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Whitcher v. Meritain Health

June 22, 2009


The opinion of the court was delivered by: J. Phil Gilbert United States District Court Judge


This matter comes before the Court on the motions to dismiss filed by defendants Meritain Health, Inc. ("Meritain") (Doc. 16) and Protestant Memorial Medical Center ("Memorial") (Doc. 17). Plaintiff Cynthia Whitcher has responded to the motions (Docs. 32 & 33), and the defendants have jointly replied to those responses (Doc. 34).

I. Standard for Dismissal

The defendants seek dismissal under Federal Rule of Civil Procedure 12(b)(6). When reviewing a Rule 12(b)(6) motion to dismiss, the Court accepts as true all allegations in the complaint. Erickson v. Pardus, 127 S.Ct. 2197, 2200 (2007) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). To avoid dismissal under Rule 12(b)(6) for failure to state a claim, a complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). In Bell Atlantic, the Supreme Court held that this requirement is satisfied if the complaint (1) describes the claim in sufficient detail to give the defendant fair notice of what the claim is and the grounds upon which it rests and (2) plausibly suggests that the plaintiff has a right to relief above a speculative level. Bell Atl., 550 U.S. at 555; see EEOC v. Concentra Health Servs., 496 F.3d 773, 776 (7th Cir. 2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (citing Bell Atl., 550 U.S. at 556).

Nevertheless, Bell Atlantic did not do away with the liberal federal notice pleading standard. Airborne Beepers & Video, Inc. v. AT&T Mobility LLC, 499 F.3d 663, 667 (7th Cir. 2007). A complaint still need not contain detailed factual allegations, Bell Atl., 550 U.S. at 555, and it remains true that "[a]ny district judge (for that matter, any defendant) tempted to write 'this complaint is deficient because it does not contain . . .' should stop and think: What rule of law requires a complaint to contain that allegation?" Doe v. Smith, 429 F.3d 706, 708 (7th Cir. 2005) (emphasis in original). Nevertheless, a complaint must contain "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl., 550 U.S. at 555. If the factual detail of a complaint is "so that the complaint does not provide the type of notice of the claim to which the defendant is entitled under Rule 8," it is subject to dismissal. Airborne Beepers, 499 F.3d at 667.

II. Facts Alleged

Accepting all the complaint's allegations as true, the Court finds the following essential facts for the purposes of the pending motions.

At all relevant times, plaintiff Whitcher was employed by defendant Memorial and was covered by the Protestant Memorial Medical Center, Inc. Employee Healthcare Plan ("Plan"), an employee welfare plan governed by the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001, et seq. The Plan explicitly identifies Memorial as the plan administrator, Plan § 1.66, and provides that it will select another entity as the claims administrator, Plan § 1.14. It has selected Meritain. The Plan also includes an administrative appeals process by which a participant can appeal an adverse claim decision. Plan § 9.6.

Whitcher has suffered from morbid obesity and related disorders since at least March 1995. She tried various methods of weight reduction, but when none of her efforts produced the magnitude of weight loss desired, her doctor recommended she have bariatric surgery ("the Procedure"). She sought pre-certification under the Plan, but Meritain declined to pre-certify the Procedure on the grounds that she had not provided documentation that she had participated in a physician-monitored weight loss program. They encouraged her to provide such documentation or, if none existed, to participate in a physician-monitored weight loss program for six months, then submit the requested documentation so pre-certification could be reconsidered. Whitcher did not submit the requested documentation and underwent the Procedure despite the lack of pre-certification. In doing so, she accrued medical bills of approximately $27,725.

After the Procedure, Whitcher submitted a claim for those bills, and Meritain processed the claim and determined it should not be paid. Its determination was based on the fact that Whitcher had not submitted her claim first to the appropriate preferred provider organization ("PPO") as the Plan requires and that Whitcher did not submit the claim in the standard billing format. Meritain indicated that if Whitcher submitted her claims to the appropriate PPO first and in the appropriate format, it would reconsider her claim. Meritain also restated Whitcher's right to appeal the denial decision within 60 days of receiving notice of it. Memorial informed Whitcher's counsel of the denial of the claim and provided counsel a copy of Meritain's letter including the rationale for denial and the right to an administrative appeal.*fn1

Whitcher filed this lawsuit in the Circuit Court for the Twentieth Judicial Circuit in St. Clair County, Illinois, against Meritain and Memorial. In Count I she alleges Meritain improperly denied her benefits under ERISA. In Count II against Meritain and Memorial, she seeks a declaration that she is entitled to payment of her medical expenses under the Plan. In Count III she alleges Memorial breached its contract to provide her with certain medical benefits. The defendants removed the case to federal court.

III. Meritain's Motion to Dismiss (Doc. 16)

Meritain seeks to dismiss Counts I and II on the grounds that Whitcher did not exhaust her administrative remedies under the Plan before filing suit and that it is not a proper defendant under ERISA. Meritain also seeks to dismiss Count II on the grounds that it is not pled with sufficient specificity and that it is duplicative of Whitcher's claim for benefits in Count I. The Court first turns to the question of whether Meritain is a proper defendant in this case, for if Meritain is not a proper defendant, whether Whitcher has otherwise properly pled her case is of no moment.

In Counts I and II, Whitcher seeks "to recover benefits due to [her] under the terms of [her] plan, to enforce [her] rights under the terms of the plan, or to clarify [her] rights to future benefits under the terms of the plan" pursuant to § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). Meritain is not a proper defendant in such causes of action. Such claims must generally be brought against the Plan itself, not the employer sponsor of the plan or the claims administrator. See Blickenstaff v. R.R. Donnelley & Sons Co. Short Term Disability Plan, 378 F.3d 669, 674 (7th Cir. 2004) (citing Neuma, Inc. v. AMP, Inc., 259 F.3d 864, 872 n. 4 (7th Cir. 2001); Jass v. Prudential Health Care Plan, 88 F.3d 1482, 1490 (7th Cir. 1996)). There is an exception to this general rule where the plan and the employer are closely intertwined and the employer serves as the plan administrator, in which case the court may also allow suits to recover benefits to proceed against the employer. Mein v. Carus Corp., 241 F.3d 581, 584-85 (7th Cir. 2001); Riordan v. Commonwealth Edison Co., 128 F.3d 549, 551 (7th Cir. 1997), see Neuma, 249 at 872 n. 4. However, because ...

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