Rojas v. Cigna Health & Life Insurance
793 F.3d 253
2d Cir.2015Background
- Rojas (two New York physicians and their practice) were in-network providers for Cigna and accepted reduced reimbursements; some patients signed assignment-of-benefits forms assigning payment rights to Rojas.
- Cigna investigated Rojas for allegedly improper billing of repetitive allergy blood tests and concluded it overpaid $844,334.52 for ~150 patients, demanding recoupment and offering arbitration under the provider contract.
- Cigna then threatened termination of Rojas’s in-network status; Rojas sued in SDNY seeking injunctive relief under ERISA’s anti-retaliation provision to prevent termination (reinstatement as a provider), not merely payment.
- The district court denied a preliminary injunction, holding Rojas lacked statutory standing under ERISA because it was not a plan “participant” or “beneficiary,” and the patient assignments conferred only rights to payment, not ERISA anti-retaliation claims.
- On appeal, the Second Circuit reviewed statutory standing de novo and considered whether healthcare providers are ERISA beneficiaries or have derivative standing via patient assignments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a healthcare provider is a “beneficiary” under ERISA §502 | Rojas: entitlement to reimbursement under the Benefit Plan makes it a beneficiary entitled to sue under §1132(a)(1)(B) | Cigna: being entitled to payment as a provider is not beneficiary status under ERISA | Not a beneficiary; providers are not ERISA beneficiaries merely by receiving plan payments |
| Whether plan language permitting direct payment makes provider a plan-designated beneficiary | Rojas: plan’s option to pay providers directly designates providers as beneficiaries under plan terms | Cigna: plan’s direct-payment provision is a convenience, not a designation conferring beneficiary status | Rejected; direct-payment option does not transform providers into beneficiaries |
| Whether patient assignments conferred derivative ERISA standing to assert anti-retaliation claims | Rojas: patients assigned payment rights to Rojas, so Rojas can sue derivatively on plan claims | Cigna: assignments (as pleaded) conveyed only the right to payment, not broader ERISA causes of action; assignee steps into assignor’s shoes | Rejected; assignments conferred rights to payment only and did not transfer anti-retaliation claims |
| Whether a provider can sue under ERISA for reinstatement as an in-network provider (remedy sought) | Rojas: ERISA anti-retaliation protects participants/beneficiaries; Rojas says it falls within that class | Cigna: provider-status rights arise from provider contract, not ERISA plan; ERISA standing is limited to participants/beneficiaries | Rojas sued under wrong vehicle; remedy is contractual/provider-agreement, not an ERISA cause of action; appeal affirmed |
Key Cases Cited
- Kendall v. Emps. Ret. Plan of Avon Prods., 561 F.3d 112 (2d Cir. 2009) (standard for reviewing statutory standing de novo)
- Franchise Tax Bd. of the State of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1 (1983) (ERISA §502’s list of persons who may sue is exclusive)
- Chemung Canal Trust Co. v. Sovran Bank/Md., 939 F.2d 12 (2d Cir. 1991) (interpretation of ERISA standing limits)
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989) (definitions and scope of ERISA terms like “participant”)
- Kolasinski v. Cigna Healthplan of CT, Inc., 163 F.3d 148 (2d Cir. 1998) (distinguishing medical coverage beneficiaries from payment recipients)
- Spinedex Physical Therapy USA Inc. v. United Healthcare of Ariz., Inc., 770 F.3d 1282 (9th Cir. 2014) (non-participant provider lacks independent ERISA benefits claim; must rely on assignments)
- Hobbs v. Blue Cross Blue Shield of Ala., 276 F.3d 1236 (11th Cir. 2001) (healthcare providers are not beneficiaries/participants under ERISA)
- Ward v. Alt. Health Delivery Sys., Inc., 261 F.3d 624 (6th Cir. 2001) (payment entitlement does not make a provider an ERISA beneficiary)
- City of Hope Nat’l Med. Ctr. v. Health-Plus, Inc., 156 F.3d 223 (1st Cir. 1998) (assignee of participant stands in assignor’s shoes; no expansion of rights)
- Cacchillo v. Insmed, Inc., 638 F.3d 401 (2d Cir. 2011) (assignment proof required for derivative standing when seeking preliminary relief)
- Munaf v. Geren, 553 U.S. 674 (2008) (if no standing, court need not address preliminary-injunction factors)