14‐3455
Henry L. Rojas, M.D., et al. v. Cigna Health and Life Insurance Company and Connecticut General Life Insurance Company
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
______________
August Term, 2014
(Argued: June 1, 2015 Decided: July 15, 2015)
Docket No. 14‐3455
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HENRY L. ROJAS, M.D., MITCHELL K. ROSEN, M.D., H & L ROJAS, M.D.,
P.C., DBA ROJAS AND ROSEN M.D.,
Plaintiffs‐Counter‐Defendants‐Appellants,
–v.–
CIGNA HEALTH AND LIFE INSURANCE COMPANY, CONNECTICUT
GENERAL LIFE INSURANCE COMPANY,
Defendants‐Counter‐Claimants‐Appellees.*
______________
Before:
WESLEY AND LOHIER, Circuit Judges.†
* The Clerk of the Court is directed to amend the caption of this case as set forth above.
† The Honorable Peter W. Hall, Judge of the United States Court of Appeals for the
Second Circuit, originally a member of the panel, recused himself after oral argument.
The appeal is being disposed of by the remaining members of the panel, who are in
agreement. See Second Circuit Local Rule § 0.14(b); Murray v. Nat’l Broad. Co., 35 F.3d
45, 47, 48 (2d Cir. 1994).
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Appeal from the United States District Court for the Southern District of
New York (Karas, J.). Plaintiffs, two physicians and the practice they co‐own,
brought an action under Section 502 of the Employee Retirement Income Security
Act of 1974 to enjoin Defendant health insurance company from removing
Plaintiffs from its coverage network. After Plaintiffs moved for a preliminary
injunction and a temporary restraining order, the district court dismissed the
case for lack of standing. The district court determined that healthcare providers
are not beneficiaries of coverage plans in this context notwithstanding a right to
reimbursement for their services. For the reasons that follow, we AFFIRM the
district court’s judgment.
RICHARD J. QUADRINO (Eugene S. R. Pagano, Harold
J. Levy, on the brief), Quadrino Law Group, P.C.,
Melville, NY, for Plaintiffs‐Counter‐Defendants‐Appellants.
ANDREW LEVCHUK (Jodi Kim Miller, on the brief),
Bulkley, Richardson and Gelinas, LLP, Springfield, MA,
for Defendants‐Counter‐Claimants‐Appellees.
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WESLEY, Circuit Judge:
The issue in this appeal is whether doctors, as healthcare providers, are
beneficiaries of their patients’ health‐insurance plans such that they have
standing to seek relief under Section 502 of the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. § 1132(a)(1)(B). Under the
circumstances of this case, they are not.
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BACKGROUND
Henry L. Rojas and Mitchell K. Rosen are physicians licensed in the State
of New York and are co‐owners of H & L Rojas, M.D., P.C. (collectively, “Rojas”).
Rojas is an in‐network healthcare provider with Cigna Health and Life Insurance
Company and Connecticut General Life Insurance Company (collectively,
“Cigna”). Cigna insureds use Cigna’s coverage to pay their bills when they
receive medical services from Rojas; in exchange, Rojas accepts reduced
reimbursement rates.
Cigna’s Benefit Plan covering its insureds states that “All Medical Benefits
are payable to you [the patient]. However, at the option of [Cigna], all or any
part of them may be paid directly to the person or institution on whose charge
[the] claim is based. . . . When benefits are paid to you or your Dependent, you or
your Dependent is responsible for reimbursing the Provider.” J.A. 81.1
Rojas’s Cigna‐insured patients assign to Rojas their right to collect
payment for medical services directly from Cigna. According to the Complaint,
the form signed by Rojas’s patients states, in relevant part, as follows:
1 The Benefit Plan uses the terms “benefit” and “payment” interchangeably. For
example, the Benefit Plan has a provision for payment that covers the event “[i]f [a
patient] die[s] while any of these benefits remain unpaid.” J.A. 81.
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Assignment and Release: I, the undersigned, have insurance
coverage with ______________________ and assign directly to Rojas
and Rosen, MD, PC all medical benefits, if any, otherwise payable to
me for services rendered. I understand that I am financially
responsible for all charges, including those related to physical
examinations, whether or not paid by insurance.
J.A. 14. Cigna regularly investigates its in‐network physicians regarding
reimbursement claims that may be inconsistent with Cigna’s coverage regarding
medical necessity. After an investigation involving Rojas and other practices,
Cigna suspected that Rojas was ordering blood tests to measure allergies, instead
of skin tests as typically required by Cigna’s coverage. Cigna also “noted the
frequency by which Dr. Rose[n] and Dr. Rojas submitted claims for blood tests
for suspected allergies for each patient.” J.A. 223. Rojas billed a blood panel test
“repetitively for the same patient over a sustained period of time,” which is
inconsistent with normal allergy testing practice. J.A. 224.
Cigna expressed its concerns about the allergy tests in a letter from its
national medical director for fraud and abuse; that letter initiated a letter
exchange between Rojas and Cigna regarding the medical necessity of the allergy
tests. Cigna determined that it had overpaid Rojas in the amount of $844,334.52
for allergy tests for about 150 patients and requested that Rojas return the full
amount “for the claims paid in error.” J.A. 130. That is when the lawyers got
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involved. Rojas’s attorney objected to Cigna’s demand. Cigna’s attorney offered
to arbitrate the dispute under the parties’ provider agreement, but Rojas rejected
the offer. Cigna’s counsel then notified Rojas that Cigna would terminate Rojas
as a healthcare provider in its network.
Rojas filed suit in the United States District Court for the Southern District
of New York (Kenneth M. Karas, Judge) seeking, among other things, an
injunction “prohibiting all retaliatory acts against [Rojas] including [the]
termination of the provider agreements.” J.A. 31. Rojas contended that Cigna
had violated the anti‐retaliation provision of ERISA, which makes it unlawful for
“any person to . . . discriminate against a participant or beneficiary for exercising
any right to which he is entitled under the provisions of an employee benefit
plan.” 29 U.S.C. § 1140. Rojas’s claim was for reinstatement as a provider, not
for payment under the Benefit Plan. Rojas moved for a temporary restraining
order and preliminary injunction to prohibit Cigna from terminating Rojas from
its provider network. The district court denied Rojas’s motion for a preliminary
injunction, finding that Rojas lacked standing to bring an ERISA action. The
district court noted that, under ERISA, a civil anti‐retaliation action may be
brought only by a “participant, beneficiary, or fiduciary” of an ERISA plan, see
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Spec. App. 77 (quoting 29 U.S.C. § 1132(a)(3)); the court found that Rojas was not
a plan “beneficiary” under ERISA. The court held that “Healthcare providers,
such as Plaintiffs . . . don’t become beneficiaries solely by virtue of receiving
reimbursement from a plan administrator, such as Cigna.” Spec. App. 78. The
district court also determined that while Rojas claimed to have taken
assignments of the rights of plan participants, the language of the assignments
was limited to receiving reimbursements, and did not convey the right to assert
ERISA anti‐retaliation claims.
DISCUSSION
We review “statutory standing de novo, provided the statutory standing
questions are of a legal nature.” Kendall v. Emps. Ret. Plan of Avon Prods., 561 F.3d
112, 118 (2d Cir. 2009).
Section 502(a)(1)(B) of ERISA, codified in Title 29 of the United States
Code, provides a federal cause of action for civil claims aimed at enforcing the
provisions of an ERISA plan. See 29 U.S.C. § 1132. ERISA enumerates “[p]ersons
empowered to bring a civil action . . . to recover benefits due to him under the
terms of his plan, to enforce his rights under the terms of the plan, or to clarify
his rights to future benefits under the terms of the plan.” Id. § 1132(a)(1)(B). As
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relevant here, Section 502 is narrowly construed to authorize only two categories
of persons to sue directly to enforce their rights under the plan: participants and
beneficiaries. Id. § 1132(a)(1); see Franchise Tax Bd. of the State of Cal. v. Constr.
Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27 (1983); see also Chemung Canal
Trust Co. v. Sovran Bank/Md., 939 F.2d 12, 14 (2d Cir. 1991) (“[I]n the absence of
some indication of legislative intent to grant additional parties standing to sue,
the list in § 502 should be viewed as exclusive.”).2 ERISA defines “participant” as
“any employee or former employee of an employer, or any member or former
member of an employee organization,” 29 U.S.C. § 1002(7), see also Firestone Tire
& Rubber Co. v. Bruch, 489 U.S. 101, 117 (1989), and “beneficiary” as “a person
designated by a participant, or by the terms of an employee benefit plan, who is
or may become entitled to a benefit thereunder,” 29 U.S.C. § 1002(8).
Rojas argues that it has standing. Rojas contends that because it is entitled
to reimbursement from Cigna—a literal “benefit”—it is a “beneficiary” entitled
to bring claims under Section 502. Rojas claims that its entitlement to receive
“benefits” under the Plan is premised on two theories. One, Rojas presses that it
2 Other subsections of the statute create causes of action for plan fiduciaries, the
Secretary of Labor, and other parties, see 29 U.S.C. §§ 1132(a)(2)–(11), but those are not
at issue in this appeal.
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is a “plan‐designated beneficiary” by virtue of how the Benefit Plan structures
payment. Appellants’ Br. 36. Rojas points to a section of the Benefit Plan that
provides that Cigna may pay Rojas directly for reimbursement for covered
services. Thus, Rojas contends, it is a beneficiary under the terms of the Benefit
Plan. In the alternative, Rojas argues that it is a “participant‐designated
beneficiary” because its patients assigned to Rojas their right to payment.
Appellants’ Br. 36–43. Under both theories, Rojas equates beneficiary status as
understood under the statute with the right to receive a “benefit” provided by
the healthcare plan. Rojas draws no distinction between its patients’ right to
have their medical bills paid by Cigna and its right to receive those payments.
Neither of these bases for standing is persuasive.
The core of Rojas’s claim is that it wants to be reinstated as a Cigna
participating provider.3 Rojas has sued under the wrong agreement.4 Approved
provider status in Cigna’s network is a function of Rojas’s provider contract with
Cigna. When we pointed this out to its counsel at oral argument, Rojas
Since Rojas has pinned its hopes on the Benefit Plan and ERISA we have no occasion to
3
pass on the provider agreement.
ERISA’s anti‐retaliation provision gives participants and beneficiaries a right to sue
4
when their health plan “discharge[s], fine[s], suspend[s], expel[s], discipline[s], or
discriminate[s] against [them] for exercising any right to which [they are] entitled.” 29
U.S.C. § 1140.
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continued to press the claim that it is a beneficiary under ERISA and can sue
under the Benefit Plan.5 So be it. The district court wisely rejected this argument
and found that Rojas is not a beneficiary as defined by ERISA and that its rights,
if any, are limited by the assignments made by its patients.
“Beneficiary,” as it is used in ERISA, does not without more encompass
healthcare providers. Although the term “benefit” is not defined in ERISA, we
are persuaded that Congress did not intend to include doctors in the category of
“beneficiaries.” Benefits to which a beneficiary is entitled are bargained‐for
goods, such as “medical, surgical, or hospital care,” Kolasinski v. Cigna Healthplan
of CT, Inc., 163 F.3d 148, 149 n.1 (2d Cir. 1998) (quoting 29 U.S.C. § 1002(1)(A)),
rather than a right to payment for medical services rendered. A beneficiary is
best understood as an individual who enjoys rights equal to the participant’s to
receive coverage from the healthcare plan. A participant’s spouse or child is the
5 We surmise that Rojas sued under ERISA to make use of the shorter time period in
which Cigna could protest a claim made by a beneficiary, see 29 C.F.R. § 2560.503‐
1(f)(2)(iii)(B) (“In the case of a post‐service claim, the plan administrator shall notify the
claimant . . . of the plan’s adverse benefit determination within a reasonable period of
time, but not later than 30 days after receipt of the claim.”). Rojas contends that Cigna’s
attempts to recoup the overpayments were untimely.
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most likely candidate for this term.6 Cameron Manor, Inc. v. United Mine Workers
of Am., 575 F. Supp. 1243, 1245 (W.D. Pa. 1983) (“Beneficiary” refers to people,
“other than the employee‐participant, who [are] covered by the plan’s
provisions—e.g., a spouse or dependent.”). While Rojas may indeed be entitled
to a benefit qua benefit through operation of the plan—i.e., payment for its
medical services—Rojas confuses the issue.7 The “benefit” the plan provides
belongs to Rojas’s patients; Rojas’s claim to payment for covered services is a
function of how Cigna reimburses healthcare providers under the Benefit Plan.
That right to payment does not a beneficiary make. See Ward v. Alt. Health
Delivery Sys., Inc., 261 F.3d 624, 627 (6th Cir. 2001) (“The fact that plaintiff may be
6 Beneficiaries have no right of beneficiary designation under ERISA; rather, “[t]he
insured has the right to change his beneficiary designation ‘at any time without the
knowledge or consent of the previous beneficiary.’” Hillman v. Maretta, 133 S. Ct. 1943,
1955 (2013) (Thomas, J., concurring) (quoting 5 C.F.R. § 870.802(f)).
7 Unfortunately, Rojas is not alone in its confusion. Some courts have used the term
“benefit” loosely to include payment owed. See, e.g., Premier Health Ctr., P.C. v.
UnitedHealth Grp., No. Civ. 11‐425 (ES), 2014 WL 4271970, at *18 (D.N.J. Aug. 28, 2014)
(“[W]hile a repayment demand based on a mistaken payment for a claim that was never
submitted may not technically be in response to a claim for benefits, it is nonetheless a
denial or termination of a previously paid benefit.” (emphasis added)); Pa. Chiropractic
Ass’n v. Blue Cross Blue Shield Ass’n, No. 09 C 5619, 2014 WL 1276585, at *13 (N.D. Ill.
Mar. 28, 2014) (“[T]he direct payments to the chiropractors at issue in this case amount
to benefits within the meaning of ERISA.”). While correct from the dictionary’s
perspective, use of “benefit” to include payment in this context does not fit with
ERISA’s greater statutory scheme.
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entitled to payment from defendants as a result of her clients’ participation in an
employee plan does not make her a beneficiary for the purpose of ERISA
standing.”). The Benefit Plan issues no guarantee of direct payment—why else
would Rojas have required the assignments? It simply offers direct payment as a
convenience for its insureds, itself, and its providers. “Beneficiary” clearly refers
to those individuals who share in the benefits of coverage—medical services and
supplies covered under their health care policy.
Our interpretation is consistent with every circuit that has considered this
question. See, e.g., Spinedex Physical Therapy USA Inc. v. United Healthcare of Ariz.,
Inc., 770 F.3d 1282, 1289 (9th Cir. 2014) (“As a non‐participant health care
provider, Spinedex cannot bring claims for benefits on its own behalf. It must do
so derivatively, relying on its patients’ assignments of their benefits claims.”);
Hobbs v. Blue Cross Blue Shield of Ala., 276 F.3d 1236, 1241 (11th Cir. 2001)
(“Healthcare providers such as physician assistants generally are not considered
‘beneficiaries’ or ‘participants’ under ERISA.”); Ward, 261 F.3d at 627 (declining
to include healthcare providers as possible beneficiaries under ERISA).
As an alternative to its plan‐designated beneficiary theory, the Complaint
alleges that Rojas has standing as its patients’ assignee. The assignments
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allegedly executed by the patients, however, confer to Rojas only the right to
pursue the participants’ claims for payment, not other categories of ERISA
claims.8 J.A. 14 (assigning the patients’ right to payment “payable to [the patient]
for services rendered”). Not all ERISA assignments convey the same rights. For
example, an assignment may give the assignee the right to bring only a claim for
benefits, but not a claim for breach of fiduciary duty. See Spinedex, 770 F.3d at
1292 (because assignee provider was “assigned only the right to bring claims for
payment of benefits, [healthcare provider] has no right to bring claims for breach
of fiduciary duty”). By expressly assigning only their right to payment, Rojas’s
patients did not also assign any other claims they may have under ERISA.
Rojas’s assignment argument also fails under common law principles. An
“assignee acquires no greater rights . . . than his assignor.” Kissling v. Skolkin, 9
N.Y.S.2d 843, 845 (App. Div. 1939). “If an assignee seeking relief in court stands
in the place of an assignor, there has been a substitution rather than an expansion
8 There is no evidence in the record that Rojas’s patients ever signed the assignment‐of‐
benefits form referenced in the Complaint, so we need not even address Rojas’s
arguments under the participant‐designated beneficiary theory. See Hobbs, 276 F.3d at
1242 (“Without proof of an assignment, the derivative standing doctrine does not
apply.”); see also Cacchillo v. Insmed, Inc., 638 F.3d 401, 404 (2d Cir. 2011) (“When a
preliminary injunction is sought, a plaintiff’s burden to demonstrate standing will
normally be no less than that required on a motion for summary judgment.” (internal
quotation marks omitted)).
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of the parties.” City of Hope Nat’l Med. Ctr. v. HealthPlus, Inc., 156 F.3d 223, 228
(1st Cir. 1998). The patients were not removed from the Cigna network such that
they were entitled to sue for a declaration clarifying their status as healthcare
providers in the network. The patients are not healthcare providers. Cigna did
not seek reimbursement for suspect allergy payments from the patients. The
assignments were not directed at any claims the patients may have had against
Cigna in that regard, as there were none. Rojas’s grievance with Cigna is
uniquely its own; it is not derivative of Rojas’s patients.
In light of our conclusion that Rojas lacked standing to bring an ERISA
anti‐retaliation claim under Section 502, we need not address the factors to be
considered in deciding whether to award a preliminary injunction, and we affirm
Judge Karas’s decision dismissing the case. See Munaf v. Geren, 553 U.S. 674, 691–
92 (2008).
CONCLUSION
Healthcare providers are not “beneficiaries” of an ERISA welfare plan by
virtue of their in‐network status or their entitlement to payment. Patients may
assign to their doctors the right to collect payment on their behalf in exchange for
medical services, but the doctors in this case do not seek payment; instead, they
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seek to assert anti‐retaliation protections which were not assigned to them. The
judgment of the district court is AFFIRMED.
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