Learing v. The Anthem Co.

1

Christine Learing, individually and on behalf of all others similarly situated, Plaintiff, v. The Anthem Companies, Inc.; Amerigroup Corporation; and Amerigroup Partnership Plan, LLC, Defendants.

Civ. No. 21-2283 (JWB/DJF)

United States District Court, D. Minnesota

March 22, 2024

Caitlin L. Opperman, Esq., Michele R. Fisher, Esq., and Rachhana T. Srey, Esq., Nichols Kaster PLLP, counsel for Plaintiff.

Brett Christopher Bartlett, Esq., Kevin Michael Young, Esq., Lennon Haas, Esq., and Thomas J. Posey, Esq., Seyfarth Shaw LPP counsel for Defendants.

ORDER ON SUMMARY JUDGMENT AND CLASS CERTIFICATION

JERRY W. BLACKWELL UNITED STATES DISTRICT JUDGE

This is a dispute over alleged misclassification of utilization review nurses as exempt from Fair Labor Standards Act (“FLSA”) overtime pay requirements. Plaintiff Christine Learing seeks to represent an FLSA collective and Rule 23 class of similarly situated utilization review nurses in Minnesota challenging their exemption status. The Defendants are the Anthem Companies, Inc. and its subsidiaries Amerigroup Corporation and Amerigroup Partnership Plan, LLC (collectively “Anthem”). Anthem hires nurses to review medical authorization requests submitted by healthcare providers to determine whether the services they have provided were medically necessary and therefore eligible for coverage-a process known as medical management or utilization review.

Anthem contends that Learing and the utilization review nurses she seeks to represent were properly classified as a category of employees ineligible for overtime pay (“exempt”) and moves for summary judgment. Learing also seeks summary judgment. She contends that utilization review positions like hers should not be exempt from overtime pay, and that Anthem has shown no evidence that its overtime exemption decision denying employees their overtime pay, was made in good faith. Anthem also moves to decertify the previously certified FLSA collective. Learing, in turn, moves to certify a Rule 23 class asserting similar claims under Minnesota law. For the reasons below, Learing's motions are granted, and Anthem's motions are denied.

BACKGROUND

Health insurance companies, like Anthem, employ utilization reviewers to confirm or deny the necessity of medical treatments. These decisions are based on whether the treatments align with established medical care standards using clinical guidelines to decide whether insurance coverage is approved or denied. In Minnesota, Anthem has hired various workers to perform utilization review work for Medicaid plans as part of a contract with Blue Cross Blue Shield. Some positions require the reviewer to be a licensed practical nurse (“LPN”) and are paid hourly, while others require licensure as a registered nurse (“RN”) and are paid a salary.

This case involves the salaried RN utilization review positions at Anthem- specifically the roles of Nurse Medical Management I, II, Senior, and Lead, among others with similar titles. These Nurse Medical Managers (“NMMs”) handle authorization requests, which are directed to specific review teams that handle different types of requests. Each request assigned to an NMM involves reviewing clinical data in Anthem's digital system, reading relevant clinical guidelines, and comparing whether the medical documentation meets the necessary medical criteria. If the criteria are present, the NMM grants authorization; if not, the decision is escalated to a licensed physician Medical Director for final determination.

Utilization review skills are not taught in nursing school but are acquired through on-the-job orientation, training, and experience. Anthem's training for NMMs includes how to use the company's digital systems to handle requests, as well as mock exercises on applying medical necessity criteria. Newly hired NMMs are also paired with experienced NMMs for mentorship and additional training.

NMMs at Anthem must follow Anthem's step-by-step process for conducting utilization review, no matter the specific team to which they are assigned or the substance of the authorization request. While the nature of each request determines the clinical guidelines that must be considered, the process of comparing the request's underlying medical records to the applicable guidelines does not vary. Each approval request is routed through Anthem's review framework using Anthem's digital system.

The National Committee for Quality Assurance (“NCQA”), an accrediting organization, sets industry standards for managed care organizations that perform medical necessity reviews. Anthem has tailored its utilization management policies and procedures to satisfy NCQA requirements across a range of requirements, including program structure, clinical criteria, staff qualifications, turnaround time for requests, and case documentation. NCQA requires at least LPN-level credentials for utilization review tasks. Although Anthem previously mixed LPNs and RNs in review teams, it now differentiates roles, reserving certain authorization tasks for LPNs that do not demand nursing judgment.

Anthem's contract with Blue Cross Blue Shield mandates that the company's utilization management program comply with NCQA standards. To maintain this compliance, Anthem conducts regular audits of its utilization review processes. These audits assess how well NMMs follow proscribed steps for processing requests, the accuracy of their decisions, and their productivity. Part of this assessment involves mandatory Inter-Rater Reliability (“IRR”) tests to ensure consistent application of medical necessity guidelines across reviewers. The IRR presents a series of short case summaries and asks a true or false question of whether the member in each case meets the criteria for the requested service. (See Doc. No. 150-21.) NMMs scoring below 90% on an IRR assessment face corrective action.

NMMs' workload sometimes demands more than 40 hours in a week. This lawsuit seeks overtime compensation for those additional hours worked.

DISCUSSION

I. Certification of Collective Proceedings

Whether to certify or decertify a collective proceeding is discretionary. See Bouaphakeo v. Tyson Foods, Inc., 765 F.3d 791, 796 (8th Cir. 2014) (citations omitted). Whether collective proceedings are warranted depends on first understanding the nature of the claims presented, and then considering whether common issues compel their resolution. See, e.g., Frank v. Gold'n Plump Poultry, Inc., Civ. No. 04-1018 (PJS/RLE), 2007 WL 2780504, at *4-5 (D. Minn. Sept. 24, 2007).

Analyzing the case at the appropriate level of abstraction is key because “[i]f one zooms in close enough on anything, differences will abound.” Id. at *4. But “[a]ny competently crafted class complaint literally raises common questions.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 349 (2011).

The core issue in this overtime pay dispute is whether utilization review work performed by NMMs at Anthem falls under exempt categories, meaning not qualifying for overtime pay. Learing argues that collective proceedings are proper because NMMs are uniformly governed by Anthem's overarching policies, training protocols, and performance expectations, regardless of their specific areas of work. On the other hand, Anthem argues against collective proceedings, emphasizing the diverse work settings and case complexities faced by NMMs based on the nature of their assigned authorization requests and corresponding medical criteria.

The resolution here hinges on examining Anthem's employment policies at a structural level rather than individual NMM performance particularities. Despite some differences in NMMs' assignments, all operate under a common employment framework that outlines their main duties, individual authority levels, and job performance standards. Consequently, for FLSA certification purposes, NMMs are deemed similarly situated within Anthem's employment structure. For class certification, the common questions about Anthem's employment framework for NMMs and related roles predominate over individual discrepancies.

A. Defendants' Motion to Decertify FLSA Collective

The FLSA permits collective action when the plaintiff presents a group of similarly situated employees who “suffer from a single, FLSA-violating policy, and when proof of that policy or of conduct in conformity with that policy proves a violation as to all the plaintiffs.” Bouaphakeo, 765 F.3d at 796 (quotation omitted); 29 U.S.C. § 216(b).

To decide whether FLSA claimants are similarly situated, courts consider: (1) the extent and consequences of disparate factual and employment settings, (2) the available defenses that appear to be individual to each plaintiff, and (3) fairness and procedural considerations. See Cruz v. Lawson Software, Inc., 764 F.Supp.2d 1050, 1056 (D. Minn. 2011) (quotation omitted). After discovery, plaintiffs must show that the claimants are similarly situated-though not necessarily identical-to proceed with an FLSA collective action. See Frank, 2007 WL 2780504, at *2-3 (citations omitted); Cruz v. TMI Hosp., Inc., Civ. No. 14-1128 (SRN/FLN), 2015 WL 6671334, at *14 (D. Minn. Oct. 30, 2015) (citing Nerland v. Caribou Coffee Co., 564 F.Supp.2d 1010, 1018 (D. Minn. 2007)). The decertification decision falls within a court's discretion. Id. (citation omitted).

1. Disparate Factual and Employment Settings

An inherent tension exists between Anthem's summary judgment argument-that all NMMs fit within either the administrative or learned professional overtime exemption-and its opposition to collective proceedings, citing differences in NMM subject areas and work settings. This contradiction highlights the need to evaluate at the appropriate level of abstraction. The key question is whether the...