Vrijesh S. Tantuwaya MD, Inc. v. Anthem Blue Cross Life & Health Ins. Co.

169 F.Supp.3d 1058

Vrijesh S. Tantuwaya MD, Inc., a California corporation, Plaintiff,

v.Anthem Blue Cross Life and Health Insurance Company, a California corporation, and Blue Cross of California, a California corporation, and California Physicians' Service d/b/a Blue Shield of California, a California corporation, and, Does 1 through 5, inclusive, Defendants.

CASE NO. 15cv1671–WQH–NLS

United States District Court, S.D. California.

Signed March 10, 2016

Filed March 11, 2016

ORDER

HAYES, Judge:

The matters before the Court are the Motion to Remand filed by Plaintiff (ECF No. 7) and the Motion to Dismiss filed by Defendant California Physicians' Services dba Blue Shield of California. (ECF No. 4).

I. Background

On June 4, 2015, Plaintiff Vrijesh S. Tantuwaya MD, Inc. (“Plaintiff”) commenced this action by filing a complaint in the San Diego Superior Court alleging violation of California's Unfair Competition Law (“UCL”) (Bus. & Prof. Code, § 17200 et seq. ) and reimbursement for the reasonable value of services rendered (“quantum meruit”). On July 28, 2015, Defendants filed a notice of removal of civil action in this court pursuant to 28 U.S.C. § 1442(a)(1), which permits removal where a person acting under the direction of a federal agency and its officers is sued for actions taken under color of federal office. (ECF No. 1).

On August 4, 2015, Defendants Anthem Blue Cross Life and Health Insurance Company (“Anthem Blue”) and Blue Cross of California dba Anthem Blue Cross (“Blue Cross”) filed a motion to dismiss. (ECF No. 3). On August 4, 2015, Defendant California Physicians' Services dba Blue Shield of California (“Blue Shield”) also filed a motion to dismiss. (ECF No. 4). On August 28, 2015, Plaintiff filed a motion to remand. (ECF No. 7). On September 14, 2015, Plaintiff filed oppositions to both motions to dismiss. (ECF Nos. 8 and 9). On September 14, 2015, Blue Shield filed an opposition to Plaintiff's motion to remand. (ECF No. 10). On September 18, 2015, Anthem Blue and Blue Cross filed a reply to Plaintiff's opposition to the motion to dismiss. (ECF No. 11). On September 21, 2015, Blue Shield filed a reply to Plaintiff's opposition to the motion to dismiss. (ECF No. 12). On September 21, 2015, Plaintiff filed a reply to Blue Shield's opposition to the motion to remand. (ECF No. 13).

On January 28, 2016, Plaintiff filed a notice of supplemental authority regarding Plaintiff's motion to remand. (ECF No. 20). On February 1, 2016, Blue Shield filed a response to Plaintiff's supplemental authority. (ECF No. 21).

On February 4, 2016, Plaintiff filed a Notice of Settlement and Motion to Dismiss the Complaint With Prejudice as to Defendants Anthem Blue Cross Life and Health Insurance Company and Blue Cross of California Only. (ECF No. 22). On February 5, 2016, the Court issued an Order dismissing Defendants Anthem Blue and Blue Cross with prejudice and denying the Motion to Dismiss filed by Anthem Blue and Blue Cross (ECF No. 3) as moot. (ECF No. 24).

On February 5, 2016, the Court held oral argument on the Motion to Remand filed by Plaintiff (ECF No. 7) and the Motion to Dismiss filed by Blue Shield (ECF No. 4).

II. Allegations of the Complaint

Plaintiff is a physician who provides emergency medical services. (ECF No. 1 –2 at ¶ 4). “Defendants are corporations which are in the business of arranging for or providing health care services to [their] enrollees in California, including emergency health care services, or are in the business of administering health care services ... for patients located in California that are members of certain ... medical health insurers or groups ... where the duty to reimburse non-contracted emergency physicians has been delegated to them.” Id. at ¶ 6. Plaintiff has no contractual relationship with any of the Defendants. Id. at 5.

“Plaintiff performed the emergency medical services at issue on multiple patients insured by, administered by, or assigned to, one (or more) of the Defendants.” Id. at ¶ 23. No personal information is listed in the complaint “regarding any individual patient in order to protect the patient's privacy rights pursuant to the Health Insurance Portability and Accountability Act of 1996 (‘HIPAA’) ....” Id. at ¶ 25. “Information regarding each specific patient's claim at issue herein will be made known to the Defendant that insures or otherwise administers or has been assigned the patient's claim, and has a right to such information.” Id. at ¶ 26.

Pursuant to the Knox–Keene Health Care Service Plan Act of 1975 (“Knox–Keene Act”), Cal. Health & Safety Code section 1340 et seq¹ ., Plaintiff is “obligated to treat all emergency room patients without regard to whether the patients are insured or able to pay.” Id. at 4. The Knox–Keene Act requires that Defendants pay Plaintiff “reasonable and customary value” for the emergency services rendered.² Id. at 16. “Defendants have a practice of paying Plaintiff arbitrary amounts for the emergency health care services provided to patients for which Defendants are responsible for reimbursement.” Id. at ¶ 18. “Defendants have failed to reimburse Plaintiff for the reasonable and customary value of his services.” Id. at ¶ 20. “Emergency service providers such as Plaintiff cannot ‘balance bill’ patients for amounts that the patients' insurers (i.e. Defendants) refuse to reimburse.” Id. at ¶ 14. “Plaintiff's only allowed recourse is against Defendants.” Id. “By not reimbursing Plaintiff at the reasonable amount for his emergency care services, with interest required by statute ... Defendants engaged in unlawful activity prohibited by Cal. Bus. & Prof. Code § 17200 et seq . ” Id. at ¶ 29. Defendants actions “constitute unlawful business practices....” Id.

Blue Shield committed an unlawful business practice in violation of California law by issuing payments directly to its insured and/or customers. Id. at ¶ 33. “[O]n August 4, 2006, Blue Shield entered into a consent agreement with the Department of Managed Health Care, agreeing that it would cease and desist this practice.” Id. Blue Shield “was fined an administrative penalty for paying patients directly instead of the physician the amount due for non-contracted emergency medical services.” Id. Blue Shield's “insured/patients who are paid directly, in many cases, as are the cases at issue here, fail to reimburse Plaintiff the amounts due to him.” Id. Plaintiff seeks damages “equal to the value of the emergency services rendered as determined pursuant to [California] law,” restitution, disgorgement of profits, interest, injunctive, and other relief. (ECF No. 1–2 at 12).

III. Request for Judicial Notice

Plaintiff requests that the Court take judicial notice of two documents. (ECF No. 7–2 at 2). The first document is a copy of a consent agreement, entitled “Consent Agreement Re Payment of Claims For Emergency Services and Care,” filed August 4, 2006 by the Department of Managed Health Care of the State of California. The second document is a copy of a Brief for the United States as Amicus Curiae Supporting Respondents, filed in the Supreme Court of the United States, in the case of Health Care Service Corporation v. Pollitt, which settled before a decision was issued.

Federal Rule of Evidence 201 provides that “[t]he court may judicially notice a fact that is not subject to reasonable dispute because it ... is generally known within the trial court's territorial jurisdiction; or ... can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed R. Evid. 210(b). “[U]nder Fed. R. Evid. 201, a court may take judicial notice of ‘matters of public record.’ ” Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir.2001) (quoting Mack v. South Bay Beer Distrib., 798 F.2d 1279, 1282 (9th Cir.1986) ). Blue Shield does not object to or question the accuracy of the documents. Blue Shield contends that “the consent agreement does not and cannot apply to the FEHBA–governed Service Benefit Plan.” (ECF No. 10 at 10 n. 1). Plaintiff does not argue that the Consent agreement applies to Blue Shield, as a FEHBA insurance carrier. The Court will take judicial notice of the documents filed by Plaintiff; however, neither document affects the outcome in this case.

IV. Motion to Remand

Defendants Anthem Blue, Blue Cross, and Blue Shield removed this case pursuant to the federal officer removal statute, 28 U.S.C. § 1442(a)(1), on the grounds that “at least one of the enrollees at issue in this case is enrolled in a health plan governed by the Federal Employees Health Benefits Act (‘FEHBA’), 5 U.S.C. §§ 8901 –14.” (Notice of Removal ECF No. 1 at 9). In the Notice of Removal, Defendants assert that one of the enrollees at issue, B.G., “was enrolled in the Blue Cross and Blue Shield Service Benefit Plan (or ‘the Service Benefit Plan’), one of the federal government's health benefits plans for federal employees and their dependents.” Id.³

A civil or criminal action originally filed in state court may be removed to federal court if, among other things, the action is against “any officer (or any person acting under that officer) of the United States or of any agency thereof, in an official or individual capacity, for or relating to any act under color of such office.” 28 U.S.C. § 1442(a)(1). “[D]efendants enjoy much broader removal rights under the federal officer removal statute than they do under the general removal statute .... Leite v. Crane Co., 749 F.3d 1117, 1122 (9th Cir.) ; cert. denied, ––– U.S. ––––, 135 S.Ct. 361, 190 L.Ed.2d 252 (2014). To invoke the federal officer removal statute, a removing party “must show that (1) it is a ‘person’ within the meaning of the statute, (2) a causal nexus exists between plaintiffs' claims and the actions [the removing party] took pursuant to a federal officer's direction, and (3) [the removing party] has a ‘colorable’ federal defense to plaintiffs' claims.” Leite, 749 F.3d at 1120. Defendants bear the burden of proving by a preponderance of...