STATE OF WEST VIRGINIA
 

SUPREME COURT OF APPEALS
 

The Health Plan of the Upper Ohio Valley, Inc., FILED 

Defendant Below, Petitioner August 30, 2013 

RORY L. PERRY II, CLERK 

SUPREME COURT OF APPEALS 

vs) No. 12-1338 (Marshall County 11-C-1) OF WEST VIRGINIA 

Thomas G. Wack, M.D., 

Plaintiff Below, Respondent 

MEMORANDUM DECISION 

Petitioner The Health Plan of the Upper Ohio Valley, Inc., by counsel Robert J. Hannen, 

Daniel Tomassetti, and Ancil G. Ramey, appeals the Circuit Court of Marshall County’s grant of 

partial summary judgment to respondent physician, ruling that petitioner is liable to respondent 

physician for payment of medical services pursuant to the West Virginia Ethics and Fairness in 

Insurer Business Practices Act (“Prompt Pay Act”), West Virginia Code § 33-45-1 et seq. 

Respondent Thomas G. Wack, M.D., by counsel Mark A. Colantonio and Daniel P. Taylor, filed 

a response. Petitioner filed a reply. Also, the Court acknowledges the filing of Amicus Curiae 

briefs by the West Virginia Chamber of Commerce, the West Virginia State Medical 

Association, and the West Virginia Academy of Family Physicians. 

This Court has considered the parties’ briefs and the record on appeal. The facts and legal 

arguments are adequately presented, and the decisional process would not be significantly aided 

by oral argument. Upon consideration of the standard of review, the briefs, and the record 

presented, the Court finds no substantial question of law and no prejudicial error. For these 

reasons, a memorandum decision is appropriate under Rule 21 of the Rules of Appellate 

Procedure. 

Respondent is a physician practicing in Marshall County. Respondent is a member of the 

Upper Ohio Valley Individual Practice Association, Inc. (“IPA”), an organization comprised of 

approximately 300 physicians. 

Petitioner is a West Virginia non-profit corporation that sells commercial health 

insurance products to individuals and groups, such as employers, unions, associations, and other 

organizations. Petitioner has been licensed as an insurer by the West Virginia Insurance 

Commission since 1979. 

In addition to providing its own health insurance products, petitioner administers selffunded plans through Administrative Services Only Agreements (“ASO Agreements”). Under 

the ASO Agreements, petitioner arranges for persons covered by a self-funded plan to receive 

health care services from a network of providers that petitioner maintains through contracts with 

physicians, hospitals, and other health care professionals. 

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The Ohio Valley Health Services and Education Corporation (“OVHSEC”) is one entity 

that has established a self-funded health plan for its employees that has contracted with petitioner 

through an ASO Agreement. As a result, persons covered by the OVHSEC health plan, including 

employees of the Ohio Valley Medical Center in Wheeling, are ASO participants who are 

eligible to obtain health care services from the petitioner’s provider network. 

The IPA entered into a Managed Health Care Service Agreement with petitioner that, 

among other things, requires all IPA members (including respondent) to provide health care 

services to all ASO participants, including those covered by the OVHSEC health plan. The 

Managed Health Care Service Agreement is between the IPA and petitioner. However, by its 

unambiguous language, the agreement is binding upon the IPA members, which includes 

respondent.1 Therefore, as respondent argues, respondent is obligated under the agreement with 

petitioner to provide health care services to persons covered by the OVHSEC health plan. In 

turn, respondent argues that petitioner is obligated under the agreement to pay respondent for 

those services,2 and to make such payments in accordance with the West Virginia Prompt Pay 

Act.3 Conversely, petitioner disputes any contractual relationship with respondent. 

On December 30, 2010, respondent filed a two-count civil action against petitioner, 

alleging that he provided health care services to persons covered by the OVHSEC health plan 

and that petitioner failed to pay for those services in accordance with the Prompt Pay Act. In 

Count I, respondent sought declaratory judgment that petitioner was subject to the Prompt Pay 

Act with respect to persons covered by the OVHSEC health plan. In Count II, respondent sought 

to recover an allegedly unpaid amount of $3,800 for services rendered, plus interest, costs, and 

attorney’s fees. 

On April 4, 2011, respondent moved for partial summary judgment on his declaratory 

judgment claim. With his motion, respondent submitted his affidavit, written contracts, and the 

deposition testimony of petitioner’s vice president of operations taken in a separate federal suit in 

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Section II.(B.) of the agreement states that “[t]he parties acknowledge that all IPA 

Participating Physicians shall be bound by this Agreement . . . IPA represents and warrants to 

[petitioner] that it has full legal authority to contract with [petitioner] on behalf of IPA 

Participating Physicians . . . .” 

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Section IV.(D.) of the agreement states: “Notwithstanding anything in this Agreement to 

the contrary, [petitioner] shall compensate IPA Participating Physicians for those services 

provided by Participating Physicians pursuant to ASO Agreements in accordance with the 

schedule set forth in the attachment.” 

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Section III.(A.) of the agreement states that “[p]ayments made to IPA Participating 

Physicians shall be made in accordance with appropriate federal and state laws and regulations 

regarding timeliness of payment, including but not limited to minimum fair business standard for 

processing and payment of health care claims required in West Virginia Code § 33-45-2(a).” The 

statute requires that an insurer either pay or deny a clean claim within 45 days of receipt of the 

claim if submitted manually, and within 30 days if submitted electronically. 

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which petitioner is a party.4 Petitioner opposed the motion, arguing that it is not subject to the 

Prompt Pay Act because of an exception stated in West Virginia Code § 33-45-2(a)(1)(A) that 

provides that the time requirements for payment do not apply where “[a]nother payor or party is 

responsible for the claim.” Petitioner argued that there is no contract between it and respondent 

and that the OVHSEC is responsible to fund the payments sought by respondent. Second, 

petitioner argued that summary judgment was premature given that no discovery had taken place 

in the case. Petitioner did not include with its opposition memorandum any affidavits challenging 

respondent’s alleged facts. 

At the May 6, 2011 hearing on respondent’s motion for partial summary judgment, the 

court heard argument from counsel and directed the parties to submit their respective proposed 

findings of fact and conclusions of law. Despite having conducted little to no discovery since 

respondent filed his suit, petitioner filed a motion to continue discovery with an accompanying 

affidavit pursuant to Rule 56(f) of the West Virginia Rules of Civil Procedure. Petitioner filed 

this motion on or about May 27, 2011, along with its proposed findings on respondent’s partial 

summary judgment motion. 

By order entered on December 8, 2011, the court granted respondent’s motion for partial 

summary judgment. The court concluded that the Managed Health Care Service Agreement 

between petitioner and respondent’s IPA constitutes a “provider contract” with respondent that is 

governed by the Prompt Pay Act. The court rejected petitioner’s argument that the OVHSEC is 

responsible to fund the payments sought by respondent on the grounds that there is no contract 

between the IPA and the OVHSEC. Rather, the court concluded that the contract is between the 

IPA and petitioner, and, by its express terms, with respondent. Having found that petitioner is 

subject to the Prompt Pay Act with respect to respondent’s claims, the court then concluded that 

petitioner failed to comply with the Act with respect to those claims. The court granted partial 

summary judgment on the issue of petitioner’s liability to respondent for payment of medical 

services rendered to persons covered by the OVHSEC health plan which had not been paid 

within the time frames specified under the Prompt Pay Act. As to petitioner’s claim that 

summary judgment was premature, the court stated that petitioner submitted no evidence to 

contradict the facts alleged by respondent. From this order, petitioner appeals to this Court.5 

Petitioner raises two assignments of error. First, petitioner argues that summary judgment 

was premature given that it had moved to take discovery and submitted the required Rule 56(f) 

4

Petitioner is a party in Wheeling Hospital, Inc. v. Ohio Valley Health Services and 

Education Corporation, Civ. No. 5:10-CV-67, in the United States District Court for the 

Northern District of West Virginia. 

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Petitioner previously appealed the December 8, 2011, order to this Court, but moved to 

dismiss the appeal without prejudice because the circuit court’s order had not been certified as 

final pursuant to Rule 54(b) of the West Virginia Rules of Civil Procedure. This Court granted 

petitioner’s motion to dismiss its previous appeal, which was docketed as Supreme Court No. 12­

0095. By order entered on October 5, 2012, the circuit court directed final judgment be entered 

with respect to its December 8, 2011, order, and this appeal followed. 

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affidavit. This Court reviews a circuit court’s decision to grant summary judgment de novo, and 

reviews a decision to deny a motion to take discovery under an abuse of discretion standard. 

Powderidge v. Highland Prop., Ltd., 196 W.Va. 692, 474 S.E.2d 872 (1996); Elliot v. 

Schoolcraft, 213 W.Va. 69, 576 S.E.2d 796 (2002). A party moving for discovery pursuant to 

Rule 56(f) must satisfy the following: 

At a minimum, the party making the motion for a continuance must satisfy four 

requirements. It should (1) articulate some plausible basis for the party's belief 

that specified “discoverable” material facts likely exist which have not yet 

become accessible to the party; (2) demonstrate some realistic prospect that the 

material facts can be obtained within a reasonable additional time period; (3) 

demonstrate that the material facts will, if obtained, suffice to engender an issue 

both genuine and material; and (4) demonstrate good cause for failure to have 

conducted the discovery earlier. 

Powderidge at 702, 474 S.E.2d. at 882. Petitioner contends that discovery is necessary regarding 

the alleged contractual relationship between respondent and petitioner. Petitioner also intended to 

direct discovery to the OVHSEC health plan relating to the ASO Agreement with petitioner. 

According to petitioner, this agreement creates an issue of fact as to whether the OVHSEC health 

plan is responsible for paying respondent’s claims. 

We do not believe the circuit court abused its discretion in denying petitioner’s motion to 

continue discovery. First, submission of a Rule 56(f) affidavit does not mandate the circuit court 

to find an issue of fact exists. Second, as to the areas cited by petitioner in its Rule 56(f) 

affidavit, petitioner is a party to both contracts. As such, petitioner could have obtained the 

contracts from its own records. Additionally, petitioner submitted no affidavit from its officers to 

contradict the express wording of the contracts. 

The question presented by this appeal is whether the Managed Health Care Service 

Agreement between petitioner and the IPA contractually obligates petitioner to compensate 

respondent for claims for the services he provided to OVHSEC employees pursuant to the 

agreement. Petitioner’s request for discovery, as identified in its affidavit, does not create an 

issue of fact in this case or have any bearing on the outcome of the case. The agreement between 

petitioner and the IPA is plain and unambiguous–petitioner is obligated to compensate IPA 

Participating Physicians, such as respondent. The ASO Agreement between petitioner and the 

OVHSEC health plan has no significance because respondent is not a party to that agreement. 

Furthermore, petitioner never noticed its motion for continued discovery for hearing, 

never briefed the issue, and did not file the motion until after briefing and argument on 

respondent’s summary judgment motion. Petitioner took a “wait and see” approach with regard 

to discovery and cannot now claim the court abused its discretion by not allowing it after the 

fact. 

Second, petitioner argues that the court erred in concluding that petitioner is subject to 

the Prompt Pay Act with respect to respondent’s medical claims. Petitioner claims that it does 

not act as an “insurer” with respect to the OVHSEC health plan, that there is no contract between 

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it and respondent, and it is exempt from the Prompt Pay Act because of the “another payor” 

exemption. 

As to petitioner’s first argument, we find that under the facts and circumstances of this 

case, petitioner is an “insurer” under the Prompt Pay Act: 

“Insurer” means any person required to be licensed under this chapter which 

offers or administers as a third party administrator health insurance; operates a 

health plan subject to this chapter; or provides or arranges for the provision of 

health care services through networks or provider panels which are subject to 

regulation as the business of insurance under this chapter. “Insurer” also includes 

intermediaries. 

W.Va. Code § 33-45-1(7). There are three ways for an entity to be an “insurer” under this 

definition, and, in this case, petitioner meets all three. The record demonstrates that petitioner 

creates and maintains a network of providers to provide services to those persons covered by the 

OVHSEC health plan; petitioner requires IPA Participating Physicians to provide services and 

agrees to compensate them through ASO Agreements; petitioner prepares OVHSEC health plan 

enrollment and claim forms; petitioner provides Explanation of Benefits to persons covered by 

the OVHSEC health plan; petitioner adjusts claims under the OVHSEC health plan, including 

coverage determinations and coordination of benefits; petitioner determines whether particular 

services may be performed or should be paid under the OVHSEC health plan; and petitioner 

performs day-to-day functions and operations of the OVHSEC health plan. 

As to petitioner’s argument that it is not subject to the Prompt Pay Act, we find that as an 

IPA Participating Physician, respondent is in privity of contract with petitioner by virtue of the 

unambiguous language in the Managed Health Care Service Agreement between petitioner and 

respondent’s IPA. Accordingly, there is no basis for petitioner’s contention that there is no 

contract between petitioner and respondent. 

Moreover, under the facts of this case, petitioner cannot avail itself of the “another payor” 

exception in West Virginia Code § 33-45-2(a)(1), which states: 

An insurer shall either pay or deny a clean claim within forty days of receipt of 

the claim if submitted manually and within thirty days of receipt of the claim if 

submitted electronically, except in the following circumstances: (A) Another 

payor or party is responsible for the claim; 

For there to be another payor, there must be a provider contract between the “other payor” and 

the respondent. Here, there is no contract between respondent and the OVHSEC health plan. 

Therefore, we find no error in the circuit court’s conclusion that petitioner is subject to the 

Prompt Pay Act with respect to respondent’s claim for payment of medical services. 

For the foregoing reasons, we affirm. 

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Affirmed. 

ISSUED: August 30, 2013 

CONCURRED IN BY: 

Chief Justice Brent D. Benjamin 

Justice Margaret L. Workman 

Justice Menis E. Ketchum 

Justice Allen H. Loughry II 

DISSENTING: 

Justice Robin J. Davis 

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