“In 2018, the Third Circuit held in American Orthopedic & Sports Medicine v. Independence Blue Cross Blue Shield, that “anti-assignment clauses in ERISA-governed health insurance plans as a general matter are enforceable.” 890 F.3d 445, 453 (3d. Cir. 2018). Here, Patient’s plan contains an anti-assignment clause. Plaintiff agrees with Defendants that anti-assignment clauses are “valid and enforceable.” Pl.’s Recon. Mot. 13. The Third Circuit set forth an alternative potential avenue for recovery in the face of an anti-assignment clause: power of attorney. A patient “may confer on his agent the authority to assert [a] claim on his behalf, and the anti-assignment clause no more has power to strip [the healthcare provider] of its ability to act as [a patient’s] agent than it does to strip [the patient] of his own interest in his claim.” Am. Orthopedic, 890 F.3d at 455.”
Alkon v. Cigna Health & Life Ins. Co. (D. N.J. 2021)
Unfortunately, the issue noted in the above excerpt was not properly before the court. In this out of network provider case the court found that the issue was not adequately presented for consideration.
“But just as in American Orthopedic, Plaintiff waived this argument. Am. Orthopedic, 890 F.3d at 455 (“Appellant waived its arguments concerning the power of attorney by failing to raise them in its opening or reply brief . . . “).”
The district court expressed its likely ruling against the plaitniff, however, stating that:
Nevertheless, the Court addresses why it is without merit.
Plaintiff makes no attempt to show that the Designation of Authorized Representative amounts to a power of attorney. As this Court has pointed out, New ersey’s Revised Durable Power of Attorney Act, N.J.S.A. 46:2B-8.1, et seq., provides that “the principal authorizes another individual or individuals or a qualified bank . . . known as the attorney-in-fact to perform specified acts on behalf of the principal as the principal’s agent.” Somerset Orthopedic Assocs., P.A. v. Horizon Healthcare Servs., Inc., No. CV 19-8783, 2020 WL 1983693, at *7 (D.N.J. Apr. 27, 2020) (quoting N.J.S.A. 46:2B-8.2(a)). In Somerset Orthopedic, Plaintiff could not establish that healthcare practices were “individuals or a qualified bank” under the language of the statute, or that caselaw supported this contention. Id. at *8 (“[N]o party points the Court to any relevant case law that addresses whether an entity other than one that falls into the definition of “banking institution” can be an attorney-in-fact.”).
Even if healthcare practices could act as a principal’s attorney in fact, Plaintiff does not attempt to show that the Designation of Authority complies with New Jersey’s power of attorney procedural requirements. See Personal Image, PC v. Tech Briefs Media Group Medical Plan, No. CV203747JMVMF, 2021 WL 486905, at *4 (D.N.J. Feb. 10, 2021) (explaining that “Assignment of Benefits and Ltd. Power of Attorney” did not satisfy New Jersey’s power of attorney procedural requirements). The Designation of Authorized Representative that the Patient signed does not make Joseph D. Alkon, M.D., PC an attorney in fact.
Note: The court observed that the policy of enforcing anti-assignment clauses in plan documents may not be in the best interests of serving ERISA’s overall policy, stating:
The Court, in holding that Plaintiff lacks ERISA standing, does not pass on whether the proliferation of anti-assignment provisions in employer-sponsored health insurance plans that generally preclude healthcare providers from seeking adequate reimbursement from insurance companies is consistent with ERISA’s “careful balancing of the need for prompt and fair claims settlement procedures against the public interest in encouraging formation of employee benefit plans.” See Jordan Davis, Seeking A Second Opinion: A Call for Congressional Evaluation of Anti-Assignment Provisions in Employee Health Plans, 89 Fordham L. Rev. 2265, 2268 (2021) (analyzing Cooperman, 2020 WL 5422801, and examining whether the effect of anti-assignment provisions undermines the intended ERISA protections of employer-sponsored employee health insurance plans). This question is within the exclusive purview of the Congress.