Main & Assocs. Inc. v. Blue Cross & Blue Shield of Ala.

776 F. Supp. 2d 1270, 2011 U.S. Dist. LEXIS 30390, 2011 WL 1004831
CourtDistrict Court, M.D. Alabama
DecidedMarch 22, 2011
DocketCase 2:10-cv-326-MEF
StatusPublished
Cited by9 cases

This text of 776 F. Supp. 2d 1270 (Main & Assocs. Inc. v. Blue Cross & Blue Shield of Ala.) is published on Counsel Stack Legal Research, covering District Court, M.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Main & Assocs. Inc. v. Blue Cross & Blue Shield of Ala., 776 F. Supp. 2d 1270, 2011 U.S. Dist. LEXIS 30390, 2011 WL 1004831 (M.D. Ala. 2011).

Opinion

*1273 MEMORANDUM OPINION AND ORDER

MARK E. FULLER, Chief Judge.

Plaintiff Main & Associates, Inc., a corporation which does business as Southern Springs Healthcare Facility (“Southern Springs”) brought this action in the Circuit Court of Bullock County, Alabama. Southern Springs alleged a number of claims all purporting to be pursuant to the laws of the State of Alabama arising out of the decisions made by Defendant Blue Cross and Blue Shield of Alabama (“BCBS”) regarding coverage and benefits determinations for enrollees in BCBS’s Medicare Advantage plans. Invoking this Court’s subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1441(b) under a variety of theories, BCBS removed the case to this Court. Now pending before the Court is the Plaintiffs Motion to Remand (Doc. # 7). For the reasons set forth below, the motion is due to be GRANTED.

FACTUAL AND PROCEDURAL HISTORY

Medicare is a social security program that provides federally subsidized health insurance for the aged and disabled. The Department of Health and Human Services, acting through, the Centers for Medicare and Medicaid Services administers the Medicare program. Benefits available through Medicare are prescribed by law and divided into four “parts.” Part A provides hospital care, skilled nursing care, home health care, and hospice care benefits. Part B provides coverage for services of physicians and out-patient services. Part D provides benefits for prescription drugs. Part C gives Medicare beneficiaries the option to contract with private health insurance plans to obtain the benefits normally available under Parts A and B, as well as other coverage. Such privately administered plans are known as Medicare Advantage Plans. 1

BCBS is a private health insurance company. In addition to its regular health insurance plans and products, BCBS offers a Medicare Advantage Plan specifically tailored for Medicare beneficiaries seeking insurance under Part C. At issue in this lawsuit is a BCBS Medicare Advantage Plan known as Blue Advantage. When Medicare recipients enroll in Blue Advantage, Medicare no longer pays providers of covered services directly when the recipients receive covered medical treatment. Medicare pays BCBS a set monthly fee called a capitation rate to administer and manage the enrollee’s healthcare insurance. In order to obtain medical treatment, the enrollee must visit and use health care providers who are willing to accept the Blue Advantage’s terms of payment or health care providers who have contracted with the insurer to accept Blue Advantage’s terms or who are a part of the Blue Advantage’s network of healthcare providers.

Southern Springs operates offers skilled nursing services at a nursing home healthcare facility that treats and cares for patients. In August of 2008, Southern Springs and BCBS entered into a contract. Under the terms of the contract, Southern Springs was to provide healthcare services to Blue Advantage enrollees seeking treatment at its facilities and BCBS would compensate Southern Springs for providing these services. Because the enrollees in the Blue Advantage plan are Medicare beneficiaries, the contract between Southern Springs and BCBS provided that BCBS was to provide the same basic bene *1274 fits and coverage to an enrollee in the Blue Advantage plan as would be provided to that patient if he was enroll in Part A or B of Medicare. Southern Springs alleges that this means that if Medicare would cover it, then BCBS must also cover it for patients enrolled in Blue Advantage. Southern Springs further alleges that Medicare has developed guidelines and payment schedules for skilled nursing facilities known as Resource Utilization Group Guidelines (“RUG Guidelines”). The RUG Guidelines dictate if there is coverage and the length of coverage available.

Southern Springs alleges that BCBS has wrongfully and tortiously failed to provide coverage and benefits for Medicare-covered services it has performed for Blue Advantage enrolled patients despite having a legal and contractual duty to do so. Specifically, Southern Springs alleges that BCBS refuses to follow the RUG Guidelines and instead uses a different system to determine whether claims are covered. BCBS allegedly does this to reduce costs and boost profits. According to Southern Springs, this means that BCBS has not been providing the same coverage to Blue Advantage enrollees as they would have received under Medicare Part A. Because BCBS allegedly breached its legal and contractual duties to Southern Springs, it has suffered lost income and revenue.

Southern Springs brings claims on its own behalf and on behalf of proposed, as-yet-uncertified class. Southern Springs’s Complaint against BCBS contained the following “counts”: breach of contract, intentional interference with business relations, negligence and wantonness, unjust enrichment, and injunctive relief. At the end of the Complaint, Southern Springs sets forth the following:

PLAINTIFF/PUTATIVE CLASS MAKES NO CLAIMS PURSUANT TO ANY FEDERAL LAW; NOR DOES PLAINTIFF/PUTATIVE CLASS MAKE ANY CLAIM THAT WOULD GIVE RISE TO FEDERAL JURISDICTION. PLAINTIFF/PUTATIVE CLASS’ CLAIMS ARISE SOLELY FROM STATE LAW.

Doc. 1-1 at p. 16 (emphasis in original).

Within thirty days after being served with the Complaint, BCBS filed a Notice of Removal invoking this Court’s subject matter jurisdiction pursuant to 28 U.S.C. § 1331. Specifically, BCBS advanced three arguments. First, BCBS contends that the unjust enrichment claim set forth in Count IV of the Complaint is in substance a claim under the False Claims Act, 31 U.S.C. §§ 3729 and 3732. Second, BCBS contends that all of Southern Springs’s claims are claims for Medicare benefits or are inextricably intertwined with claims for Medicare benefits and therefore the claims “arise under” the Medicare Act and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (“MMA”). Finally, BCBS alleges that the Medicare Act, as amended by the MMA, completely preempts Southern Springs’s claims. Just over a week after removing the action, BCBS filed an Amended Notice of Removal correcting an error in one of the paragraphs. .

On April 28, 2010, Southern Springs filed a motion to remand. By this motion, Southern Springs argues that the Court does not have subject matter jurisdiction under any of the theories BCBS advances. The motion to remand has been extensively brief and is ready for disposition.

DISCUSSION

A. Limited Nature of Subject Matter Jurisdiction in Federal Courts

Federal courts are courts of limited jurisdiction. See, e.g., Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375

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Bluebook (online)
776 F. Supp. 2d 1270, 2011 U.S. Dist. LEXIS 30390, 2011 WL 1004831, Counsel Stack Legal Research, https://law.counselstack.com/opinion/main-assocs-inc-v-blue-cross-blue-shield-of-ala-almd-2011.