Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 1 of 8 Page ID #:1
`
`Russell G. Petti, State Bar No. 137160
`THE LAW OFFICES OF RUSSELL G. PETTI
`466 Foothill Blvd., # 389
`La Canada, California 91011
`818 952-2168Telephone
`818 952-2186 Facsimile
`Email: Rpetti@petti-legal.com
`Counsel for Plaintiff Steven Villalobos
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`Case No. 2:21-cv-06375
`COMPLAINT FOR:
`1.
`DECLARATION OF RIGHTS
`UNDER THE EMPLOYEE
`RETIREMENT INCOME
`SECURITY ACT OF 1974;
`DECLARATORY RELIEF;
`EQUITABLE RELIEF.
`
`2.
`3.
`
`)))))))))))))
`
`STEVEN VILLALOBOS,
`Plaintiff,
`
`vs.
`BLUE SHIELD OF CALIFORNIA
`LIFE & HEALTH INSURANCE
`COMPANY,
`Defendant.
`
`
`Plaintiff, Steven Villalobos (hereinafter “Dr. Villalobos” or “Plaintiff”),
`herein sets forth the allegations of his Complaint against Blue Shield of California
`Life & Health Insurance Company (“Blue Shield”).
`PRELIMINARY ALLEGATIONS
`“Jurisdiction” - This action is brought under 29 U.S.C. §§ 1132(a),
`1.
`(e), (f) and (g) of the Employee Retirement Income Security Act of 1974
`(hereinafter “ERISA”) as it involves a claim by Plaintiff for employee benefits
`under an employee benefit plan regulated and governed by ERISA. Jurisdiction is
`predicated under these code sections as well as 28 U.S.C. § 1331 as this action
`involves a federal question. This action is brought for the purpose of obtaining
`benefits under the terms of an employee benefit plan; to clarify and enforce
`Plaintiff’s past, present and future rights to benefits under an employee benefit
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 2 of 8 Page ID #:2
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`plan; and to obtain other equitable relief, including but not limited to, an injunction
`ordering Defendant to qualify Plaintiff for the receipt of benefits and to pay health
`care claims for treatments provided to Plaintiff; for prejudgement and
`postjudgment interest; and for attorneys’ fees and costs.
`2.
`Dr. Villalobos is a citizen of the state of California, residing in West
`Covina, in the County of Los Angeles, California. He is a physician who
`graduated from the University of Southern California Medical School in 1985 and
`is employed as a Physician Advisor with Alignment Health Plan, a Medicare
`Advantage Healthplan (“Alignment”).
`3.
`Due to his employment with Alignment, Dr. Villalobos’ medical
`coverage is provided by the Alignment Health Plan (“the Plan”). Because the Plan
`provides employer sponsored medical benefits, funded by a group insurance policy
`issued by defendant Blue Shield, Dr. Villalobos’ health care claims are governed
`by ERISA.
`Blue Shield is in the business of providing health insurance. It is a
`4.
`California Corporation with its principal place of business in Oakland, California.
`Blue Shield issued TriNet III Blue Shield HMO 30-500/Admit (“the Policy”) to
`fund medical benefits under the Plan. Blue Shield ultimately makes all coverage
`determinations for the Plan, including whether an insured should receive a referral
`to a different medical provider.
`5.
`Dr. Villalobos’ claim arose in this judicial district, as his claim for
`benefits was denied in this district. Moreover, Blue Shield can be found in this
`judicial district and thus venue is proper in this judicial district pursuant to 29
`U.S.C. Section 1132(e)(2) (special venue rules applicable to ERISA actions).
`GENERAL STATEMENT OF RELEVANT FACTS
`The Policy requires insureds to select a “Primary Care Physician”
`6.
`(“PCP”) from a network of authorized providers. Once selected, the PCP acts as
`Blue Shield’s agent to make decisions regarding whether a particular medical
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`Complaint for Benefits; Case No.:2:21-cv-06375
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 3 of 8 Page ID #:3
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`treatment is a covered service. In particular the PCP controls, on Blue Shield’s
`behalf, whether an insured may see a specialist or obtain medical treatment from
`other physicians or medical providers.
`7.
`Dr. Villalobos’ assigned PCP was HealthCare Partners Medical Group
`(“HealthCare”).
`8.
`In June of 2019 Dr. Villalobos suffered from a serious infection of the
`bottom of his right foot near his toes. On June 2, 2019 he received a referral by
`HealthCare to be treated at the Inter-Community Medical Center (“ICMC”). Dr.
`Villalobos went to the ICMC emergency room and he was admitted to the hospital.
`The ICMC physicians started him on antibiotics and performed two wound
`debridements, which is a surgical process for cleaning a wound and opening it up
`so it could drain and be treated. The debridements were unsuccessful in resolving
`the infection which continued to worsen.
`9.
`After the debridements were unsuccessful Dr. Villalobos consulted
`with the general surgeon and vascular surgeon assigned to his case by ICMC. The
`surgeons told Dr. Villalobos that his only remaining option was an extensive
`amputation. This, they told Dr. Villalobos, might involve removing most of his
`right foot but more likely would involve a “below-the-knee” amputation of his
`lower leg.
`10. Dr. Villalobos did not want a below-the-knee amputation of his right
`foot, so he asked HealthCare for an expeditious transfer–as his infection was
`progressing–to another facility, preferable a tertiary facility that had foot surgeons
`who specialized in limb salvage. HealthCare denied this request for a transfer, and
`instead had a network orthopaedic foot surgeon from another hospital consult with
`Dr. Villalobos for a second opinion. This surgeon agreed with the two ICMC
`physicians, stating that a mid-foot amputation was an unlikely possibility but his
`recommendation was for a full below-the-knee amputation.
`///
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 4 of 8 Page ID #:4
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`11. Dr. Villalobos was unhappy with this option so he called the Ronald
`Reagan UCLA Medical Center (“UCLA”), and was told it had contracts with both
`HealthCare and Blue Shield. At this point his infection was visibly progressing,
`and the third toe on his right foot was blue. After discussing the matter with his
`wife, Dr. Villalobos checked out of the ICMC and was driven by his wife to the
`UCLA emergency room. He consulted with Dr. Virit Butani, a podiatrist with a
`speciality in diabetic limb salvage. Dr. Butani, after reviewing Dr. Villalobos’
`imaging and performing an extensive evaluation, stated that he would have to
`amputate Dr. Villalobos’ right third tow and a small part of the third ray bone but
`could save the rest of Dr. Villalobos’ right foot.
`12. Unfortunately, HealthCare refused to approve Dr. Villalobos being
`treated at UCLA and insisted that he be transferred back to an “in-network” facility
`(even though UCLA was an in-network facility). Dr. Villalobos was informed by a
`UCLA Case Manager that, although UCLA had contracts with both HealthCare
`and Blue Shield, Blue Shield did not like to use UCLA because it was more
`expensive.
`13. At that point, Dr. Villalobos had a stark choice. He could agree to
`treatment at a facility that was acceptable to HealthCare, which would almost
`certainly result in a below-the-knee amputation of his right leg. Or, he could agree
`to be financially responsible for the UCLA surgery and save his right leg below-
`the-knee and almost all of his right foot. And, because the infection was steadily
`worsening, he needed to make an immediate decision.
`14. Dr. Villalobos agreed, not unreasonably, to continue his treatment at
`UCLA so his foot could be saved. In June of 2019 Dr. Butani operated on Dr.
`Villalobos’ foot, amputating his toe and a small portion of his ray bone but saving
`the rest of his foot (“the June 2019 surgery”). Dr. Villalobos recovered fully from
`the surgery, retaining continued use of his foot.
`///
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`Complaint for Benefits; Case No.:2:21-cv-06375
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 5 of 8 Page ID #:5
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`15. Dr. Villalobos submitted the UCLA bills to Blue Shield, which
`refused to pay them. Eventually Blue Shield did pay some of the bills, however it
`left a substantial balance owed for which Dr. Villalobos was responsible.
`16.
`In addition, after the surgery HealthCare approved multiple continued
`outpatient services at UCLA with the UCLA Wound Clinic, which was not
`involved in the surgery or the inpatient hospital stay.
`17. Dr. Villalobos retained counsel who, on January 11, 2021 appealed
`the denial to Blue Shield. A Blue Shield representative responded that Blue Shield
`was offering a “one-time administrative exception” and would negotiate with
`UCLA over the billings.
`18. On March 22, 2021 counsel for Dr. Villalobos submitted the UCLA
`billings to Blue Shield. On June 3, 2021, not having heard from Blue Shield,
`counsel wrote asking for an update.
`19.
`In response counsel received two brief facsimiles which provided no
`substantive information but suggested he contact Dr. Villalobos’ medical group.
`The facsimiles provided a telephone number but no name and address.
`20. On July 27, 2021 counsel called the number provided in the facsimile,
`reaching an entity called Optum which, from the recorded message he listened to
`while on hold, appeared to be a third party administrator. Counsel waited on hold
`for fifteen minutes but no representative of Optum picked up. Counsel left a
`voicemail message which was not returned.
`21.
`That same day counsel sent an email to Blue Shield, asking for an
`update. He informed Blue Shield that he would file a lawsuit if there was no
`timely response. Again, Blue Shield did not provide a response.
`22. At present, Blue Shield has not provided a response to Dr. Villalobos’
`appeal.
`///
`///
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`Complaint for Benefits; Case No.:2:21-cv-06375
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 6 of 8 Page ID #:6
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`FIRST CAUSE OF ACTION
`TO ENFORCE PLAINTIFF’S RIGHT TO PLAN BENEFITS
`23.
`Plaintiff refers to and incorporates by reference paragraphs 1 through
`22 as though fully set forth herein.
`24. At all times relevant, Dr. Villalobos was covered under the Blue
`Shield Policy.
`25. Blue Shield had an obligation to either provide adequate treatment
`“in-network” or refer its insureds to a provider who could provide adequate
`treatment. To do otherwise violates its obligations under the Policy and ERISA.
`26.
`It is not adequate treatment to require an insured to have his entire
`lower leg amputated when all that was medically required was amputation of a
`single toe.
`In failing to provide adequate medical services in-network, while at
`27.
`the same time refusing to provide Dr. Villalobos with a referral to someone who
`could provide adequate medical treatment, Blue Shield violated its obligation
`under ERISA. Its failure put Dr. Villalobos in the unfortunate position of either
`having an unnecessary below-the-knee amputation or having to obligate himself to
`pay out-of-pocket for a medical procedure that should have been Blue Shield’s
`responsibility.
`28.
`Further, Blue Shield violated Dr. Villalobos’ rights under ERISA
`when, after the surgery, it refused to honor the health care claims arising out of the
`surgery.
`Following the denial of Plaintiff’s claims for medical benefits Plaintiff
`29.
`has exhausted all administrative remedies required under ERISA and the Policy.
`In the alternative, due to Blue Shield’s repeated violations of its Policy and
`ERISA’s governing regulations, including its obligation to timely respond to
`Plaintiff’s appeal, Plaintiff can and does deem any remaining administrative
`remedies exhausted.
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 7 of 8 Page ID #:7
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`30. As such, by this lawsuit, Dr. Villalobos seeks that this Court overturn
`Blue Shield’s denial of his claim for the June 2019 surgery and pay all claims for
`medical care related to this surgery.
`31.
`Plaintiff is entitled to recover benefits due under the terms of the plan
`under 29 U.S.C. § 1132(a)(1)(B).
`32.
`Further, as a direct and proximate result of this improper
`determination regarding Plaintiff’s medical claims Plaintiff, in pursuing this action,
`has been required to incur attorneys’ costs and fees. Pursuant to 29 U.S.C. §
`1132(g)(1), Plaintiff is entitled to have such fees and costs paid by Defendant.
`SECOND CAUSE OF ACTION
`FOR A DECLARATION OF RIGHTS
`Plaintiff refers to and incorporates by reference paragraphs 1 through
`33.
`32 as though fully set forth herein.
`34. A controversy now exists between Defendant on the one hand and
`Plaintiff on the other as to whether Defendant is required to pay the health care
`claims arising out of his June 2019 surgery. Plaintiff seeks a declaration by this
`Court that Defendant is required to pay for the requested treatment.
`35.
`In seeking this Declaration regarding Plaintiff’s medical claims,
`Plaintiff has been required to incur attorney’s costs and fees. Pursuant to 29
`U.S.C. § 1132(g)(1), Plaintiff is entitled to have such fees and costs paid by
`Defendant.
`
`THIRD CAUSE OF ACTION
`FOR EQUITABLE RELIEF
`Plaintiff refers to and incorporates by reference paragraphs 1 through
`36.
`35 as though fully set forth herein.
`37. As a direct and proximate result of the failure of the Defendant to pay
`Plaintiff’s claim for medical benefits, and the resulting injuries and damages
`sustained by Plaintiff as alleged herein, Plaintiff is entitled to and hereby requests
`///
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`Case 2:21-cv-06375-JFW-RAO Document 1 Filed 08/06/21 Page 8 of 8 Page ID #:8
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`b.
`
`that this Court grant Plaintiff the following relief pursuant to 29 U.S.C. §
`1132(a)(3):
`a.
`
`That it pay all health care claims arising out of the June 2019 surgery;
`and
`Such other and further relief as the Court deems necessary and proper
`to protect Plaintiff’s interests.
`In seeking this equitable relief regarding Plaintiff’s medical claims,
`38.
`Plaintiff has been required to incur attorney’s costs and fees. Pursuant to 29
`U.S.C. § 1132(g)(1), Plaintiff is entitled to have such fees and costs paid by
`Defendant.
`
`
`
`REQUEST FOR RELIEF
`Wherefore, Plaintiff prays for judgment against Defendant as follows:
`1.
`Payment of the health insurance benefits to the Plaintiff pursuant to
`Plaintiff’s medical coverage under the Policy, including payment for all medical
`claims related to the June 2019 surgery;
`2.
`A Declaration that Defendant is obligated to pay all claims for
`medical services related to the June 2019 surgery;
`3.
`Pursuant to 29 U.S.C. § 1132(g), payment of all costs and attorneys’
`fees incurred in pursuing this action;
`4.
`Payment of prejudgment and postjudgment interest as allowed for
`under ERISA; and
`5.
`For such other and further relief as the Court deems just and proper.
`
`DATED: August 6, 2021
`
`Law Offices of Russell G. Petti
`
`BY S/Russell G. Petti
` Russell G. Petti
` Attorney for Plaintiff
` Steven Villalobos
`
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