United States District Court, N.D. California, San Jose Division
ORDER GRANTING IN PART AND DENYING IN PART MOTION TO
DISMISS WITH LEAVE TO AMEND Re: Dkt. Nos. 7, 13
H. KOH UNITED STATES DISTRICT JUDGE
California Spine and Neurosurgery Institute
(“Plaintiff”) sues Defendant United Healthcare
Insurance Company (“Defendant”) and Does 1
through 25 for causes of action arising from Defendant's
alleged under-payment of claims for reimbursement submitted
by Plaintiff after Plaintiff provided medically necessary
spinal procedures and treatment to patients who were insured
by Defendant. ECF No. 1-1 Ex. C ¶¶ 8-67 (First
Amended Complaint or “FAC”). Before the Court is
Defendant's motion to dismiss. ECF No. 7. Having
considered the parties' submissions, the relevant law,
and the record in this case, the Court GRANTS in part and
DENIES in part Defendant's motion to dismiss with leave
is a “medical facility dedicated to the care and
treatment of spine injuries and/or conditions” located
in Campbell, California. FAC ¶¶ 1, 8. In March 2018
and July 2018, Plaintiff rendered “medically
necessary” “spine surgeries” to three
patients-D.B., L.M., and M.B.- whose health insurance
benefits were sponsored and administered by
Defendant. Id. ¶¶ 12, 20, 25, 30,
36, 41. All three patients worked for the same employer and
were “beneficiar[ies] of a health plan . . .
administered” by Defendant. Id. ¶¶
11, 24, 35. All patients owned an identification card from
Defendant that was presented to medical providers in order to
obtain medical care. Id. Defendant instructed
patients to present an identification card “to assure
medical providers that they would be paid for medical care .
. . at a percentage of the usual and customary value for such
care.” Id. Furthermore, patients' employer
published a summary of the benefits of patients' medical
plans and noted that the plans paid 70% of eligible expenses
for care from out-of-network providers. Id.
¶¶ 12, 25, 36. Plaintiff was an out-of-network
provider under the health plans administered by Defendant.
Id. ¶ 9.
L.M., and M.B. experienced back pain and sought medical
services from Plaintiff. Id. ¶¶ 13, 26,
37. For each patient, Plaintiff contacted Defendant to verify
medical eligibility benefits, and Defendant's client
services representatives “either expressly or impliedly
assured” Plaintiff that Defendant “carried the
financial responsibility to pay for” all three
patients' “anticipated medical care at 70% of the
usual and customary value for such care.” Id.
¶¶ 17, 27, 38. For D.B., Plaintiff received an
authorization letter in response to Plaintiff's request
for coverage of services that determined that the treatment
was medically necessary. Id. ¶ 14-16. For
patients L.M. and M.B., Defendant's client services
representatives allegedly told Plaintiff that “no
pre-authorization was required.” Id.
¶¶ 29, 40.
on the existence of an identification card issued by
Defendant, the pre-authorization discussions and the
authorization letter, and “the express and/or implied
resultant assurances” that Plaintiff “would be
paid at least 70% of the usual and customary value of its
medical services anticipated to be rendered, ”
Plaintiff provided treatment to D.B., L.M., and M.B. and
submitted claims for payment at the usual and customary rate
for such services. Id. ¶¶ 20-21, 30-31,
41-42. Plaintiff alleges, however, that Defendant
significantly underpaid Plaintiff and owes $206, 909.66 plus
interest and other costs. Id. ¶¶ 21-23,
31-34, 42-45, 67.
December 20, 2018, Plaintiff filed suit against UHC of
California doing business as UnitedHealthcare of California,
Apple Inc., and Does 1 through 25 in the Superior Court of
Santa Clara County. ECF No. 1-1 Ex. A. Plaintiff's
complaint asserted three causes of action against defendants:
breach of implied in fact contract, breach of express
contract, and quantum meruit. Id. On February 25,
2019, Plaintiff amended the complaint and replaced UHC of
California with United Healthcare Insurance Company. FAC
¶ 5. On April 23, 2019, Plaintiff filed a request for
dismissal of Apple Inc. in state court. ECF No. 1-1 Ex. E. On
April 30, 2019, Plaintiff also filed a request for dismissal
of UHC of California in state court. ECF No. 1-1 Ex. F.
United Healthcare Insurance Company was the only remaining
3, 2019, Defendant removed the case to this Court. ECF No. 1.
On May 10, 2019, Defendant moved to dismiss all three causes
of action. See ECF No. 7 (“Mot.”).
Plaintiff opposed the motion to dismiss on July 17, 2019,
see ECF No. 19 (“Opp.”), and on July 31,
2019, Defendant filed a Reply, see ECF No. 20
Motion to Dismiss Under Rule 12(b)(6)
8(a)(2) of the Federal Rules of Civil Procedure requires a
complaint to include “a short and plain statement of
the claim showing that the pleader is entitled to
relief.” A complaint that fails to meet this standard
may be dismissed pursuant to Federal Rule of Civil Procedure
12(b)(6). The United States Supreme Court has held that Rule
8(a) requires a plaintiff to plead “enough facts to
state a claim to relief that is plausible on its face.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). “The plausibility
standard is not akin to a probability requirement, but it
asks for more than a sheer possibility that a defendant has
acted unlawfully.” Id. (internal quotation
marks omitted). Put another way, “a complaint need not
contain ‘detailed factual allegations,' [but] a
plaintiff must plead at least enough facts to put the
defendant on notice of the claim against it.”
Wheeler v. MicroBilt Corp., 700 Fed. App'x 725,
727 (9th Cir. 2017) (quoting Iqbal, 556 U.S. at
678). For purposes of ruling on a Rule 12(b)(6) motion, the
Court must “accept factual allegations in the complaint
as true and construe[s] the pleadings in the light most
favorable to the nonmoving party.” Manzarek v. St.
Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031
(9th Cir. 2008).
Court, however, need not “assume the truth of legal
conclusions merely because they are cast in the form of
factual allegations.” Fayer v. Vaughn, 649
F.3d 1061, 1064 (9th Cir. 2011) (per curiam) (internal
quotation marks omitted). Mere “conclusory allegations
of law and unwarranted inferences are insufficient ...