Court: $1.6 Million Denied & Delayed? Prompt Pay Penalty from ERISA Not State Prompt Pay Laws

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ERISAclaim.com Offers Webinars to Examine the Latest Federal Court Decisions on Nov. 09, 2011 That a Provider’s State Prompt Pay Lawsuit Against CareFirst, Inc. in Maryland Must be Removed to Federal ERISA Court, and Awarded $11,983 to the Provider Under Federal Prompt Pay Protections.

This is a quite lengthy 60 page federal ERISA court ruling, but every word of the court decision is worth of millions of dollars for all hospitals and providers faced with unreasonable denials and delays of all legitimate claims.

ERISAclaim.com offers Executive Webinars to examine the latest federal court decisions on Nov. 09, 2011 that a provider’s state prompt pay lawsuit against CareFirst, Inc in Maryland state court must be removed to the federal ERISA Court, and on Nov. 28, 2011, the Court awarded $11,983.00 to the plaintiff provider under ERISA federal prompt pay protections.

The Court case info: Feldman's Medical Center Pharmacy, Inc. V. CareFirst, Inc., Case #: 1:10-cv-00254-SKG, Document 150, Filed 11/09/11, in the United States District Court for the District Of Maryland.

ERISAclaim.com’s Executive Webinars will discuss the Court decision in this case: (1) federal law ERISA completely pre-empts Maryland State Prompt Pay Law; (2) State prompt pay penalty law is statutory while federal ERISA prompt pay penalty is the discretion of the Court; (3) ERISA prompt pay penalty is available as “the federal postjudgment interest rate under 28 U.S.C. § 1961”; (4) A provider must have a valid ERISA Assignment in order to seek for ERISA remedies; (5) “Based on its assignments of benefits from CareFirst's insureds, however, FMCP is entitled to direct reimbursement under ERISA § 502”; (6) A “Par Provider” may seek for state prompt pay remedies pursuant to "Participating Professional Provider Agreement" or "PPP Agreement"), however the plaintiff provider “is not a par provider with respect to factor drugs under the PPP Agreement”.

“This is a quite lengthy 60 page federal ERISA court ruling, but every word of the court decision is worth of millions of dollars for all hospitals and providers faced with unreasonable denials and delays of all legitimate claims,” says Dr. Jin Zhou, President of ERISAclaim.com, a national expert on PPACA and ERISA appeals and compliance.

According to the Court document, the following is the case background:

“On June 1, 2009, Plaintiff Feldman's Medical Center and Pharmacy, Inc. ("FMCP" or "Plaintiff") sued Defendant CareFirst, Inc. ("CareFirst" or "Defendant") in the Circuit Court for Baltimore County for $1,588,127.77 plus interest for breach of contract, unjust enrichment, and bad faith arising out of CareFirst's denial of reimbursement to FMCP for factor drugs it provided to CareFirst's insureds. (ECF No. 2). CareFirst removed to this Court pursuant to 28 U.S.C. § 1441. (ECF No. 1). The case was referred to the undersigned magistrate judge by consent of the parties pursuant to 28 U.S.C. § 636(c) and Local Rule 301.4. (ECF No. 94).

On March 4, 2011, FMCP moved for summary judgment, seeking as relief: (i) judgment on Counts I through III for non-payment of invoices in the amount of $109,989.32; (ii) interest on the unpaid contributions in the amount of $886,483.93; (iii) attorneys' fees and costs; and (iv) such other and further relief as the Court deems just and proper. (ECF No. 100, 1-2). FMCP asserted alternative theories of recovery: Maryland contract law; § 502 of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132; and unjust enrichment. (ECF No. 100-1). FMCP asserted entitlement to prejudgment interest under Md. Code Ann., Insur. § 15-1005 (the "Maryland Prompt Pay Statute") or, alternatively, under ERISA § 502. (Id.). CareFirst opposed FMCP's motion for summary judgment and moved for partial summary judgment with respect to FMCP's claims for reimbursement and prejudgment interest under the Maryland Prompt Pay Statute. (ECF No. 109). CareFirst did not, however, assert entitlement to summary judgment under § 502 of ERISA. See id. The Court held motions hearings on June 9, 2011 and August 11, 2011 pursuant to Local Rule 105.6. (ECF No. 128).

During the pendency of the litigation, CareFirst paid $1,547,054.87 in satisfaction of FMCP's claims for reimbursement1, as well as $23,017.00 in prejudgment interest.

The parties agree that the only issue presently pending before the Court is FMCP's claim for prejudgment interest. (ECF No. 121, 2).2 For the reasons set forth herein, the Court GRANTS IN PART FMCP's motion for summary judgment with respect to its claim for prejudgment interest under ERISA § 502 but DENIES IN PART FMCP's motion for summary judgment with respect to its claim for prejudgment interest under the Maryland Prompt Pay Statute. The Court DENIES IN PART CareFirst's motion for summary judgment with respect to FMCP's claim for additional interest.”

According to the Court document, the Court decided in part:

“For the reasons set forth below, the Court orders prejudgment interest under ERISA § 502 at the federal postjudgment rate set forth in 28 U.S.C. 1961. Interest shall be determined on a claim-by-claim basis using the 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date on which interest begins to accrue for each individual claim”.

To find out more about PPACA Claims and Appeals Compliance Services from ERISAclaim.com:
http://www.erisaclaim.com/products.htm

Located in a Chicago suburb in Illinois, ERISAclaim.com offers free webinars, basic and advanced educational seminars and on-site claims specialist certification programs for doctors, hospitals and commercial companies, as well as numerous pending national ERISA class action litigation support. Dr. Jin Zhou is regarded as the industry “Godfather of ERISA claims” for healthcare providers.

For any questions, please contact Dr. Jin Zhou, president of ERISAclaim.com, at 630-808-7237.

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