On Thursday, the court issued a Memorandum of Law and Order in a putative class action case brought against Blue Cross and Blue Shield of Minnesota. The order rejected a demand for certification of a class of plaintiffs and was filed in the District of Minnesota. The plaintiffs sought to include all insured members of BCBSM who were members of plans that made direct payments to insureds instead of to the doctor’s office directly, and for whom the defendant and ever declined to issue a payment due to overpayment of another claim.
When insurance companies process claims, the bills are supposed to be processed according to the terms of the contract with the group being insured, which sometimes results in bills being denied for a variety of reasons. Most claims are denied prior to payment being issued for the claim, however sometimes payment is issued, then later during audits or quality control checks, the insurer discovers that payment was made in error and must be recouped.
When payment is made directly to a health care provider, the insurer has the option of demanding a direct repayment by the provider or offsetting the incorrect payment against any future claim being made by the provider, regardless of who the patient. When payment is made directly to the insured, the plan has the option of demanding direct repayment from the insured, or by offsetting the payment against future claims from that insured. In this case, the named plaintiff received a demand letter for repayment of funds issued for a prior claim, and then after not receiving repayment, BCBSM offset a later claim against the amount that BCBS sought recoupment on.
The plaintiffs sought certification of the full class of insureds who, but for the recoupment of denied claims, would have received direct payment from BCBSM. The court noted that certification of a class requires both numerosity, which makes a class certification desirable in the name of efficiency of the court process, and commonality of issue, which allows the class to proceed in an effective manner, and typicality, which requires that the named plaintiffs be typical examples of the class they are seeking to certify. The court concluded that commonality and typicality could not be met by the class.
While the class does have the recoupment issue in common, the different potential class members had different plan documents constituting their benefits, the court explained, which would have different interpretations as to whether an offset would be permissible or not. This lack of commonality also meant that the plaintiffs could not show typicality as it was very possible that the restrictions in the various contracts meant that the plaintiffs’ situation could be unique, or limited to a few members of the potential class. The court also noted that the named plaintiffs appeared to subject to defenses specific to their particular claim situation, which might make the plaintiffs inadequate to fully represent the interests of the class. As a result of the above factors, the court denied class certification.
The court also noted that the named plaintiffs appeared to subject to defenses specific to their particular claim situation, which might make the plaintiffs inadequate to fully represent the interests of the class.
As a result of the above factors, the court denied class certification.