U.S. Court in California Dismisses Provider Lawsuit Against Aetna over COVID-19 Testing Reimbursement
- October 07, 2022
The U.S. District Court for the Northern District of California rejected September 30 a putative class action against Aetna Health of California Inc. for failing to fully reimburse out-of-network health care providers for COVID-19 tests.
Plaintiff, which operated seven specimen collection sites for COVID testing, argued that the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and the Families First Coronavirus Response Act (FFCRA) required insurers to reimburse providers of diagnostic testing at “an amount that equals the cash price for such service as listed by the provider on a public internet website.”
But the court found that the claim failed as a matter of law because the CARES Act and FFCRA do not include a private right of action against insurers to recover reimbursement for COVID-19 testing at their publicly posted cash price.
The court also dismissed plaintiff’s claims under the Employee Retirement Income Security Act (ERISA) and Racketeer Influenced Corrupt Organizations (RICO).
Plaintiff, as a medical provider, lacked statutory standing to bring a claim for benefits due under ERISA and the complaint failed to allege statutory standing by virtue of assignment, the court said.
The court rejected, as a matter of law, plaintiff’s argument that the CARES Act and FFCRA “have given [out-of-network] providers of Covid Testing services standing to sue self-funded health plans subject to ERISA,” which made obtaining a specific assignment unnecessary.
The court also found plaintiff’s RICO allegations “fatally conclusory.” Plaintiff failed to allege that Aetna engaged in a predicate act of mail fraud, wire fraud, or embezzlement.
The court dismissed both the ERISA and RICO claims with leave to amend.
Saloojas, Inc. v. Aetna Health of Cal., Inc., No. 22-cv-02887-JSC (N.D. Cal. Sept. 30, 2022).