Justia Insurance Law Opinion Summaries

Plaintiff appealed the district court’s order affirming the Social Security Administration’s (“SSA”) denial of her application for Social Security Disability Insurance (“SSDI”). In her application, she alleged major depressive disorder (“MDD”), anxiety disorder, and attention deficit disorder (“ADHD”). Following a formal hearing, the Administrative Law Judge (“ALJ”) determined that Plaintiff suffered from severe depression with suicidal ideations, anxiety features and ADHD, but he nonetheless denied her claim based on his finding that she could perform other simple, routine jobs and was, therefore, not disabled. Plaintiff contends that the ALJ erred by (1) according to only little weight to the opinion of her long-time treating psychiatrist (“Dr. B”) and (2) disregarding her subjective complaints based on their alleged inconsistency with the objective medical evidence in the record.   The Fourth Circuit reversed and remanded with instructions to grant disability benefits. The court agreed with Plaintiff that the ALJ failed to sufficiently consider the requisite factors and record evidence by extending little weight to Dr. B’s opinion. The ALJ also erred by improperly disregarding Plaintiff’s subjective statements. Finally, the court found that the ALJ’s analysis did not account for the unique nature of the relevant mental health impairments, specifically chronic depression. The court explained that because substantial evidence in the record clearly establishes Plaintiff’s disability, remanding for a rehearing would only “delay justice.” View "Shelley C. v. Commissioner of Social Security Administration" on Justia Law

The 2010 ACA (Patient Protection and Affordable Care Act; Health Care and Education Reconciliation Act) created a three-year Risk Corridors program with the creation of new health-insurance marketplaces, which presented uncertain risks for participating health-insurance companies. Qualified health-plan issuers (QHP issuers) that offered their products in the new marketplaces were entitled to payments from HHS if they suffered sufficient losses, 42 U.S.C. 18062(b).The government failed to make those payments. QHP issuers sued under the Tucker Act, 28 U.S.C. 1491(a)(1). In two such lawsuits, the Quinn law firm was lead counsel for classes of QHP issuers seeking payments. In the opt-in notices sent to potential class members with court approval, Quinn represented that it would seek attorney’s fees out of any recovery, that it would seek no more than 5% of any judgment or settlement, and that the Claims Court would determine the exact amount by considering how many issuers participated, the amount at issue, and a “lodestar cross-check” (based on hours actually worked). Meanwhile, the Supreme Court, in other cases, held that QHP issuers were entitled to collect ACA-promised payments.The Claims Court entered judgments in favor of the classes, totaling about $3.7 billion, then awarded Quinn 5% of the common funds, rejecting objections. The total fee was about $185 million. The Federal Circuit vacated. The Claims Court’s analysis was inconsistent with the class opt-in notices and did not adequately justify the extraordinarily high award. View "Health Republic Insurance Co. v. United States" on Justia Law

Van Dermark served in the Navy from 1963 until his 1976 honorable discharge. The VA found Van Dermark to be totally and permanently disabled due to service-connected injuries. Van Dermark received treatment in Thailand (where he lived) at non-VA facilities, from physicians and others not affiliated with VA, in 2016 and in 2018, both times for cardiac conditions not related to his service-connected disability. For each of the two instances of treatment abroad, Van Dermark filed a claim with VA under 38 U.S.C 1728 and 1725 seeking VA payment—to him or his medical creditors—for the surgical or other heart-related treatment he received abroad.VA Community Care denied both claims. The Board of Veterans’ Appeals maintained the denials. The Veterans Court and Federal Circuit affirmed. Section 1724(a) prohibits the VA from “furnish[ing] hospital . . . care or medical services” abroad, where the care or services are unrelated to the service-connected disability. The “furnishing” phrase encompasses the payment for a veteran’s hospital care or medical expenses abroad at issue here; sections 1728 and 1725 do not override that prohibition. View "Van Dermark v. McDonough" on Justia Law

This case arose out of a qui tam action against Prime Healthcare Services—Encino Hospital, LLC (Encino Hospital) and others to impose civil penalties for violation of the Insurance Fraud Prevention Act (IFPA), Insurance Code section 1871 et seq. The State of California and relator (Plaintiffs) appealed from a judgment entered after a bench trial in which the court found insufficient evidence to support their allegations that Defendants engaged in insurance fraud by billing insurers for services performed in a detox center for which they had no appropriate license, and by employing a referral agency to steer patients to the center.   The Second Appellate District affirmed the judgment. The court explained that, CDI alleged that Encino Hospital misrepresented to insurers that it was properly licensed to provide detox services when it was not. The trial court found no evidence suggesting that Defendants presented a false claim to any insurer. The court agreed, reasoning that no authority of which it is aware or to which it has been directed obligates Encino Hospital to hold any license other than its license as a general acute care hospital. Because Encino Hospital needed no separate license or approval, and no evidence showed it concealed any provider, the CDI’s cause of action for false claims failed for lack of a predicate. View "State of Cal. v. Encino Hospital Medical Center" on Justia Law

Plaintiff Lancaster Hospital Corporation (Lancaster) operates an inpatient rehabilitation facility that provides services for Medicare beneficiaries. The Department of Health and Human Services (HHS) denied Plaintiff’s request for reimbursement because the provider failed to submit information in a form that could be audited. The district court granted summary judgment to HHS.   The Fourth Circuit affirmed. The court explained that Lancaster asserts that—even if some reductions were warranted—the Board erred by denying its entire 1997 reimbursement request. There appears no doubt Lancaster provided services to Medicare beneficiaries in 1997, and denying all reimbursement for that year may seem harsh. But the principle that people “must turn square corners when they deal with the Government” “has its greatest force when a private party seeks to spend the Government’s money.” However, the court explained that under Heckler v. Community Health Servs. of Crawford Cnty., Inc., “As a participant in the Medicare program,” Lancaster “had a duty to familiarize itself with the legal requirements for cost reimbursement,” including the need to provide cost data in a form “capable of being audited.” Thus, the Board’s decision to deny reimbursement for the fiscal year 1997 was neither arbitrary nor capricious and was supported by substantial evidence. View "Lancaster Hospital Corporation v. Xavier Becerra" on Justia Law

Lawsuits brought by governmental bodies and health clinics alleged that Quest, a wholesale pharmaceutical distributor, engaged in misconduct that contributed to a nationwide epidemic of opioid abuse. The plaintiffs plead violations of the RICO Act and state statutes, common law public nuisance, and negligence, seeking damages for “significant expenses for police, emergency, health, prosecution, corrections, rehabilitation, and other services.” Some complaints clarify that the claims “are not based upon or derivative of the rights of others” and that the plaintiffs “do not seek damages for death, physical injury to person, emotional distress, or physical damages to property[.]”Quest's insurance policies covered "damages because of 'bodily injury' or 'property damage'" and explain that “[d]amages because of ‘bodily injury’ include damages claimed by any person or organization for care, loss of services or death resulting at any time from the ‘bodily injury.’” “Bodily injury” is defined as “bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time.”The insurers sought declaratory judgments that they had no duty to defend or indemnify Quest. The district court granted the insurers summary judgment. The Sixth Circuit affirmed. Based on the plain language of the policies and their overall context and purpose, the court concluded that the Kentucky Supreme Court would find that the insurers have no duty to defend because the lawsuits do not seek damages “because of bodily injury” and claim only economic damages. View "Westfield National Insurance Co. v. Quest Pharmaceuticals, Inc." on Justia Law

The Supreme Court held that the Texas Insurance Code does not authorize a private cause of action by a physician against an insurer for payment of claims that accrued prior to 2020 and that Plaintiffs' claims for recovery in quantum merit and for unfair settlement practices failed as a matter of law.In each of the consolidated cases before the Supreme Court, Plaintiffs, groups of emergency medicine doctors outside of an insurer's provider network, brought suit against Defendant, the insurer, alleging that it did not pay them at the usual and customary rates for treating its insureds. Defendant moved for dismissal under Fed. R. Civ. P. 12(b)(6) for failure to state a claim. The district court granted the motion with respect to Plaintiff's implied contract and quantum merit claims and with respect to claims brought under the Emergency Care Statutes. On appeal, the court of appeals certified a question to the Supreme Court. The Supreme Court held (1) the Insurance Code does not create a private cause of action for claims under the Emergency Care Statutes; and (2) with respect to one case, the lower courts did not err in dismissing Plaintiffs' quantum merit and unfair settlement practices claims. View "Texas Medicine Resources, LLP v. Molina Healthcare of Texas, Inc." on Justia Law

This consolidated matter arose from a class action for damages filed by Louisiana health care providers for alleged violations of the Preferred Provider Organizations (“PPO”) statute. La. R.S. 40:2201, et seq. The Louisiana Supreme Court granted writs to interpret the statute and to determine whether defendant, Stratacare, Inc. (“Stratacare”), was a “group purchaser” subject to penalties for violating the mandatory notice provision of the statute. After a review of the record and the law, the Supreme Court concluded that Stratacare was not a group purchaser as contemplated by the statute. Therefore, the Court reversed the court of appeal, vacated the lower court judgments, and dismissed the case. View "Williams, et al. v. Bestcomp, Inc. et al." on Justia Law

The Supreme Court affirmed the order of the circuit court granting summary judgment in favor of Municipal Health Benefit Fund and dismissing this class action complaint challenging the Fund's decision to deny payment for portions of Plaintiff's daughter's medical bills based on its interpretation of the uniform, customary, and reasonable charges (UCR) exclusion in the Fund's policy booklet, holding that there was no error.Through his employment with a municipal police department, Plaintiff obtained health benefits coverage through the Fund. After Plaintiff's daughter was injured in a car accident the Fund denied payment for portions of her medical bills based on its interpretation of the UCR exclusion. Plaintiff then brought this class action against the Fund challenging the enforcement of the UCR term. The circuit court granted class certification and later granted summary judgment in favor of the Fund. The Supreme Court affirmed, holding that the circuit court did not err in granting summary judgment in favor of the Fund. View "Hendrix v. Municipal Health Benefit Fund" on Justia Law

Blue Cross Blue Shield of Vermont (Blue Cross) appealed the Green Mountain Care Board’s (GMCB) decision modifying its proposed health-insurance rates for 2022. The GMCB approved Blue Cross’s proposed rates with several exceptions, one of which was relevant here: its contribution to reserves (CTR). Blue Cross had sought a base CTR rate of 1.5%, but the GMCB ordered Blue Cross to lower it to 1.0%, thereby diminishing overall insurance rates by 0.5% and reducing health-insurance premiums. The GMCB found that a 1.5% base CTR was “excessive” because Blue Cross was expected to be above its target Risk Based Capital (RBC) range by the end of 2021, “individuals and small businesses are still struggling financially after a year-long economic slowdown,” and a 1.0% CTR would allow its “reserves to sit comfortably within the company’s RBC target range.” Blue Cross moved for reconsideration, arguing that the term “excessive” was strictly actuarial in nature, and that the GMCB misconstrued it by weighing non-actuarial evidence— testimony concerning affordability—as part of its examination of whether the proposed rate was excessive. On appeal to the Vermont Supreme Court, Blue Cross raised essentially the same issue. Because none of the actuarial experts who testified concluded that Blue Cross’s proposed CTR was excessive, Blue Cross argued, the GMCB could not properly conclude that it was. Blue Cross conceded that health-insurance rates for 2022 could not now be changed, but it urged the Supreme Court to rule on the merits, arguing that this matter was not moot because the CTR rate for this year will disadvantage Blue Cross in future rate-review proceedings. The Supreme Court determined Blue Cross did not demonstrate that this kind of case was capable of repetition yet evading review or subjected it to continuing negative collateral consequences. Therefore, Blue Cross failed to meet the exceptional thresholds necessary for the Court to reach the merits in a moot case. View "In re Blue Cross and Blue Shield 2022 Individual & Small Group Market Filing" on Justia Law