Ruggles v. Wellpoint Inc

FAY RUGGLES, ANTOINETTE BOONE, GEORGIA WOODRUFF, MAURICE BILLMAN, KAREN HAWKINS, HARRIET CHILDRESS, and NANCY COLEMAN, on behalf of themselves and all similarly situated employees Plaintiffs,

v.WELLPOINT, INC., Defendant.

No. 1:08-CV-0201(LEK/RFT)

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF NEW YORK

Dated: February 22, 2011

MEMORANDUM-DECISION and ORDER¹

I. INTRODUCTION

Pending before the Court are Motions seeking the certification and the denial of certification of proposed Rule 23 classes for alleged violations of New York, California, and Illinois wage and hour laws. See Dkt. Nos. 197, 198, 200, 204. For the reasons that follow, Plaintiffs' consolidated Motion for class certification (Dkt. No. 204) is denied, and Defendant's Motions for denial of certification of a New York Rule 23 class (Dkt. No. 197); a California Rule 23 class (Dkt. No. 198); and an Illinois Rule 23 class (Dkt. No. 200) are granted.

II. BACKGROUND

A. Factual Background

Plaintiffs are all registered nurses ("RNs"), employed, or previously employed by Defendant WellPoint, Inc. ("Defendant" or "WellPoint") in the position of "Utilization Review Nurse, " "Case Management Nurse, " or "Medical Management Nurse." Am. Compl. (Dkt. No. 166) ¶ 1. WellPoint, one of the nation's largest health benefits companies, is a complex corporate entity headquartered in Indianapolis, Indiana, which provides health insurance benefits and services to approximately 34 million customers nationwide. Among the services WellPoint provides are "medical management, " "case management, " and "utilization review."² Formed in 2004, WellPoint has a corporate presence in California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia, and Wisconsin. See Ginzinger Decl. (Dkt. No. 53-3) ¶¶ 2-4.

WellPoint's current structure is the result of numerous mergers and acquisitions, some of which are pertinent to the instant Motions. See Ginzinger Decl. (Dkt. No. 53-3) ¶¶ 3-4; Welker-Finney Decl. (Dkt. No. 200-2) ¶¶ 4-6. In 1992, Blue Cross of California created a for-profit entity, WellPoint Health Networks Inc., to operate its managed care business. Blue Cross of California, a managed care program in California, and Blue Cross Life and Health Insurance Company, an insurance program in California, became subsidiaries of WellPoint Health Networks Inc., operating under the trade names Anthem Blue Cross and Anthem Blue Cross Life & Health Insurance Company (collectively "Anthem Blue Cross"). Welker-Finney Decl. (Dkt. No. 200-2) ¶¶ 4-6.

UniCare Life & Health Insurance Company ("UniCare") existed as another subsidiary of WellPoint Health Networks Inc. and in 1995 became the brand name for the parent company's non-Blue Cross Blue Shield businesses operating outside of California. In early 2000, WellPoint Health Networks Inc. acquired Rush Prudential Health Plazas in Illinois. Id.. ¶ 5.

WellPoint, Inc. was formed in November 2004, when WellPoint Health Networks Inc. merged with Anthem, Inc. Ginzinger Decl. ¶ 3-4; Welker-Finney Decl. (Dkt. No. 200-2) ¶¶ 4-6. Anthem Blue Cross continues to operate in numerous locations throughout California, including Anaheim, Camarillo, Costa Mesa, Fresno, Glendale, Los Angeles, Modesto, Newbury Park, North Hollywood, Oakland, Pomona, Rancho Cordon, Sacramento, San Bernardino, San Diego, San Francisco, San Jose, Santa Barbara, Thousand Oaks, Visalia, Walnut Creek, West Hills, and Woodland Hills; it employs registered nurses in the following job positions: Nurse Case Manager I, Nurse Case Manager II, Nurse Case Manager Senior, Nurse Case Manager Lead, Nurse Medical Management I, Nurse Medical Management II, Nurse Medical Management Senior, and Nurse Medical Management Lead. Welker-Finney Decl. (Dkt. No. 200-2) ¶ 7-8. Unicare continues to operate in a number of locations in Illinois, including: Chicago, Deerfield, Mt. Vernon, Schaumburg, and Westchester; it employs registered nurses in the following job positions: Nurse Case Manager I, Nurse Case Manager II, Nurse Case Manager Senior, Nurse Case Manager Lead, Nurse Medical Management I, Nurse Medical Management II, Nurse Medical Management Senior, Nurse Medical Management Lead, and HMC Nurse Care Manager Senior. Id.. ¶¶ 9-10.³

Subsequent to its formation, WellPoint continued expanding its operations, including through its December 2005 acquisition of WellChoice Inc. and WellChoice Inc. subsidiary, Empire Blue Cross Blue Shield ("Empire"). Through that deal, WellPoint acquired Empire's New York operations, including those in Albany, Brooklyn, Melville, and New York City. Pekrol Decl. (Dkt. No. 197-1, Ex. 6) ¶¶ 1, 3. Under Empire, all nurse employees, regardless of their duties, carried the same title, "Case Manager." Id.. ¶ 6. Following Empire's acquisition by WellPoint, all of Empire's employees became employees of WellPoint. As part of the restructuring, nurse employees previously designated uniformly as "Case Managers" took on various job titles including "Utilization Review Nurse, " "Medical Management Nurse, " and "Case Manager Nurse." Id.

According to WellPoint, the legacy organizations from which its current structure is derived employed registered nurses in differently titled positions who performed a wide array of duties that varied based on the entity that employed them. Ginzinger Decl. WellPoint insists that variation survives to date, yielding significant differences among its nurses nationwide in terms of the duties they perform and their compensation structure both within and across job categories. See, e.g., Ginzinger Decl. (Dkt. No. 53-3); Pekrol Decl. ¶ 8; Fooks Decl. (Dkt. No. 200-6) ¶ 10; Nieweglowski Decl. (Dkt. No. 200-6) ¶ 7. Nurses in the job titles at issue work in a variety of different departments, often specializing in discrete areas of WellPoint's business, and are employed in different settings including large buildings, small office complexes, hospitals, and their own homes. Dkt. No. 53 at 4-5. Nevertheless, Plaintiffs contend that WellPoint has devoted itself to a program of "job mapping" that has achieved substantial uniformity nationwide, and they have submitted job descriptions for the "job families" of Medical Management and Case Management that they claim are applicable to all WellPoint employees. Mem. in Supp. Mot. to Certify (Dkt. No. 204-2) ("Pls.' Certification MOL") at 15-16; Selby Dep. at 64-72, 77-80, 85-89, 101, 120-21; Srey Aff, Exs. D-E (Dkt. Nos. 204-7, 204-8). Each job family contains several subcategories, or grades, and while some of the "Core Content" and "Roles" for the subcategories overlap, variation based on grade is also readily apparent in the descriptions. For example, in the Medical Management family, all grades conduct pre-certification, concurrent, and retrospective reviews, guide customers to covered care options, identify discharge planning needs, and work with hospitals and healthcare providers; the higher grades handle complex cases, act as company representatives, develop training materials, and monitor and prioritize workflows. See Dkt. No. 204-7. Similarly, in the Case Management family, all grades conduct assessments to identify insured's needs and goals, prepare and implement suitable case management plans, link policy holders with appropriate care facilities and providers, and participate in "rounds." The higher grades are described as fulfilling additional functions, such as acting as a preceptor, facilitating conflict resolution, monitoring workflows, and evaluating the Utilization Management processes. Dkt. No. 204-8. Both job families' descriptions note that all grades shall be expected to "erform other related duties as required."

Some WellPoint nurses utilize various guidelines and regulations, produced or endorsed by WellPoint, as tools in making their managed care recommendations. These include, but are not limited to the Milliman Guidelines, WellPoint Clinical Guidelines, NICU Guidelines, ACOEM Guidelines, MTUS Guidelines, and McKesson Guidelines. See, e.g., Whitney Decl. ¶ 6; Parisi Dep. (Dkt. No. 215-15) at 29; Kennedy Dep. (Dkt. No. 204-14) at 17:1-3. From the interrogatory responses and deposition testimony, the Milliman Guidelines appear to be widely used in utilization review. Numerous deponents and declarants attest to collecting clinical information on an insured, comparing these against the insured's policy and the Milliman Guidelines and approving therequested benefit or service if the relevant Milliman criteria were met; if they were not met, under WellPoint policies, the nurse could not deny the request but would send the insured's information to a physician reviewer. But see Sager Dep (Dkt. No. 214-15) at 49-51 (Nurses in Nation Accounts can authorize a requested benefit even if it does not meet the guidelines). Similar testimony exists from Case Managers, with WellPoint care plans providing the criteria for evaluating an insured's needs and generating appropriate care plans. See Pls.' Certification MOL at 7-13 (overviewing certain testimony).

The Milliman Guidelines open with a disclaimer:

The appropriate use of these Guidelines requires professional medical judgment.... Professional medical judgment is required in all phases of the health care delivery and management process that should include consideration of the individual circumstances of any particular patient. These Guidelines are not intended as a substitute for this important professional judgment.

Use of the Guidelines as a basis for denying authorization for treatment without proper consideration of the unique characteristics of each patient or as a basis for denying payment for treatment received is an inappropriate use of the Guidelines.

Milliman Care Guidelines: Inpatient and Surgical Care, 8^th ed. (Dkt. No. 216-4) at viii. The Guidelines' Introduction reiterates this point: "Use of the Guidelines requires, and never replaces, clinical judgment." Id.. at 1.

WellPoint issues...