of a body organ
necessary for normal bodily function; (4) loss of a body member; (5) exacerbation of a
serious or life-threatening disease or condition that results in serious or significant harm or
requires substantial medical treatment; (6) a physical condition resulting in chronic and
significant pain; or (7) substantial physical or mental harm which resulted in further
substantial medical treatment made medically necessary by the denial or delay of care.
N.J.S.A. 2A:53A-33(a) (emphasis added). In contrast, the WDA imposes liability “when the
death of a person is caused by a wrongful act, neglect, or default,” N.J.S.A. 2A:31-1, but limits
damages to “pecuniary” injuries suffered by the survivors, N.J.S.A. 2A:31-5. Thus, under the
WDA, survivors may only recover economic losses. See Beim v. Hulfish, 216 N.J. 484, 501–04
(2014). A wrongful death action under the WDA is a derivative action brought by survivors who
seek compensation for the pecuniary losses they suffered as a result of the tortious conduct of

2

Both parties agree that the insurance contract at issue is an individual plan and therefore, not
governed by ERISA. (Doc. No. 54 at 16; Doc. No. 56 at 7).
4

another. Such actions differ from a survival action under the New Jersey Survivor’s Act,
N.J.S.A. 2A:15-3, which preserves to the decedent’s representatives a tort cause of action that
the decedent would have had if he or she had survived. See Smith v. Whitaker, 160 N.J. 221,
230–34 (1999). The Survivor’s Act does not explicitly limit recoverable damages. See N.J.S.A.
2A:15-3.
“The role of the Court in statutory interpretation is to determine and effectuate the
Legislature’s intent,” by “look[ing] first to the plain language of the statute.” Marino v. Marino,
200 N.J. 315, 329 (2009) (citations omitted). Courts will not “rewrite a plainly-written
enactment of the Legislature [nor] presume that the Legislature intended something other than
that expressed by way of the plain language.” Id. Only if the plain language of a statute is
unclear or susceptible to multiple meanings may a court look to extrinsic secondary evidence.
See id. Additionally, “[t]he preamble . . . should be read in harmony with the statute that it
introduces, whenever possible.” DiProspero v. Penn, 183 N.J. 477, 496 (2005) (citations
omitted). “To the extent that the preamble is at variance with the clear and unambiguous
language of the statute, the preamble must give way.” Id. at 497.
Plaintiff asserts that the plain language and purpose of the HCCAA permit her to present
proof of non-economic damages at trial. The operative provision of the HCCAA explicitly states
that “carriers . . . shall be liable to a covered person for economic and non-economic loss.”
N.J.S.A. 2A:53A-33(a). Therefore, Plaintiff argues that she may seek non-economic damages at
trial. Moreover, to the extent that other statutes may conflict with the HCCAA, Plaintiff claims
that the HCCAA supersedes any contrary provision because it begins with the phrase
“[n]otwithstanding the provisions of any other law to the contrary.” Id. In addition to this
explicit statutory command, Plaintiff asserts two other reasons why the HCCAA is not

5

constrained by any potential damages limits in the WDA and Survivor’s Act. First, the HCCAA
was enacted more recently than both the WDA and Survivor’s Act; thus, to the extent there is
any conflict among the statutes, the HCCAA prevails. 3 Second, the HCCAA more specifically
applies to the facts at hand than the WDA and Survivor’s Act, which are general tort statutes. 4
Therefore, to the extent there is any conflict among the statutes, Plaintiff argues that the HCCAA
supersedes the WDA and Survivor’s Act and permits proof of non-economic damages.
In addition to the plain language of the statute, Plaintiff asserts that the purpose of the
HCCAA also supports a broad remedy that includes non-economic damages. The HCCAA was
enacted because:
Health and dental carriers, in particular health maintenance organizations and other
managed care entities, have become increasingly involved in health care treatment decisions,
including, but not limited to, the use of financial incentives to providers and practice
guidelines, in an effort to reduce health care costs;
As a result, many carriers have been reducing or denying medically necessary health care
treatments for their insured patients;
Since the carriers are in many instances making medical decisions when they deny, delay,
or diminish health care treatments, they should be held to the same level of legal
responsibility as physicians and other health care providers who make decisions regarding
the necessity and appropriateness of medical care; and
It is fair and appropriate that insured patients have the opportunity to dispute carrier or
organized delivery system decisions in court, as well as in internal and external appeals
procedures so that these disputes may be quickly and efficiently resolved in ways that best
accommodate the needs of the insured patient.

3

Plaintiff states that “[w]here a subsequent legislative enactment clearly conflicts with an earlier
statute affecting the same subject matter, courts will find the legislative intent to supersede the
earlier law,” citing Kemp v. State, 147 N.J. 294, 306–07 (1997), among other cases. (Doc. No.
54 at 20-21).
4
Plaintiff cites the canon of statutory construction that if two statutes seem to be in conflict, and
one is more general while the other specific, the conflict is resolved in favor of the more specific
statute. (Doc. No. 54 at 23) (citing In re Salaries for Probation Officers of Hudson Cnty., 158
N.J. Super. 363, 366 (App. Div. 1978)).
6

N.J.S.A. 2A:53A-31. In light of the clear legislative intent to provide remedies to individuals
harmed by the decisions of their health insurers, Plaintiff argues that the HCCAA should be
construed liberally in favor of broad remedies, as courts have construed other remedial statutes. 5
In opposition, Defendants assert that the HCCAA should be interpreted in the context of
other similar tort statues such as the WDA and Survivor’s Act, and that under this interpretation,
non-economic damages are barred in Plaintiff’s case. Since all three statutes address the same
subject matter, Defendants argue that the statutes “should be read in pari materia and construed
together as a unitary and harmonious whole.” Saint Peter’s Univ. Hosp. v. Lacy, 185 N.J. 1, 15
(2005) (citation omitted). Specifically, Defendants assert that the HCCAA was intended to
impose on health insurers the equivalent legal liability that doctors and other health care
providers face, citing the HCCAA preamble that states health care carriers “should be held to the
same level of legal responsibility as physicians and other health care providers who make
decisions regarding the necessity and appropriateness of medical care.” N.J.S.A. 2A:53A-31.
Since physicians would only be liable for economic damages under the WDA and economic and
non-economic damages under the Survivor’s Act, Defendants argue that insurance companies’
liabilities under the HCCAA should be similarly construed. 6 To allow economic and noneconomic damages in all cases under the HCCAA, Defendants’ assert, would produce an

5

Plaintiff cites the following: Hous. and Redev. Auth. of Twp. of Franklin v. Miller, 397 N.J.
Super. 1, 5 (App. Div. 2007) (stating that broad, sweeping remedial statutes should be construed
liberally to accomplish the legislature’s beneficent purposes); Jefferson Loan Co., Inc. v. Session,
397 N.J. Super. 520, 533–34 (App. Div. 2008) (construing the Consumer Fraud Act liberally in
consumers’ favor).
6
In other words, Defendants seemingly assert that the HCCAA is not a standalone statute.
Whether a plaintiff suing under the HCCAA could seek economic damages only or both
economic and non-economic damages would depend on whether the plaintiff is also asserting
claims under the WDA or Survivor’s Act. Here, Plaintiff has asserted claims under both the
WDA and Survivor’s Act, (Doc. No. 34 at 21), thus it is unclear why Defendants assert that noneconomic damages are barred in this case.
7

unreasonable result—the singling out of insurance carriers for increased damages that no other
group of defendants face.
Defendants’ interpretation of the HCCAA contradicts the plain language of the statute,
which explicitly and unambiguously permits covered persons to seek both economic and noneconomic damages against health care carriers. There is no reference in the HCCAA to the
WDA or Survivor’s Act. Instead, the Act’s language specifically commands courts to give the
HCCAA precedence over other statutes by imposing liability “notwithstanding the provisions of
any other law to the contrary.” N.J.S.A. 2A:53A-33(a). In light of the HCCAA’s clear statutory
language, courts cannot “rewrite a plainly-written enactment of the Legislature [nor] presume
that the Legislature intended something other than that expressed by way of the plain language.”
Marino v. Marino, 200 N.J. 315, 329 (2009) (citations omitted).
In addition, to the extent that there is any conflict between the HCCAA’s operative,
liability-imposing provision and the statute’s statement of purpose (that carriers “should be held
to the same level of legal responsibility as physicians”), the operative provision prevails. See
DiProspero v. Penn, 183 N.J. 477, 497 (2005) (“To the extent that the preamble is at variance
with the clear and unambiguous language of the statute, the preamble must give way.”). Finally,
reading the HCCAA to consistently permit economic and non-economic damages does not
produce unreasonable results nor conflict with other statutes such as the WDA and Survivor’s
Act. Each of these statutes was enacted for a separate purpose and intended to provide remedies
to plaintiffs facing different circumstances. 7 The fact that there may be disparities between
insurance carriers and doctors or other health care providers in the amount of damages each

7

Both parties’ briefs address the historical context and purposes of these acts. (Doc. No. 54;
Doc. No. 56; Doc. No. 57).
8

group faces is not unreasonable. As Plaintiffs discussed in their brief, many remedial statutes
single out a group of defendants for exposure to damages that no other group faces. 8 It is within
the legislature’s discretion to establish specific remedies for certain violations, and when the
legislature chooses to do so, courts should abide by such statutory commands. See U.S. v. Ware,
161 F.3d 414, 424 (6th Cir. 1998) (“Generally when Congress has designated a specific remedy
for violation of one of its acts, courts should presume that Congress has engaged in the necessary
balancing of interests to determine the appropriate penalty.”) (citations omitted); U.S. v. Frazin,
780 F.2d 1461, 1466 (9th Cir. 1986) (“Where Congress has both established a right and provided
exclusive remedies for its violation, [courts] would not encroach upon the prerogatives of
Congress . . . .”).
CONCLUSION
For the reasons set forth above, Plaintiff’s Motion in Limine will be granted.

/s/ Anne E. Thompson
ANNE E. THOMPSON, U.S.D.J.

8

For example, the Conscientious Employee Protection Act, N.J.S.A. 34:19-1, singles out
employers who retaliate against whistleblowers for damages that no other group faces; the
Consumer Fraud Act, N.J.S.A. 56:8-1, singles out persons committing an unconscionable
commercial practice for damages that no other group of defendants face. (See Doc. No. 57 at 1011).
9