Federal Court Has Jurisdiction Where Claim Relates to ERISA Plan.

Position:PREEMPTION - Employee Retirement Income Security Act of 1974
 
FREE EXCERPT

The U.S. District Court for the Northern District of Texas finds that it has subject matter jurisdiction in a case involving a doctor seeking reimbursement for medical services from an insurance company.

The plaintiff is a health care provider who participates in the provider network of a Texas insurance company and treats patients who are participants and beneficiaries under health benefit plans administered by the insurance company. The defendant is another branch of the insurance company based in Louisiana, and its insureds have access to the provider network of the Texas insurance company for services.

The plaintiff treated a patient who was insured by the defendant under an employee health benefit plan sponsored by the patient's employer. At the time of treatment, the plaintiff obtained an assignment of benefits from the patient, allowing him to bill the defendant directly for payment of services.

After paying the claim, the defendant determined that the claim was paid in error and sought a refund from the plaintiff. The plaintiff disagreed with the assessment and appealed the determination, but the defendant recouped the owed amount from a subsequent payment owed to the plaintiff for the treatment of a different patient. The plaintiff filed suit against the defendant in small claims court in Texas for theft of money involving recoupment for medical services. The defendant removed the case to this court on the basis of federal question jurisdiction. The defendant alleges that the plan qualifies as an employee welfare benefit plan governed by the Employee Retirement Income Security Act of 1974 (ERISA).

The defendant argues that the plaintiff's claim cannot avoid ERISA preemption because the recoupment of benefits is unavoidably dependent on whether the benefits are covered under the plan. The plaintiff argues that his claim is not preempted by ERISA because the defendant failed to follow the ERISA appeal procedures.

A defendant can remove an action filed in state court to federal court if the action is one that could have originally been filed in federal court. The removing party bears the burden of establishing jurisdiction. The jurisdiction of a federal court is limited, and federal courts generally may only hear a case if it involves a question of federal law or where diversity of citizenship exists between the parties. Removal is not possible unless the plaintiff's well-pleaded complaint raises issues of federal law sufficient to...

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