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Forward Momentum, LLC v. Team Health, Inc.

United States District Court, M.D. Alabama, Northern Division

October 30, 2019

FORWARD MOMENTUM, LLC, et al ., Plaintiffs,
TEAM HEALTH INC., et al., Defendants.



         Pending before the Court is Defendants Team Health Inc., (“Team Health”) and Paragon Contracting Services, LLC's (“Paragon”) Motion to Dismiss the Amended Complaint. (Doc. 33). For the reasons stated below, this motion is due to be granted in part and denied in part.

         I. BACKGROUND [1]

         The Plaintiffs are independent contractor physicians who work in emergency rooms. Defendant Team Health is a staffing company that, through its subsidiaries such as Defendant Paragon, contracts with physicians to provide emergency care at many hospitals across the country. The Defendants make money based on the number of patients each of its physicians cares for and the services its physicians provide. Thus, the Defendants make more money when its physicians see more patients and provide more care.

         Around 2012, the Defendants added a bonus program to its contracts with the physicians to incentivize them to assume additional responsibility during their shifts. This bonus system relies on “relative value units” (“RVUs”) to calculate the physicians' bonus. RVUs are based on a similar system initially established by Medicare to help it determine how much to reimburse healthcare providers for services. RVUs assign a value to each service provided. RVUs are generated when physicians directly see patients and, according to the Plaintiffs, RVUs are also generated when physicians supervise physician's assistants and nurse practitioners, also referred to as Advanced-Practice Clinicians (“APCs”). The Plaintiffs claim that these RVUs are referred to as “Assisting RVUs, ” and allow the Defendants to increase their billing and collections with insurers.

         A physician's supervision of APCs may include signing patient charts, even when the physician does not directly treat the patient. The Plaintiffs explain that for some patients, physicians work with the APCs to formulate a diagnosis and treatment plan, and in other cases, the physicians review an APC-created treatment plan. The Plaintiffs further emphasize that by supervising APCs and signing the patients' charts, the physicians are responsible for the patient's treatment, assuming significant responsibility and exposing themselves to liability. Accordingly, the Plaintiffs assert that the Defendants assured the Plaintiffs that they would receive RVU credit generated through their supervision of APCs to compensate for the attendant liability they assume.

         The contracts[2] do not explicitly state that the physicians will receive a bonus when they supervise APCs, but they do specify that the physicians will receive “incentive compensation equal to the RVU Multiplier times the applicable Relative Value Unit (“RVU”) for the services provided by the Professional.” (Doc. 31 at 10). The contracts further obligate the physicians to supervise APCs. The Plaintiffs assert that because the physicians were contractually required to supervise APCs and because that supervision generates an RVU that earns the Defendants additional money, the language of the contract obligates the Defendants to pay the Plaintiffs a bonus for that supervision.

         Plaintiffs argue that the individual plaintiff physicians have not been paid the RVUs owed for supervising APCs. The Plaintiffs also allege a class claim and assert that the Defendants admitted that in the Southeast region, it is their policy to not pay physicians for Assisting RVUs. Accordingly, the Plaintiffs bring a class claim for breach of contact (Count I); individual claims for unjust enrichment (Count II); and allege a separate count for declaratory judgment on behalf of both the individual plaintiffs and the class members (Count III).


         A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint against the legal standard set forth in Rule 8: “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Determining whether a complaint states a plausible claim for relief [is] . . . a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Iqbal. at 679.

         The plausibility standard requires “more than a sheer possibility that a defendant has acted unlawfully.” Iqbal, 556 U.S. at 678. Conclusory allegations that are merely “conceivable” and fail to rise “above the speculative level” are insufficient to meet the plausibility standard. Twombly, 550 U.S. at 555, 570. This pleading standard “does not require ‘detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678. Indeed, “[a] pleading that offers ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action will not do.'” Id.

         In sum, “[t]he plausibility standard ‘calls for enough fact to raise a reasonable expectation that discovery will reveal evidence' of the defendant's liability.” Miyahira v., Inc., 715 F.3d 1257, 1265 (11th Cir. 2013) (quoting Twombly, 550 U.S. at 556). “Our duty to liberally construe a plaintiff's complaint in the face of a motion to dismiss is not the equivalent of a duty to re-write it for the plaintiff.” Wilchombe v. Teevee Toons, Inc., 555 F.3d 949, 960 (11th Cir. 2009) (quoting Snow v. DirecTV, Inc., 450 F.3d 1314, 1320 (11th Cir. 2006)).


         A. The Plaintiffs plead sufficient facts to support their ...

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