This appears to have been started back in 2005 and recently upon changing the case it is now a breach of contract for payments made for less than the amount the contract called for. I am guessing these are medical treatments as a result of a car accident where the chiropractor gave treatment.
Again this states the use of a computer program, which is how all claims are processed these days, not a big room of people sitting at desks opening up envelopes. We have all read about the New York case against Ingenix where the data base has been retired as a result of the court agreement and I’m not sure if this is another data base used or the same one. At any rate it appears to be the same result, short payment. This is a class action suit too, so there’s no mention of the number of potential beneficiaries. The chiropractor was originally denied as he didn’t have enough information on the data base, but returned with the needed information and the suit was filed. BD
On February 11, 2005, F. Ryan Bemis, an Illinois chiropractor, filed a class action in the Illinois state court. On February 18, 2005, seven days later, the Class Action Fairness Act of 2005 became effective. Four years later, on March 25, 2009, the state court granted class certification. On April 24, 2009, the Safeco Insurance Company of America ("SICA") and Safeco Insurance Company of Illinois ("SICI") (collectively hereinafter referred to as "Safeco" or "petitioners") removed the action to the district court, but the district court granted Dr. Bemis' motion to remand the action to the state court. Safeco then filed this petition for permission to appeal under 28 U.S.C. § 1453(c). We grant the petition for leave to appeal and, for the following reasons, affirm the judgment of the district court.
All insured persons and licensed medical providers who: (a) submitted first-party medical claims to a Safeco member company pursuant to a Safeco insurance policy; (b) had their claim submitted to computer review, [sic] (c) received or were tendered an amount less than the submitted medical expenses and [sic] (d) received or were tendered an amount less than the stated policy limits.
The state court initially dismissed Count I of the complaint (breach of contract) because of insufficient evidence that the rights under the contract had been assigned to Dr. Bemis, but granted leave to amend. Dr. Bemis then filed a first amended complaint that contained the required assignment as an exhibit, but Safeco concedes that, in all other material respects, this pleading was identical to the initial complaint. Later, Dr. Bemis voluntarily dismissed the consumer fraud and unjust enrichment causes of action; only the breach of contract claim remains.
On March 25, 2009, long after the effective date of the Class Action Fairness Act of 2005, Pub. L. 109-2, 119 Stat. 4 (2005) ("CAFA"), Dr. Bemis sought, and was granted, class certification. The state court certified a class of:All persons insured by Safeco property and casualty insurance companies in [14 states] (and their assignee medical providers), who(a) during the period from January 1, 1997, to the date of this Order, submitted one or more claims for payment of medical expenses pursuant to an automobile policy's medical payments coverage;(b) had their claim(s) adjusted and reviewed by computer bill review software incorporating Ingenix "MDR modules;" and
(c) received or were tendered payment in an amount less than the submitted medical expenses due to charges purportedly exceeding the usual, customary or reasonable amount based on the Ingenix "MDR modules."
The key remains adequate notice to the defendant of its potential liability. We are convinced that, when the complaint is read as a totality, the original complaint clearly placed Safeco on notice that it was facing liability for its use of the computer program in adjusting the accounts of its affiliates' policy holders. Routine, "workaday" changes to class definitions do not create new litigation for CAFA purposes. See Schorsch, 417 F.3d at 751.