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finding that plaintiff had not exhausted her administrative remedies where "plaintiff failed to file any grievance or appeal pursuant to the plan as a result of the denial of her claims."
Summary of this case from Marcella v. Ochsner Health SystemOpinion
No. 00-2606, SECTION "R" (5).
January 16, 2001.
ORDER AND REASONS
Before the Court is the motion for summary judgment by defendants, United Healthcare of Louisiana, Inc. and United Behavioral Health, to dismiss the claims of plaintiff, Cheryl Lou Lavigne, for failure to exhaust her administrative remedies under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1001, et seq. For the reasons stated below, the Court dismisses plaintiff's claims for failure to exhaust her administrative remedies.
I. Background
Cheryl Lou Lavigne filed her petition for damages in the 21st Judicial District Court of Tangipahoa Parish, Louisiana on July 28, 2000. Plaintiff was employed by Liberty Life Insurance (Liberty) and covered under a group health insurance plan ("the plan") administered by United Healthcare. In her petition, plaintiff seeks money for the denial of her medical claims. On September 1, 2000, defendants removed the case to this Court, asserting that plaintiff's claims are preempted by the Employee Retirement Income Security Act (ERISA). On October 24, 2000, this Court denied plaintiff's motion to remand, finding that the group health insurance plan is part of an ERISA plan and that plaintiff participated in that plan.
II. Discussion
A. Summary Judgment Standard
Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. See FED. R. CIV. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552 (1986). A court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, "that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Lavespere v. Niagara Mach. Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990), abrogated on other grounds by Little v. Liquid Air Corp., 37 F.3d 1069 (5th Cir. 1994) ( citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2511 (1986)). The moving party bears the burden of establishing that there are no genuine issues of material fact.
If the dispositive issue is one for which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325, 106 S.Ct. at 2554; see also Lavespere, 910 F.2d at 178. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See Celotex, 477 U.S. at 324, 106 S.Ct. at 2553. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue exists for trial. See Id. at 325, 106 S.Ct. at 2553-54; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1996).
B. Failure to Exhaust Administrative Remedies
Defendants contend that plaintiff's claims for unpaid medical benefits should be dismissed without prejudice because plaintiff has failed to exhaust her administrative remedies under the group health insurance plan. On the other hand, plaintiff contends that ERISA is not applicable to this case and that the case should be remanded to state court. As the Court stated earlier, it has already considered and rejected plaintiff's arguments that ERISA is inapplicable. Plaintiff has presented nothing to change the Court's opinion.
ERISA does not specifically require a claimant to exhaust her administrative remedies. See Hall v. National Gypsum Co., 105 F.3d 225, 231 (5th Cir. 1997). However, relying on Congressional intent, the Fifth Circuit has adopted the rule that a "plaintiff generally must exhaust administrative remedies afforded by an ERISA plan before suing to obtain benefits wrongfully denied." Chailland v. Brown Root, Inc., 45 F.3d 947, 950 (5th Cir. 1995). The exceptions to this exhaustion rule are extremely limited. See Hall, 105 F.3d at 231 (recognizing exceptions to the general rule where resort to administrative remedies is futile or the remedy inadequate). Plaintiff does not argue that she falls within any of the applicable exceptions to the administrative exhaustion requirement.
Here, plaintiff's group health insurance plan requires compliance with certain "Grievance Procedures" prior to instituting any litigation to recover the costs of benefits. ( See Def.'s Mem. Supp. Mot. to Dismiss, Ex. A at 52.) The plan contains an extensive explanation of the procedure for denial of a claim, review of the denial, and a decision on review. ( See id.)
The Court's review of the policy behind the exhaustion requirement supports its conclusion that plaintiff must first exhaust her administrative remedies before filing suit. Courts have recognized that the purposes of the exhaustion requirement are to (1) uphold Congress' desire that ERISA trustees be responsible for their actions, not the federal courts; (2) provide a sufficiently clear record of administrative action if litigation should ensue; and (3) assure that any judicial review of fiduciary action (or inaction) is made under the arbitrary and capricious standard, not de novo. See Denton v. First Nat'l Bank of Waco, Texas, 765 F.2d 1295, 1300 (5th Cir. 1995). Lawsuits by plan participants are proper only after the exhaustion of administrative remedies because participants otherwise would be able to circumvent the administrative review, and federal courts would be forced to review such claims de novo. See Denton, 765 F.2d at 1300. These policies apply here and support the Court's conclusion that plaintiff must exhaust her administrative remedies.
In this case, plaintiff has failed to exhaust the administrative remedies provided under her group health insurance plan. In fact, plaintiff failed to file any grievance or appeal pursuant to the plan as a result of the denial of her claims. ( See Def.'s Mem. Supp. Mot. to Dismiss, Ex. B) Accordingly, the Court finds that plaintiff has failed to exhaust her administrative remedies.
III. Conclusion
For the foregoing reasons, the Court grants defendant's motion for summary judgment for failure to exhaust administrative remedies. Plaintiff's complaint is dismissed without prejudice.
New Orleans, Louisiana, this 16th day of January, 2001.