ERISA-Fifth Circuit Affirms District Court’s Decision On Aetna’s Payment Of Medical Bills

North Cypress Medical Center Operating Company v. Aetna Life Insurance Company, No. 16-20674 (5th Cir. 2018), involved the following situation.  Under Aetna’s insurance plans, patients are responsible for a portion of their bills.  Insurance companies cover the remainder.  But how much is Aetna obligated to pay for medical services provided to its members by an out-of-network hospital?

Houston medical services provider North Cypress Medical Center Operating Co., Ltd. and North Cypress Medical Center Operating Co. GP, LLC (collectively “NCMC”) alleged Aetna underpaid out-of-network providers like NCMC in violation of ERISA.  Aetna counterclaimed, alleging NCMC fraudulently and negligently misrepresented its billing practices by routinely waiving patient responsibilities yet billing Aetna for the total out-of-network cost.

The district court granted Aetna judgment as a matter of law on NCMC’s ERISA claims and granted NCMC judgment as a matter of law on Aetna’s fraud and negligent misrepresentation counterclaims.  Upon reviewing the case, the Fifth Circuit Court of Appeals affirmed the district court’s decision.

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