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Anti-assignment Provisions and their effect on Forum Selection: S.D.N.Y.

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  • Anti-assignment Provisions and their effect on Forum Selection: S.D.N.Y.

    In a recent case from New York, the court delves into the effect that anti-assignment provisions can have on the forum. In this case, the Plaintiff is a physician who was assigned all medical benefits by his patient. After completing two medically necessary surgeries, the Plaintiff billed the Defendant accordingly. The Defendant refused to pay the full amount, and the Plaintiff filed suit in state court. The Defendant removed the case to federal court, and this case is in reference to the Plaintiff's motion to remand the case back to state court. The court reasoned that:

    the Second Circuit held an out-of-network health care provider was not the type of party who could bring a claim pursuant to Section 502(a)(1)(B) because the health care provider did not have a valid assignment for payment. The patient had authorized payment of medical benefits to the health care provider, but the court held the assignment was ineffective because the health care plan contained an anti-assignment provision. That provision stated, “although [c]overage may be assigned . . . with the written consent of Aetna[,] . . . Aetna will not accept an assignment to an out-of-network provider.”
    The Defendant argues that it would be able to remedy the standing issue simply by waiving the anti-assignment provision. However the court reasoned that "Aetna’s offer to waive the anti-assignment provision is no more than an attempt to circumvent the Court’s lack of subject matter jurisdiction. Aetna’s argument fails because “[a] party . . . cannot waive a defect in a federal court’s subject matter jurisdiction."

    As such, the court concluded that it does not have subject matter jurisdiction over the case, and granted the Plaintiff's motion. The entire opinion is attached below.
    Attached Files