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Home / Opinions / Courts / 8th U.S. Circuit Court of Appeals / Insurance Law : Group Health Policies – Rates – Vexatious Refusal

Insurance Law : Group Health Policies – Rates – Vexatious Refusal

(1)Where an outpatient surgery center that entered an agreement to become a network provider brought claims including breach of contract and quantum meruit challenging the rates paid to it by insurers, summary judgment for the insurers is affirmed because the plain language of the contract provisions supported the district court’s conclusion that the surgery center agreed to accept the insurer’s rate for services to insureds belonging to all of the insurers’ networks in its ancillary-provider agreement, and the court also properly found that equitable claims were barred by the contracts covering the reimbursement rates.

(2)Where a surgery center argued that the insurers’ reimbursement rates were unreasonable and constituted a refusal to pay a loss under the statute, the parties’ contracts controlled the payments and the policies authorized payments directly to providers for covered services, so the district court did not err in granting summary judgment to the insurers on a claim of vexatious refusal.

Judgment is affirmed.

32nd Street Surgery Center, LLC v. Right Choice Managed Care (MLW No. 699097/Case No. 15-1727 – 13 pages) (U.S. Court of Appeals, 8th Circuit, Gruender, J.) Appealed from U.S. District Court, Western District of Missouri, Fenner, J. (William J. Skepnek, Lawrence, Kansas, argued for appellant; Frankie Forbes and Brennan P. Fagan appeared on the brief) (Rebecca R. Hanson, Chicago, argued for appellees; Martin J. Bishop appeared on the brief).

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