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SURGICORE, INC. v. TRUSTMARK INSURANCE COMPANY

January 15, 2004.

SURGICORE, INC., Plaintiff, v., TRUSTMARK INSURANCE COMPANY, Defendant


The opinion of the court was delivered by: JOHN W. DARRAH, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff, Surgicore, Inc., filed suit against Defendant, Trustmark Insurance Company, for outpatient surgical facility charges related to five different insureds pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1132 et seq. The parties have submitted an agreed statement of uncontested facts and trial briefs. Trustmark also filed a response to Surgicore's trial brief. Surgicore failed to file a response to Trustmark's trial brief. Presently before the Court is a ruling on Surgicore's claims.

BACKGROUND

  Surgicore operates an outpatient surgical facility in Chicago, Illinois. Trustmark is an Illinois corporation authorized by the Illinois Department of Insurance to issue group health insurance policies to employees in the State of Illinois. Each of the insurance policies applicable to the instant case grants Trustmark discretionary authority to make claims determinations. Peer Review Network ("Peer Review") is a healthcare utilization review organization that is not affiliated with Trustmark.

  Adam Gonzales was insured by Trustmark through his employer's group health insurance. Trustmark received an insurance claim from Surgicore for $6,960.96 in charges for services rendered to Gonzales. The charges billed by Surgicore were for the "excision of toe nail and nail matrix Page 2 partial or complete and application of xenograft, skin." Gonzales assigned the right to receive payment for the services provided by Surgicore under the insurance policy to Surgicore.

  On May 21, 2001, Surgicore's claim was referred to the Special Investigation Unit ("SIU"). Surgicore's claim was subsequently referred to the Peer Review. At Peer Review, a board-certified Doctor of Podiatric Medicine in private practice and Peer Review's Reimbursement Division ("Reviewing Board") reviewed Surgicore's claim for Gonzales. The claim was re-referred to Peer Review on July 11, 2001, with a second page of the operative report that had not been previously provided.

  Peer Review provided a report in which the Reviewing Board found that the procedures performed were not included on the acceptable list of procedures to be performed within an Ambulatory Surgery Center ("ASC") or a Freestanding Outpatient Center ("FOC"). The Reviewing Board determined that the subject procedures are routinely performed in a provider's office and require a "clean room" only, not an operating suite. The Reviewing Board found that the itemized list of services, drugs, and supplies contained unusual amounts of items which would not have been appropriate. The Reviewing Board recommended that $262.05 be allowed for the procedures performed.

  Trustmark advised Surgicore of its determination that the appropriate charges for the services rendered to Gonzales should not exceed $262.05 and that some of the charges on the bill fell outside reasonable and appropriate parameters. Trustmark paid Surgicore $209.64 for the services rendered to Gonzales. Surgicore appealed Trustmark's claim decision; the appeal was denied. Trustmark advised Surgicore that after further review of the charges, it determined that the procedures Page 3 performed did not require the use of an ASC and that the procedures could be performed effectively and safely in the provider's office.

  Sonya Poston was insured by Trustmark through her employer's group health insurance. Trustmark received a claim from Surgicore for $9,262.35 in charges for services rendered to Poston. Poston assigned the right to receive payment far the services provided by Surgicore under the insurance policy to Surgicore.

  On September 7, 2001, Surgicore's claim for Poston" was referred to the SIU. The claim was referred to Peer Review on October 4, 2001. The Reviewing Board found that Poston presented "first metatarsal osteotomy with internal fixation, right foot, under MAC anesthesia." The Reviewing Board found that the reasonable and customary charges for the services provided by Surgicore totaled $1,687.55. Based on the Peer Review recommendation, Trustmark denied Surgicore's charges beyond $1,687.55 on the basis that they were not reasonable and customary.

  Trustmark paid Surgicore $1,671.52, and Surgicore appealed Trustmark's decision. Trustmark denied the appeal. Surgicore filed an additional appeal. The second appeal was denied based on the lack of any additional information from what was originally reviewed in the original determination.

  Rocio Morgado was insured by Trustmark through his employer's group health insurance. Trustmark received a claim from Surgicore for $9,335.22 in charges for services rendered to Morgado. Morgado assigned the right to receive payment for the services provided by Surgicore under the insurance policy to Surgicore.

  On June 18, 2001, Surgicore's claim for Morgado was referred to the SIU. The claim was referred to Peer Review on July 19, 2001. The Reviewing Board found that Morgado was diagnosed Page 4 with "loose body left ankle, hypertrophic synovitis left ankle." The Reviewing Board recommended that $1,436.27 be allowed for the procedures performed on Morgado. The Reviewing Board found that there were several items listed on the itemized bill which were not documented as used in the operative report and which, in their opinion, would be unlikely to be used for the procedure. The Reviewing Board also found that some of the charges that were listed were unreasonable. Based on the Peer Review recommendation, Trustmark denied Surgicore's charges beyond $1,436.27.

  After reducing monies for co-insurance, Trustmark paid Surgicore $728.48 for the services provided to Morgado. Surgicore appealed Trustmark's ...


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