Wagner v. Magellan Health Services, Inc.

121 F. Supp. 2d 673, 2000 U.S. Dist. LEXIS 8729, 2000 WL 804692
CourtDistrict Court, N.D. Illinois
DecidedJune 21, 2000
Docket99 C 8235
StatusPublished
Cited by13 cases

This text of 121 F. Supp. 2d 673 (Wagner v. Magellan Health Services, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wagner v. Magellan Health Services, Inc., 121 F. Supp. 2d 673, 2000 U.S. Dist. LEXIS 8729, 2000 WL 804692 (N.D. Ill. 2000).

Opinion

MEMORANDUM OPINION AND ORDER

BUCKLO, District Judge.

Dr. Richard Wagner instituted this action alleging that he was “blacklisted” by managed care organization Magellan Health Services, Inc. (“Magellan”) in violation of §§ 1 and 2 of the Sherman Antitrust Act, 15 U.S.C. § 1 et seq. Dr. Wagner also alleges defamation, civil conspiracy and intentional interference with contractual relations. Magellan and the individually-named defendants (the “defendants”) move for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). I grant the motion as to Counts I — III, and I dismiss the remaining counts, IV — VI, without prejudice for lack of subject matter jurisdiction. To the extent that Dr. Wagner’s response to the motion to dismiss seeks to add a RICO claim, it is denied, but his motion to amend the complaint is granted.

I.

Richard Wagner is a licensed, board-certified psychiatrist with offices in Bar-rington, Illinois. Dr. Wagner also has staff privileges at Good Shepherd Hospital in Barrington, which require him to periodically be “on-call” for the hospital’s emergency room. Magellan Health Services, Inc., (“Magellan”), is a managed care organization and a Delaware corporation with its principal place of business in Columbia, Maryland. Defendants Pengall, Gerstein, Sullivan, Wirthman, Pope, and Roberts are current or former employees of Magellan.

The events giving rise to this complaint began on January 20,1998, when Dr. Wagner — who is not a Magellan network provider — was the on-call psychiatrist for the emergency room of Good Shepherd Hospital. On that night, a patient arrived by ambulance in severe emotional distress. The patient’s primary care physician came to the hospital, and after he and Dr. Wagner conferred, Dr. Wagner admitted the patient, who had out-of-network benefits with Magellan. Thereafter, Magellan conducted an internal review of the case and decided not to certify the patient’s hospital stay for payment. Nonetheless, Dr. Wagner refused to discharge the patient, believing it was in the patient’s best interest to remain hospitalized. Magellan contacted Good Shepherd’s Director of Psychiatry *678 to ask about Dr. Wagner and threatened to pull its contract with Good Shepherd because of the incident. During the patient’s hospital stay, Magellan sent a letter to the patient via courier indicating that it would not authorize payment for the hospital stay; simultaneously, it sent a letter to the unit clerk at Good Shepherd indicating that the patient may “require support” upon reading the letter denying HMO benefit coverage. In response, Dr. Wagner spoke with defendant Sullivan, Magellan’s regional medical director, about the treatment of his patient. Sullivan told Dr. Wagner he would discuss the situation with Magellan’s CEO and renewed the threat of possible cancellation of Good Shepherd’s contract with Magellan.

On November 4, 1998, another emergency psychiatric patient arrived at Good Shepherd when Dr. Wagner was on call. When a Good Shepherd social worker contacted defendant Pehnall at Magellan regarding the patient’s insurance coverage, she was told that the patient could be treated by “anyone but Dr. Wagner.” Magellan instructed the social worker to transfer the patient to another hospital despite the fact that medical stability was not established. Dr. Wagner informed the Magellan employee and defendant Cull that Magellan’s attempt to transfer the patient without the attending physician’s authorization was unethical and against the hospital’s by-laws. The incident was basically repeated the next day, but Good Shepherd decided that the incoming patient would be seen by a physician other than Dr. Wagner. Another incident occurred on November 23, 1998, and Good Shepherd’s medical director, Dr. Jacobs, was forced to intervene and confirm that a patient cannot be moved without following proper hospital procedures and COBRA statutes. On December 15, 1998, Dr. Wagner met with Dr. Jacobs, who told him that Magellan attempted to get Good Shepherd to deflect patients away from him and have him bypassed in the normal emergency room rotation, but the hospital refused Magellan’s request. On October 14, 1999, a Magellan case was admitted to the psychiatric unit and defendant Pope of Magellan told the social worker that “I don’t think the patient can see Dr. Wagner, we’ve had a lot of problems with Dr. Wagner.” Dr. Wagner filed this action on December 17,1999.

II.

Federal Rule of Civil Procedure 12(c) permits a party to move for judgment after the parties have filed the complaint and answer. When considering a motion for judgment on the pleadings, I regard all well-pleaded facts as true, view them in- the light most favorable to the plaintiff, and draw all reasonable inferences in favor of the plaintiff. Hentosh v. Herman M. Finch Univ. of Health Sciences/The Chicago Medical School, 167 F.3d 1170, 1173 (7th Cir.1999); Frey v. Bank One, 91 F.3d 45, 46 (7th Cir.1996) (standard is the same as Fed.R.Civ.P. 12(b)). I grant judgment on the pleadings only when it appears beyond doubt that the plaintiff cannot prove any facts that would support his claim for relief. Forseth v. Village of Sussex, 199 F.3d 363, 368 (7th Cir.2000). The complaint need only “narrate a claim,” and need not depend on a particular theory of recovery. Id. at 367. Indeed, “a plaintiff may supplement the complaint with factual narration in an affidavit or brief. If the extra assertions make out a claim, then the complaint stands.” Albiero v. City of Kankakee, 122 F.3d 417, 419 (7th Cir.1997) (citation omitted).

III. Antitrust Claims

Dr. Wagner alleges that the defendants have conspired in an illegal boycott (Count I) and unreasonable restraint of trade (Count II) in violation of § 1 by preventing him from providing emergency psychiatric medical care at Good Shepherd to patients with Magellan insurance coverage. In Count III, Dr. Wagner alleges that the defendants have conspired to monopolize *679 the Barrington area market for emergency psychiatric services. The basis of Dr. Wagner’s antitrust claims is that in retaliation for his refusal to accede to Magellan’s wishes regarding patient care, Magellan has coerced or attempted to coerce various hospital personnel to refer his patients to other doctors or hospitals and to have him removed from the on-call rotation by threatening the loss of the hospital’s contract with Magellan. These actions have harmed his ability to compete for emergency psychiatric patients, and he has suffered a corresponding loss of income from these patients who otherwise would have been in his care.

The defendants move for judgment on the pleadings claiming Dr.

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Bluebook (online)
121 F. Supp. 2d 673, 2000 U.S. Dist. LEXIS 8729, 2000 WL 804692, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wagner-v-magellan-health-services-inc-ilnd-2000.