“On April 27, 2022, Sanford began requesting that Mayo refund the payments made on the claims submitted, and that Mayo should bill BCBS ND as primary; Mayo refunded these payments in good faith,” the lawsuit states. “Mayo then billed BCBS ND, who denied the claims … based on a lack of preauthorization.

“Mayo would not have sought preauthorization from BCBS ND at the time of [the patient’s] admission because it was led to believe that Sanford was primary, and Sanford confirmed this fact by preauthorizing all dates of service and paying several claims submitted to it by Mayo for those dates.”

Due to Sanford’s “negligent and material misrepresentations,” the lawsuit says, Mayo has gone unpaid for more than two years for services in the amount of $739,956.20.

The clinic wants Sanford to pay damages that go beyond the value of the unpaid medical bills, including its costs and fees in the litigation.

In its motion to dismiss, Sanford Health Plan argues Mayo has not sufficiently identified the contract or material terms that the insurer allegedly breached. Further, the health plan says Mayo’s reliance on inaccurate information allegedly supplied by the insurer was not the cause of its failed claim for reimbursement from Blue Cross.

“Mayo alleges that the denial and rejected appeal were the result of no pre-authorization for the health care [the patient] received and that Sanford led Mayo to wait too long to request a retroactive authorization,” Sanford said in its motion. “However, in a letter explaining its denial, BCBS ND directly contradicts Mayo’s allegations.”