Court Opinion

ID: 4664379
Source: CourtListenerOpinion
Date Created: 2021-03-03 07:17:13.82515+00
Date Added: 2024-06-11T08:02:35.956757
License: Public Domain

Affirm and Opinion Filed February 23, 2021

                                        In The
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                No. 05-19-01447-CV

       TEXAS MEDICINE RESOURCES, LLP; TEXAS PHYSICIAN
     RESOURCES, LLP; AND PEDIATRIC EMERGENCY MEDICINE
                     GROUP, LLP, Appellants
                             V.
          MOLINA HEALTHCARE OF TEXAS, INC., Appellee

                On Appeal from the 160th Judicial District Court
                             Dallas County, Texas
                     Trial Court Cause No. DC-18-14467

                                   OPINION
              Before Justices Schenck, Osborne, and Partida-Kipness
                            Opinion by Justice Schenck
      Texas Medicine Resources, LLP, Texas Physician Resources, LLP, and

Pediatric Emergency Medicine Group, LLC (collectively, “Physicians”) appeal the

trial court’s order granting Molina Healthcare of Texas, Inc.’s (“Molina”) plea to the

jurisdiction. Physicians assert the trial court erred in dismissing their claims because

they have standing to assert same and their complaints present a justiciable

controversy. We affirm the trial court’s order.
                                           BACKGROUND

        Physicians are medical provider groups composed of doctors who staff

emergency departments at hospitals and freestanding emergency medical care

centers. Physicians assert they provide emergency care without regard to patients’

financial standing, whether the patients have healthcare coverage or—where the

patient has coverage—whether the Physicians have contractual relationships with

the patient’s insurance carriers.

        Molina is a Health Maintenance Organization (“HMO”) that issues Health

Insurance Exchange (“HIX”) plans.1 Physicians are “non-network physicians”

relative to Molina, meaning there is no written contract establishing the rates which

Molina will pay for emergency medical care Physicians provide to Molina’s

enrollees. Thus, pursuant to the emergency care statute applicable to HMOs, Molina

is to “pay for emergency care performed by [Physicians] at the usual and customary

rate.”2 TEX. INS. CODE § 1271.155(a).

        Physicians claim to have provided emergency medical care to more than 3,800

patients enrolled in Molina’s HIX plans between January 2017 and September 2018.

   1
     HIX plans are created under the federal Affordable Care Act (“ACA”), are offered primarily for low
income individuals, and are sold through the federal government’s exchange. Molina’s HIX plans must be
approved as HMOs by the Texas Department of Insurance and separately approved as Qualified Health
Plans by the Centers for Medicare and Medicaid Services. See TEX. INS. CODE § 843.071; 45 C.F.R.
§ 155.1010. The ACA strives to provide affordable insurance for underserved citizens.
    2
      If a non-network physician or provider is to be compensated based on usual and customary charges,
then the methodology must be based on generally accepted industry standards and practices for determining
the customary billed charge for a service, and fairly and accurately reflect market rates, including
geographic differences in costs. 28 TEX. ADMIN. CODE § 11.1161(f)(1).
                                                  –2–
They billed Molina for the services. Dissatisfied with the payments they received,

Physicians sued Molina seeking judicial resolution of their claim that Molina’s

reimbursement regime under Medicare–Medicaid programs, as implemented

through the federal Affordable Care Act and corresponding federal and state

regulations, is inadequate. Specifically, Physicians urge that the rates fail to satisfy

the obligation to pay the “usual and customary” rate for services under an

administrative regulation that has been codified as section 1271.155 of the Texas

Insurance Code. They go on to argue that section 1271.155 implies a private cause

of action and, thus, a justiciable claim to be presented to lay jurors. This theory has

not met success with other courts. Molina urges that the regulation and resulting

legislation are part of a broader comprehensive regulatory regime that courts have

uniformly held affords no private right of action and presents no justiciable issue, or

both. In addition, Physicians claim they are entitled to recover the value of the

services provided to Molina’s HIX plan enrollees under the equitable theory of

quantum meruit and seek a declaration that the jury’s finding on the usual and

customary rate will be the rate Molina pays Physicians in the future. Molina urges

that these claims are all anchored in the same regulatory regime and, accordingly,

present a nonjusticiable controversy.

      Molina filed a plea to the jurisdiction asserting Physicians lack standing to

assert claims under the emergency care statute, the unfair settlement practices statute

and the prompt payment statute; that no direct relationship exists between Physicians

                                          –3–
and Molina to support a quantum meruit claim; and no justiciable controversy exists

to support Physicians’ claim for declaratory relief regarding future claims. The trial

court granted Molina’s plea and dismissed Physicians’ claims in their entirety. This

appeal followed. For reasons that follow, we join our colleagues in federal courts in

finding these claims to be nonjusticiable at this time. See Angelina Emergency Med.

Assocs. PA v. Health Care Serv. Corp., No. 3:18-CV-00425-X, 2020 WL 7259222,

at *1–2, 6–8 (N.D. Tex. Dec. 10, 2020); Apollo MedFlight, LLC v. Bluecross

Blueshield of Tex., No. 2:18-CV-166-Z-BR, 2019 WL 4894263, at *2–3 (N.D. Tex.

Oct. 4, 2019).

                                    DISCUSSION

             I.    Standard of Review

      A plea to the jurisdiction challenges a court’s subject-matter jurisdiction to

hear a case. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). When,

as in this case, the plea challenges the claimant’s pleadings, we determine whether

the claimant has pleaded facts that affirmatively demonstrate the trial court’s

jurisdiction, construing the pleadings liberally and in favor of the claimant. Tex.

Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993).

      “Standing is a prerequisite to subject-matter jurisdiction, and subject-matter

jurisdiction is essential to a court’s power to decide a case.” M.D. Anderson Cancer

Ctr. v. Novak, 52 S.W.3d 704, 708 (Tex. 2001). Thus, a plea to the jurisdiction is a

proper vehicle to challenge a plaintiff’s standing to maintain suit. Vernco Constr.,

                                         –4–
Inc. v. Nelson, 460 S.W.3d 145, 149 (Tex. 2015). Ripeness is also a component of

subject-matter jurisdiction. Robinson v. Parker, 353 S.W.3d 753, 755 (Tex. 2011).

In order for a claim to be ripe, there must be “a real and substantial controversy

involving genuine conflict of tangible interests and not merely a theoretical dispute.”

Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995). The plaintiff bears

the burden to plead and establish facts affirmatively showing the court has subject-

matter jurisdiction. Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217,

225–26 (Tex. 2004); see also Bland, 34 S.W.3d at 554.

      We review a trial court’s ruling on a plea to the jurisdiction de

novo. Miranda, 133 S.W.3d at 226. In our review, we construe the pleadings

liberally in favor of the pleader and look to the pleader’s intent to determine whether

the facts alleged affirmatively demonstrate the trial court’s jurisdiction to hear the

cause. See id. If the pleadings affirmatively negate the existence of jurisdiction,

then the trial court may grant the plea to the jurisdiction without allowing the

plaintiffs an opportunity to amend. Id. at 227.

             II.    Physicians’ Claim Molina Violated the Emergency Care
                    Statute

      In their first issue, Physicians urge the trial court erred in dismissing their

claim seeking to enforce the payment obligation set forth in the emergency care

statute, specifically section 1271.155 of the Texas Insurance Code.            Section

1271.155 requires HMOs to “pay for emergency care performed by non-network

                                         –5–
physicians or providers at the usual and customary rate or at an agreed rate.” INS.

CODE § 1271.155(a).

       When a private cause of action is alleged to derive from a statutory provision,

as it is in this case, our duty is to ascertain the drafters’ intent. Rocor Int’l, Inc. v.

Nat’l Union Fire Ins. Co. of Pittsburgh, PA, 77 S.W.3d 253, 260 (Tex. 2002). The

legislature can indicate its intent to create a private right of action either by including

an express provision in the statutory text or through implication. Brown v. De La

Cruz, 156 S.W.3d 560, 563 (Tex. 2004). Physicians concede that section 1271.155

does not expressly confer a private right of action but contend that it does so by

implication because the requirement that the HMO make the payment directly to the

physician or provider establishes the statute was enacted to benefit healthcare

providers; and thus, claim Physicians, they are entitled to enforce the payment

obligation. See INS. CODE § 1271.155(f). The statute, as it existed at the time

Physicians provided medical services to Molina enrollees, did not contain a

provision that HMOs pay the physician or provider directly.                    That provision,

subsection (f) to section 1271.155, was enacted in 2019, after Physicians provided

the services at issue in this case, and it applies to health care or medical services

provided on and after January 1, 2020. Consequently, Physicians’ reliance on direct

payment language subsequently added to the statute is misguided.3

   3
     As noted below, the legislature also included a comprehensive regulatory compliance regime by
which claims, direct and otherwise, might be resolved.
                                              –6–
        How Texas addresses issues concerning the availability of and payment for

emergency medical services involves important policy considerations that are

primarily for the legislature, not the courts. The unique bifurcated structure of the

Texas court system calls for particular deference to legislative choices regarding the

method of enforcement of Texas statutes.                      Brown, 156 S.W.3d at 566.                  The

legislature may delegate enforcement to executive departments, administrative

agencies, regulatory commissions, local governments and districts, as well as to the

criminal or civil courts. Id. at 566–67. We are obligated by separation of powers

principles to exercise restraint, strictly construe statutory enforcement schemes, and

imply a private cause of action to enforce a statute only when the legislature’s intent

is clearly expressed from the language as written.4 Witkowski v. Brian, Fooshee &

Yonge Props., 181 S.W.3d 824, 831 (Tex. App.—Austin 2005, no pet.) (citing

Brown, 156 S.W.3d at 567). Although in some cases it may be desirable to imply a

private right of action to provide remedies thought to effectuate the purpose of the

statute, ultimately we must determine whether the drafters intended to create such a

private remedy. See Transamerica Mortg. Advisors, Inc. v. Lewis, 444 U.S. 11, 15–

16 (1979); see also Brown, 156 S.W.3d at 567 (rejecting rule of “necessary

implication” that provides when a legislative enforcement scheme fails to adequately

    4
       Physicians’ references to principles of statutory construction ignore the relevant legal standard
applicable to inquiries into private rights of action. Because grants of private rights of action implicate the
separation of powers, the rules are applied strictly in that context.
                                                     –7–
protect intended beneficiaries, the courts must imply a cause of action to effectuate

the statutory purposes); Linick v. Emp’rs Mut. Cas. Co., 822 S.W.2d 297, 300 (Tex.

App.—San Antonio 1991, no writ) (where intent of legislature is clear, it will be

given effect even if result appears harsh or ill-advised). Moreover, in cases such as

this, where the relevant statutes are silent on a private right of action but provide

detailed administrative enforcement mechanisms, we may presume that the

legislature intended that a separate private right of action not be included.

Witkowski, 181 S.W.3d at 831; see also Middlesex Cty. Sewage Auth. v. Nat’l

Clammers Ass’n, 453 U.S. 1, 14 (1981) (when a statute includes elaborate

enforcement provisions, it cannot be assumed that Congress authorized by

implication additional judicial remedies for private citizens).

        The insurance industry is heavily and comprehensively regulated by both

federal and state law. Most sections of the Texas Insurance Code are expressly

enforced by the Texas Attorney General or the Texas Department of Insurance.

Moreover, where the legislature has intended to provide a private right of action

under the insurance code, it has made a clear expression of that intent. See, e.g., INS.

CODE § 541.151.5 By law, federal and state regulators must certify Molina’s HIX

    5
      Section 541.151 provides “a person who sustains damages may bring an action against another person
for those damages caused by the other person engaging in an act or practice (1) defined by Subchapter B to
be an unfair method of competition or an unfair or deceptive act or practice in the business of insurance; or
(2) specifically enumerated in Section 17.46(b), Business & Commerce Code, as an unlawful deceptive
trade practice if the person bringing the action shows that the person relied on the act or practice to the
person’s detriment.” INS. CODE § 541.151.
                                                    –8–
plans before they can be offered to consumers. 45 C.F.R. § 155.1000; INS. CODE

§843.071. Federal regulators have the authority to remove Molina’s HIX plans from

the healthcare exchanges for non-compliance with federal law.           45 C.F.R.

§ 155.1010(a)(2). At the state level, the legislature has delegated enforcement

powers over HMOs to the Texas Department of Insurance. See INS. CODE § 843.461.

      The Texas Department of Insurance, in turn, requires HMOs, such as Molina,

to maintain dispute resolution processes and expressly permits dissatisfied persons

to make complaints directly to the department, including for violations of section

1271.155. Id. §§ 843.251–.261, 843.282. In fact, the commissioner of insurance

may suspend or revoke a certificate of authority issued to an HMO, impose

sanctions, issue a cease and desist order, or impose administrative penalties. Id.

§§ 82.051, 843.082, 843.461(a). In addition, the legislature has empowered the

commissioner to direct the holder of a permit, license, certificate of authority,

certificate of registration, or other authorization issued or existing under the

commissioner’s authority or the insurance code to make complete restitution to each

Texas resident, each Texas insured, and each entity operating in this state that is

harmed by a violation of, or failure to comply with, the Texas Insurance Code or a

rule of the commissioner.     Id. §§ 82.052, 82.053(a).     The commissioner is

empowered to adopt rules necessary to implement the provisions governing HMOs

and to meet the minimum requirements of federal law, including regulations. Id.

§ 1271.004(d).   Accordingly, the Texas Insurance Code provides a distinct and

                                       –9–
comprehensive enforcement mechanism, but it is not directed to the courts.

Accordingly, we presume the legislature did not intend for a private right of action

to be included.

      Moreover, Physicians’ claim that section 1271.155 impliedly authorizes a

private cause of action because it mandates payment to an identifiable group and

attempt to analogize the emergency care statutes to the Texas Constitution’s

prohibition on takings without just compensation are unavailing.           The Texas

Supreme Court has noted the Texas Constitution provides a party whose property

has been taken by the government with “a textual entitlement to compensation.” City

of Beaumont v. Bouillion, 896 S.W.2d 143, 149 (Tex. 1995). As the Bouillion

opinion makes clear, however, the Takings Clause creates a limited right to relief

because it requires the State to pay just compensation—but the court explicitly

cautioned the “limited context” of the Takings Clause and stated that its holding

“cannot be interpreted beyond its context.” Id. Accordingly, Physicians’ reliance

on the existence of a right of action under the constitution’s takings clause for the

proposition that a private right of action can be implied where a statute is enacted to

benefit a particular group of persons is misplaced. Coll v. Abaco Operating LLC,

No. 2:08-CV-345-TJW, 2011 WL 1831748, at *4 (E.D. Tex. May 12, 2011).

      Physicians’ reliance on Merkle v. Health Options, Inc., 940 So. 2d 1190 (Fla.

Dist. Ct. App. 2006), an intermediate appellate opinion interpreting Florida’s

emergency care statute, is unpersuasive. In reaching the conclusion that an implied

                                        –10–
private right of action existed under the Florida statute, the Merkle court cited the

rule articulated by the Florida Supreme Court “that ‘because the legislature enacted

a statute that clearly imposes a duty and because the intent of the section is to

preclude retaliatory discharge, the statute confers by implication every particular

power necessary to insure the performance of that duty.’” Id. at 1196 (quoting Smith

v. Piezo Tech. & Prof’l Adm’rs, 427 So. 2d 182, 184 (Fla. 1983)). Thus, Merkle

adheres to the “necessary implication test,” which the Texas Supreme Court

explicitly rejected in Brown. Brown, 156 S.W.3d at 567. Texas now applies a far

stricter rule of construction in determining whether a private right of action exists:

“[A] right of enforcement should not be implied simply because the statute ‘fails to

adequately protect intended beneficiaries.’” Witkowski, 181 S.W.3d at 831 (quoting

Brown, 156 S.W.3d at 567). The fact that a person claims to have suffered harm

from the violation of a statute does not automatically give rise to a private cause of

action. Cannon v. Univ. of Chicago, 441 U.S. 677, 688 (1979).

      In addition, Physicians’ reliance on Brown v. De La Cruz and Davis v.

Hendrick Autoguard, Inc. to support their implied enforcement right argument is

unfounded because in each of those cases the statutory provision Physicians rely

upon stated the seller or provider is liable to the purchaser or contracting party.

Brown, 156 S.W.3d at 561 (property code provision which directs that “a seller is

‘liable to the purchaser for . . . liquidated damages’ . . . clearly provides a private

cause of action for purchasers”); Davis, 294 S.W.3d 835, 837–39 (Tex. App.—

                                        –11–
Dallas 2009, no pet.) (statutory provision which dictated that if a “provider does not

pay the refund or credit the service contract holder’s account . . ., the provider is

liable to the service contract holder” reflected legislative intent to imply a private

right of action).

        Moreover, the cases squarely addressing the issue, while not binding on this

Court, applied Brown and properly analyzed the Texas authorities in concluding that

there is no private right of action under the Texas emergency care statutes 6 because

those provisions “do not clearly express a legislative intent to create such a right.”

Angelina, 2020 WL 7259222, at *6; Apollo MedFlight, 2019 WL 4894263, at *2–3.

        In addition, section 1271.155’s legislative history confirms the statute was

intended to function as part of a broader regulatory scheme and, as it existed through

2019, was not intended to create a private cause of action. See Brown, 156 S.W.3d

at 568 (“legislative history may sometimes provide insight as to legislative intent”).

What is now section 1271.155(a) first appeared as an amendment to the Texas

Administrative Code on November 24, 1995. 28 TEX. ADMIN. CODE § 11.204. That

regulation governed the certificate of authority to operate as an HMO and listed the

items an HMO must include in an application for a certificate, and subsection (20)

    6
     Texas Insurance Code sections 1271.155 (HMO plans), 1301.0053 (EPO plans), and 1301.155 (PPO
plans) are collectively referred to as the emergency care statutes. Apollo MedFlight, 2019 WL 4894263, at
*1. Only section 1271.155 is implicated here.

                                                 –12–
included the same “usual and customary rate” language at issue here. Id.7 In 1997,

the legislature passed Senate Bill 385 and codified this rule as section 20A.04 of the

Texas Insurance Code. See 75th Leg., R.S., ch. 1026 (S.B. 385). In 2001, the Texas

House of Representatives passed House Bill 2811, which codified the Texas

Insurance Code and moved the relevant language from section 20A.04 to section

20A.9Y. See 77th Leg., R.S., ch. 1419 (H.B. 2811). House Bill 2811 retained the

payment language but moved the certificate of authority reference to another section

of the code. That move was intended to be “nonsubstantive.” See id. In 2003, the

Texas House of Representatives passed House Bill 2922, which recodified the Texas

Insurance Code and moved section 20A.9Y to section 1271.155(a). See 78th Leg.,

R.S., ch. 1274 (H.B. 2922). This amendment was also “nonsubstantive.” See id.

       In 2019, the legislature adopted amendments to the Texas Insurance Code, to

be effective prospectively. See Acts 2019, 86th Leg., ch. 1342 (S.B. 1264). Among

other things, Senate Bill 1264 amended section 1271.155 to add subsection (f),

which for the first time required HMOs to pay non-network providers “directly,” and

subsection (g), which substantially limits the right of non-network providers to bill

patients for the difference between the billed amount and the paid amount. The bill

   7
      More particularly, subsection 20 provided, in part, for “documentation demonstrating that the HMO
will pay for emergency care services performed by non-network physicians or providers at the negotiated
or usual and customary rate . . . .”

                                                –13–
also included a detailed dispute resolution process in chapter 1467 of the insurance

code.

        As we read Physicians’ brief, they appear to present a claim arising only in

connection with payments sought prior to the effective date of the 2019

amendments. Nevertheless, the amendments appear to offer little support to the

contention that the legislature intended to create a general private cause of

action. On the contrary, the legislature directed the parties away from the court to

an administrative arbitrator who would appear to function in lieu of the Texas

Department of Insurance itself. INS. CODE § 1467.083. Unlike traditional arbitration

in lieu of plenary judicial proceedings, the parties to this administrative proceeding

are not directed to participate by their own consent, a feature indispensable to

arbitration under either the Texas or federal arbitration acts,8 but by legislative

decree with the arbitrator empowered to act in the place of the Texas Department of

Insurance and pursuant to the mandatory administrative process we have outlined

above. More notably, when the arbitration is concluded, the parties may come to

court, not for confirmation or vacatur pursuant to the general arbitration acts, but for

the familiar “substantial evidence” review that would follow from an administrative

appeal from the decision of an administrative agency under the Administrative

   8
       See Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 404 (1967) (“arbitration is ‘a
matter of consent, not coercion’”); In re Merrill Lynch Trust Co. FSB, 235 S.W.3d 185, 192 (Tex. 2007)
(orig. Proceeding) (same).
                                               –14–
Procedure and Texas Register Act—or, in this case, the Texas Department of

Insurance. See TEX. GOV’T CODE § 2001.175.

      As Senate Bill 1264 does not apply retroactively to any claim preceding its

enactment and does not clearly create the plenary judicial proceeding Physicians

urge, it is much like the amendment to the property code in Brown, which the Texas

Supreme Court determined did not clarify the legislature’s prior intent; rather, it

simply reaffirmed that the statute had not allowed for a private right of action. See

Brown, 156 S.W.3d at 565.

      Considering the text of section 1271.155, the legal standard applicable to

legislative intent to create private rights of action, and the legislative history of

section 1271.155, we conclude the version of section 1271.155 applicable to this

case does not create a private right of action in favor of non-network physicians or

providers. Accordingly, the trial court did not err in dismissing Physicians’ section

1271.155 claim. We overrule Physicians’ first issue.

             III.   Violations of the Unfair Settlement Practices and Prompt
                    Payment Statutes

      In their second issue, Physicians contend the trial court erred in dismissing

their claims under the unfair settlement practices statute (specifically, sections

541.060 and 541.151 of the Texas Insurance Code) and the prompt payment statute

(chapter 843 of the Texas Insurance Code) because they are within the class of

persons expressly authorized to bring claims under the statutes.

                                       –15–
                   A. Unfair Settlement Practices

      Physicians assert they have standing to bring an unfair settlement practices

claim both independently and as assignees of the Molina enrollees’ benefits. Molina

counters that Physicians do not have standing to bring the claim because they lack

any direct basis for their own standing and any claim the Molina enrollees may have

under chapter 541 is unassignable under Texas law. We agree with Molina.

      In bringing their unfair settlement practices claim, Physicians rely on the

express provision for a private cause of action under section 541.151 and claim

Molina’s violation of section 1271.155 constitutes a violation of section

541.060 (a)(2), allowing for redress under section 541.151.         Section 541.151

provides:

      a person who sustains damages may bring an action against another
      person for those damages caused by the other person engaging in an act
      or practice (1) defined by Subchapter B to be an unfair method of
      competition or an unfair or deceptive act or practice in the business of
      insurance; or (2) specifically enumerated in Section 17.46(b), Business
      & Commerce Code, as an unlawful deceptive trade practice if the
      person bringing the action shows that the person relied on the act or
      practice to the person’s detriment.

INS. CODE § 541.151. Subchapter B provides, in part:

      it is an unfair method of competition or an unfair or deceptive act or
      practice in the business of insurance to engage in the following unfair
      settlement practices with respect to a claim by an insured or beneficiary
      . . . failing to attempt in good faith to effectuate a prompt, fair, and
      equitable settlement of: (A) a claim with respect to which the insurer’s
      liability has become reasonably clear.

Id. § 541.060(a)(2)(A) (emphasis added).

                                       –16–
      As an initial matter, Physicians are not insureds or beneficiaries to which the

unfair settlement practices statute applies.     See id. § 541.151.     In addition,

Physicians’ asserted independent unfair settlement practices claim is premised on a

violation of section 1271.155, which we have already concluded to be

jurisdictionally unsupported.

      As to Physicians’ assertion they are entitled to maintain an unfair settlement

practices claim as assignees of Molina enrollees’ benefits, that assertion fails

because the overwhelming weight of persuasive authority holds that claims under

chapter 541 of the Texas Insurance Code may not be assigned. Angelina, 2020 WL

7259222, at *7; Gilmour v. Blue Cross and Blue Shield of Ala., No. 4:19-CV-160,

2020 WL 2813197, at *8 (E.D. Tex. May 29, 2020). Although the Texas Supreme

Court has not directly addressed the issue, it has held that Texas Deceptive Trade

Practices Act claims are unassignable because such claims are fundamentally

personal and punitive. PPG Indus., Inc. v. JMB/Houst. Ctrs. Partners Ltd. P’ship,

146 S.W.3d 79, 87 (Tex. 2004). Drawing on PPG Industries, several federal courts

have held that claims under chapter 541 of the Texas Insurance Code are also

personal and punitive and likewise are unassignable. See, e.g., Berkley Reg’l Ins.

Co. v. Phila. Indem. Ins. Co., No. A-10-CA-362, 2011 WL 9879170, at *8–9 (W.D.

Tex. Apr. 27, 2011) (collecting cases), rev’d on other grounds, 690 F.3d 342 (5th

Cir. 2012); see also Montoya v. State Farm Mut. Auto. Ins. Co., No. 16-00005(RCL),

2016 WL 5942327, at *6 (W.D. Tex. Oct. 12, 2016). Several Texas intermediate

                                       –17–
courts of appeals, including this Court, have concluded Chapter 541 provides

remedies that are personal and punitive in nature. See Goin v. Crump, No. 05-18-

00307-CV, 2020 WL 90919, at *15 (Tex. App.—Dallas Jan. 8, 2020, no pet.) (mem.

op.) (concluding trial court erred in ordering the turnover of Chapter 541 claims to

receiver); Lee v. Rogers Agency, 517 S.W.3d 137, 146 n.3 (Tex. App.—Texarkana

2016, pet. denied) (noting insurance code claims are not assignable for the reasons

discussed in PPG). Therefore, Physicians lack standing as assignees to bring a claim

against Molina for unfair settlement practices.

                   B. Prompt Payment

      Physicians’ assertion the trial court erred in dismissing their prompt payment

statute claim is likewise unavailing. While section 843.351 of the Texas Insurance

Code requires prompt payment of claims when a non-network provider renders

medical care related to an emergency or its attendant episode of care as required by

state or federal law, the penalties under the prompt payment statute are not available

to out-of-network providers. INS. CODE §§ 843.342; 843.351, 1301.069. Section

843.342 provides for penalties based on the billed charges, as submitted on the claim,

and the contracted rate. Id. § 843.342.      The penalty structure depends, for its

calculation, on the contracted right of reimbursement to the provider. The legislature

could have specified the manner for calculating a penalty for non-network providers

who do not have a contracted rate but it failed to do so. Because out-of-network

physicians and providers do not have contracted rates, there is no basis for the

                                        –18–
statutory penalties. See Emerus Hosp. v. Health Care Serv. Corp., No. 1:13-cv-

8906, 2020 WL 1675665, at *3 (N.D. Ill. Apr. 6, 2020); see also TEX. ATT’Y GEN.

Op. No. KP-0250, at 6 (2019) (concluding out-of-network physicians do not have a

right to penalties under the prompt payment statute).9

        Physicians’ claim under the prompt payment statute is also predicated on the

viability of their claim under section 1271.155, which, as noted above, fails.

Accordingly, we conclude Physicians cannot seek penalties under the prompt

payment statute and thus the trial court did not err in dismissing Physicians’ claim

against Molina for violation of the prompt payment statute.

        We overrule Physicians’ second issue.

                IV.     Quantum Meruit and Declaratory Judgment

        In their third issue, Physicians claim principles of quantum meruit and

declaratory judgment afford them alternative means to redress Molina’s alleged

underpayment for services.

    9
      The legislature explicitly requested an attorney general opinion on the issue of penalties under the
prompt payment statute. Thus, the “usual deference paid to formal opinions of state attorney generals is
accentuated,” Kneeland v. Nat’l Collegiate Athletic Ass’n, 850 F.2d 224, 228 (5th Cir. 1988), and Texas
courts generally accord great weight to such opinions. See Plainview Indep. Sch. Dist. v. Edmonson Wheat
Growers, Inc., 681 S.W.2d 299, 302 (Tex. App.—Amarillo 1984, writ ref’d n.r.e.).

                                                 –19–
                        A. Quantum Meruit10

         Physicians’ equitable claim of quantum meruit seeks to enforce the same

payment obligations they cannot enforce under the emergency care statute.

Accordingly, the claim fails because the judiciary is precluded from creating a claim

in equity that merely repackages a statutory claim the legislature declined to create.

See Davis, 294 S.W.3d at 840 (“[P]laintiff attempts to achieve indirectly what he

cannot do directly under the statute.”). In addition, a comprehensive regulatory

scheme has been enacted to regulate plans created under the Affordable Care Act,

signaling a pre-emption of state law claims. See, e.g., English v. GE Co., 496 U.S.

72, 78 (1990) (in absence of explicit statutory language, state law is pre-empted

where it regulated conduct in a field that Congress intended the Federal Government

to occupy exclusively).

         Moreover, the trial court properly dismissed Physicians’ quantum meruit

claim because, contrary to Physicians’ assertion, the facts alleged in Physicians’

petition do not establish they rendered valuable services to Molina. Merely stating

the services Physicians provided were for Molina’s benefit would be insufficient to

state a quantum meruit claim. See Wooley v. Schaffer, 447 S.W.3d 71, 76 (Tex.

App.—Houston [14th Dist.] 2014, pet. denied) (it is not enough that plaintiff recite

    10
       Quantum meruit is an equitable remedy based on an implied promise to pay for benefits
received. See Vortt Expl. Co. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex. 1990). To recover on a
claim of quantum meruit a plaintiff must show (1) he rendered valuable services, (2) for the defendant, (3)
the defendant accepted his services, and (4) he rendered the services under circumstances that would
reasonably notify the defendant he expected to be paid. Smith v. Deneve, 285 S.W.3d 904, 915 (Tex. App.—
Dallas 2009, no pet).
                                                  –20–
certain talismanic words in their pleading because allegations that are mere

conclusions are entitled to no deference). The non-conclusory facts alleged—those

entitled to deference—reflect that the benefits at issue are healthcare services

provided to the insured patients, not Molina. Where, as here, a plaintiff renders

services to an insured, courts applying Texas law have held the plaintiff does not

have a quantum meruit claim against the insurer because any services rendered only

indirectly benefit the insurer, if they benefit the insurer at all. See Angelina, 2020

WL 7259222, at *3 (services rendered to an insured are not directed to or for the

benefit of the insurer); Fisher v. Blue Cross & Blue Shield of Tex., Inc., No. 3:10-

CV-2652-L, 2015 WL 5603711, at *13 (N.D. Tex. Sept. 23, 2015) (holding doctors

who rendered medical services to insured patients had no quantum meruit claim

against patients’ insurer because “any possible benefit conferred on [insurer] was

too attenuated and indirect”); Tex. Spine & Joint Hosp., Ltd. v. Blue Cross & Blue

Shield of Tex., No. 6:14-cv-952-JDL, 2015 WL 13649419, at *7 (E.D. Tex. May 28,

2015) (dismissing quantum meruit claim against insurer for medical services

rendered to insureds); Encompass Office Sols., Inc. v. Ingenix, Inc., 775 F. Supp. 2d

938, 966 n.11 (E.D. Tex. 2011) (“It is counterintuitive to say that services provided

to an insured are also provided to its insurer. The insurance company derives no

benefit from those services; indeed, what the insurer gets is a ripened obligation to

pay money to the insured—which hardly can be called a benefit.” (quoting Travelers

Indem. of Conn. v. Losco Grp., 150 F. Supp. 2d 556, 563 (S.D.N.Y. 2001)).

                                        –21–
      In this case, the services for which Physicians seek additional compensation

were provided for the benefit of and accepted by Molina’s insureds, not Molina. If

Molina received any benefit, it was too indirect and attenuated to support a quantum

meruit claim operating in parallel to but outside of the legislature’s regulatory

scheme. See Encompass Office Sols., 775 F. Supp. 2d at 966 & n.11. Because

Physicians cannot rebrand their defunct section 1271.155 claim as a quantum meruit

claim and cannot aver that valuable services were rendered to and accepted by

Molina, the trial court did not err in dismissing Physicians’ quantum meruit claim.

                   B. Declaratory Judgment

      Under the Texas Uniform Declaratory Judgments Act (“the Act”), a person

whose rights, status, or other legal relations are affected by a statute may have

determined any question of construction or validity arising under the statute and

obtain a declaration of rights, status or other legal relations thereunder. TEX. CIV.

PRAC. & REM. CODE § 37.004(a). The Act is not a grant of jurisdiction, but merely a

procedural device for deciding cases already within a court’s jurisdiction. Chenault

v. Phillips, 914 S.W.2d 140, 141 (Tex. 1996) (quoting State v. Morales, 869 S.W.2d

941, 947 (Tex. 1994)).

      “A declaratory judgment is appropriate only if a justiciable controversy exists

as to the rights and status of the parties and the controversy will be resolved by the

declaration sought.” Bonham State Bank, 907 S.W.2d at 467 (citing Tex. Ass’n of

Bus., 852 S.W.2d at 446).      The Act gives the court no power to pass upon

                                        –22–
hypothetical or contingent situations, or determine questions not then essential to the

decision of an actual controversy. Firemen’s Ins. Co. of Newark, N.J. v. Burch, 442

S.W.2d 331, 333 (Tex. 1968), superseded by constitutional amendment on other

grounds as stated in Farmers Tex. Cty. Mut. Ins. Co. v. Griffin, 955 S.W.2d 81 (Tex.

1997). Thus, a declaratory judgment action cannot resolve issues not yet mature and

subject to change. See Lane v. Baxter Healthcare Corp., 905 S.W.2d 39, 41–42

(Tex. App.—Houston [1st Dist.] 1995, no writ).

      Here, Physicians seek a declaratory judgment as to the rate Molina should pay

under section 1271.155(a) for services provided to Molina’s insureds in the future.

Because Physicians lack standing to enforce section 1271.155(a) directly, they

likewise lack standing to assert that claim indirectly under the Declaratory

Judgments Act. See Reid v. Aransas Cty., 805 F. Supp. 2d 322, 339 (S.D. Tex. 2011)

(“[A] plaintiff cannot use the Declaratory Judgments Act to create a private right of

action where none exists.”).

      In addition, Physicians seek a declaration concerning claims for payment for

medical services that have not yet been performed. The adjudication of hypothetical

future claims, with unknown patients and unknown medical procedures, does not

present a real controversy. The controversy is not ripe for consideration. Burch, 442

S.W.2d at 333.

      Moreover, future disputes concerning the “usual and customary rates” will be

subject to the dispute resolution process set forth in chapter 1467 of the insurance

                                        –23–
code, and a judicial declaration concerning same in advance of a party’s employment

of that process would contravene the legislative mandate that a court’s review of an

arbitrator’s decision is to determine whether it is supported by substantial evidence.

      Because the Declaratory Judgments Act neither creates jurisdiction nor

permits the rendition of advisory opinions, the trial court properly dismissed

Physicians’ claim for declaratory relief.

      We overrule Physicians’ third issue.

                                    CONCLUSION

      We affirm the trial court’s order granting Molina’s Plea to the Jurisdiction.

                                             /David J. Schenck/
                                             DAVID J. SCHENCK
                                             JUSTICE

191447F.P05

                                        –24–
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                   JUDGMENT

 TEXAS MEDICINE RESOURCES,                      On Appeal from the 160th Judicial
 LLP; TEXAS PHYSICIAN                           District Court, Dallas County, Texas
 RESOURCES, LLP; AND                            Trial Court Cause No. DC-18-14467.
 PEDIATRIC EMERGENCY                            Opinion delivered by Justice
 MEDICINE GROUP, LLP,,                          Schenck. Justices Osborne and
 Appellant                                      Partida-Kipness participating.

 No. 05-19-01447-CV           V.

 MOLINA HEALTHCARE OF
 TEXAS, INC., Appellee

      In accordance with this Court’s opinion of this date, the order of the trial court
granting Molina Healthcare of Texas, Inc.’s plea to the jurisdiction is AFFIRMED.

      It is ORDERED that appellee MOLINA HEALTHCARE OF TEXAS, INC.
recover its costs of this appeal from appellant TEXAS MEDICINE RESOURCES,
LLP; TEXAS PHYSICIAN RESOURCES, LLP; AND PEDIATRIC
EMERGENCY MEDICINE GROUP, LLP.

Judgment entered this 23rd day of February, 2021.

                                         –25–