Advanced Reimbursement Sols. v. Aetna Life Ins. Co.

• Decision Date: 25 March 2022
• Docket Number: CV-19-05395-PHX-DLR
• Parties: Advanced Reimbursement Solutions LLC, et al., Plaintiffs, v. Aetna Life Insurance Company, et al., Defendants.
• Court: U.S. District Court — District of Arizona

Advanced Reimbursement Solutions LLC, et al., Plaintiffs, v. Aetna Life Insurance Company, et al., Defendants.

No. CV-19-05395-PHX-DLR

United States District Court, D. Arizona

March 25, 2022

ORDER

Douglas L. Rayes United States District Judge

Counterclaim-Plaintiffs are Aetna, Inc., and Aetna Life Insurance Company (“Aetna”). Counterclaim-Defendants are Advanced Reimbursement Solutions, LLC (“ARS”), American Surgical Development, LLC (“ASD”), and 9 outpatient treatment centers (“OTCs”).^[1] Pending before the Court are motions to dismiss Aetna's Second Amended Counterclaim (“SACC”) filed by ARS and ASD (Doc. 262) and the remaining OTCs (Docs. 274 and 284). Also before the Court is Aetna's motion for leave to amend its SACC. (Doc. 437.) As explained below, the Court grants in part and denies in part ARS and ASD's motion to dismiss, denies the remaining OTCs' motions to dismiss, and grants Aetna's motion for leave to amend.^[2] I Background^[3]

Aetna brings counterclaims on its own behalf as the provider of fully insured health plans, and in its capacity as claims administrator for self-funded, employer-established health plans that retain Aetna as a third-party administrator. For fully insured plans, Aetna pays claims using its own money. For self-funded plans, claims are paid directly by employers and employees using their own money, but in its capacity as claims administrator, Aetna is authorized by contract to bring actions to recover overpayments on behalf of those plans. (Doc. 203-1 ¶¶ 43-49.)

Aetna policy and the terms of Aetna's plans set forth several requirements designed to impose reasonable limits on the cost of care. For example, Aetna members have cost-sharing obligations. (Id. ¶ 53.) Plan members generally are required to pay an annual deductible before plan benefits are triggered. Once members have paid their deductibles, the plans then generally require members to pay coinsurance-a percentage of the cost- for the healthcare services they receive, until they meet a plan-prescribed out-of-pocket maximum. Members also sometimes are required to pay fixed dollar amounts called copays at the time they receive certain healthcare services. (Id. ¶¶ 54-56.) Aetna's Copayment and Coinsurance Waivers Payment Policy requires providers to collect copayments and coinsurance as defined by a member's plan and prohibits providers from waiving those obligations. (Id. ¶ 57.) network provider bills Aetna and the amount allowed by Aetna. (Id. ¶¶ 61-62.)

The OTCs contracted with ARS and ASD to provide, among other things, billing services and back-office support in exchange for a portion of the OTCs' reimbursements. (Id. ¶¶ 66-81.) Aetna alleges that Counterclaim-Defendants “engag[ed] in a multi-faceted out-of-network billing scheme intended to extract extraordinarily inflated payments from Aetna and its self-funded plan sponsors simply because Aetna members received treatment from medical professionals at the OTCs' offices.” (Id. ¶ 1.) In particular, Aetna accuses Counterclaim-Defendants of:

(a) causing Aetna's contracted providers to refer patients to the out-of-network OTCs in violation of their provider contracts;

(b) causing in-network providers to perform services at out-of-network OTCs in violation of their contracts; (c) inducing Aetna members to violate the terms of their insurance plans, including by waiving the Aetna members' cost-sharing obligations, which otherwise would have served as a deterrent to Aetna members' use of the OTCs; (d) improperly billing for facility fees on behalf of the OTCs, including misrepresenting the licensure and nature of the OTCs, despite the fact that industry-standard practices and Aetna policy prohibited the billing of facility fees by OTCs; (e) misrepresenting the OTCs' rates and instead billing at rates required by ARS, which artificially inflated the OTCs' charges by up to 4, 900%; (f) misrepresenting the medical services actually rendered to Aetna members; and (g) billing for uncovered and experimental medical treatments.

(Id. ¶ 83.)

Aetna's detailed, 336-paragraph SACC contains 13 separate claims: (1) tortious interference with its Member Benefit Plans, brought against all Counterclaim-Defendants; (2) tortious interference with its Provider Contracts, brought against all Counterclaim-Defendants; (3) fraud, brought against all Counterclaim-Defendants; (4) negligent misrepresentation, brought against all Counterclaim-Defendants; (5) violations of the federal Racketeer Influenced and Corrupt Organizations (“RICO”) Act, 18 U.S.C. § 1962(c), brought against ARS and ASD only; (6) violation of RICO, 18 U.S.C. § 1962(d), brought against ARS and ASD only; (7) violation of Arizona's version of RICO, A.R.S. § 13-2314.01, brought against ARS and ASD only; (8) conspiracy to violate Arizona's RICO statute, brought against ARS and ASD only; (9) civil conspiracy, brought against all Counterclaim-Defendants; (10) aiding and abetting a tort, brought against all Counterclaim-Defendants; (11) for recoupment of overpayments under the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1132(a)(3), brought against all Counterclaim-Defendants; (12) unjust enrichment, brought against all Counterclaim-Defendants; and (13) money had and received, brought against all Counterclaim Defendants. (Doc. 203-1.)

II. Legal Standard

The Federal Rules of Civil Procedure require a pleading to contain “a short and plain statement of the claim showing that the pleader is entitled to relief[.]” Fed.R.Civ.P. 8(a)(2). “To avoid a Rule 12(b)(6) dismissal, a complaint need not contain detailed factual allegations; rather, it must plead ‘enough facts to state a claim to relief that is plausible on its face.'” Clemens v. DaimlerChrysler Corp., 534 F.3d 1017, 1022 (9th Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)). When ruling on a motion to dismiss, the Court does not assess whether the pleading's allegations are, in fact, true. Instead, well-pled factual allegations are accepted as true and construed in the light most favorable to the pleader. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). The Court's task merely is to determine whether those well-pled factual allegations plausibly state a claim to relief under governing law. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

The federal rules, however, set a heightened pleading standard for allegations of fraud. “In alleging fraud . . . a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind maybe alleged generally.” Fed.R.Civ.P. 9(b). “Averments of fraud must be accompanied by the who, what, when, where, and how of the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (quotations and citation omitted). Ordinarily, Rule 9(b)'s heightened pleading standard applies only to averments of fraud; “[t]he rule does not require that allegations supporting a claim be stated with particularity when those allegations describe non-fraudulent conduct.” Id. at 1104. But “[i]n some cases, the plaintiff may allege a unified course of fraudulent conduct and rely entirely on that course of conduct as the basis of a claim. In that event, the claim is said to be ‘grounded in fraud' or to ‘sound in fraud,' and the pleading of that claim as a whole must satisfy the particularity requirement of Rule 9(b).” Id. at 1103-04.

When multiple defendants sued in connection with an alleged fraudulent scheme, there is no requirement that the pleader identify every instance of fraudulent conduct for every defendant. Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007). Though “Rule 9(b) does not allow a complaint to merely lump multiple defendants together, ” in fraud suits involving multiple defendants it is sufficient for a pleader to identify the role each defendant played in the alleged fraudulent scheme. Id. at 764-65. Further, in cases such as this one, involving hundreds or thousands of alleged fraudulent transactions, specifying each and every transaction with the particularity ordinarily demanded by Rule 9(b) “is neither practical nor required.” Nutrishare, Inc. v. Connecticut Gen. Life Ins. Co., No. 2:13-cv-02378-JAM-AC, 2014 WL 1028351, at *4 (E.D. Cal. Mar. 14, 2014). “When dealing with thousands of instances, it is often the case that a complaint or counterclaim laying out each and every misrepresentation in detail would provide less effective notice and be less useful in framing the issues than would a shorter, more generalized version.” Id.

Indeed, Rule 9(b) serves four purposes:

First, the rule ensures that the defendant has sufficient information to formulate a defense by putting it on notice of the conduct complained of. . . . Second, Rule 9(b) exists to protect defendants from frivolous suits. A third reason for the rule is to eliminate fraud actions in which all the facts are learned after discovery. Finally, Rule 9(b) protects defendants from harm to their goodwill and reputation.

U.S. ex rel. Stinson, Lyons, Gerlin & Bustamante P.A. v. Blue Cross Blue Shield of Georgia, Inc., 755 F.Supp. 1055, 1056-57 (S.D. Ga. 1990). “A court should hesitate to dismiss a complaint under Rule 9(b) if the court is satisfied (1) that the defendant has been made aware of the particular circumstances for which she will have to prepare a defense at trial, and (2) that plaintiff has substantial prediscovery evidence of those facts.” Harrison v. Westinghouse Savannah River Co., 176 F.3d 776, 784 (4th Cir. 1999). “Rules 8(a) and 9(b) must be read in conjunction with one another. [A] [p]laintiff may state allegations of fraud in short, plain statements, provided that said statements put [d]efendants on adequate notice of the...