Court dismisses Ambrosia Treatment Centers' suit in claims dispute with Cigna

By Gabriel Neves | Nov 28, 2018

WEST PALM BEACH –Three South Florida substance abuse treatment centers suffered a setback in their dispute with a health insurance provider in the U.S. District Court for the Southern District of Florida.

In a ruling issued Nov. 20, U.S. District Judge Robin Rosenberg dismissed the first amended complaint of the lawsuit filed by RMP Enterprises, doing business as Ambrosia Treatment Centers, against Connecticut General Life Insurance Co., doing business as Cigna.

Ambrosia Treatment Centers sued Cigna alleging that the insurance provider failed to pay claims, underpaid claims, delayed payment on claims and sought to recover overpayment on claims. Ambrosia also claimed that Cigna attempted to recover payments that it already made.

Ambrosia operates treatment facilities for substance abuse and mental health, providing services for members of employee health plans that are insured by the health insurance company.

As stated in the ruling, the Ambrosia centers "accept direct payments from Cigna and the companies for which

Cigna directly acts as the group coverage insurer as reimbursement for the services it provides to

plan members and their beneficiaries for medical and mental health services directly related to

substance abuse."

Cigna acts a third-party administrator of the plans, as directed by Employee Retirement Income Security Act of 1974 (ERISA).

The amended complaint also alleged "failure to provide benefits under ERISA plans, failure to maintain reasonable claims procedures, breach of implied-in-fact contract, breach of implied-in-law contract and declaratory judgment."

In her ruling, Rosenberg considered that Ambrosia missed the deadline to amend their pleadings, as well as "the opportunity to amend their pleadings" and "a clear directive on how to cure their pleading deficiencies."

She also said that "plaintiffs’ failure to follow those instructions and cure the pleading deficiencies warrant the court’s dismissal of the FAC (first amended complaint) with prejudice, and without further leave to amend."

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