Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 1 of 11 Page ID #:5
`Case 8:22-cv-00240 Document1-1 Filed 02/15/22 Page1of11 Page ID#:5
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`EXHIBIT A
`EXHIBIT A
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 2 of 11 Page ID #:6
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`21STCV47278
`Assigned for all purposes to: Stanley Mosk Courthouse, Judicial Officer: John Doyle
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`Electronically FILED by S perior Court of California, County of Los Angeles on 12/28/2021 11 :37 PM Sherri R. Carter, Executive Officer/Clerk of Court, by R. Perez.Deputy Clerk
`JONATHAN A. STIEGLITZ
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`{SBN 278028)
`jonathan.a.sti~litz@,gmail.com
`·
`THE LAW OFFICES'""'OF
`JONATHAN A. STIEGLITZ
`11845 W. Olympic Blvd., Ste. 800
`Los Angeles, California 90064 ·
`Telephone: (323) 979-2063
`Facsimile:
`(323) 488-6748
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`Attorney for Plaintiff
`Premier Spine Neurosurgery, Inc.
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`SUPERIOR COURT OF THE STATE OF CALIFORNIA
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`COUNTY OF LOS ANGELES
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`Premier Spine Neurosurgery, Inc.
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`Case No.: 21STC:V47278
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`Plaintiff,
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`V.
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`Complaint For:
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`1. QUANTUMMERUIT;
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`(Jury Trial Requested)
`Total Damages - $100,000.0~
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`CIGNA Health and Life Insurance
`15 Co. and DOES 1-10,
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`Defendant.
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`Complaint
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 3 of 11 Page ID #:7
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`Plaintiff Premier Spine Neurosurgery, Inc. (hereinafter referred to as
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`"PLAINTIFF", or "Medical Provider") complains and alleges:
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`PARTIES
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`1.
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`Plaintiff, Medical Provider, is and at all relevant times was a medical
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`corporation, organized and existing under the laws of the State of California.
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`7 Medical Provider is and at all relevant times was in good standing under the laws of
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`the State of California.
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`2.
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`DEFENDANT, CIGNA Health and Life Insurance Co.
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`("DEFENDANT") is and was licensed to do business in and is and was doing
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`business in the State of California. DEFENDANT is, in fact, transacting business in
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`the State of California and is thereby subject to the laws and regulations of the State
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`of California.
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`3.
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`The true names and capacities, whether individual, corporate,
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`associate, or otherwise, of defendants DOES 1 through 10, inclusive, are unknown
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`to PLAINTIFF, who therefore sues said defendants by such fictitious names.
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`PLAINTIFF is informed and believes and thereon alleges that each of the
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`defendants designated herein as a DOE is legally responsible in some manner for
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`the events and happenings referred to herein and legally caused injury and damages
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`proximately thereby to PLAINTIFF. PLAINTIFF will seek leave of this Court to
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`amend this Complaint to insert their true names and capacities in place and instead
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`of the fictitious names when they become known to it.
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`4.
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`· At all times herein mentioned, unless otherwise indicated,
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`24 DEFENDANT ls were the agents and/or employees of each of the remaining
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`defendants, and were at all times acting within the purpose and scope of said
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`agency and employment, and each defendant has ratified and approved the acts of
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`his agent. At all times herein mentioned, DEFENDANT/s had actual or ostensible
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`authority to act on each other's behalf in certifying or authorizing the provision of
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`- 2 -
`COMPLAINT
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`services; processing and administering the claims and appeals; pricing the claims;
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`approving or denying the claims; directing each other as to whether and/or how to
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`pay claims; issuing remittance advices and explanations of benefits statements;
`making payments to Medical Provider and its Patients.
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`GENERAL ALLEGATIONS
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`5.
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`All of the claims asserted in this complaint are based upon the
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`individual and proper rights of Medical Provider in its own individual capacity and
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`are not derivative of the contractual or other rights of the Medical Provider's
`Patient.
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`6.
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`This complaint arises out of the failure of DEFENDANT to make
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`proper payments and/or the underpayment to Medical Provider by DEFENDANT
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`and DOES I through 10, inclusive, of amounts due and owing now to Medical
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`Provider for emergent surgical care, treatment and procedures provided to Patient,
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`who was an insured, member, policyholder, certificate-holder or was otherwise
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`covered for health, hospitalization and major medical insurance through policies or
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`certificates of insurance issued and underwritten by DEFENDANT and DOES I
`through I 0, inclusive.
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`7. Medical Provider is informed and believes based on DEFENDANT's
`oral and other representations that the Patient was an insured of DEFENDANT
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`either as a.subscriber to coverage or a dependent of a subscriber to coverage under a
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`policy or certificate of insurance issued and underwritten by DEFENDANT and
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`DOES I through 10, inclusive, and each of them. Medical Provider is informed
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`and believes that the Patient entered into a valid insurance agreement with
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`DEFENDANT for the specific purpose of ensuring that the Patient would have
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`access to medically necessary treatments, care, procedures and surgeries by medical
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`practitioners like Medical Provider and ensuring that DEFENDANT would pay for
`the health care expenses incurred by the Patient.
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`COMPLArNT
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 5 of 11 Page ID #:9
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`8. Medical Provider is informed and believes that DEFENDANT and
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`2 DOES 1 through 10, inclusive, and each of them, received and continue to receive,
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`valuable premium payments from the Patient and/or other consideration from
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`Patient under the subject policies applicable to Patient.
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`9.
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`It is standard practice in the health care industry that when a medical
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`provider enters into a written preferred provider contract with a health plan such as
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`7 DEFENDANT, that a medical provider agrees to accept reimbursement that is
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`discounted from the medical provider's total billed charges in exchange for the
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`benefits of being a preferred or contracted provider.
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`10. Those benefits include an increased volume of business, because the
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`health plan provides financial and other incentives to its members to receive their
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`12 medical care and treatments from the contracted provider, such as advertising that
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`the provider is "in network", and allowing the members to pay lower co-payments
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`and deductibles to obtain care and treatment from a contracted provider.
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`11. Conversely, when a medical provider, such as Medical Provider, does
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`not have a written contract or preferred provider agreement with a health plan, the
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`12. The medical provider has no obligation to reduce its charges. The
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`health plan is not entitled to a discount from the medical provider's total bill charge
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`for the services rendered, because it is not providing the medical provider with in
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`network medical provider benefits, such as increased patient volume and direct
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`payment obligations.
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`13. The reason why medical providers have chosen to forgo the benefits of
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`a contract with a payor is that, in recent years, many insurers including
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`one-sided and onerous, that many providers like Medical Provider have determined
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`that they cannot afford to enter into such contracts. As a result, a growing number
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`of medical providers have become non-contracted or out of network providers.
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`COMPLAINT
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 6 of 11 Page ID #:10
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`14.
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`Plaintiff believes that for non-contracted, out-of-plan, or out-of-
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`network providers, DEFENDANT have unlawfully underpaid these providers for
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`the medically necessary and appropriate services they have rendered to the insured
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`of the DEFENDANT. Plaintiff believes that in some cases DEFENDANT has used
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`flawed databases and systems to unilaterally determine what amounts it pays to
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`6 medical providers and has colluded with other insurers to artificially underpay,
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`decrease, -limit and minimize the reimbursement rates paid for services rendered by
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`non-contracted providers.
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`· 15. Often, the rates paid to medical providers such as Medical Provider by
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`1 o pay ors such as DEFENDANT for the exact same procedure, treatment, surgery or
`service, were paid at different rates during the same year. At other times, medical
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`providers were paid rates which were below what they would have received had
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`they been a preferred or in-network provider, even though such volume-discounted
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`rates would have been significantly lower than usual, reasonable or customary rates
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`as defined by California law.
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`16. Medical Provider is informed and believes and thereon alleges that
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`17 DEFENDANT's system for paying out-of-network claims is flawed, that
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`18 DEFENDANT improperly manipulat_es the data in its systems to underpay out-of-
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`network Medical Provider claims and that DEFENDANT's system and method for
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`calculating such rates violate California law.
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`1 7. Medical Provider and its affiliated physicians have a reputation for
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`providing high quality care, surgeries and procedures. Its charges for services are
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`on par with the charges of other surgeons in the same general area for the same
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`procedures and/or services. Medical Provider's billed charges are usual, reasonable
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`and customary.
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`18. The California Department of Managed Health Care has adopted
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`regulations that define the amount that health care service plans such as
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`COMPLAINT
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 7 of 11 Page ID #:11
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`1 DEFENDANT is obligated to pay non-contracted providers such as Medical
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`Provider. These regulations provide, in pertinent part:
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`For contracted providers without a written contract and non-
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`contracted providers, .. : [the Plan shall remit to the provider] the
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`payment of the reasonable and customary value for the health care
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`services rendered based upon statistically credible information that is
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`updated at least annually and takes into consideration: (I) the
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`provider's training, qualifications and length of time in practic'e; (ii)
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`the nature of the services provided; (iii) the fees usually charged by
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`the provider; (iv) prevailing provider rates charged in the general
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`geographic area in which the services were rendered; (v) other aspects
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`of the economics of the medical provider's practice that are relevant;
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`and (vi) and unusual circumstances in the case.
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`28 Cal. Code Regs. Section 1300.71(a)(3)(B). These definitions are the same
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`criteria used by California Courts to determine the quantum meruit amounts that
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`should be paid for services rendered by non-contracted providers by insurers in
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`19. Based upon these criteria, Medical Provider's charges are usual,
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`reasonable and customary. Medical Provider charged DEFENDANT the same fees
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`that it charges all other payors. Medical Provider's fees are comparable to the
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`prevailing provider rates for other surgeons in comparable geographic areas to the
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`one in which the services were provided.
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`20. At all relevant times, Medical Provider expected to be paid by
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`defendants at the lesser of its billed charges or the then-current usual, customary
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`and reasonable rate, which is defined-by California law as follows:
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`A "usual" charge is the amount that is most consistently charged by
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`an individual physician for a given service. A "customary" charge is
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`the amount that falls within a specified range of usual charges for a
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`COMPLATNT
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 8 of 11 Page ID #:12
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`given service billed by most physicians with similar training and
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`experience within a given geographical area. A "reasonable" charge
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`is a charge that meets the Usual and Customary criteria, or is
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`otherwise reasonable in light of the complexity of treatment of the
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`particular case. Under a UCR Program, the payment is the lowest of
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`the actual billed charge, the physician's usual charge or the area
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`customary charge for any given covered service.
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`SPECIFIC FACTS
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`Patient YW
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`21. On January 1, 2021, Medical Provider provided emergency medical
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`services to Patient DW a policyholder of DEFENDANT at El Camino Hospital,
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`22. Medical Provider was obligated under California Health and Safety
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`14 Code § 131 7 et seq. to provide medical services to the Patient without regard for
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`Provider's services.
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`Following the procedure, Patient provided Patient's insurance
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`information to Medical Provider who then submitted a total bill for $73,400.00 to
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`Patient's insurer, DEFENDANT, for payment.
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`24. DEFENDANT processed Medical Provider's bill made a payment of
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`$0 to Medical Provider.
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`$0 is far less than the UCR value of Medical Provider's services.
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`26. According to the Knox-Keane Health Care Service Plan Act of 1975,
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`24 Health & Safety Code, §§ 1340, et seq., ("Knox-Keane Act"), Medical Provider is
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`prohibited from balancing billing Patient. According to the Knox Keene Act,
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`26 Medical Provider is obligated to resolve all billing disputes with Patient's insurer,
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`COMPLAINT
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`Case 8:22-cv-00240 Document 1-1 Filed 02/15/22 Page 9 of 11 Page ID #:13
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`27. As Medical Provider is prohibited by California Law, specifically the
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`2 Knox Keene Act, from balancing billing and resolving billing disputes with a
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`patient seen in the emergency room, Plaintiff Medical Provider now seeks to
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`resolve this dispute and obtain payment from DEFENDANT as is required by
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`FIRST CAUSE OF ACTION:
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`FOR QUANTUM MERUIT
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`Plaintiff incorporates all allegations set forth in the above paragraphs
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`as though fully set forth herein.
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`29. Medical Provider provided emergency medical services, surgeries,
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`procedures and other medical care and treatment to Patient, who is and was insured
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`by DEFENDANT.
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`30. DEFENDANT has failed and refused to pay Medical Provider at the
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`14 UCR rate for the amounts incurred by Medical Provider in rendering treatment,
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`care, surgery and procedures to the Patient.
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`31. DEFENDANT is and was required to resolve all payment disputes
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`dispute.
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`32. As a result, DEFENDANT owes Medical Provider the total UCR value
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`of Medical Provider's services.
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`33. The quantum meruit or total UCR value of Medical Provider's services
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`is determined according to what providers in the area usually charge for the same or
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`similar medical services in the absence of preferred provider or participating
`provider contractual rates. 1
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`1 UCR (Usual Customary and Reasonable), healthcare.gov,
`https :/ /www.healthcare.gov/ glossary /ucr-usual-customary-and-reasonab le/ (last
`· viewed September 26, 2019)
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`COMPLAINT
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`34. DEFENDANT has refused to pay, and continues to refuse to pay
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`3 Accordingly, there is now due and owing, to Medical Provider an unpaid sum, plus
`statutory interest thereon.
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`COMPLAINT
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`PRAYER FOR RELIEF
`WHEREFORE, Premier Spine Neurosurgery, Inc. prays for judgment
`against defendants as follows:
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`· For compensatory damages in an amount to be determined, plus
`statutory interest;
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`For restitution in an amount to be determined, plus statutory interest;
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`For a declaration that DEFENDANTS are obligated to pay plaintiff all
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`For such other relief as the Court deems just and appropriate
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`11 Dated: December 28, 2021
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`LAW OFFICE OF JONATHAN A.
`STIEGLITZ
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`By: Isl Jonathan A. Stieglitz
`JONATHAN A. STIEGLITZ
`Attorneys for Plaintiff,
`Premier Spine Neurosurgery, Inc.
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`DEMAND FOR JURY TRIAL
`Plaintiff, National Precision Neurosurgery, Inc. hereby demands a jury trial as
`provided by law.
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`Dated: December 28, 2021
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`LAW OFFICE OF JONATHAN A.
`STIEGLITZ
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`By: Is/ Jonathan A. Stieglitz
`JONATHAN A. STIEGLITZ
`Attorneys for Plaintiff,
`Premier Spine Neurosurgery, Inc.
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`COMPLAINT
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