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Schwartz v. Associated Employers Group Benefit Plan And Trust

United States District Court, D. Montana, Billings Division

January 16, 2018

LAUREN F. SCHWARTZ, M.D. on assignment of AMANDA S., Plaintiff,
v.
ASSOCIATED EMPLOYERS GROUP BENEFIT PLAN AND TRUST, and EMPLOYEE BENEFIT MANAGEMENT SYSTEMS, Defendants.

          OPINION AND ORDER

          SUSAN P. WAITERS UNITED STATES DISTRICT JUDGE

         Before the Court is a motion to dismiss filed by Defendant Associated Employers Group Benefit Plan ("AEG") (Doc. 12) and a motion to dismiss filed by Defendant Employee Benefit Management Systems ("EBMS") (Doc. 10). For the foregoing reasons, the motions are granted in part and denied in part.

         I. Facts alleged in complaint

         Lauren Schwartz is a neurosurgeon from New Jersey. (Doc. 1 at ¶¶ 1, 10). In July 2013, while volunteering at a Montana Camp Mak-A-Dream, she befriended a young woman named Amanda. (Doc. 1 at ¶ 8). As a child, Amanda was diagnosed with a brain tumor which required surgery and a brain shunt. (Doc. 1 at ¶ 9). Amanda asked Schwartz to be her doctor because her Montana doctor was not experienced with her condition. (Doc. 1 at ¶ 10). Schwartz believed Amanda would be better off receiving treatment closer to home. (Doc. 1 at ¶ 14). Schwartz discussed insurance coverage with Amanda's mother, who stated Amanda was insured through EBMS. (Doc. 1 at ¶ 13). Schwartz reached out to several doctors on Amanda's behalf but they either failed to respond or declined to provide treatment. (Doc. 1 at¶¶ 14-19).

         In March 2014, Amanda's condition worsened. (Doc. 1 at ¶ 20). Out of fear Amanda was dying, Amanda's mother contacted Schwartz. (Doc. 1 at ¶ 20). Schwartz told Amanda's mother to contact Amanda's doctor and request a CT Scan to determine if there was bleeding in Amanda's head. (Doc. 1 at ¶ 21). After Amanda underwent a CT Scan, a nurse called Schwartz and said Amanda's condition was "out of their league." (Doc. lat¶22). Schwartz contacted Hackensack University Medical Center in New Jersey. (Doc. 1 at ¶ 23). Schwartz explained Amanda had difficulty receiving treatment close to home and needed emergency treatment. (Doc. 1 at ¶ 23). Hackensack agreed to accept Amanda. (Doc. 1 at¶23).

         Schwartz contacted EBMS and stated Amanda needed to travel to New Jersey on an emergency flight under medical observation. (Doc. 1 at ¶ 24). EBMS administers claims under a healthcare plan provided by AEG. (Doc. 1 at ¶¶ 2-3). Schwartz explained to EBMS that she does not accept Medicare or Medicaid and was relying on EBMS to cover Amanda's treatment, including surgery. (Doc. 1 at ¶ 24). EBMS told Schwartz Amanda's treatment would be reimbursed in full. (Doc. 1 at ¶¶ 24-25).

         Amanda was flown to New Jersey on an emergency flight. (Doc. 1 at ¶ 26). Upon landing, Amanda was rushed to the Hackensack emergency room in unstable condition. (Doc. 1 at ¶¶ 26-27). Schwartz then took Amanda to the operating room and performed brain surgery. (Doc. 1 at ¶¶ 28-30). A few hours after surgery, Amanda developed acute severe meningitis and began having seizures. (Doc. 1 at ¶ 30). Amanda was returned to the operating room for more surgery. (Doc. 1 at ¶¶ 30-31). Due to the extensive surgeries and complications, Amanda underwent a detailed course of treatment for the next month. (Doc. 1 at ¶ 31). During Amanda's rehabilitation, Schwartz spoke with EBMS about paying for Amanda's treatment. (Doc. 1 at ¶ 33). EBMS again stated Schwartz would be reimbursed in full. (Doc. 1 at ¶ 33).

         At some point on the day Amanda arrived at Hackensack, she signed Hackensack's general admission consent form. (Docs. 1 at ¶ 34; 1-2). The form had Schwartz's and Amanda's names at the top. (Doc. 1-2). Amanda initialed the form at the bottom. (Doc. 1-2). The form's assignment of benefits clause stated "I authorize my health insurance benefits to be paid directly to Hackensack University Medical Center." (Doc. 1-2). The form's financial agreement clause stated "I understand that the Medical Center bill applies only to hospital charges and does not include any charges or fees by physicians." (Doc. 1-2).

         Schwartz submitted a bill to AEG and EBMS in the amount of $476, 448.00 for Amanda's treatment. (Doc. 1 at ¶ 35). AEG and EBMS paid Schwartz $31, 946.51, but refused to pay the rest. (Docs. 1 at ¶¶ 37, 40). Schwartz appealed the adverse decision but AEG and EBMS continued to refuse to pay the remainder. (Doc. 1 at ¶¶ 38-40). Schwartz filed suit to collect the remaining balance. (Doc. 1).

         Schwartz's complaint contains three counts. Under count one, Schwartz claims she is entitled to the remaining balance because Amanda assigned Schwartz the rights to medical payments for the treatment. Under count two, Schwartz claims she is entitled to the remaining balance because EBMS promised Schwartz would be reimbursed in full for the treatment and Schwartz relied on that promise to her detriment. Under count three, Schwartz claims she is entitled to the remaining balance because AEG and EBMS breached their fiduciary duties to Amanda. The parties have stipulated to the dismissal of count three. The parties have also stipulated that Amanda's insurance policy is governed by the Employee Retirement Income Security Act (ERISA).

         II. Law

         A motion to dismiss for failure to state a claim is governed by Fed.R.Civ.P. 12(b)(6). To survive a motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face."' Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corporation v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. The complaint is construed in the light most favorable to the non-moving party. Davis v. HSBC Bank Nevada, N.A., 691 F.3d 1152, 1159 (9th Cir. 2012).

         In determining a motion to dismiss, a district court may consider documents attached to the complaint and documents "whose contents are alleged in a complaint and whose authenticity no party questions." Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005).

         III. ...


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