Non participating providers have been waiting for this decision for a long time. In North Jersey Brain & Spine Center v. Aetna, Inc., the Third Circuit held that an assignment of insurance benefits to aprovider, but without explicitly giving the provider the right to file suit, nonetheless gives the provider standing to sue for these benefits under ERISA.
Aetna contended in this case, and healthcare insurer CIGNA argued in other cases, such as Franco v. Connecticut General Life Ins. Co., that a provider could only have ERISA standing if she had an assignment that gave her the right to file suit on her patient’s behalf.
Some insurers went further, contending that the assignment language must specify the causes of action that the provider could bring, as if a non-lawyer patient could know that. Here the Third Circuit properly held: “An assignment of the right to payment logically entails the right to sue for non-payment. . . .
The value of such assignments lies in the fact that providers, confident in their right to reimbursement and ability to enforce that right against insurers, can treat patients without demanding they prove their ability to pay up front. Patients increase their access to healthcare and transfer responsibility for litigating unpaid claims to the provider, which will ordinarily be better positioned to pursue those claims.”
The Third Circuit now joins all the other circuits in this holding. This applies to non-participating providers, that is, providers who do not participate in an insurer’s network. Participating providers don’t need an assignment from their patients (called participants or beneficiaries under ERISA) because they have a direct action under their participating provider agreements.