United States District Court, S.D. Texas, Houston Division
MEMORANDUM AND ORDER
Rosenthal, Chief United States District Judge
Infusion sued Aetna Life Insurance Company under the Employee
Retirement Income Security Act (ERISA), 29 U.S.C. §
1001, et seq., alleging that Aetna had paid for
out-of-network services but later recouped some of the
payments on the ground that it had overpaid other claims.
Experience Infusion alleges that the initial payments were
proper and seeks damages for those offsetting recoupments.
issues employer-sponsored health-insurance plans and serves
as a third-party administrator for self-funded
employee-benefit plans. Some of these plans are governed by
ERISA. Experience Infusion is an out-of-network medical
provider of intravenous antibiotic-infusion services. Most of
its patients are treated by Dr. Patricia Salvato, an
Aetna-network physician who specializes in Lyme Disease
treatment. Experience Infusion alleges that no providers in
the Aetna network offer these services.
Aetna insurance plans assign to the medical-services provider
the right to pursue claims for plan benefits. Under the
plans, Aetna must pay out-of-network providers a portion,
usually 60 to 100 percent, of the “reasonable and
customary” charges for the medical services provided to
Infusion billed Aetna for the services it provided. Aetna
reduced the bills to what it stated were the reasonable and
customary amounts, and, as set out in the plans, paid
Experience Infusion that percentage. Aetna sent Experience
Infusion explanation-of-benefits statements explaining the
amounts it paid. According to Experience Infusion, Aetna did
not ultimately pay the amounts set out in those statements.
Instead, Aetna offset the amounts on the ground that it had
years earlier overpaid Experience Infusion for services
provided to other patients under different plans.
Infusion challenges this “recoupment” practice of
offsetting payments based on alleged overpayments made
earlier for services to different patients on different
plans. Experience Infusion alleges that when it complained
about these recoupments, “Aetna frequently did not
provide an explanation” or gave a general reason for
why it viewed the prior payment as excessive, such as a
“lack of medical necessity” but without
supporting documents. Experience Infusion's complaint
sets out 19 examples of allegedly improper recoupments and
inadequate explanations. (Docket Entry No. 49 ¶¶
Infusion asserted eight causes of action: (1) failure to
comply with group-plan requirements, in violation of ERISA;
(2) breach of fiduciary duty under ERISA; (3) failure to
provide a full and fair review under ERISA; (4) violation of
claims procedures under ERISA; (5) violations of the Texas
Prompt Pay Act, Tex. Prop. Code § 28.002; (6) breach of
contract; (7) fraud; and (8) negligent misrepresentation.
Aetna moved for summary judgment, Experience Infusion
responded, and Aetna replied. (Docket Entries No. 29, 44,
52). After the summary judgment briefing, Experience Infusion
dismissed its ERISA claims for breach of fiduciary duty,
failure to provide a full and fair review, and for violation
of claims procedures, and its claims under the Texas Prompt
Pay Act. (Docket Entry No. 56, 59).
Memorandum and Order addresses Aetna's motion for summary
judgment on the state-law fraud and
negligent-misrepresentation claims. Experience Infusion's
remaining ERISA claim and its breach-of-contract claim are
not addressed because they were asserted in an amended
complaint filed after Aetna moved for summary judgment.
on the pleadings, motion, response, reply, the summary
judgment record, and the applicable law, Aetna's motion
for summary judgment, (Docket Entry No. 29), is granted. The
fraud and negligent-misrepresentation claims are dismissed,
leaving the ERISA and breach-of-contract claims.
reasons for these rulings are explained below.
The Summary Judgment Legal Standard
judgment is appropriate only if ‘there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.'” Vann v. City of
Southaven, Miss., 884 F.3d 307, 309 (5th Cir. 2018)
(citations omitted); see also F ed. R. Civ. P.
56(a). “A genuine dispute of material fact exists when
the ‘evidence is such that a reasonable jury could
return a verdict for the nonmoving party.'”
Burrell v. Prudential Ins. Co. of Am., 820 F.3d 132,
136 (5th Cir. 2016) (quoting Anderson v. Liberty
Lobby, 477 U.S. 242, 248 (1986)). “The moving
party ‘bears the initial responsibility of informing
the district court of the basis for its motion, and
identifying those portions of [the record] which it believes
demonstrate the absence of a genuine issue of material
fact.'” Brandon v. Sage Corp., 808 F.3d
266, 269-70 (5th Cir. 2015) (quoting Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986)).
the non-movant bears the burden of proof at trial, ‘the
movant may merely point to the absence of evidence and
thereby shift to the non-movant the burden of demonstrating .
. . that there is an issue of material fact warranting
trial.'” Kim v. Hospira, Inc., 709
Fed.Appx. 287, 288 (5th Cir. 2018) (quoting Nola Spice
Designs, L.L.C. v. Haydel Enters., Inc., 783
F.3d 527, 536 (5th Cir. 2015)). While the party moving for
summary judgment must demonstrate the absence of a genuine
issue of material fact, it does not need to negate the
elements of the nonmovant's case. Austin v. Kroger
Tex., L.P., 864 F.3d 326, 335 (5th Cir. 2017) (quoting
Little v. Liquid Air Corp., 37 F.3d 1069, 1076 n.16
(5th Cir. 1994)). A fact is material if “its resolution
could affect the outcome of the actions.” Aly v.
City of Lake Jackson, 605 Fed.Appx. 260, 262 (5th Cir.
2015) (citing Burrell v. Dr. Pepper/Seven UP Bottling
Grp., Inc., 482 F.3d 408, 411 (5th ...