ACS Primary Care Physicians Sw., P.A. v. UnitedHealthcare Ins. Co.

• Decision Date: 22 January 2021
• Docket Number: CIVIL ACTION NO. 4:20-CV-01282
• Citation: 514 F.Supp.3d 927
• Parties: ACS PRIMARY CARE PHYSICIANS SOUTHWEST, P.A., et al., Plaintiffs, v. UNITEDHEALTHCARE INSURANCE COMPANY, et al., Defendants.
• Court: U.S. District Court — Southern District of Texas

514 F.Supp.3d 927

ACS PRIMARY CARE PHYSICIANS SOUTHWEST, P.A., et al., Plaintiffs,

v.UNITEDHEALTHCARE INSURANCE COMPANY, et al., Defendants.

CIVIL ACTION NO. 4:20-CV-01282

United States District Court, S.D. Texas, Houston Division.

Signed January 22, 2021

John Zavitsanos, Michael Alexander Killingsworth, Sammy Ford, IV, Ahmad Zavitsanos Anaipakos Alavi & Mensing PC, Houston, TX, Jonathan E. Siegelaub, Justin C. Fineberg, Lash Goldberg LLP, Miami, FL, for Plaintiffs.

Donald C. Colleluori, Andrew G. Jubinsky, Figari Davenport LLP, Dallas, TX, for Defendants.

ORDER

Andrew S. Hanen, United States District Judge

Pending before the Court is a motion to dismiss filed by Defendants UnitedHealthcare Insurance Company and UnitedHealthcare of Texas, Inc. (collectively, the "Defendants") (Doc. No. 13), and a request for clarification by Plaintiffs ACS Primary Care Physicians Southwest, P.A., Hill Country Emergency Medical Associates, P.A., Longhorn Emergency Medical Associates, P.A., Central Texas Emergency Associates, P.A., Emergency Associates of Central Texas, P.A., and Emergency Services of Texas, P.A. (collectively, the "Plaintiffs") (Doc. No. 40). Plaintiffs filed a response to Defendants' motion. (Doc. No. 25). Defendants replied. (Doc. No. 27). Defendants also filed a response to Plaintiffs' request for clarification (Doc. No. 41), and the Court heard oral argument on both motions. Finally, Plaintiffs filed a motion for leave to file submit supplemental authority (Doc. No. 52), to which Defendants replied (Doc. No. 55). After careful consideration of the arguments, the briefing, and applicable law, this Court GRANTS Plaintiffs' motion for leave to file, DENIES their motion to clarify, and GRANTS in part and DENIES in part the Defendants' Motion to Dismiss.

I. Background

Plaintiffs are emergency care physician groups in Texas, and Defendants are health care insurance companies. Unlike some other physicians, emergency care providers are obligated by law to serve all those who require emergent care. As a result of this duty, Plaintiffs are protected by Texas laws that require health care insurers to compensate nonpreferred and non-network emergency medical providers at usual and customary rates. The protective statutes relevant to Plaintiffs' claims govern health maintenance organizations ("HMO"), exclusive provider organizations, ("EPO"), and preferred provider organizations ("PPO"). The statutes include Tex. Ins. Code §§ 1271.155(a) (applicable to HMO plans), 1301.0053(a) (applicable EPO plans), and 1301.155(b) (applicable to PPO plans) (collectively, the "emergency care statutes").

Based upon the pleadings, Plaintiffs have provided emergency medical services to patients enrolled in Defendants' various health care plans from January 2016 through the present. The parties agree that the Plaintiffs should have been compensated for the services rendered to plan members and for the most part agree that Defendants have already paid benefits to Plaintiffs for these services. Due to the fact that Plaintiffs did not participate in Defendants' provider network, however, there were no written contracts between the parties and consequently no explicitly agreed-upon rates. Plaintiffs allege that the reimbursement levels were "paid at unacceptably low rates," that were below the "usual and customary rate" required by statute. (Doc. No. 9 at 6–7).

II. Procedural History

Plaintiffs sued Defendants in the 190^th Judicial District Court of Harris County, Texas "to collect damages from Insurance Companies for Insurance Companies' failure to comply with Texas law and to compel Insurance Companies to pay Plaintiff[s] the usual and customary rate for the emergency services that Plaintiff[s] provided to Insurance Companies' Members." (Doc. No. 1-6 at 12). Plaintiffs pleaded three causes of action in their Original Petition: (1) violations of the Texas Insurance Code; (2) breach of contract implied in fact; and (3) quantum meruit. (Id. at 12–14). Defendants removed the case to federal court on the basis that Plaintiffs' claims were completely preempted by the Employment Retirement Income Security Act ("ERISA"). (Doc. No. 1 at 3). Subsequently, Plaintiffs amended their pleadings and moved to remand. (Doc. Nos. 9 & 10). Defendants also filed, following Plaintiffs' amended complaint, a motion to dismiss (Doc. No. 13), to which Plaintiffs responded (Doc. No. 25), and Defendants replied (Doc. No. 27). This Court denied Plaintiffs' motion to remand, because it found that Plaintiffs' claims under the Texas Insurance Code, Section 1301.155(b) ("the PPO statute") from January 2016 through December 31, 2019, including the common law claims involving PPO plans, were completely preempted by ERISA. (Doc. No. 38 at 16). Following this Court's order, the Plaintiffs filed a request for clarification (Doc. No. 40), to which Defendants replied (Doc. No. 41). The Court then heard oral argument on the motion to dismiss and request for clarification.¹ Before the Court, therefore, remains Defendants' motion to dismiss, Plaintiffs' request for clarification, and Plaintiffs' motion for leave to file supplemental authority (Doc. No. 52).

III. Legal Standard

A party may file a motion to dismiss claims against it for "failure to state a claim upon which relief may be granted." Fed. R. Civ. P. 12(b)(6). To defeat a motion under Rule 12(b)(6), a plaintiff must plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 663, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ). "Where a complaint pleads facts that are ‘merely consistent with’ a defendant's liability, it ‘stops short of the line between possibility and plausibility of entitlement to relief.’ " Id. (quoting Twombly , 550 U.S. at 557, 127 S.Ct. 1955 ). In reviewing a Rule 12(b)(6) motion, the court must accept all well-pleaded facts in the complaint as true and view them in the light most favorable to the plaintiff. Sonnier v. State Farm Mut. Auto. Ins. Co. , 509 F.3d 673, 675 (5th Cir. 2007). The Court is not bound to accept factual assumptions or legal conclusions as true, and only a complaint that states a plausible claim for relief survives a motion to dismiss. Iqbal , 556 U.S. at 678-79, 129 S.Ct. 1937. When there are well-pleaded factual allegations, the court assumes their veracity and then determines whether they plausibly give rise to an entitlement to relief. Id.

IV. Analysis

A. Plaintiffs' Request for Clarification

As an initial matter, the Court is unpersuaded by the argument in Plaintiffs' request for clarification that the Court should reconsider its holding that Plaintiffs' common law claims pertaining to the PPO statute from January 2016 through December 31, 2019 were completely preempted by ERISA. The Court held that claims for reimbursement under the PPO statute were completely preempted because prior to 2020, the statute imposed a duty on the insurer only to pay "at the preferred level of benefits," which would require an interpretation of the ERISA plan. The "at the usual and customary rate or at an agreed rate" language upon which Plaintiffs rely to take their claims outside of ERISA was not effective in the PPO statute until January 1, 2020, and thus does not apply to any PPO-related claims in this case from January 2016 through December 31, 2019. (Doc. No. 38 at 15).

Plaintiffs now argue that the Texas Administrative Code, Section 3.3708 established a price term outside of the ERISA plans throughout the relevant period, even though the PPO statute itself did not.² (Doc. No. 40 at 4). Plaintiffs point to the fact that § 3.3708(b) used the "usual and customary" language before the PPO statute allegedly codified it. The Court, however, agrees with Defendants' position, expressed during oral argument, that the clear text of Section 3.3701 of the Texas Administrative Code prevents the regulation from governing the PPO statute:

(d) These sections [of the Administrative Code] do not create a private cause of action for damages or create a standard of care, obligation, or duty that provides a basis for a private cause of action. These sections do not abrogate a statutory or common law cause of action, administrative remedy, or defense otherwise available.

Tex. Admin. Code § 3.3701(d) (emphasis added). The regulation's own directive against deriving from it a "standard of care, obligation, or duty" strongly counsels against lifting the text of § 3.3708 and dropping it into a statute in order to impose an extra obligation upon insurers. Moreover, the Administrative Code itself specifically states that it does not create a private cause of action. Tex. Admin. Code § 3.3701(d). This could not be clearer. Furthermore, Plaintiffs have not demonstrated why the Court should assume a regulation should trump the plain words of the statute in the first place. The Supreme Court of Texas has clearly stated that "clear text equals controlling text," and "[o]ur aversion to extratextual impulses is less prudish than prudent: If it is not necessary to depart, it is necessary not to depart." Bankdirect Capital Fin., LLC v. Plasma Fab, LLC , 519 S.W.3d 76, 85 (Tex. 2017). In this regard, Plaintiffs have not shown that the prior PPO statute was not clear, nor have they demonstrated why a regulation should control over a very specific statute. For the foregoing reasons, the Court will not reconsider its previous order on complete preemption and it denies the "request" for clarification insofar as its goal is for this Court to change its decision on the Motion to Remand.

B. The Motion to Dismiss

Defendants asserted five theories upon which to grant relief in...