1. Case Name: Am. Psychiatric Ass’n et al., v. Anthem Health Plans, Inc., United States Court of Appeals for the Second Circuit, May 13, 2016

2. Type of Treatment Services Denied: Reimbursement rates

3. Lawyers:

  • Plaintiff: Aaron Panner, Mathew Seligman, Kellogg, Huber, Hansen, Todd, Evans & Figel, PLLC; Brian Hufford and Jason Cowart, Zuckerman Spaeder, LLP and David Reiser Amici Curiae in support of Plaintiffs
  • Defendant: Peter Bisio, Hogan Lovells, U.S., LLP

4. Format: Published opinion and order affirming dismissal of the action.

5. Outline:

  • ERISA Claim? Yes.
  • Class Action or Individual Action? Individual
  • Defendant? Insurance Company and Stockholder of Insurance Company
  • Type of Insurance Plan? Self-Insured Employer Plan
  • Type of Coverage Denial? Administrative

6. Legal Pointer: None.

7. Legal Issues and Causes of Action: Plaintiffs–Appellants are two individual psychiatrists, Susan Savulak, M.D., and Theodore Zanker, M.D. (“the psychiatrists”), and three professional associations of psychiatrists, the American Psychiatric Association, the Connecticut Psychiatric Society, Inc., and the Connecticut Council of Child and Adolescent Psychiatry (collectively, “the associations”). They brought suit in the United States District Court for the District of Connecticut against Defendants–Appellees, four health-insurance companies: Anthem Health Plans, Inc., Anthem Insurance Companies, Inc., Wellpoint, Inc. and Wellpoint Companies, Inc. (collectively, “the health insurers”). The psychiatrists and the associations allege that the health insurers’ reimbursement practices discriminate against patients with mental health and substance use disorders in violation of the MHPAEA and ERISA. The associations brought suit on behalf of their members and their members’ patients, while the psychiatrists brought suit on behalf of themselves and their patients. The district court dismissed the case after concluding that the psychiatrists lacked a cause of action under the statute and the associations lacked constitutional standing to pursue their respective claims.

  • Ruling: The appellate court affirmed the lower court’s decision.

8. Narrative Case Description: The appellate court affirmed that the psychiatrists lacked standing and rejected their argument that they have standing to assert their ERISA § 502(a)(3) claims as third parties bringing suit on behalf of their patients. The court opined that the plaintiffs did not fall within the class of whom Congress had authorized to sue, as Section 502(a)(3) unambiguously provides that a civil action under ERISA may be brought by a participant, beneficiary, or fiduciary.

The psychiatrists, as well as the American Medical Association and Connecticut State Medical Society as amici curiae, argued in substance that, in accordance with prudential principles, the psychiatrists may stand in the shoes of their patients and thus they have their patients’ cause of action under the statute. While the court acknowledged that policy reasons might support allowing physicians to bring suit on behalf of patients with mental health and substance use disorders in the absence of statutory authorization for such an action, the psychiatrists here lacked a cause of action under ERISA’s § 502(a)(3), irrespective of whether they may stand in the shoes of their patients in other matters. Because the psychiatrists are not among those expressly authorized to sue, they lack a cause of action under ERISA. Therefore, the district court correctly dismissed the case.

Separately, Dr. Savulak argued that she had a cause of action under the statute for another reason: she holds an assignment of claims from two of her patients. However, the court concluded that Dr. Savulak’s argument fails, stating that precedent makes clear that, for purposes of conferring an ERISA cause of action upon a provider, an assignment to a provider must be made in exchange for consideration, in the form of the provision of healthcare services. Such consideration is lacking in this case.

Lastly, the Court agreed with the district court that the association plaintiffs lacked constitutional standing under Article III because their members lack standing. While the associations’ members could assert their own Article III injuries related to the restrictions imposed on their ability to provide care, none are plaintiffs and the complaint here does not sufficiently plead facts to show that its members have a cause of action under § 502(a)(3).

9. Additional Comments: None

10. Website: http://caselaw.findlaw.com/us-2nd-circuit/1734907.html

11. Practical Implications and Lessons Learned: None.

12. All Legal Theories Presented in Case: Violation of MHPAEA and ERISA

13. Successful Legal Theories in Case: None

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