Eid v. Duke

ELDRIDGE, Judge. Jerry Eid, Sr., an employee of Bell Atlantic Corporation (now called Verizon Corporation), along with his wife, filed this tort action against the administrator of his employer’s disability benefits plan and the administrator’s medical consultant. The issue before us is whether the Eids’ tort action is preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA), 88 Stat. 832 , 29 U.S.C. § 1001 et seq. ⁶ I. Eid, an auto mechanic working for Bell Atlantic, was covered by Bell Atlantic’s Sickness, Accident and Disability Benefit Plan (hereafter referred to as “the Plan”), which provided short term disability benefits to employees who were “physically disabled and unable to work because of a work related injury.” The Bell Atlantic Plan is an ERISA covered employee benefit plan under the definition in 29 U.S.C. § 1002 (3). Bell Atlantic retained Core, Inc., as the Claims and Appeals Fiduciary to administer the Plan.

Core was authorized to make findings of fact and to resolve all issues presented by claims and appeals under the Plan. In August 1996, Eid was diagnosed as- having a bone spur on his right heel. His podiatrist, Dr. Victor. Tritto, scheduled Eid for surgery on August 29, 1996, to have the spur excised.

Mrs. Eid, prior to August 29, notified a Core representative that Eid would be disabled following the surgery and would rely on Plan benefits during his convalescence. On the day of the surgery, Dr. Tritto informed a Core representative that Eid would be absent from work for a period of three to six weeks, as the surgery was- complex and rare. Dr. Tritto also informed the Core representative that he would re-evaluate Eid’s capacity for light work duties in three weeks. Approximately two weeks after the surgery, a Core representative informed Mrs. Eid that Mr. Eid’s benefits were scheduled to be terminated on September 20, 1996, and that he was expected to return to work the following day, September 21st.

When Mrs. Eid informed Dr. Tritto about this development, Dr. Tritto contacted a Core representative, who' was a nurse, to express his opinion that the termination date was inappropriately early. Dr. Tritto also provided medical information about the complexity of Eid’s surgery and informed the Core nurse that Eid would not be able to return to work for an additional two toi four weeks, as he was presently on crutches and- could not place any weight on the injured foot. The Core nurse told Dr. Tritto that the file would be forward ⁷ ed for physician staff review in accordance with internal review procedures under the Plan. Eid’s file was forwarded to Dr. Christopher J. Duke for a review of the benefit determination.

Dr. Duke had been hired by Core to perform such reviews. The physician review, under the terms of the Plan, is based on the record maintained by Core and any information that the treating physician provides to the reviewing physician. Dr. Duke did not conduct a medical examination of Eid, or review Eid’s medical or x-ray records during the review process. Dr. Duke never met or spoke personally with Eid at any time, before or after the termination of Eid’s benefits, and he conducted the review based on Eid’s file and a conversation with Dr. Tritto.

Dr. Duke contacted Dr. Tritto by telephone to discuss Eid’s case. Dr. Tritto, in an affidavit, stated that he told Dr. Duke that the surgery was successful but that Eid was not yet physically able to return to work. According to Dr. Duke’s deposition, however, Dr. Tritto told Dr. Duke that Eid could walk on crutches but could not put any weight on the foot and was unable to get to work because he could not drive. Dr. Duke, according to his deposition, then informed Dr. Tritto that, because Eid was able to walk with crutches, he was no longer eligible for disability benefits because he was no longer wholly disabled under the Plan guidelines. 1 Dr. Duke advised Dr. Tritto of his opinion that Eid was capable of returning to work in a sedentary capacity, with accommodations that took into account the fact that he could not bear any weight on his right foot.

In accordance with Dr. Duke’s determination, Core scheduled Eid’s benefits to terminate on September 21. Because of certain administrative reasons, this termination date was postponed to October 7. ⁸ Eid returned to work on October 8, 1996, following the termination of his disability benefits under the Plan. He stated in his deposition that he returned to work on that date because he was afraid that he would be discharged if he did not do so. Eid based this belief on the response he received from a Core nurse to his inquiry about the consequences of his not reporting to work on October 8.

According to Eid, the nurse informed Eid that Bell Atlantic could take disciplinary action against him if he did not return to work that day. In his deposition, Eid also said that he contacted a union representative who told him that, under the circumstances, Bell Atlantic would have the authority to discharge him. Eid worked half days on October 8 . and 9, performing sedentary duties. He experienced considerable pain and left early each day, using vacation time.

On October 10, while at work, he once again experienced considerable pain. As Eid walked to the restroom before leaving on October 10, one of his crutches caught on a metal plate in the floor. Eid fell on his injured foot and tore his Achilles tendon. He has since needed several surgeries to repair the damage and remains in pain.

He has been unable to resume his normal employment as an auto mechanic with Bell Atlantic.

II

Jerry Eid and his wife filed this medical malpractice tort action in the Circuit Court for Baltimore City against Dr. Duke and Core. In their complaint, as amended, the Eids alleged in count one that Dr. Duke and Core negligently caused Jerry Eid to return to work before he was physically fit to do so by cutting off his disability benefits under the Plan. Dr. Duke’s recommendation that Eid was fit to return to work was the basis of the negligence alleged in count one. In count two, the plaintiffs alleged that Dr. Duke, “as an agent and/or employee” of Core, “fraudulently concealed and/or misrepresented” Mr. Eid’s condition and disability as well as the recommendation of his treating physician.

This second count was based on the notes that Dr. Duke made in Eid’s file following Dr. Duke’s discussion with Dr. Tritto. In a third ⁹ count, Eid and Mrs. Eid sought damages for loss of consortium. The defendants filed a motion to dismiss the complaint, arguing that the claims were related to a benefit determination under an ERISA covered plan and thus were preempted under ERISA. The trial court denied the motion.

After discovery, Dr. Duke and Core filed two motions for summary judgment. The first motion for summary judgment asserted that the tort claims were preempted by ERISA. The second motion for summary judgment asserted that there was no patient-physician relationship between Eid and Dr. Duke and thus no basis for a tort action under Maryland law. The trial court granted the defendants’ motion for summary judgment based on ERISA preemption, without expressly ruling on the other motion for summary judgment.

The Eids appealed, and the Court of Special Appeals affirmed the trial court’s judgment in an unreported opinion authored by Judge Charles E. Moylan, Jr. The Court of Special Appeals’ opinion was based on the broad reach of federal preemption under ERISA. See California Div. of Labor Standards Enforcement v. Dillingham Constr., N.A., Inc., 519 U.S. 316 , 117 S.Ct. 832 , 136 L.Ed.2d 791 (1997); New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645 , 115 S.Ct. 1671 , 131 L.Ed.2d 695 (1995). In holding that the plaintiffs’ state law tort claims were preempted, the Court of Special Appeals distinguished the facts of the instant case from other authority cited by the plaintiffs where the courts had found that a physician-patient relationship existed to sustain a medical malpractice claim that was not preempted by ERISA.

In particular, the intermediate appellate court distinguished this case from Crum v. Health Alliance-Midwest Inc., 47 F.Supp.2d 1013 (C.D.Ill. 1999). In Crum , the insured received what turned out to be improper treatment suggestions, to alleviate symptoms, from a nurse employed by the health insurer. The insured subsequently died because of delay in seeking further medical care. The delay was based on the nurse’s advice, and the federal court held that, under such circumstances, the wrongful death ¹⁰ claim was not preempted by ERISA.

Nevertheless, as the Court of Special Appeals pointed out in the instant case, Crum is distinguishable because the insured in Crum had sought and received medical advice from a nurse, a medical provider under the ERISA plan. On the other hand, as the Court of Special Appeals emphasized, Dr. Duke never met or spoke with Eid, and made “his recommendation as to benefit eligibility ... solely as a result of a paper file ... and a one-time consultation with [Eid’s] treating physician.” The Eids filed in this Court a petition for a writ of certiorari, raising two issues. First, they challenged the trial court’s and the Court of Special Appeals’ holding that the action was preempted by ERISA. Second, the Eids asserted that the Court of Special Appeals erred by relying on the lack of a patient-physician relationship when the trial court did not grant summary judgment on that ground.

We granted the Eids’ petition for a writ of certiorari, Eid v. Duke, 363 Md. 205 , 768 A.2d 54 (2001).

III

As a preliminary matter, we shall first consider the plaintiffs’ argument that the Court of Special Appeals erred in reaching the issue of whether a patient-physician relationship existed between Eid and Dr. Duke. The Eids correctly assert that it is an “established rule of Maryland procedure that, ‘[i]n appeals from grants of summary judgment, Maryland appellate courts, as a general rule, will consider only the grounds upon which the [trial] court relied in granting summary judgment.’ ” Lovelace v. Anderson, 366 Md. 690, 695 , 785 A.2d 726, 729 (2001), quoting PaineWebber v. East, 363 Md. 408, 422 , 768 A.2d 1029,1036 (2001). But this principle is applicable only when there are two or more separate and distinct grounds for the grant of summary judgment, and the trial court relies on one, but not another, in granting summary judgment. The two motions for summary judgment in the case at bar were not based on separate and distinct grounds.

Under ¹¹ circumstances like those in the present case, the issue of ERISA preemption is inextricably intertwined with the existence of a patient-physician relationship and whether the plaintiffs set forth a viable state law medical malpractice cause of action. As the Court of Special Appeals recognized, and as we discuss in Part IV below, these issues are interrelated under the Supreme Court cases interpreting and applying the ERISA statute. In fact, the plaintiffs indirectly acknowledge that the issues are interrelated, as they repeatedly characterize their action as a medical malpractice action and rely on cases holding that ERISA does not preempt traditional state law medical malpractice actions. (Petitioners’ brief at 16-17, 21-25, 27).

Consequently, because of the interrelationship of the issues, the Court of Special Appeals did not uphold a grant of summary judgment on a ground which was separate and distinct from the ground relied on by the trial court.

IV

As previously stated, the issue before us is whether the trial court correctly granted summary judgment in favor of the defendants, Dr. Duke and Core, on the ground that the tort action was preempted by ERISA. We shall hold that the Eids’ asserted state law tort action “relates to” a benefits determination under an ERISA covered plan and is, therefore, preempted under 29 U.S.C. 1144(a). Congress enacted ERISA in recognition of the rapid and substantial “growth in size, scope, and numbers of employee benefit plans.” 29 U.S.C. § 1001 (a). ERISA had two broad goals: safeguarding the interests of the plan participants and encouraging employers to offer such plans.

ERISA sought to protect the interests of participants in employee benefit plans “by providing for appropriate remedies, sanctions, and ready access to Federal courts.” 29 U.S.C. § 1001 (b). To encourage employers to provide benefit plans by simplifying administration, Congress included a broad preemption provision in the statute, by which the federal law was ¹² to “supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan.” 29 U.S.C. § 1144 (a) (emphasis added). State laws, in the context of ERISA, include “all laws, decisions, rules, regulations, or other State action having the effect of law, of any State.” 29 U.S.C. § 1144 (c). This broad preemption provision was intended to eliminate possibly conflicting or inconsistent state and local regulation of employee benefit plans.

For prior discussions by this Court of ERISA and its preemption of state law, see Connecticut General v. Insurance Commissioner, 371 Md. 455 , 810 A.2d 425 (2002) (involving the exception to the ERISA preemption provision for state laws regulating insurance); Insurance Commissioner v. Metropolitan Life Ins. Co., 296 Md. 334 , 463 A.2d 793 (1983) (same). Having preempted state law, ERISA provides specific remedies that are available in federal courts. ERISA has an “overpowering federal policy in [its] civil enforcement provisions, 29 U.S.C. § 1132 (a), authorizing civil actions for ... specific types of relief.” Rush Prudential HMO Inc. v. Moran, 536 U.S. 355 ,-, 122 S.Ct. 2151, 2164 , 153 L.Ed.2d 375, 395 (2002) (footnote omitted).

These provisions amount to an