Grand Traverse Band of Ottawa v. Blue Cross Blue Shield of Mich.
| Decision Date | 03 August 2022 |
| Docket Number | 14-11349 |
| Parties | The Grand Traverse Band of Ottawa and Chippewa Indians, and its Employee Welfare Plan, Plaintiffs, v. Blue Cross Blue Shield of Michigan, Defendant/Third-Party Plaintiff, v. Munson Medical Center, Third-Party Defendant. |
| Court | U.S. District Court — Eastern District of Michigan |
Curtis Ivy, Jr. Mag. Judge
ORDER GRANTING DEFENDANT BCBSM'S MOTION FOR PARTIAL SUMMARY JUDGMENT [154], DENYING PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT [155], AND GRANTING PLAINTIFFS' MOTION FOR LEAVE TO FILE A RESPONSE TO DEFENDANT BCBSM'S SUPPLEMENTAL REPLY BRIEF IN FURTHER SUPPORT OF ITS MOTION FOR PARTIAL SUMMARY JUDGMENT [184]
Before the Court are cross motions for partial summary judgment. (ECF Nos. 154-155.) Plaintiffs, the Grand Traverse Band of Ottawa and Chippewa Indians (“the Tribe”) and its Employee Welfare Plan (“the Plan”) allege that Defendant Blue Cross Blue Shield of Michigan (“BCBSM”), the Plan administrator, is liable for violations of Michigan's Health Care False Claims Act (“HCFCA”), Mich. Comp. Laws § 752.1001 et seq. Each contend that summary judgment is proper regarding Plaintiffs' HCFCA claim only.
For the reasons set forth below, Defendant BCBSM's motion for partial summary judgment (ECF No. 154) is granted and Plaintiffs' motion for partial summary judgment (ECF No 155) is denied. The Court also grants Plaintiffs' motion for leave to file a response to Defendant BCBSM's supplemental reply brief in further support of its motion for partial summary judgment. (ECF No. 184.)
The Court has extensively summarized the factual background of the underlying claims in previous opinions. (See ECF Nos. 99 122.) For clarity, updates to the case's procedural history are included below.
After the Sixth Circuit's decision in Saginaw Chippewa Indian Tribe of Mich. v. Blue Cross Blue Shield of Mich., 748 Fed.Appx. 12, 19 (6th Cir. 2018), the parties agreed to reinstate Plaintiffs' claims for violations of the HCFCA and breach of common law fiduciary duty as to Group #01020, the non-employee Tribe members. (ECF No. 116.) Defendant BCBSM filed a motion to dismiss Plaintiffs' state law claims regarding BCBSM's administration of the Plan as to the nonemployee group. (ECF No. 117.)
On May 20, 2019, the Court granted in part and denied in part Defendant BCBSM's motion to dismiss. (ECF No. 122.) First, the Court denied Defendant BCBSM's motion to dismiss Plaintiffs' claim under the HCFCA. (Id. at PageID.3262.) Then, the Court granted Defendant BCBSM's motion to dismiss the common law breach of fiduciary duty claim. (Id. at PageID.2274.) Defendant BCBSM filed a motion for reconsideration on the HCFCA claim, or in the alternative, for certification to the Michigan Supreme Court, or as another alternative, for certification to the United States Court of Appeals for the Sixth Circuit. (ECF No. 123.) The motions for certification were denied (ECF No. 126), and the motion for reconsideration was denied. (ECF No. 129.)
The only claims remaining in the operative complaint are Plaintiffs' claims for breach of the Facility Claims Process Agreement (“FCPA”) as well as for violation of the HCFCA, with each claim only relating to Group #01020.
On May 21, 2021, Plaintiffs and Defendant BCBSM filed cross motions for partial summary judgment, both respectively concerning the HCFCA claim only. (ECF Nos. 154-155.) These motions are fully briefed. (ECF Nos. 154-157, 164-165, 167-168, 182, 184.)
Summary judgment is proper when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “A party asserting that a fact cannot be or is genuinely disputed must support the assertion by: (A) citing to particular parts of materials in the record . . .; or (B) showing that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.” Fed.R.Civ.P. 56(c)(1). The Court may not grant summary judgment if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The Court “views the evidence, all facts, and any inferences that may be drawn from the facts in the light most favorable to the nonmoving party.” Pure Tech Sys., Inc. v. Mt. Hawley Ins. Co., 95 Fed.Appx. 132, 135 (6th Cir. 2004) (citing Skousen v. Brighton High Sch., 305 F.3d 520, 526 (6th Cir. 2002)).
Plaintiffs and Defendant BCBSM propose differing interpretations of the HCFCA claim. Plaintiffs' motion for partial summary judgment suggests that the relevant question for the Court is whether Defendant BCBSM presented a false claim by misrepresenting that Plaintiffs were receiving the better of Medicare-Like Rates (“MLR”) or Defendant BCBSM's contractual rates, considering Plaintiffs' entitlement to MLR on MLR-eligible claims based on the MLR regulations. In contrast, Defendant BCBSM argues that the HCFCA claim as stated requires the Court to determine whether Defendant BCBSM presented a false statement under the meaning of the HCFCA by submitting claims that were not at MLR for payment.
Consideration of the HCFCA claim as articulated in Plaintiffs' first amended complaint (hereinafter, “the complaint”), in tandem with the heightened pleading requirement for HCFCA claims, reveals that Defendant BCBSM is correct. Furthermore, because Plaintiffs have failed to demonstrate that Defendant BCBSM is bound by-and thus in violation of-the MLR regulations at issue, Defendant BCBSM is entitled to summary judgment on the HCFCA claim.
Michigan's HCFCA provides a cause of action for bringing false claims:
[A] person who knowingly presents or causes to be presented a claim which contains a false statement, shall be liable to the health care corporation or health care insurer for the full amount of the benefit or payment made.
Mich. Comp. Laws § 752.1009; see also State ex rel. Gurganus v. CVS Caremark Corp., No. 299997 et al., 2013 WL 238552, at *8 (Mich. Ct. App. Jan. 22, 2013) () (reversed on other grounds).
A “claim” under the HCFCA is “any attempt to cause a health care corporation or health care insurer to make the payment of a health care benefit.” Mich. Comp. Laws § 751.1002(a). This Court has previously determined that “[P]laintiffs are health care insurers within the meaning of the HCFCA and have statutory standing.” (ECF No. 122, PageID.3262.) “‘False' means wholly or partially untrue or deceptive.” Mich. Comp. Laws § 752.1002(c). “‘Deceptive' means making a claim to a health care corporation or health care insurer which contains a statement of fact or which fails to reveal a material fact, which statement or failure leads the health care corporation or health care insurer to believe the represented or suggested state of affair to be other than it actually is.” Mich. Comp. Laws § 752.1002(b). “‘Health care benefit' means the right under a contract or a certificate or policy of insurance to have a payment made by a health care corporation or health care insurer for a specified health care service.” Mich. Comp. Laws § 752.1002(d).
There is little Michigan precedent analyzing this private cause of action under the HCFCA: (1) Gurganus, 2013 WL 238552 at *10, in which the Michigan Court of Appeals found that Mich. Comp. Laws § 752.1009 creates a private cause of action for health care corporations and health care insurers under the HCFCA; and (2) State ex rel. Gurganus v. CVS Caremark Corp., 496 Mich. 45 (2014), in which the Michigan Supreme Court reversed the Michigan Court of Appeals' finding that the plaintiffs alleged sufficient facts regarding an alleged violation of a provision of Michigan's Public Health Code in order to sustain a derivative HCFCA claim under Mich. Comp. Laws § 752.1009.
When analyzing Mich. Comp. Laws § 752.1009, Michigan courts have looked to the federal False Claims Act (“FCA”), stating that the FCA[1] is “analogous to the . . . HCFCA.” Gurganus, 2013 WL 238552 at *10, rev'd on other grounds, 496 Mich. at 45; see also Gurganus, 496 Mich. at 73-4 (Cavanaugh, J., concurring) (). However, Michigan courts have not considered the FCA to be analogous in all respects. Indeed, while Gurganus, 496 Mich. at 45 did not analyze this particular issue, the Michigan Court of Appeals explicitly declined to follow federal FCA precedent on the issue of how to demonstrate a “false claim” under the HCFCA when the underlying falsehood was premised on a violation of a separate statutory provision. Gurganus, No. 299997, 2013 WL 238552, at *14 ( ).
As a preliminary, but essential, matter, the Court must determine the confines of Plaintiffs' HCFCA claim. The parties disagree on the nature of this...
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