In HUMC Opco, LLC v. United Benefit Fund, the United States District Court for the District of New Jersey addressed motions to dismiss an ERISA action brought against a health insurer and insurance claims administrators. The action concerned medical bills in excess of $7 million, for medical care provided by a hospital over the course of nearly a year. According to the Complaint, the patient’s health insurer was obligated to pay over $789,000.00 for the medical care based upon the so-called “Medicare rate,” but instead paid less than $12,900.00. Following the patient’s death, his spouse assigned his right to benefits to the hospital, which instituted this action. The hospital pursued three claims under ERISA. In addition to bringing a claim against the insurer regarding its failure to pay the amount owed, the hospital also brought a claim against the insurer and claims administrators for breach of fiduciary duty, as well as a claim against the parties for the failure to perform a “full and fair review” of denied claims.
The Court reviewed two motions to dismiss brought by each claims administrator, Aetna and Omni. In the first motion, Aetna argued that ERISA claims could not be pursued against it because it did not exercise any discretionary authority with regard to the claims at issue. The Court rejected this motion, contending that it presented issues of fact that were premature at this stage. In the second motion, Omni contended that the second and third causes of action were redundant of the first claim. While noting that this argument may prove successful upon the development of a factual record, the Court found at this stage, the plaintiff should be permitted to plead in the alternative. The Court also rejected Omni’s argument that ERISA did not provide an independent cause of action for the failure to perform a “full and fair review” of denied claims, noting that the plaintiff had asserted a claim under a “catch-all” civil enforcement provision. The Court therefore denied both motions to dismiss.