Court Blesses Provider Class Action Challenging Horizon's Bundling Policies
Judge William J. Martini of the District of New Jersey has granted class certification in an action by chiropractors challenging the bundling practices of Horizon Blue Cross Blue Shield of New Jersey ("Horizon"). The action asserts claims under ERISA and the common law stemming from Horizon's practice of incorporating payments for evaluation and management ("E/M") and physical therapy ("PT") services into a single "global fee" for chiropractic manipulation.
In granting class certification under both Fed. R. Civ. P. 23(b)(3) and (b)(1)(B), Judge Martini opined that the plaintiffs presented evidence that Horizon's systematic denial of E/M and PT services violated the terms of all of the relevant health plans and provider agreements. As a result, the class certification motion posed a "simple, concrete question":
Can the Court fairly and efficiently determine whether the bundling policy violated the rights of the proposed classes? Or do the individual inquiries that will be required to ultimately determine what, if any, actual damages each class member gets, pose such an overwhelming problem as to make class certification impractical and unfair? On the evidence produced, the Court can indeed determine, on a class-wide basis, whether the bundling policy violated ERISA or breached all the non-ERISA contracts in this case.
Significantly, Judge Martini also held that questions regarding provider assignment of benefits, or the potential applicability of anti-assignment clauses, did not pose individual issues sufficient to defeat class certification. This is because the claim forms submitted by the class members to Horizon all contained an assignment of benefits, and Horizon's course of dealing with those class members rendered any anti-assignment clauses "null and void." That holding is of a piece with similar findings reached by Judge Debevoise when he similarly certified a provider class in the Premier v. UnitedHealth case we've discussed previously. Together, these decisions confirm the ability of providers to challenge insurer claims practices through ERISA class actions.
The action is entitled Demaria v. Horizon Healthcare Services, Inc. and the Court's decision can be read here. The Maul Firm is collaborating on this case with class counsel Buttaci & Leardi LLC and Zuckerman Spaeder LLP.