Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 1 of 52 PageID #: 20158
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`MEMORANDUM AND ORDER
`2:19-cv-4817 (DRH) (ARL)
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`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF NEW YORK
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`NEUROLOGICAL SURGERY, P.C.,
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`Plaintiff,
` - against -
`AETNA HEALTH INC. and AETNA HEALTH
`INSURANCE COMPANY OF NEW YORK,
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`Defendants.
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`APPEARANCES
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`GARFUNKEL WILD, P.C.
`Attorneys for Plaintiff
`111 Great Neck Road
`Great Neck, NY 11021
`By: Roy W. Breitenbach, Esq.
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`Colleen M. Tarpey, Esq.
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`Marc A. Sittenreich, Esq.
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`FOX ROTHSCHILD LLP
`Attorneys for Defendants
`10 Sentry Parkway, Suite 200
`P.O. Box 3001
`Blue Bell, PA 19422
`By:
`Jordann R. Conaboy, Esq.
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`ELLIOT GREENLEAF P.C.
`Attorneys for Defendants
`925 Harvest Drive, Suite 300
`Blue Bell, PA 19422
`By: Gregory R. Voshell, Esq.
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`HURLEY, Senior District Judge:
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`
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`Plaintiff Neurological Surgery P.C. (“Plaintiff”) brought this action against
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`INTRODUCTION
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`Defendants Aetna Health Inc. and Aetna Health Insurance Company of New York
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`(collectively “Aetna” or “Defendants”) seeking payment, pursuant to the Employee
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`Retirement Income Security Act (“ERISA”) and New York state law, for 200 medical
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`claims for services performed on Aetna health plan members1 alleging that Aetna has
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`either underpaid or denied full payment on these claims. The claims2 arise from
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`medically necessary, complex procedures occurring over a four-year span (2012–2016)
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`and implicating 145 different Aetna health plans. Presently before the Court is
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`Aetna’s motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). [DE
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`21]. For the reasons set forth below, Aetna’s motion is granted in part and denied in
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`part.
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`I.
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`
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`BACKGROUND
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`Factual Background
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`Plaintiff is the largest private neurosurgery practice on Long Island and in the
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`New York tri-state area. (Compl. ¶ 1). As a healthcare provider, Plaintiff treats
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`patients with “complex, often emergent, neurological conditions requiring
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`neurosurgical procedures and treatment.” (Id. ¶ 15). These patients often have
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`health insurance coverage with, or are members of, group health plans sponsored or
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`administered by Aetna. (Id. ¶ 17).
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`Aetna is a health insurance company that creates “provider networks”: a group
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`of providers whom Aetna reimburses at pre-determined, contractual rates for services
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`performed for Aetna members. (Id. ¶ 5). A provider in a “provider network” is “in-
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`1
`The term “members” refers to individuals covered by fully-insured and self-
`funded Aetna health plans, including any such members, subscribers, or
`beneficiaries. (See Compl. ¶¶ 1, 19, 46).
`2
`For the purposes of this Memorandum and Order, the term “claim” is not used
`synonymously with “cause of action,” unless used in that manner in a quotation.
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`network”; otherwise, a provider is “out-of-network.” (Id. ¶¶ 5–6). Aetna members
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`may obtain treatment from out-of-network providers. (Id. ¶¶ 7, 19). When they do,
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`however, Aetna reimburses at “the usual, customary, and reasonable charges for the
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`services rendered, less any co-payment, co-insurance, member out-of-pocket, or
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`deductible amounts” – the “UCR Rate.” (Id. ¶¶ 8, 20). The precise reimbursement
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`methodology is set out in each member’s plan. (Id. ¶ 20).
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`Plaintiff is out-of-network with Aetna. (Id. ¶¶ 9, 23). Before Plaintiff performs
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`medically necessary, complex procedures for Aetna members, the members authorize
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`and assign Plaintiff their rights to receive payment directly from Aetna. (Id.). They
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`do so, for example, by executing “assignment of benefits” forms. (Id. ¶ 24). With
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`these authorizations and assignments, Plaintiff “engage[s Aetna] in communications
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`or discussions” in order to open a “claim” for reimbursement at the rates in each Aetna
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`member-patient’s “applicable health plan.” (Id. ¶¶ 25, 29, 31–33, 40). Aetna has
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`allegedly failed to pay or, after delay, underpaid on 200 claims between 2012 and
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`2016. (Id. ¶¶ 37–39; see, e.g., id. ¶¶ 44–2365). Plaintiff’s attempts to collect any
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`outstanding amounts fell “on deaf ears” and yielded “vague letters and promises of
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`proper payment at some uncertain point in the future.” (Id. ¶¶ 40–41).
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`The Complaint sets out the details of each claim in the following pattern: (i) the
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`Aetna member’s initials; (ii) the date of service; (iii) whether the services were
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`emergency or elective, (iv) the nature of the services (i.e., the diagnosis and
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`procedure, generally); (v) the date on which the member assigned to Plaintiff all
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`rights to receive reimbursement from Aetna for the services provided; (vi) the date on
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`which Plaintiff first billed Aetna, and the amount of the bill; (vii) the dates on which
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`Plaintiff “communicated” with Aetna, if any; (viii) whether or not Aetna reimbursed
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`Plaintiff, and the amount of reimbursement, if any; (ix) “the reimbursement
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`methodology that Aetna should have applied in accordance with the terms of the
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`applicable plan”; and (x) the dates and outcome of “additional, written appeals” to
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`Aetna seeking further reimbursement, if any. (Compl. ¶¶ 44–2365; see Pl. Opp. at 4
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`[DE 23]). The abundance of details prevents the Court from reciting the particulars
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`succinctly in the body of this Order, though they are important for the analysis below.
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`Instead, the spreadsheet at Appendix A lays out each claim’s pertinent facts.3
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`A few observations about the claims are worthy of note. Though Aetna
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`members assigned their reimbursement rights for 198 of the 200 claims, Plaintiff does
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`not reveal the terms of each assignment or attach the assignment contracts
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`themselves. (Compl. ¶¶ 401–09, 491–503 (failing to allege assignment)). Plaintiff
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`identifies a reimbursement methodology for most—but not all—of the claims.
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`(Compare id. ¶¶ 53, 65, 77 (detailed methodologies), with id. ¶¶ 390–400, 401–09 (no
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`methodology given)). A claim’s reimbursement methodology is the only instance
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`where Plaintiff relays the terms of the health plan at issue on that claim. While
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`Plaintiff styles its communications with Aetna as “appeals . . . for additional payment”
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`in which Aetna “[r]ecogniz[ed] [Plaintiff’s] status as an assigned beneficiary,”
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`Plaintiff never specifies the context and content of these “numerous” communications.
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`3
`As they have minimal bearing on the Court’s analysis, Appendix A does not
`devote columns to the information in (iii), (iv), and (v).
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`(E.g., id. ¶¶ 51, 63). Plaintiff likewise omits the context and content of its “additional,
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`written appeal[s].” (E.g., id. ¶¶ 102, 114).
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`II.
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`Procedural Background
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`Plaintiff originated this action in late July 2019 in Nassau County Supreme
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`Court of the State of New York.4 (Notice of Removal at 1 [DE 1]). Defendants
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`removed this action to federal court on August 22, 2019. (Id.). Plaintiff filed its
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`Complaint on August 30, 2019. [DE 5]. Plaintiff brings eight causes of action:
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`(1) recovery of benefits due under an employee benefit plan, enforcement rights under
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`the plan, and clarification of rights and future benefits under the plan, pursuant to
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`ERISA, 29 U.S.C. § 1132; (2) an award of reasonable attorneys’ fees and costs
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`pursuant to ERISA, 29 U.S.C. § 1132(g)(1); (3) breach of contract; (4) breach of
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`implied-in-fact contract; (5) unjust enrichment; (6) tortious interference with
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`contract; (7) violation of the New York Prompt Pay Law, N.Y. Ins. Law § 3224-a; and
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`(8) breach of third-party beneficiary contract. (Compl. ¶¶ 2366–432). The first two,
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`as ERISA-based causes of action, are governed by federal law; the rest are governed
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`by New York state law.
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`4
`Defendants allege Plaintiff’s present suit is the third time it brings an action
`“over the same subject matter.” (Def. Mem. at 3). The first was Neurological Surgery,
`P.C. v. Aetna Health Inc., No. 16-4524 (E.D.N.Y. 2016), voluntarily dismissed without
`prejudice via notice pursuant to a Federal Rule of Civil Procedure 41(a)(1)(A)(i). That
`action was commenced in state court via a summons with notice and then removed.
`No complaint was filed in that matter. The second was Neurological Surgery, P.C. v.
`Aetna Health Inc., No. 18-2167 (E.D.N.Y. 2018), voluntarily dismissed without
`prejudice via stipulation pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii).
`Its docket includes the complaint at Exhibit D to the Notice of Removal.
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`Defendants moved to dismiss on December 6, 2019 on nine grounds. First,
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`several claims trigger ERISA preemption, requiring dismissal of those claims’ state
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`law causes of action. (Def. Mem. at 9–12 [DE 21-2]). Second, Plaintiff failed to
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`exhaust administrative remedies for its ERISA-governed claims. (Id. at 12–17).
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`Third, many ERISA-governed claims involve health plans with anti-assignment
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`provisions and/or expired limitations periods, depriving Plaintiff of standing and
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`rendering the action as to those claims untimely. (Id. at 18–25). The fourth through
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`ninth grounds address the merits of Plaintiff’s state law causes of action. (Id. at 25–
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`34).
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`Plaintiff opposes. First, ERISA does not preempt any claims partially-paid by
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`Aetna. (Pl. Opp. at 6–8). Second, a valid anti-assignment provision or time limitation
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`bars ERISA from preempting state law causes of action. (Id. at 9–14). Third,
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`exhaustion of administrative remedies is an affirmative defense and not required in
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`Plaintiff’s pleading, and any further measures would have been futile regardless. (Id.
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`at 14–18). Fourth, dismissal is premature where discovery may show that Defendant
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`failed to notify Plaintiff and Aetna members of a time limitation to file suit. (Id. at
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`18–21). Fifth, Aetna waived its anti-assignment and time limitation by accepting
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`claims from, and paying, Plaintiff. (Id. at 21–22). Plaintiff further argues that the
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`Complaint adequately pleads its state law causes of action. (Id. at 23–35).
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`Plaintiff concludes by requesting leave to amend its Complaint should the
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`Court agree with Defendants. (Pl. Opp. at 35). Defendants ask this Court to deny
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`leave due to Plaintiff’s repeatedly-filed “substantively-identical complaints.” (Def.
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`Reply at 15 [DE 24]; see supra note 4).
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`DISCUSSION
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`The legal analysis will occur in the following order: In Section I, the Court
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`identifies the legal standards. In Section II, the Court determines whether it can
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`consider the health plan exhibits, and highlights certain plans that are inconclusively
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`labeled (see Appendix B) or mislabeled (see Appendix C) with respect to whether
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`ERISA applies. In Section III, the non-ERISA claims are analyzed. (See Appendix
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`D). In Section IV, the Court addresses the unassigned ERISA claims. (See Appendix
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`E). In Section V, the various anti-assignment provisions in the ERISA plans are
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`interpreted. (See Appendix F). In Section VI, the ERISA preemption analysis is
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`performed. (See Appendix G). In Section VII, the Court determines whether Plaintiff
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`exhausted administrative remedies before bringing suit. (See Appendix G). In
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`Section VIII, the Court concludes with Plaintiff’s request for leave to amend the
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`Complaint.
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`I.
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`Legal Standards
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`A.
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`Rule 12(b)(6) Motion to Dismiss Standard
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`In deciding a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6),
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`a court should “draw all reasonable inferences in Plaintiff[’s] favor, assume all well-
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`pleaded factual allegations to be true, and determine whether they plausibly give rise
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`to an entitlement to relief.” Faber v. Metro. Life Ins. Co., 648 F.3d 98, 104 (2d Cir.
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`2011) (internal quotation marks omitted). The plausibility standard is guided by two
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`principles. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v.
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`Twombly, 550 U.S. 544 (2007)); accord Harris v. Mills, 572 F.3d 66, 71–72 (2d Cir.
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`2009).
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`First, the principle that a court must accept all allegations as true is
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`inapplicable to legal conclusions. Thus, “threadbare recitals of the elements of a
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`cause of action supported by mere conclusory statements, do not suffice.” Iqbal, 556
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`U.S. at 678. Although “legal conclusions can provide the framework of a complaint,
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`they must be supported by factual allegations.” Id. at 679. A plaintiff must provide
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`facts sufficient to allow each named defendant to have a fair understanding of what
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`the plaintiff is complaining about and to know whether there is a legal basis for
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`recovery. See Twombly, 550 U.S. at 555.
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`Second, only complaints that state a “plausible claim for relief” can survive a
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`motion to dismiss. Iqbal, 556 U.S. at 679. “A claim has facial plausibility when the
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`plaintiff pleads factual content that allows the court to draw the reasonable inference
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`that the defendant is liable for the misconduct alleged. The plausibility standard is
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`not akin to a ‘probability requirement,’ but asks for more than a sheer possibility that
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`defendant acted unlawfully. Where a complaint pleads facts that are ‘merely
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`consistent with’ a defendant's liability, it ‘stops short of the line’ between possibility
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`and plausibility of ‘entitlement to relief.’” Id. at 678 (quoting Twombly, 550 U.S. at
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`556-57) (internal citations omitted); see In re Elevator Antitrust Litig., 502 F.3d 47,
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`50 (2d Cir. 2007). Determining whether a complaint plausibly states a claim for relief
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`is “a context specific task that requires the reviewing court to draw on its judicial
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`experience and common sense.” Iqbal, 556 U.S. at 679; accord Harris, 572 F.3d at 72.
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`B. Materials Considered on a Rule 12(b)(6) Motion to Dismiss
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`In considering a motion to dismiss pursuant to Rule 12(b)(6), a court is
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`generally limited to the complaint and documents attached thereto. See Fed. R. Civ.
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`P. 12(d); Nakahata v. N.Y.-Presbyterian Healthcare Sys., Inc., 723 F.3d 192, 202 (2d
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`Cir. 2013). A court “‘may also consider matters of which judicial notice may be
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`taken.’” Apotex Inc. v. Acorda Therapeutics, Inc. 823 F.3d 51, 60 (2d Cir. 2016)
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`(quoting Staehr v. Hartford Fin. Servs. Grp., Inc., 547 F.3d 406, 425 (2d Cir. 2008));
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`see Bristol v. Nassau County, 2016 WL 2760339 (E.D.N.Y. May 12, 2016) (“On a
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`motion to dismiss, consideration is limited to the factual allegations in plaintiff's
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`amended complaint, which are accepted as true, to documents attached to the
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`complaint as an exhibit or incorporated in it by reference, to matters of which judicial
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`notice may be taken, or to documents either in plaintiff's possession or of which
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`plaintiff had knowledge and relied on in bringing suit.” (internal quotation marks
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`omitted)).
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`II.
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`The Health Plan Exhibits
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`Absent from the Complaint is any method to decipher which, and how many,
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`claims involve ERISA-governed employee benefit plans – beyond the allegation that
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`“[s]ome,” indeed, do. (Compl. ¶ 2367). Defendants attach every health plan—145 in
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`total—implicated by the claims in the Complaint.5 (See Exs. 1–145, Aff. of Elizabeth
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`Petrozelli (“Petrozelli Aff.”) [DE 21-4];6 see also Appendix A to this Order).
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`Defendants’ Exhibit A to their Opening brief lists whether a plan is governed by
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`ERISA or not. There is no explanation for Defendants’ ERISA or non-ERISA label,
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`but Plaintiff’s submissions thus far do not dispute their accuracy. (See Pl. Opp. at 5
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`n.1, 9–10).
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`A.
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`Consideration of the Health Plans
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`At the outset, the Court must determine whether it can consider these exhibits
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`on the motion to dismiss. Plaintiff does not contest the Court’s consideration of the
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`health plans. And Defendants state they provided Plaintiff with copies in exchange
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`for the dismissal of Neurological Surgery, P.C. v. Aetna Health Inc., No. 18-2167
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`(E.D.N.Y. 2018). (See Def Mem. at 5).
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`Courts routinely consider the health plans on motions to dismiss in similar
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`cases. E.g., Neurological Surgery, P.C. v. Travelers Co. (“Travelers”), 243 F. Supp. 3d
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`318, 325 (E.D.N.Y. 2017) (“When deciding a motion to dismiss, a court may
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`consider . . . ERISA plan documents.”); Neurological Surgery, P.C. v. Northrup
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`Grumman Sys. (“Northrup Grumman”), 2017 WL 389098, at *5 (E.D.N.Y. Jan. 26,
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`2017). In Neurological Surgery, P.C. v. Siemens Corp. (“Siemens”), the Court
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`considered a health plan because, in part, ERISA plaintiffs “had to exhaust all
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`5
`Every claim implicates a health plan. Two or more claims may implicate the
`same plan, but no one claim implicates more than one plan.
`6
`Unless otherwise noted, any citation to “Ex. #” refers to the exhibits in the
`Affidavit of Elizabeth Petrozelli [DE 21-4].
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`administrative remedies outlined in the [p]lan whether or not they were aware of
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`such remedies before bringing suit.” 2017 WL 6397737, at *7 (E.D.N.Y. Dec. 12,
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`2017). In Steger v. Delta Airlines, the plaintiff did not attach the applicable ERISA
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`plan to the complaint, but the defendants “annexed a copy . . . to [the] motion to
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`dismiss.” 382 F. Supp. 2d 382, 385 (E.D.N.Y. 2005). The Steger Court considered the
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`plan because it was “directly referenced in the complaint and is the basis of this
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`action.” Id.
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`The Complaint here specifies each plan’s precise reimbursement methodology
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`for most claims, though the methodologies are pled “upon information and belief.”
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`(See, e.g., Compl. ¶¶ 53, 65, 77, 100–01, 137, 698, 1361, 1428, 1566). Plaintiff’s brief
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`admits by way of example that certain claims are governed by the plans at Exhibits
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`63 and 84. (E.g., Pl. Opp. at 8; see Exs. 63, 84 [DE 22-13, 22-34]). Plaintiff also relies
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`on plan terms in formulating arguments in opposition. (Pl. Opp. at 24 (quoting the
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`language of the various anti-assignment provisions in the health plans at issue)).
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`For the reasons expressed in Travelers, Northrup Grumman, Siemens, and
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`Steger, the 145 health plans at issue are properly considered on this motion to
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`dismiss. See Exs. 1–145. The exhibited plans form the basis of the action: Each plan’s
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`reimbursement methodology enabled Plaintiff to determine whether, and to what
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`extent, Aetna allegedly owes payment.
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`In reviewing certain exhibits, however, the Court notes that some contradict
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`or fail to confirm Defendants’ ERISA or non-ERISA label. The Court now turns to
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`the inconclusive and mislabeled plans.
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`B.
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`Inconclusive Plans7
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`There are 3 exhibits Defendants label “non-ERISA” that do not provide a basis
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`to determine whether or not the plan is subject to ERISA. Exhibit 33 is labeled a
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`non-ERISA plan, but the one-page slipsheet Defendants provided states “Aetna has
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`no plan document for this claim.” Ex. 33 [DE 21-37]. Defendants do not address why
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`they nevertheless labeled it as a non-ERISA plan.
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`Exhibit 54 is also labeled a non-ERISA plan. Upon inspection, Exhibit 54 is a
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`chart labeled “Attachment A,” and the document which it appends is not included.
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`Ex. 54 at 1 [DE 22-4]. The chart purports to identify the benefits available for certain
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`network and out-of-network services. This chart is not the health plan, and the Court
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`cannot say whether it is governed by ERISA. Additionally, the word “Aetna” does not
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`appear in the document. See id.
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`Exhibit 95 is also labeled a non-ERISA plan, but the one-page slipsheet
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`Defendants provided states “Aetna has no plan document for this claim.” Ex. 95 [DE
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`22-45]. Defendants do not address why they nevertheless labeled it as a non-ERISA
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`plan.
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`Without a basis to say whether or not the health plans are subject to ERISA,
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`the 4 claims implicating Exhibits 33, 54, and 95 are treated as inconclusive. The
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`Court retains jurisdiction over such claims until it is clear whether they are subject
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`to ERISA.
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`7
`Appendix B lists all pertinent information for the claims mentioned in this
`Inconclusive Plans section.
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`C. Mislabeled Plans8
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`There are 2 “non-ERISA” claims implicating plans which, upon review, suggest
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`they are governed by ERISA. Exhibit 11 is titled “Extraterritorial Riders,” which is
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`a set of provisions that “form[] a part of the booklet certificate issued to [a member]
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`by Aetna describing the benefits provided under the policy,” implying that Exhibit 11
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`is not, in fact, the actual health plan at issue for that claim. Ex 11 at 1 [DE 21-15].
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`Moreover, the first page of the Schedule of Benefits states, “This is an ERISA plan,
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`and you have certain rights under this plan.” Id. at 134.
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`In similar fashion, the Schedule of Benefits page in Exhibit 13 also states,
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`“This is an ERISA plan, and you have certain rights under this plan.” Ex. 13 at 102
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`[DE 21-17]. For the purposes of this Memorandum and Order, and without an
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`argument to treat them as non-ERISA, the 2 claims implicating Exhibits 11 and 13
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`are thus treated as subject to ERISA.
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`III. Non-ERISA Plans and Standing9
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`The non-ERISA label is correctly applied to 8 plans implicated by 12 claims.
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`Under such plans, Plaintiff (assigned the right to reimbursement) cannot enforce
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`ERISA rights, as the assigning Aetna member is not an ERISA “participant or
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`beneficiary.” See Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d 321, 328–29
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`(2d Cir. 2011) (citing 29 U.S.C. § 1132(a)(1)(B)). With no ERISA causes of action, only
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`8
`Appendix C lists all pertinent information for the claims mentioned in this
`Mislabeled Plans section.
`9
`Appendix D lists all pertinent information for the claims mentioned in this
`Non-ERISA Plans section.
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`state law causes of action remain; no federal question jurisdiction pursuant to 28
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`U.S.C. § 1331 exists. There is no diversity jurisdiction pursuant to 28 U.S.C. § 1332
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`because all parties hail from New York. (Compl. ¶¶ 13–15).
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`Plaintiff therefore asks the Court to exercise supplemental jurisdiction over
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`these claims. 28 U.S.C. § 1367(a); see Pl. Opp. at 5 n.1, 11 n.2. District courts have
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`“supplemental jurisdiction over all the claims that are so related to claims in the
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`action with such original jurisdiction that they form part of the same case or
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`controversy.” 28 U.S.C. § 1367(a). Thus supplemental jurisdiction exists if the Court
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`has subject-matter jurisdiction over other claims and if the federal and state claims
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`stem from a “common nucleus of operative fact.” United Mine Workers of Am. v.
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`Gibbs, 383 U.S. 715, 725 (1966).
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`Plaintiff alleges the Court’s subject-matter jurisdiction comes from its
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`“multiple viable ERISA claims.” (Pl. Opp. at 11 n.2). Yet the Court’s analysis below
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`reveals that there may not be any viable claims in federal court,10 meaning there is
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`no original jurisdiction to affix supplemental jurisdiction. See 28 U.S.C. § 1367(a).
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`Even if certain claims remained in federal court, however, it is arguable
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`whether the 12 non-ERISA claims stem from the same “common nucleus of operative
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`fact” as any of the 184 ERISA claims. A similar legal theory undergirds all claims:
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`Aetna allegedly underpaid or failed to pay Plaintiff for services performed for Aetna
`
`
`10
`The Court retains jurisdiction over the 4 claims implicating Exhibits 33, 54,
`and 95 to determine whether these are, in fact, ERISA-governed claims for which
`Plaintiff has statutory standing. (See Compl. ¶¶ 538–48, 549–60, 853–62, 1431–41).
`If not, then such claims must be remanded to state court.
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`Page 14 of 52
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`Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 15 of 52 PageID #: 20172
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`members. See Montefiore Med. Ctr., 642 F.3d at 323–333 (citing Brunswick Surgical
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`Ctr., LLC v. CIGNA Healthcare, 2010 WL 3283541, at *1 (D.N.J. Aug. 18, 2010)). But
`
`practically, there are important differences. The members are different, their health
`
`plans have different terms, their medical procedures were different, the
`
`reimbursement methodologies are different, the dates of service and correspondence
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`were different, and some but not all involve “additional, written appeals.”
`
`A court “may decline to exercise supplemental jurisdiction” if “in exceptional
`
`circumstances, there are compelling reasons for declining jurisdiction.” 28 U.S.C.
`
`§ 1367(c)(4). Compelling reasons to decline exist here. Plaintiff’s 400-page Complaint
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`details 200 total claims: 4 inconclusive, 12 non-ERISA, and 184 ERISA. There are
`
`145 implicated health plans: 3 inconclusive, 8 non-ERISA, and 134 ERISA – and no
`
`indication that any non-ERISA plans are “substantially identical” to any ERISA ones.
`
`By way of contrast: the Brunswick Surgical Court exercised supplemental
`
`jurisdiction over claims relating to 5 non-ERISA plans, where those 5 were among 12
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`“substantially identical” plans, in a case with 13 total plans. 2010 WL 3283541, at
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`*1.
`
`Without supplemental jurisdiction, all causes of action related to the 12 non-
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`ERISA claims are remanded to New York state court.
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`Page 15 of 52
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`

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`Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 16 of 52 PageID #: 20173
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`IV. The Unassigned Claims11
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`
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`For 2 ERISA claims, Plaintiff fails to allege that the Aetna members assigned
`
`their rights to receive reimbursement for the health care services provided. (Compl.
`
`¶¶ 401–09, 491–503). Plaintiff nevertheless asserts ERISA “cause[s] of action as an
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`assignee” of these two Aetna members. (Id. ¶¶ 401–09, 491–503, 2376; see Exs. 25,
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`30 [DE 21-29, DE 21-34]).
`
`The ERISA statute is “narrowly construed” to permit only ERISA enumerated
`
`parties—“participant[s] or beneficiar[ies]”—to enforce their right to reimbursement.
`
`See Franchise Tax Bd. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27
`
`(1983); Montefiore Med. Ctr., 642 F.3d at 328–29 (citing 29 U.S.C. § 1132(a)(1)(B)).
`
`Plaintiff, a health care provider, is not an enumerated party. (See Compl. ¶¶ 1–3, 9).
`
`Without a valid assignment of this right to reimbursement, (see id. ¶¶ 9, 23–24, 27,
`
`401–09, 491–503, 2376), Plaintiff has no standing to bring a claim for benefits. Simon
`
`v. Gen. Elec. Co., 263 F.3d 176, 177–78 (2d Cir. 2001) (“Simon conceded that he is
`
`neither a participant nor beneficiary of the plan under which his benefit claims
`
`arise. . . . Simon is not a healthcare provider assignee. Accordingly, and for the
`
`reasons given by the several circuit courts, we conclude that Simon does not have
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`standing to sue under the terms of ERISA.”).
`
`
`11
`Appendix E lists all pertinent information for the claims mentioned in this
`Unassigned Claims section.
`
`Page 16 of 52
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`

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`Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 17 of 52 PageID #: 20174
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`Plaintiff’s ERISA causes of action for these 2 claims are dismissed. To the
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`extent any state law causes of action survive, they are remanded to New York state
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`court.
`
`V.
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`Anti-Assignment Provisions and Statutory Standing12
`
`Plaintiff therefore brings 184 actionable ERISA claims. At play in 111 of them
`
`are anti-assignment provisions. (See Def. Mem. at 18; Exs. E–G, id.). If valid, these
`
`provisions would keep Plaintiff from bringing ERISA causes of action based on these
`
`claims’ plans.
`
`While only an ERISA “participant or beneficiary” may bring a claim for
`
`benefits under ERISA, a “narrow exception” exists for “healthcare providers to whom
`
`a beneficiary has assigned his claim in exchange for health care.” Montefiore Med.
`
`Ctr., 642 F.3d at 328–29 (internal quotation marks omitted); see 29 U.S.C.
`
`§ 1132(a)(1)(B). Plaintiff alleges all “Aetna [m]embers at issue have assigned their
`
`right to receive benefits under relevant health plans to” Plaintiff. (Compl. ¶ 2376).
`
`Valid anti-assignment provisions render Plaintiff’s “acceptance of [the]
`
`assignment . . . ineffective—a legal nullity.” McCulloch Orthopaedic Surgical Servs.,
`
`PLLC v. Aetna Inc. (“McCulloch”), 857 F.3d 141, 147 (2d Cir. 2017); Mbody Minimally
`
`Invasive Surgery, P.C. v. Empire Healthchoice HMO, Inc. (“Mbody”), 2014 WL
`
`4058321, at *3 (S.D.N.Y. Aug. 15, 2015) (“If a health insurance plan ‘unambiguously
`
`prohibits assignment, an attempted assignment will be ineffectual’” (quoting
`
`
`12
`Appendix F lists all pertinent information for the claims mentioned in this
`Anti-Assignment Provisions section.
`
`Page 17 of 52
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`

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`Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 18 of 52 PageID #: 20175
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`Neuroaxis Neurological Assocs., P.C. v. Costco Wholesale Co., 919 F. Supp. 2d 345,
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`351–52 (S.D.N.Y. 2013))). A plaintiff must establish that the ERISA beneficiary
`
`“assigned his right [to reimbursement] in accordance with the terms of the ERISA
`
`plan.” Travelers, 243 F. Supp. 3d at 326; see McCulloch, 857 F.3d at 148 (“[A]bsent a
`
`valid assignment of a claim, . . . non-enumerated parties lack statutory standing to
`
`bring suit under ERISA . . . .” (internal quotation marks omitted) (emphasis in
`
`original)); Mbody, 2014 WL 4058321, at *3; Neuroaxis Neurological Assocs., P.C., 919
`
`F. Supp. 2d at 351. Courts “construe ERISA plans according to federal common law
`
`and interpret them in an ordinary and popular sense as would a person of average
`
`intelligence and experience.” Pepe v. Newspaper & Mail Deliveries’-Publishers’
`
`Pension Fund, 559 F.3d 140, 147 (2d Cir. 2009) (internal quotation marks and citation
`
`omitted).
`
`Plaintiff does not argue that the language in any of the anti-assignment
`
`provisions is ambiguous. Instead, Plaintiff contends that “[r]egardless of whether o[r]
`
`not the applicable health plans at issue contain anti-assignment clauses, Aetna
`
`accepted and acknowledged the assignment” of benefits by paying or communicating
`
`with Plaintiff and thus “affected a waiver.” (Compl. ¶ 25; Pl. Opp. at 21–22). To
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`Plaintiff, any anti-assignment language is thereby “ineffective to bar an assignment
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`as a matter of law.” (Id. ¶ 26).
`
`Page 18 of 52
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`Case 2:19-cv-04817-DRH-ARL Document 27 Filed 01/04/21 Page 19 of 52 PageID #: 20176
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`A. The Nine Anti-Assignment Provisions
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`There are nine different anti-assignment provisions across the 86 ERISA plans
`
`implicated by the 111 claims.13 Each provision is analyzed below. Minor differences
`
`in the wording of two anti-assignment provisions of the same type—like referring to
`
`the health plan as a “contract” or a “policy”—do not impact the analysis and are not
`
`mentioned. As a result of the analysis below, 110 claims implicate 85 ERISA plans
`
`with valid anti-assignment provisions, which deprives Plaintiff of standing to bring
`
`such claims. Appendix F identifies which claims correspond to which anti-
`
`assignment clause.
`
`be
`may
`Anti-Assignment Provision #1: “Coverage
`assigned only with the written consent of Aetna. To the