Opinion ID: 150123
Heading Depth: 3
Heading Rank: 1

Heading: Whether Appellants Could Have Brought Their Claims Under ERISA

Text: The first question posed by Davila in assessing complete preemption is whether an individual, at some point in time, could have brought his claim under ERISA § 502(a)(1)(B). Davila, 542 U.S. at 210, 124 S.Ct. at 2496. Under ERISA § 502(a)(1)(B), claims pursuant to ERISA benefit plans may be brought by a participant or beneficiary. 29 U.S.C. § 1132(a)(1). In Davila, it was clear that the plaintiffs, themselves participants in and beneficiaries under ERISA plans, were appropriate parties to enforce rights under the statute. By contrast, [h]ealthcare providers ... generally are not considered `beneficiaries' or `participants' under ERISA and thus lack standing to sue under the statute. Hobbs v. Blue Cross Blue Shield of Ala., 276 F.3d 1236, 1241 (11th Cir.2001). Healthcare providers may have standing under ERISA only when they derivatively assert rights of their patients as beneficiaries of an ERISA plan. Id. To sue derivatively, the provider must have obtained a written assignment of claims from a patient with standing to sue under ERISA. Id. In Hobbs, we determined that a healthcare provider had no standing to sue when there was no evidence that it received any assignments from its eligible patients. Id. at 1241-42. As a result, we concluded that there was no complete preemption of the provider's claims because there was no evidence of derivative standing. Id. at 1242-43. In Connecticut State Dental, we addressed the ERISA preemption issue in a case related to those on appeal here. [1] Two dentists and their representative organization sued a health plan administrator for damages relating to the payment contracts between the parties. The dentists claimed that the administrator wrongfully paid them below their contracted rates and refused to make payment on claims for medically necessary services. This court held that the dentists' claims were completely preempted by ERISA's remedies provision, and that the court therefore had subject matter jurisdiction over the claims. Connecticut State Dental, 591 F.3d at 1350-53. In Connecticut State Dental, we discussed two types of claims that can be made by providers against insurers: those challenging the rate of payment pursuant to the provider-insurer agreement, and those challenging the right to payment under the terms of an ERISA beneficiary's plan. Id. at 1349-50; see also Lone Star OB/GYN Assocs. v. Aetna Health, Inc., 579 F.3d 525, 530 (5th Cir.2009); Pascack Valley Hosp., Inc. v. Local 464A UFCW Welfare Reimbursement Plan, 388 F.3d 393, 402-03 (3d Cir.2004). We indicated that a rate of payment challenge does not necessarily implicate an ERISA plan, but a challenge to the right to payment under an ERISA plan does. Connecticut State Dental, 591 F.3d at 1350-51. We then examined the dentists' complaint and concluded that it challenged both the rate of payment and the right to payment under the ERISA plan because it alleged that the administrator both paid them the wrong rate and denied payment altogether for medically necessary services, a coverage determination defined by the beneficiary's ERISA plan. Id. We next concluded that the complaint presented a hybrid claim, some of which was within ERISA and some of which was not. Id. at 1351. Therefore, to resolve the first prong of the Davila test, we evaluated whether the dentists had standing to assert their beneficiaries' claims. Id. Noting that the dentists had in the past submitted claim forms that authorized benefit payments to go to the dentists on the beneficiary's behalf, we concluded that these claim forms suffice to show an assignment of benefits by the dentists' patients. Id. at 1351; see also Hobbs, 276 F.3d at 1241 (requiring assignment of benefits for complete preemption under ERISA). We reasoned that [o]ur own cases confirm that assignment of the right to payment is enough to create standing. Connecticut State Dental, 591 F.3d at 1352. In this case, the only remaining question is whether the Appellants, at any time, asserted claims on behalf of ERISA beneficiaries. United presented evidence of such assignments to the district court. Appellants make two principal arguments in an attempt to distinguish their cases from Connecticut State Dental. First, they contend that their complaints expressly disclaim causes of action under ERISA, unlike those in Connecticut State Dental. Second, they contend that the claim forms exhibiting assignments were representative and typical of assignments in Connecticut State Dental, but the assignment forms presented in this case are anomalous and thus could not confer standing upon them. Both attempted distinctions are unavailing. We emphasize that the first Davila prong is satisfied by a two-part showing: (1) the plaintiff's claim must fall within the scope of ERISA; and (2) the plaintiff must have standing to sue under ERISA. Connecticut State Dental, 591 F.3d at 1350. The Appellants' first contention attempts to undermine their own standing to sue here. In the midst of disclaiming the assignments of benefits, Appellants' complaints contend generally that this action does not otherwise seek benefits or other remedies under [ERISA.] But our above analysis indicates that the factual allegations raise precisely the type of ERISA determinations that trigger complete preemption and convert the otherwise state law claims into federal claims. We must then resolve the inherent conflict in a factually pled but simultaneously disclaimed cause of action. Appellants' attempt to characterize their claims as eluding the scope of ERISA itself presents a legal rather than factual conclusion. It is our function, however, to draw legal conclusions from the facts pled. See Ashcroft v. Iqbal, ___ U.S. ___, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) ([T]he tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions.). We acknowledge that the plaintiff is the master of the complaint. Caterpillar Inc. v. Williams, 482 U.S. 386, 398-99, 107 S.Ct. 2425, 2433, 96 L.Ed.2d 318 (1987). But when the plaintiff chooses to plead a cause of action completely preempted by federal law, the plaintiff is not always master of the forum. In Caterpillar, the plaintiffs had at their disposal a set of contracts covered by a collective bargaining agreement and a set of individual employment contracts governed only by state law. The plaintiffs sued only on the individual contracts. The defendant removed their claims to federal court, arguing that the claims were founded on the collective bargaining agreements and were governed exclusively by federal law. Id. at 394, 107 S.Ct. at 2430. The Supreme Court held that removal was impermissible. Id. at 399, 107 S.Ct. at 2433. The Supreme Court recognized that the state law claims were distinct from any potential claims related to the collective bargaining agreements, and reasoned that respondents' complaint is not substantially dependent upon interpretation of the collective-bargaining agreement. Id. at 395, 107 S.Ct. at 2431. Caterpillar demonstrates that plaintiffs may choose to exclusively pursue their state law claims in state court, even against the backdrop of another set of potentially preempted claims. Appellants here have not pursued exclusively state law claims, but instead have cast their pleadings in a way that implicates federal law as well. Their claims are substantially dependent upon interpretation of ERISA plans. Ultimately, we ask whether the physicians and their associations  could have brought his claim under ERISA § 502(a)(1)(B). Davila, 542 U.S. at 210, 124 S.Ct. at 2496 (emphasis added). Our precedent reveals this to be true here. See Connecticut State Dental, 591 F.3d at 1350-53. Second, nothing in Connecticut State Dental indicates that the assignment of benefits forms submitted to the court must be typical of those regularly submitted by the providers in order to confer standing. The result in Connecticut State Dental turned on whether the doctors had standing to pursue any claim asserted against the insurer, not whether the doctors had standing to pursue their average or typical claims against the insurer. Here, all of the individual Appellants at one time received assignments of benefits from their patients. Because their complaints contest the global practices of United and do not identify any specific patient, we must assume that the providers are asserting at least some derivative claims.