A federal district court in Illinois recently issued a pair of rulings in cases where insurers sought to recoup payments from practitioners. Pennsylvania Chiropractic Association v. Blue Cross Blue Shield Association, 2013 U.S. Dist. LEXIS 159331 (N.D. Ill. Nov. 7, 2013); 2013 U.S. Dist. LEXIS 159491 (N.D. Ill. Nov. 7, 2013). Plaintiffs, three individual chiropractors and three chiropractic associations, alleged that defendants, Blue Cross Blue Shield of America and individual Blue Cross Blue Shield entities (collectively, “BCBS”), falsely or fraudulently determined that certain reimbursements they received for services rendered should never have been made. When plaintiffs refused BCBS’s demands to repay the challenged reimbursements, BCBS withheld payments on subsequent, unrelated claims that plaintiffs submitted to BCBS for services provided to other BCBS insureds.
The court ruled that one of the individual chiropractors had standing to assert claims under ERISA because the chiropractor’s patients (i.e., plan participants) had assigned to him their rights to payment under their health plans and was thus an ERISA beneficiary. The court found that the chiropractor was not afforded ERISA notice and appeal rights to which a beneficiary is entitled following an adverse benefit determination, and thus granted the chiropractor summary judgment as to liability. For the other two individual chiropractor plaintiffs, the court denied summary judgment because there remained triable issues regarding anti-assignment clauses in their provider agreements. In a related decision, the court determined that the chiropractic-association plaintiffs also had standing because the injunctive and equitable relief sought would inure to the benefit of plaintiffs’ members.