Unreported / Non-Citable
Background
Five Texas hospitals sued Louisiana Health Service & Indemnity Company, doing business as Blue Cross/Blue Shield of Louisiana, seeking at least $673,030.79 in allegedly unpaid reimbursement for services provided to 15 Texas patients. The patients were covered by plans issued or administered by BCBSLA, and the claims were processed through the Blue Card Program using hospital service agreements between the hospitals and Blue Cross Blue Shield of Texas.
The hospitals asserted a petition to compel arbitration, claims based on express and implied contracts, an ERISA benefits claim, a contract claim involving non-ERISA plans, and promissory estoppel. BCBSLA moved to dismiss, arguing among other things that anti-assignment provisions defeated the hospitals’ ERISA standing and that its contacts with Texas did not support personal jurisdiction over the state-law claims.
The Court’s Holding
The court dismissed the ERISA claim without prejudice for lack of subject-matter jurisdiction. The plans contained unambiguous anti-assignment provisions, and the hospitals submitted no evidence establishing that BCBSLA had waived—or was estopped from invoking—those provisions. Because the assignments could not confer derivative ERISA standing, the hospitals failed to establish jurisdiction by a preponderance of the evidence.
The court also dismissed the state-law claims without prejudice for lack of personal jurisdiction. BCBSLA did not purposefully avail itself of Texas merely by covering Texas residents, participating in the Blue Card Program, processing claims for treatment in Texas, or allegedly receiving the benefit of agreements containing a Texas choice-of-law clause. The court denied jurisdictional discovery because the hospitals did not identify disputed jurisdictional facts or specify what discovery could establish.
The court granted the hospitals leave to amend through September 11, 2026, reasoning that evidence might permit them to overcome the jurisdictional defects. It deferred ruling on BCBSLA’s challenge to the petition to compel arbitration until the amendment period passed and BCBSLA reasserted the challenge.
Key Takeaways
- An unambiguous ERISA anti-assignment clause can prevent a healthcare provider from acquiring derivative standing to sue for plan benefits.
- An insurer does not establish minimum contacts with Texas merely by covering Texas residents, participating in a nationwide reciprocal network, or processing claims for care delivered in Texas.
- A request for jurisdictional discovery must identify the discovery sought, the facts it is expected to reveal, and how those facts would support jurisdiction.
Why It Matters
The decision underscores the jurisdictional obstacles healthcare providers may face when suing an out-of-state insurer over Blue Card claims. Providers relying on patient assignments must address enforceable anti-assignment language with evidence, not allegations alone, when an insurer mounts a factual jurisdictional challenge.
It also shows that nationwide network participation and the insurer’s awareness that members live or receive treatment in the forum will not necessarily establish specific personal jurisdiction. The dismissal remains without prejudice, however, and the hospitals may amend before the court resolves the arbitration count.