Conway v. Benefis Health Sys., Inc.
| Decision Date | 19 March 2013 |
| Docket Number | No. DA 12–0180.,DA 12–0180. |
| Citation | 297 P.3d 1200,369 Mont. 309 |
| Parties | Shannon CONWAY, Plaintiff and Appellee, v. BENEFIS HEALTH SYSTEM, INC., Defendant and Appellant. |
| Court | Montana Supreme Court |
OPINION TEXT STARTS HERE
For Appellant: Leo S. Ward, David M. McLean, Daniel J. Auerbach, Christy S. McCann, Browning, Kaleczyc, Berry & Hoven, P.C., Missoula, Montana.
For Appellee: Alexander (Zander) Blewett, III, Andrew (Drew) Blewett, Hoyt & Blewett, Great Falls, Montana.
For Amicus Curiae: Ian McIntosh, Steven R. Milch, Kenneth K. Lay, Crowley Fleck PLLP, Billings, Montana.
¶ 1 Benefis Health System, Inc. (Benefis) appeals several orders of the Eighth Judicial District Court, Cascade County, issued in an individual and class action lawsuit filed against Benefis by Shannon Conway (Conway). First, Benefis alleges that the District Court improperly converted Conway's motion for judgment on the pleadings into a motion for summary judgment. Next, Benefis challenges the District Court's grant of summary judgment on Conway's individual breach of contract claims. Lastly, Benefis appeals from the District Court's order certifying the matter as a class action. We affirm the District Court's conversion of the motion for judgment on the pleadings to a motion for summary judgment and reverse the District Court's order of summary judgment. Based on our reversal of summary judgment, we do not reach the class certification issue. We affirm in part and reverse in part.
¶ 2 Benefis raises the following three issues on appeal:
¶ 3 1. Did the District Court err in converting Conway's motion for judgment on the pleadings to a motion for summary judgment?
¶ 4 2. Did the District Court err in granting summary judgment to Conway?
¶ 5 3. Did the District Court err in granting Conway's motion to certify the class?
¶ 6 On November 6, 2009, Conway was injured in an automobile accident and received medical treatment at Benefis. Conway had healthcare coverage as a TRICARE beneficiary and also had medical payments coverage through his automobile insurance carrier, Kemper. TRICARE is a Department of Defense healthcare benefits program that is regionally administered by TriWest Healthcare Alliance (TriWest). TRICARE provides benefits to members of the military and their families. TriWest employed Blue Cross Blue Shield, Inc. (BCBS) as a network subcontractor to establish a provider network. BCBS entered into a preferred provider agreement (PPA) with Benefis.
¶ 7 Conway's medical treatment costs totaled $2,073.65. Benefis billed TriWest, Kemper, and other insurers for this amount. Benefis received payment from TRICARE on January 26, 2010. Benefis accepted $662.74 from TRICARE as payment in full satisfaction of the bill. Benefis accepted this reduced amount pursuant to the PPA between BCBS and Benefis, which provided in pertinent part as follows:
Provider agrees to treat TRICARE Beneficiaries according to the terms and conditions of this Agreement and in accordance with all applicable laws, rules and regulations pertaining to TRICARE including, but not limited to, the TRICARE manuals and the Code of Federal Regulations (CFR). Provider shall accept the Reimbursement Rates (less the amount of any Copayments payable by the TRICARE Beneficiary) as the only payment expected from TriWest and TRICARE Beneficiaries for Covered Services, and for all services paid for by the TRICARE program. TRICARE Beneficiaries are responsible only for Copayments. The Reimbursement Rates shall apply to Active Duty and civilian claims, to enrollees and to non-enrollees, and to all TRICARE Beneficiaries whose care is reimbursed by the Department of Defense, regardless of their residence. In no event will Provider be paid for such services more than the TRICARE/CHAMPUS Maximum Allowable Charge (CMAC) or applicable TRICARE DRG rate or what is permissible under Federal law or TRICARE policy.
On February 4, 2010, Benefis received payment of $1,866.29 from Kemper. Upon receiving payment from Kemper, Benefis reimbursed TRICARE's payment in full. As is the case with Medicaid and Medicare programs, TRICARE functions as a secondary payer.
¶ 8 On December 9, 2010, Conway filed his individual and class action complaint. Conway claimed that he was entitled to the additional $1,203.55 that Benefis received from Kemper over and above the TRICARE reimbursement rate. The complaint alleged individual and class action claims against Benefis for breach of contract, breach of third party beneficiary contract, and intentional interference with contractual relations. The complaint also included individual claims of fraud and violation of Montana's Consumer Protection Act.
¶ 9 On January 14, 2011, Benefis filed a notice of removal of the action to the United States District Court for the District of Montana, Great Falls Division, on the basis of federal subject matter jurisdiction under 28 U.S.C. § 1441(b) and (c). On March 2, 2011, the federal court determined that there was no basis for federal jurisdiction and granted Conway's motion to remand the case back to Montana's Eighth Judicial District Court, Cascade County.
¶ 10 On March 25, 2011, Conway filed a motion requesting that the District Court issue an order certifying the matter as a class action pursuant to M.R. Civ. P. 23. Conway asserted that Benefis has entered into multiple agreements with health insurers to accept reduced payments for medical services, and that it then violates those contracts by accepting payments in full from third party insurers. Conway sought certification of a class to include “all persons who are Benefis patients and insureds and/or beneficiaries of TRICARE, BCBSMT, or other health insurers and from whom Benefis has accepted payments in excess of the predetermined and previously agreed upon ‘reimbursement rate.’ ” Benefis opposed Conway's motion for an order certifying the class.
¶ 11 On April 25, 2011, Conway filed a motion for judgment on the pleadings pursuant to M.R. Civ. P. 12(c). Conway asked the District Court to find that Benefis breached its contract with TRICARE 1 and that Benefis was liable for Conway's damages caused by the breach as a matter of law. Conway asserted that Benefis had admitted in its answer each fact necessary to conclude that it had breached the contract. Benefis countered that judgment on the pleadings was not appropriate because it had raised several affirmative defenses and challenged many of Conway's assertions that were central to his breach of contract claim.
¶ 12 After the motion was fully briefed, the District Court issued an order on August 25, 2011. First, the District Court converted the Rule 12(c) motion into a M.R. Civ. P. 56 motion for summary judgment so that it could consider documents outside the pleadings in reaching a decision. Specifically, the District Court considered the PPA, which had been attached to Benefis' response brief. The District Court reviewed the language of the PPA and determined that Conway was an intended beneficiary of the PPA. Next, the District Court granted summary judgment in favor of Conway and concluded that Benefis breached the PPA by accepting more money for its services than the maximum allowable charge.
¶ 13 On December 1, 2011, Benefis petitioned this Court for a writ of supervisory control. Benefis sought review of the District Court's conversion of the motion for judgment on the pleadings to a motion for summary judgment and the District Court's grant of partial summary judgment in favor of Conway on his individual breach of contract claims. We denied Benefis' petition for supervisory control on January 18, 2012, concluding that Benefis failed to establish urgency or emergency factors that would render the normal appeal process inadequate.
¶ 14 The District Court held oral argument on Conway's motion to certify the class on November 16, 2011. The District Court awaited this Court's decision on Benefis' petition for a writ of supervisory control before issuing its order on class certification. On March 7, 2012, the District Court issued an order granting Conway's motion to certify the class. The District Court determined that Conway satisfied the four prerequisites set forth in Rule 23(a): (1) numerosity; (2) commonality; (3) typicality; and (4) adequacy of representation. Next, the District Court concluded that class certification was appropriate under Rule 23(b)(3) because it was “clearly desirable to concentrate the litigation of the claims in this forum and the difficulties of managing the litigation are comparatively minor.” Since the fundamental issue in the litigation involved recovery of the excess payments collected by Benefis, the District Court reasoned that once all the data was collected, the matter could be resolved by mathematical calculation.
¶ 15 On May 4, 2012, the District Court entered final judgment on the conversion of the motion for judgment on the pleadings to a motion for summary judgment, the entry of summary judgment on Conway's individual breach of contract claims, and the certification of the class. Benefis appeals.
¶ 16 Since a motion for judgment on the pleadings is decided as a matter of law, we review a district court's decision for correctness. Ritter v. Bill Barrett Corp., 2009 MT 210, ¶ 10, 351 Mont. 278, 210 P.3d 688;Nelson v. Barlow, 2008 MT 68, ¶ 9, 342 Mont. 93, 179 P.3d 529.
¶ 17 We review a district court's ruling on a motion for summary judgment de novo, applying the same criteria of M.R. Civ. P. 56 as did the district court. Reichert v. State, 2012 MT 111, ¶ 18, 365 Mont. 92, 278 P.3d 455;Shattuck v. Kalispell Reg'l Med. Ctr., 2011 MT 229, ¶ 8, 362 Mont. 100, 261 P.3d 1021. Summary judgment “should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material...
To continue reading
Request your trial
-
Van Orden v. United Servs. Auto. Ass'n
...a windfall to the insured if the coverage is limited to a discrete item, such as payment of medical expenses. See Conway v. Benefis Health Sys., 2013 MT 73, ¶ 35, 369 Mont. 309, 297 P.3d 1200 (citing Newbury v. State Farm Fire & Cas. Ins. Co., 2008 MT 156, ¶ 38, 343 Mont. 279, 184 P.3d 1021......
-
Winter v. State Farm Mut. Auto. Ins. Co., DA 13–0548.
...support their respective positions by citing prior cases wherein the term “incurred” was used. State Farm notes that in Conway v. Benefis Health System, 2013 MT 73, ¶ 34, 369 Mont. 309, 297 P.3d 1200, we explained that our decision in Newbury “ultimately upheld State Farm's refusal to pay m......
-
West v. United Servs. Auto. Ass'n
...the TRICARE liens. USAA contended that federal law—specifically 42 U.S.C. § 2651 —and our decision in Conway v. Benefis Health Systems, Inc. , 2013 MT 73, 369 Mont. 309, 297 P.3d 1200, established TRICARE as a secondary payer and obligated USAA either to include TRICARE as a co-payee or to ......
-
Meek v. Mont. Eighth Judicial Dist. Court
...of authority nationally, the legal issue has been decided in Montana, citing this Court's decisions in Conway v. Benefis Health System, 2013 MT 73, 369 Mont. 309, 297 P.3d 1200 and Newbury v. State Farm, 2008 MT 156, 343 Mont. 279, 184 P.3d 1021.¶ 6 The District Court determined that since ......