Griffin v. Corning, Inc.,
Filing
18
ORDER granting 5 Motion for Summary Judgment. Clerk to close case. Signed by Hon. Michael A. Telesca on August 16, 2011. (MK)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
________________________________________
DOUGLAS W. GRIFFIN, AS EXECUTOR OF THE
ESTATE OF WILLIAM L. GRIFFIN,
Plaintiff,
11-CV-6050
DECISION
and ORDER
v.
CORNING INCORPORATED,
Defendants.
________________________________________
INTRODUCTION
Plaintiff,
Douglas
W.
Griffin
(“Plaintiff”),
brings
this
action pursuant to the Employee Retirement Security Act of 1974, 29
U.S.C. §§ 1001 et seq. (“ERISA”), as executor of his father,
William L. Griffin’s estate.
Plaintiff seeks payment for medical
care received by his father prior to his death at Robert Packer
Hospital (the “Hospital”) in Sayre, Pennsylvania, from December 31,
2008 to February 17, 2009, the date of his death. Compl., Docket
No. 1.
Plaintiff’s father was eligible for benefits under an
employee welfare benefits plan (the “Plan”) governed by ERISA,
sponsored by Defendant, Corning Incorporated, and administered by
the Corning Benefits Committee (the “Plan Administrator”).
Defendant moves for summary judgment pursuant to Rule 56 of
the Federal Rules of Civil Procedure (“Rule 56") claiming that it
is entitled to judgement as a matter of law, as the undisputed
facts reveal that Plaintiff is not entitled to payment under the
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Plan because Medicare provided payment-in-full to the Hospital and
he has no outstanding financial liability with respect to his
father’s treatment at the Hospital from December 31, 2008 to
February 17, 2009. Plaintiff opposes the motion, citing language in
the Plan which he contends entitles him to payment regardless of
whether his father’s estate has any financial liability to the
Hospital.
For the reasons set forth herein, this Court grants
Defendant’s Motion for Summary Judgement and Plaintiff’s Complaint
is hereby dismissed with prejudice.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
After reviewing Defendant’s statement of facts1, Plaintiff’s
submissions
in
opposition
to
this
motion,
and
the
entire
administrative record, this Court finds that the following facts
are not in dispute.
Plaintiff’s
father,
as
the
spouse
of
a
retired
Corning
Incorporated employee, was eligible to receive certain benefits
under the Plan.
Pursuant to the Corning Medicare Supplemental
Plan, the Plan coordinates payment of certain medical expenses with
Medicare when a plan participant turns 65.
Under this scheme,
Medicare
the
becomes
the
primary
insurer
and
Plan
provides
secondary coverage. Plaintiff’s father was over 65 at all relevant
1
Plaintiff has not submitted a statement of material facts in dispute. See Discussion, infra
at 7-8.
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times, and therefore, his primary insurer was Medicare and the Plan
provided secondary insurance coverage.
The Plan provides “full discretionary authority” to the Plan
Administrator to determine all questions about the Plan, including
questions regarding the eligibility for benefits.
authorizes
the
administrator
Plan
or
Administrator
insurance
to
company
engage
and
to
The Plan also
a
third
party
delegate
its
discretionary authority to such an entity. In this case, pursuant
to an Administrative Services Agreement, the Plan Administrator
delegated its discretionary authority to UnitedHealthcare Service
Corp. (“UHC”).
The Plan, in pertinent part, provides as follows: “If you or
members of your family are covered by ... a government medical
insurance program, ... your total benefits from all sources will be
limited to 100% of reasonable and customary charges for the medical
expenses incurred.”
The Plan also provides, “When a Corning
medical plan is the secondary payer, it pays benefits so that your
total medical plan does not exceed 100% of reasonable and customary
charges for the covered service.”
UHC “pays 80% of the difference
between the Medicare-allowable amounts and Medicare-paid amounts
after a $250 annual deductible is met, up to $300,000 per person,
per lifetime.”
Pursuant
to
42
U.S.C.
§
1395cc,
the
Secretary
of
the
Department of Health and Human Services is authorized to enter into
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agreements with hospitals or other service providers whereby the
service provider is required to accept payment from Medicare for
Medicare recipients based on a Medicare approved adjustment.
Accordingly, based on these agreements, Medicare will “allow”
certain charges and then pay all or a portion of the “Medicareallowable amount.”
A secondary insurance plan, like the instant
Plan, may then pay all or a portion of the amount (if any) Medicare
allowed but did not pay.
In this case, the Plan will pay 80% of
the difference between what Medicare allows and what Medicare
actually pays, after a $250 annual deductible.
Plaintiff’s father was hospitalized at Robert Packer Hospital
from December 31, 2008 until his death on February 17, 2009.
Robert
Packer
Hospital
submitted
an
“Itemized
Statement”
to
Medicare following his hospitalization, which listed charges of
$267,505.502. Medicare accepted the charges and adjusted the claim
by $208,735.22, leaving a balance of $58,770.28.
Based on a prior
agreement with the Hospital, Medicare then paid the hospital
$58,770.28.
Also based on this agreement, the outstanding balance
due to the Hospital was $0.00, because the Hospital had agreed to
2
The total amount charged by the Hospital is unclear in the record. It is listed as
$267,505.50 on the Itemized Statement to Medicare, and also as $266,573.00 on other
documentation. Defendant states that the actual amount is unclear at this time however, the
parties assume for the purpose of this motion that the total amount charged, prior to adjustments,
was $266,573.00. The exact figure is not relevant to the Court’s analysis, therefore, the Court
will assume for the purpose of this motion, that the total amount is $266,573.00.
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accept the amount of money Medicare “allowed” ($58,770.28), which
it paid to the Hospital.
In a letter dated March 31, 2010, following his father’s death
and his appointment as executor of his father’s estate, Plaintiff
filed a claim with UHC requesting payment of $165,992.18 for his
father’s medical care at Robert Packer Hospital. Plaintiff attached
a form provided by Medicare to the Hospital describing its payments
and adjustments for the services received by his father. Plaintiff
interpreted the form to read that the amount “allowed” by Medicare
was the full amount initially charged to Medicare by the Hospital.
Accordingly, he asserted that the amount “allowed” by Medicare was
$266,573.00 and the amount paid by Medicare was $58,770.29.
Accordingly, he contended that his father’s estate was entitled to
80%
of
the
difference
between
these
numbers,
less
the
$250
UHC responded to Plaintiff’s claim on June 3, 2010.
UHC
deductible under the Plan, or $165,992.17.
explained that it had not issued a payment to him because Medicare
had
paid
the
Hospital
charges,
as
adjusted,
in
full.
They
specifically informed Plaintiff that he had no financial liability
to the Hospital based on his father’s hospitalization.
In a letter dated June 16, 2010, Plaintiff reiterated his
contentions
and
again
requested
payment
pursuant
to
his
interpretation of the Plan. Plaintiff did not dispute, nor does he
dispute now, that his father’s estate has no financial liability to
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the Hospital.
Rather, he contended that the estate is entitled to
payment under the plan, regardless of the lack of any outstanding
financial liability to his father’s estate.
UHC again responded to Plaintiff’s letter on July 14, 2010,
reiterating that the estate had no financial liability.
UHC also
explained the difference between the Medicare allowable amount and
the amount by which the claim was adjusted.
They specifically
informed the Plaintiff that the adjusted amount is written off by
the Hospital pursuant to an agreement with Medicare. Accordingly,
no further payment by the Plan or the estate was due.
Plaintiff then filed this lawsuit on December 29, 2010 seeking
payment under the Plan in the amount of 80% of the Medicare
“allowable” amount, which he argues is $266,573.00, less the $250
deductible and the amount already paid by Medicare, $58,770.28, or
$165,992.17.
DISCUSSION
Rule 56(c) of the Federal Rules of Civil Procedure provides
that summary judgment “should be rendered if the pleadings, the
discovery and disclosure materials on file, and any affidavits show
that there is no genuine issue as to any material fact and that the
movant is entitled to judgment as a matter of law.” See Fed. R.
Civ. P. 56(c). When considering a motion for summary judgment, all
genuinely disputed facts must be resolved in favor of the party
against whom summary judgment is sought. See Scott v. Harris, 550
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U.S. 372, 380 (2007). If, after considering the evidence in the
light most favorable to the nonmoving party, the court finds that
no rational jury could find in favor of that party, a grant of
summary judgment is appropriate. See Id. (citing Matsushita Elec.
Industrial
Co.
v.
Zenith
Radio
Corp.,
475
U.S.
574,
586-587
(1986)). “When opposing parties tell two different stories, one of
which
is
blatantly
contradicted
by
the
record,
so
that
no
reasonable jury could believe it, a court should not adopt that
version of the facts for purposes of ruling on a motion for summary
judgment.” Id.
A. Local Rule 56
Pursuant to Local Rule 56 (a)1, “Upon any motion for summary
judgment pursuant to Federal Rule of Civil Procedure 56, there
shall be annexed to the notice of motion a separate, short, and
concise statement, in numbered paragraphs, of the material facts as
to which the moving party contends there is no genuine issue to be
tried.” See W.D.N.Y. Loc. R. Civ. P. 56 (a)(1). “The papers
opposing a motion for summary judgment shall include a response to
each numbered paragraph in the moving party’s statement...and, if
necessary, additional paragraphs containing a short and concise
statement of additional material facts as to which it is contended
that there exists a genuine issue to be tried. Each numbered
paragraph in the moving party’s statement of material facts will be
deemed
admitted
unless
specifically
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controverted
by
a
correspondingly numbered paragraph in the opposing statement.” See
id. 56 (a)(2). “While the consequence of this miscue is minimal
given the general consensus between the parties [as shown by
defendant] as to the constituent facts of this case, where a
discrepancy exists this Court is obligated to and will ‘deem
admitted’ the [moving party’s] version of the facts.
At the same
time, the Court is obligated to and will believe the [non-moving
party’s] evidence and all justifiable inferences will be drawn in
[his] favor.”’ See Kuchar v. Kenmore Mercy Hosp., No. 97-CV-0756,
2000 WL 210199, at *1 (W.D.N.Y.2000); See also Duckett v. Wal-Mart
Stores, Inc., No. 07-CV-6204, 2009 WL 995614, *2.
Plaintiff has not submitted a Local Rule 56 statement of
material facts in dispute and has not pointed to any facts to show
that there exists a material issue to be tried.
Plaintiff states
in his affidavit in opposition to Defendant’s motion, “there are
many factual questions which have not been resolved despite the
extensive documents set forth in Defendant’s motion.” Griffin Aff.
at ¶10. However, Plaintiff may not oppose a motion for summary
judgment by conclusively stating that there are issues of fact,
rather, he must “set out specific facts showing a genuine issue for
trial.” See Fed.R.Civ.P. 56(e)(2); see also D'Amico v. City of New
York, 132 F.3d 145, 149 (2d Cir.1998) (“non-moving party may not
rely on mere conclusory allegations nor speculation, but instead
Page -8-
must offer some hard evidence showing that its version of...events
is not wholly fanciful.”
Plaintiff also contends in his affidavit that there is a
question of fact as to what UHC considers “reasonable and customary
charges” under
the
Plan,
a
phrase
appearing in
provisions which are the subject of this suit.
several
Plan
For example, the
Plan provides, “When a Corning medical plan is the secondary payer,
it pays benefits so that your total medical plan does not exceed
100% of reasonable and customary charges for the covered service.”
However, the meaning of this particular phrase is not relevant to
the outcome of this case because, as set forth below, the case
turns on UHC’s interpretation of other Plan provisions. Therefore,
UHC’s calculation of “reasonable and customary charges,” even if in
dispute, is not material and cannot preclude an entry of summary
judgment. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(2005)(“Only disputes over facts that might affect the outcome of
the suit under the governing law will properly preclude the entry
of summary judgment.”).
B. ERISA Standard of Review
In an ERISA action challenging a denial of benefits, a court
applies a de novo standard of review, “unless the benefit plan
gives the administrator or fiduciary discretionary authority to
determine eligibility for benefits or to construe the terms of the
plan.” See Krauss v. Oxford Health Plans, Inc., 517 F.3d 614, 622
Page -9-
(2d Cir. 2008)(quoting Firestone Tire & Rubber Co. v. Bruch, 489
U.S. 101, 115 (1989)).
Here, the Plan granted “full discretionary
authority” to the Plan Administrator to interpret Plan provisions
and determine eligibility for benefits.
The Plan Administrator
then delegated that authority to UHC, through an Administrative
Services Agreement.
Accordingly, this Court will review UHC’s
determination that Plaintiff was not entitled to payment pursuant
to the arbitrary and capricious standard of review.
Under the
arbitrary and capricious standard of review, the court’s review is
limited, and a denial of benefits may only be overturned where it
was
“without
reason,
unsupported
by
substantial
evidence
or
erroneous as a matter of law.” Pagan v. NYNEX Pension Plan, 52 F.3d
438 (2d Cir. 1995).
C. UHC’s Determination was not Arbitrary and Capricious
Plaintiff argues the Plan is an “indemnity plan,” which he
defines as an obligation “to pay in a predetermined manner the
amount under
the
policy.”
He
further
contends
that,
“[t]he
agreement and Plan of the Defendant do not say the amount the Plan
would pay is the difference between what Medicare allowed, as
adjusted, or subject to any credits, or subject to negotiations or
any contract between the Plan and provider.” Griffin Aff. at ¶¶ 1214.
Plaintiff does not dispute the fact that the estate has no
financial liability to the Hospital.
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Rather, he argues that his
father’s estate should be entitled to 80% of the difference between
the Medicare allowable amount and the Medicare paid amount, less
$250, notwithstanding the fact that Medicare adjusted the claim
down to $58,770.28 and then paid the Hospital $58,770.28.
He
states that certain documentation he received listed the Medicare
“allowable” amount as $266,573.00.
He also contends that because
the Plan does not discuss an “adjustment” or any agreement between
the Hospital and Medicare, that this adjustment must be ignored and
the estate is entitled to the money outright.
This Court finds
that Plaintiff’s arguments are without merit.
Plaintiff ignores language in the Plan that reads: “If you or
members of your family are covered by ... a government medical
insurance program, ... your total benefits from all sources will be
limited to 100% of reasonable and customary charges for the medical
expenses incurred.”
UHC interprets this language to mean that the
insured party
have
must
an
actual
financial liability
entitled to a financial benefit under the Plan.
to
be
This Court finds
that this interpretation of the Plan is entirely in line with the
plain meaning of this clause, and therefore is not arbitrary and
capricious.
The definition of “incur” is “to suffer or bring on
oneself (a liability or expense).” See Black’s Law Dictionary,
Seventh Edition, 1999.
Plaintiff admits that the estate did not
suffer a financial liability based on his father’s hospitalization,
accordingly, his claim for benefits is without merit.
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Further, UHC’s determination that Plaintiff was not eligible
for benefits based on the evidence submitted was reasonable and
supported by substantial evidence. UHC examined Plaintiff’s claim,
and discussed his contentions with both the Hospital and Medicare
to confirm that he did not have any financial liability to the
Hospital, and to confirm that the Medicare “allowable” amount was
in
fact
$58,770.28.
UHC
utilized
Medicare’s
adjustment
in
calculating the Medicare “allowable” amount, and determined that
they did not owe the estate or the Hospital any money, because
Medicare had paid the adjusted claim in full.
This interpretation
is substantially supported by the record. Plaintiff’s mistaken
belief that he was entitled to payment based on certain plan
provisions which he interprets differently does not render UHC’s
interpretation arbitrary and capricious.
This Court finds that Plaintiff’s version of the facts is “so
blatantly contradicted by the record” that no reasonable jury could
find
in
his
favor.
See
Scott,
550
U.S.
at
380.
Accepting
Plaintiff’s arguments would allow for an unintended windfall, which
this Court can not endorse.
Accordingly, Defendant’s Motion for
Summary Judgment is granted and Plaintiff’s Complaint is dismissed
with prejudice.
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CONCLUSION
For
the
reasons
set
forth
above,
this
Court
finds
that
Defendant’s decision to deny plaintiff benefits was not arbitrary
and capricious. Defendant’s Motion for Summary Judgment is granted
and Plaintiff’s Complaint is hereby dismissed with prejudice.
ALL OF THE ABOVE IS SO ORDERED.
s/ Michael A. Telesca
MICHAEL A. TELESCA
United States District Judge
Dated:
Rochester, New York
August 16, 2011
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