The opinion of the court was delivered by: SYLVIA H. RAMBO
Before the court are the parties' cross-motions for summary judgment. The motions are ripe for disposition.
The following facts are essentially undisputed. Plaintiff Dorothy Travitz is a Pennsylvania resident. In 1990 she was an employee of BR Apparel, Inc., a member of the International Ladies' Garment Workers' Union ("ILGWU"), and a participant in that union's health and welfare program. Defendants Northeast Department ILGWU Health and Welfare Fund and ILGWU Eastern States Health and Welfare Fund were providers of benefit programs for members of the ILGWU. In January 1990, these two funds merged into a single entity, the ILGWU Eastern States Health and Welfare Fund ("the Fund"), which is the surviving union health and welfare plan, with offices in New York City.
On October 18, 1990, Plaintiff was seriously injured in a motor vehicle accident. According to Plaintiff, her accident-related medical expenses exceeded $ 65,000. She exhausted the available medical benefits coverage on her Prudential motor vehicle insurance and subsequently filed both a claim against the tortfeasor responsible for the accident, and an underinsurance claim with Prudential. She apparently exhausted the Prudential coverage. She reached a settlement with the tortfeasor on June 17, 1992.
Subsequent to the accident, Plaintiff made various claims under the ILGWU Fund plan for medical benefits which remain unpaid. She brought the captioned action to recover the benefits, as well as to clarify her rights to future benefits. According to her complaint, she seeks bad faith damages as well as the benefits, attorney's fees, costs, and interest. The complaint asserts federal jurisdiction on diversity grounds and presents no explicit legal doctrine to justify the claims.
Defendants have counterclaimed for reimbursement of $ 2,924.78 in advance payments made to Plaintiff for medical expenses allegedly excluded from Fund coverage, but advanced until Plaintiff recovered from the relevant third party(s) or tortfeasor(s). Plaintiff argues that since the medical expenses were improperly excluded from coverage, the subject payments were not "advances" and need not be reimbursed.
I. Motions for Summary Judgment.
The court will consider these cross-motions under the accepted standards for the award of summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Summary judgment is appropriate where there are no remaining issues of material fact to be decided, and one party is entitled to judgment as a matter of law. Hankins v. Temple Univ., 829 F.2d 437, 440 (3d Cir. 1987). In examining Rule 56 motions, the court must consider "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986).
The parties' burdens in summary judgment may be described in the following way: Once the moving party has shown an absence of evidence to support the claims of the non-moving party, the non-moving party must do more than simply sit back and rest on the allegations in her complaint. She must "go beyond the pleadings and by her own affidavits, or by the 'depositions, answers to interrogatories, and admissions on file,' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). If the non-movant bears the burden of persuasion at trial, the moving party may meet its burden by showing that the evidentiary materials of record, if reduced to admissible form, would be insufficient to carry the non-movant's burden at trial. Chipollini v. Spencer Gifts, Inc., 814 F.2d 893, 896 (3d Cir.), cert. dismissed, 483 U.S. 1052 (1987).
II. Is the Fund a Self-Insured ERISA Plan?
From the outset of this action, Defendants have asserted that the Fund is a multi-employer health and welfare plan within the meaning of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Defendants' legal arguments in the captioned action depend on the Fund being an ERISA plan. However, Plaintiff has never, in either responsive or reply briefs, addressed the Fund's status under ERISA, or submitted any evidence to controvert Defendants' position on this point. In fact, Plaintiff's arguments seem to implicitly accept the fact that the ILGWU Fund is an ERISA plan. (See, e.g., Plaintiff's brief in support at 6-8.)
Defendants have submitted the affidavit of the Fund director, which states that the Fund has always been a multi-employer plan within the meaning of ERISA. (See Aff. of Bert N. Obrentz ("Obrentz Aff.") at P 3, p.2.) It provides medical, disability, and preventative health care, as well as vacation benefits to employees of contributing union employers. (Id.) As per collective bargaining agreements, plan benefits are funded by employer contributions and the income earned on them. (Id.) The Fund has a published Plan, Rules, and a Summary Plan description available to individuals upon request and routinely supplied to union affiliates. Defendants have supplied copies of these documents as exhibits.
The Fund has ongoing agreements with Blue Cross and Blue Shield to administer its hospital, medical, and major medical benefits; the Fund itself remains solely responsible for the payment of such benefits. These agreements have also been included as exhibits by Defendants.
After viewing the above documents, and given the lack of any controverting evidence from Plaintiff, this court concurs with Defendants that the subject Fund is a multi-employer employee welfare benefit plan covered by ERISA. See 29 U.S.C. § 1002 (1), (4), (37A) (definitions of employee welfare plan, employee organization, multi-employer plan); 29 U.S.C. § 1003 (coverage of ERISA); 29 U.S.C. § 1102 (a), (b) (establishment and requisite features of employee benefit plan). The court further agrees that the Fund is a self-insured ERISA plan.
III. What is Plaintiff's Cause of Action and What Is the Standard of Review?
As the court stated earlier, the captioned Complaint cites facts and the desired outcome but no explicit legal doctrine. It makes no mention of ERISA. Because the Complaint requests "bad faith" damages, a state law concept, the court infers that Plaintiff's action was intended as one under state law, perhaps for breach of contract.
Since the court has decided that the Fund is an ERISA plan, ERISA itself circumscribes the causes of action available to plan participants. ERISA is a comprehensive piece of legislation which contains three provisions pertaining to its preemptive effect on state law. ERISA § 514(a), the so-called "preemption clause," provides,
Except as provided in subsection (b) [ERISA savings clause] of this section, the provisions of this subchapter and subchapter II of this chapter shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan . . . .
Except as provided in subparagraph (B) [ERISA deemer clause], nothing in this subchapter shall be construed to exempt or relieve any person from any law of any State which regulates insurance, banking or securities.
29 U.S.C. § 1144(b)(2)(A). ERISA § 514(b)(2)(B), the "deemer clause," provides,
Neither an employee benefit plan . . . nor any trust established under such a plan, shall be deemed to be an insurance company or other insurer, bank, trust company, or investment company or to be engaged in the business of insurance or banking for purposes of any law of any State purporting to regulate insurance companies, insurance contracts, banks, trust companies, or investment companies.
29 U.S.C. § 1144 (b)(2)(B). Whatever else these three provisions encompass, it is clear that they result in the preemption of state common law causes of action to recover medical benefits, such as breach of contract. Such causes of action relate to employee benefit plans, and are thus within the scope of the "preemption clause," but are not specifically directed at the regulation of insurance, banking or securities and thus not saved under the "savings clause." See Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 47 (1987). As the United States Supreme Court has detailed, Congress intended that the deliberately extensive civil enforcement scheme contained in ERISA § 502(a), 29 U.S.C. § 1132(a), be the exclusive vehicle for actions by plan participants and beneficiaries asserting improper benefits processing. Id. at 52-54.
Under ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), a plan participant may bring a civil action "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B). The court will deem Plaintiff's action to be one under ERISA § 502(a)(1)(B).
In actions under § 1132(a)(1)(B), the United States Supreme Court has held that courts must review the denial of benefits under a de novo standard, unless the subject plan explicitly gives the plan administrator, or fiduciary, discretionary authority to determine eligibility for plan benefits or to construe the plan's terms. In those cases, courts must apply a more deferential standard ...