Breast Cancer Survivors Permitted to Proceed with Putative Class Action Suit Against Aetna Over Reconstructive Surgery Underpayments; Law360 Quotes Lead Counsel to Proposed Class John W. Leardi

On July 5, 2023, United States District Judge Esther Salas issued a 23-page opinion granting in part and denying in part Aetna’s motion to dismiss in Shapiro v. Aetna, a putative class action filed in the District of New Jersey by Buttaci Leardi & Werner LLC alleging that Aetna systemically underpaid claims for reconstructive surgery performed by out-of-network surgeons at in-network facilities. The plaintiffs are represented by John W. Leardi, Nicole P. Allocca, and Christopher B. Bladel of Buttaci Leardi & Werner LLC. In a statement provided to Law360 on the decision, John Leardi, lead counsel to Plaintiffs and the proposed class, said: “We are very pleased with Judge Salas’s thoughtful and well-reasoned decision, and we look forward to moving this case forward.”

The Shapiro case is just one of several class action lawsuits the firm has filed on behalf of healthcare providers or their patients seeking previously denied or underpaid benefits.

Plaintiffs’ Claims Against Aetna are for Failure to Pay Health Benefits

The three plaintiffs in the case are breast cancer survivors who were beneficiaries under ERISA-regulated health benefit plans administered by Aetna. Each plaintiff was diagnosed and subsequently treated for breast cancer; and now, because of Aetna’s failure to pay claims consistent with the terms of its health benefit plans, they find themselves personally responsible for significant debts owed to the plastic surgeons who performed their post-mastectomy reconstruction procedures.

Each plaintiff, as is their right under Federal law, chose to have their post-mastectomy reconstructions performed by board-certified microsurgeons, each of whom does not participate in Aetna’s provider network. These out-of-network microsurgeons worked in tandem with the Plaintiffs’ in-network surgical oncologists. Each of the reconstructive procedures was performed at an in-network hospital. In each instance, Aetna approved the procedure, and deemed the services covered under the terms of its plans. But plaintiffs allege the amount Aetna paid each surgeon did not comply with its plans.

Specifically, each of the Aetna plans through which the plaintiffs were covered contains a definition of so-called “Involuntary Services” that includes procedures at an in-network facility by an out-of-network provider. Each plan then provides that the standard methodology for pricing out of network claims under the plan “does not apply to involuntary services.” Instead, each plan goes on to state that Aetna will calculate the patient’s cost share for involuntary services in the same way it would if the patient received the services from an in-network provider.” Aetna’s obligation to each plaintiff was to ensure that benefits were paid for their post-mastectomy surgeries in such amounts that would limit the plaintiffs’ out-of-pocket responsibility to their in-network cost-sharing obligations. Plaintiffs allege this did not happen.

Court Denies Aetna’s Motion to Dismiss as to Interpretation of “Involuntary Services”

The main thrust of Aetna’s motion to dismiss was that the term “Involuntary Services” cannot possibly mean what plaintiffs allege in their complaint, and that, as a matter of law, the plaintiffs’ claims were not for involuntary services. In denying that portion of Aetna’s challenge, Judge Salas noted that it was “inappropriate” for the Court to determine “whose interpretation of the ‘Involuntary Services’ provision of the [p]ans is correct” on a motion to dismiss. Instead, the Court concluded that the plaintiffs had satisfied their obligation to plausibly state a claim because “[e]ach has identified a particular provision in her [p]lan—the “Involuntary Services” provision—which she alleges entitles her to benefits, and which she alleges [Aetna] improperly applied to her claim(s) for services rendered by an out-of-network provider at an in-network facility, resulting in [an] underpayment of benefits.”

Court Rejects Aetna’s Motion to Dismiss Claims for Equitable Relief Under ERISA

Aetna also argued that plaintiffs’ claims for equitable relief under § 502(a)(3) of ERISA should be dismissed as “duplicative” of their claim for benefits under § 502(a)(1)(B). In denying Aetna’s motion, Judge Salas noted that while plaintiffs cannot “recover under both §§ 502(a)(1) and 502(a)(3),” “it is nonetheless premature to dismiss § 502(a)(3) claims alleged in the alternative on a motion to dismiss, before it is clear whether the plaintiff may attain adequate relief under § 502(a)(1).” The Court also rejected Aetna’s argument that the relief sought by plaintiffs under § 502(a)(3) “is akin to a prayer for money damages,” concluding that “a reprocessing order is an appropriate form of equitable relief for ERISA actions” and “[i]nsofar as Plaintiffs seek only a declaratory judgment, a reprocessing order and permanent injunction under § 502(a)(3) in Count II, these are appropriate forms of equitable relief.”

If you are a provider or patient who believes a health benefit claim has been wrongfully denied or underpaid, please feel free to contact John Leardi’s assistant Marianna Nicolas to schedule a complimentary consultation.

• Posted on: Jul 19 2023