1. Case Name: Marlena Mills et. al. v. BlueCross BlueShield of Tennessee, Inc.
2. Type of Treatment Services Denied: Out-of-network inpatient treatment for an unspecified mental health disorder
- Plaintiff: Carol A. Molloy, Law Office of Carol A. Molloy
- Defendant: Ashley M. Lowe, Baker Donelson, Bearman, Caldwell & Berkowitz, PC
4. Format: Memorandum Opinion and Order issued by the United States District Court for the Eastern District of Tennessee
- ERISA Claim? No.
- Class Action/or Individual Action: Individual action
- Defendant: Health insurer
- Type of Insurance Plan: Plan was purchased through a state exchange set up by the ACA
- Type of Coverage Denial: No denial was provided – this is part of the issue before the court
6. Legal Pointer: This case is useful in discussing the grievance procedure but the discussion of MHPAEA and ACA is limited since there is no private right of action
7. Legal Issues and Causes of Action: Plaintiff argues breach of the covenant of good faith and fair dealing, breach of contract, fraudulent concealment, anticipatory breach of contract, violations of the Affordable Care Act (ACA) and MHPAEA
- Ruling: Defendant’s motion to strike is granted. Defendant’s motion for judgment on the pleadings is denied as to the breach claim and granted as to all others. Plaintiff’s motion to amend their complaint is granted as to the breach claim and denied as to all others. Plaintiff’s claims for fraudulent concealment, anticipatory breach of contract, and failure to comply with the ACA and MHPAEA are dismissed with prejudice.
8. Narrative Case Description: Plaintiff’s father sought prior authorization for Plaintiff to be treated at an out-of-network treatment center. Without prior authorization, Plaintiff would be required to pay all costs out of pocket. Plaintiff sought prior authorization for more than 2 weeks. Defendant never approved, nor denied the claim. Plaintiff filed suit. Several procedural issues were argued, including whether the Plaintiff could file an amended complaint without permission. These issues will not be addressed in this summary.
The preliminary issue is whether Plaintiff is barred from bringing suit because they have not exhausted their contractual remedies. Defendant argues Plaintiff must secure prior authorization, file a claim, and go through the grievance procedure before they may file suit. The Court disagrees stating that 1) filing a claim would have been futile, 2) even if they had filed a claim that they would have been unable to receive maximum reimbursement, and 3) that the grievance procedure is only one way to resolve disputes, but not the only way.
The Plaintiff argues breach of good faith and breach of contract. While the Court does not decide these issues on their merits, these claims do withstand the Defendant’s motion to strike the amended complaint.
Finally, Plaintiff argues that Defendant breached both the ACA and MHPAEA. The Court disagrees, finding that neither statute provides for a private right of action.
9. Additional Comments: The Court’s discussion of MHPAEA is kept to a minimum. The primary focus is on the grievance procedure and whether it must be exhausted prior to filing a claim.
11. Practical Implications and Lessons Learned: It is unclear whether additional legal theories would have held weight had the Plaintiff received permission to file an amended complaint.
12. All Legal Theories Presented in Case: Breach of contract, breach of good faith and fair dealing, fraudulent concealment, violation of ACA and MHPAEA
13. Successful Legal Theories in Case: Breach of contract