Rathbun v. Health Net of the Northeast, Inc.

• Decision Date: 24 January 2012
• Docket Number: No. 32712.,32712.
• Citation: 133 Conn.App. 202,35 A.3d 320
• Court: Connecticut Court of Appeals
• Parties: Amy RATHBUN et al. v. HEALTH NET OF the NORTHEAST, INC.

133 Conn.App. 202

35 A.3d 320

Amy RATHBUN et al.

v.HEALTH NET OF the NORTHEAST, INC.

No. 32712.

Appellate Court of Connecticut.

Argued Nov. 16, 2011.Decided Jan. 24, 2012.

Paul T. Edwards, with whom, on the brief, were Michael A. Stratton, Joel T. Faxon, New Haven, and Eric P. Smith, for the appellants (plaintiffs).

Linda L. Morkan, with whom, on the brief, were Theodore J. Tucci and Michael J. Kolosky, Hartford, for the appellee (defendant).

DiPENTIMA, C.J., and ROBINSON and FLYNN, Js.

ROBINSON, J.

The plaintiffs, Amy Rathbun and Tanequa Brayboy, appeal following the judgment of the trial court granting a motion for summary judgment in favor of the defendant, Health Net of the Northeast, Inc.¹ On appeal, the plaintiffs, who are Medicaid recipients, contend that the court erred in determining that the defendant could assert a claim against the plaintiffs to recover the costs of medical care owed to the plaintiffs by responsible third parties. We affirm the judgment of the trial court.

The following facts were stipulated to by the parties and accepted by the court. Under the Medicaid Act (Medicaid); 42 U.S.C. § 1396 et seq.; federal financial assistance is provided to states that choose to reimburse the costs of medical care to the economically disadvantaged. States may choose contractors to provide or to arrange for services under the state Medicaid plan, which is known as Medicaid managed care. The state of Connecticut participates in the Medicaid program and has authorized the department of social services (department) to administer the program within the state. The department is authorized to award “contracts for Medicaid managed care health plans” under General Statutes § 17b–28b.

The department contracted with the defendant directly and through its predecessors from 1995 through 2008 regarding the administration of the Medicaid managed care program. The contract provided that “[t]he [d]epartment hereby assigns to [the defendant] all rights to third party recoveries from Medicare, health insurance, casualty insurance, workers' compensation, tortfeasors, or any other third parties who may be responsible for payment of medical costs for [the defendant's] members.” The contract limited the defendant's right to recovery to the amount that the defendant paid toward the cost of its member's care. The contract required the defendant to make efforts to determine the legal liability of third parties for health care services provided to Medicaid enrollees, and to “pursue, collect, and retain any monies from third party payers for services to [the defendant's] members under this contract....” The contract further provided that the defendant could assign “the right of recovery to [its] subcontractors and/or network providers.”

The defendant contracted with The Rawlings Company, LLC (Rawlings), during all relevant times to this lawsuit to pursue recoveries for medical treatment provided to the defendant's members in instances where there was potential for third party liability. When Rawlings became aware that a member was injured by a third party, it typically notified the injured member and the third party that the defendant had a right to recover medical expenses paid on the member's behalf.

Rathbun was a member of the defendant's Medicaid managed care plan. The defendant paid $2982.93 for medical treatment affiliated with Rathbun's injuries stemming from a motor vehicle accident that occurred on July 24, 2006. Rathbun retained legal counsel to pursue potential tort claims against the driver of the other vehicle involved in the accident. Rawlings notified Rathbun's counsel, as well as the third party's insurer, that the defendant had a claim for repayment of the medical benefits it paid on Rathbun's behalf for injuries sustained in the motor vehicle accident. Rathbun's counsel sent a check in the amount of $2982.93 to the defendant in satisfaction of the defendant's claim.

Kay' Anah Brayboy, the daughter of Tanequa Brayboy, was a member of the defendant's Medicaid managed care plan. On July 4, 2007, Kay' Anah was struck by a motor vehicle and subsequently died as a result of her injuries. The defendant paid $13,541.45 for medical treatment affiliated with Kay' Anah Brayboy's injuries from the accident. Tanequa Brayboy retained legal counsel to pursue possible tort claims against the driver of the motor vehicle that struck her daughter. Rawlings notified Tanequa Brayboy's counsel that the defendant had a claim for repayment for medical benefits paid on behalf of Kay' Anah Brayboy in connection with the motor vehicle accident. Brayboy subsequently retained new counsel, and Rawlings reissued its notice of claim letter to the attention of Brayboy's new counsel. To date, the defendant has not been reimbursed for the cost of medical care provided to Kay' Anah Brayboy.

The plaintiffs brought a putative class action against the defendant on November 26, 2008. The plaintiffs filed a second amended complaint, dated May 7, 2009, which alleged four counts, a putative class action, breach of the duty of good faith and fair dealing, conversion and a count seeking a declaratory judgment. The declaratory judgment count sought a declaration of the plaintiffs' rights and obligations to reimburse the defendant pursuant to Connecticut statutes, regulations and contract. Both parties filed motions for summary judgment on the declaratory judgment count on June 15, 2009. On August 21, 2009, the court granted the defendant's motion for summary judgment and denied the plaintiffs' motion for summary judgment.²

In its memorandum of decision, the court concluded that the department had assigned its statutory recovery right to the defendant. The court noted that under General Statutes § 17b–265 (a), the department has the right to be subrogated to any right of recovery that the Medicaid enrollee may have against a third party. Relying on § 17b–265 (b), which provides that the department may assign its right to subrogation to a designee or health care provider participating in the Medicaid program, the court concluded that the department properly assigned its statutory rights to the defendant. The court also concluded that, under Connecticut law, the defendant, as the assignee of the department, was not required to bring a separate action against the third party tortfeasor to recover the medical expenses expended on behalf of the Medicaid enrollee. Further, the court found that the defendant's reimbursement was limited to the amount of Medicaid funds expended by the defendant and identified as part of any settlement or judgment.

On appeal, the plaintiffs contend that the court erred in determining that the defendant could assert a claim against the plaintiffs to recover the costs of medical care received by the plaintiffs from responsible third parties. The plaintiffs argue that General Statutes § 52–225c prohibits the defendant from asserting such a claim against the plaintiffs unless “otherwise provided by law....” The plaintiffs contend that the defendant cannot assert such claims because neither § 17b–265 nor General Statutes § 17b–94 are applicable to the circumstances of the case. We disagree.

We begin by setting forth the relevant standard of review. “Practice Book § 17–49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party.... The party moving for summary judgment has the burden of showing the absence of any genuine issue of material fact and that the party is, therefore, entitled to judgment as a matter of law.... On appeal, we must determine whether the legal conclusions reached by the trial court are legally and logically correct and whether they find support in the facts set out in the memorandum of decision of the trial court.... Our review of the trial court's decision to grant [a party's] motion for summary judgment is plenary.” (Internal quotation marks omitted.) State v. Peters, 287 Conn. 82, 87, 946 A.2d 1231 (2008).

The plaintiffs' claim challenging the court's interpretation of a state statute is also subject to plenary review. Brown & Brown, Inc. v. Blumenthal, 297 Conn. 710, 721, 1 A.3d 21 (2010). “The process of statutory interpretation involves the determination of the meaning of the statutory language as applied to the facts of the case.... When construing a statute, [o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature.... In other words, we seek to determine, in a reasoned manner, the meaning of the statutory language as applied to the facts of [the] case.... In seeking to determine that meaning ... [General Statutes] § 1–2z directs us first to consider the text of the statute itself and its relationship to other statutes. If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered.... When a statute is not plain and unambiguous, we also look for interpretive guidance to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation and common law principles governing the same general subject matter.... We recognize that terms in a statute are to be assigned their ordinary meaning, unless context dictates otherwise....” (Internal quotation marks omitted.) Id., at 722, 1 A.3d 21.

We begin our review with the language of the relevant statute. Section 17b–265 (a) provides in relevant part that “[i]n the case of such a recipient who is an...