Blue Cross Blue Shield of Louisiana’s Wins Remand of Overpayment Case

On Wednesday, the Eastern District of Louisiana granted Blue Cross Blue Shield of Louisiana’s (BCBSLA) motion to remand a suit to the state court. The defendant in the suit, Dr. Narinder M. Gupta, opposed the decision but the court ultimately denied his motion for leave to conduct jurisdictional discovery. The court granted the plaintiff’s motion to remand the matter because they found that the case governed by state law; “neither ERISA nor FEHBA completely preempts BCBSLA’s claims,” the court found.

The suit was initially filed due to the defendant’s alleged improper billing practices regarding his medical practice. As a medical service provider, the order said, Dr. Gupta entered into a “Physician Agreement” with the plaintiff. As a part of the agreement, he agreed to only perform procedures that were medically necessary and to keep record of performed procedures. Two audits conducted by BCBSLA in late 2017 revealed that he was performing medically unnecessary procedures and failing to keep proper records. These audits prompted BCBSLA to send Dr. Gupta a recoupment request, as they were “seeking a refund for overpayments totaling $240,222.31.”

After Dr. Gupta failed to file an appeal in a timely manner and did not pay the full amount owed, BCBSLA filed suit, alleging breach of contract, violation of La. Rev. Stat., detrimental reliance, unjust enrichment, and declaratory relief. The defendant countered the claims by citing that they were preempted by the Employer Retirement Income Security Act of 1974 (ERISA) and the Federal Employees Health Benefits Act (FEHBA), and that the court had federal question jurisdiction. BCBSLA then moved to remand, asserting that neither ERISA nor FEHBA preempted its claims completely, meaning the Court lacks jurisdiction.

In their decision, the court explained that Dr. Gupta did not adequately demonstrate that federal jurisdiction exists. Further, his claims of a preemption under ERISA were inadequate in the court’s eyes because the BCBSLA complaint seeks recovery of general assets rather than a constructive trust or equitable lien on certain funds. His claims of preemption under FEHBA are inadequate since FEHBA does not confer removal jurisdiction in contract-based reimbursement claims. The court also stated that Dr. Gupta’s argument for federal officer removal jurisdiction is denied and that he has failed to show necessity for jurisdictional discovery.

The plaintiff is represented by The Carter Firm, while the defendant is represented by Taggart Morton Law.