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Woodruff v. Blue Cross and Blue Shield of Alabama

United States District Court, N.D. Alabama, Southern Division

January 26, 2018




         The plaintiff filed the amended complaint in this action under the Employee Retirement Income Security Act of 1974 (“ERISA”), asserting that defendant Blue Cross Blue Shield of Alabama (“BCBS”) wrongfully denied his request for reimbursement of medical care expenses, in violation of 29 U.S.C. § 1001, et seq.[2](Doc. 4).[3] The plaintiff asserts that defendant Southern Company Services, Inc. Healthcare Plan (“SCSHP”) is also liable for the denial of benefits under the plan.[4] (Id.). Defendant SCSHP filed a motion for judgment on the record and supporting brief, defendant BCBS filed a motion for summary judgment and supporting brief, and the plaintiff filed responses to both motions, after which the defendants filed replies. (Docs. 24, 25, 27, 28, 30-33). The parties also filed the administrative record under seal. (Doc. 29).[5]

         Upon consideration of the pleadings, memoranda, and administrative record, the court concludes the defendants' motions (Docs. 24, 27) are due to be granted and that judgment is due to be entered in favor of both defendants for the reasons stated below.

         I. Factual Background

         The underlying, material facts of this case are not in dispute. The plaintiff had health benefits coverage through the employee group welfare plan of Southern Company Services, Inc. (Doc. 28 at 3; Doc. 30 at 2). The SCSHP documents state that the Plan is administered by the Benefits Administration Committee and that one of the Claims Administrators is BCBS.[6] (AR 000367-68). The Plan further states that the “Plan Administrator . . . has the exclusive discretionary authority to: interpret the Plan, decide all questions of eligibility for benefits, and determine the amount of these benefits.” (AR 000377). The Plan continues:

The Plan Administrator has delegated to your Claims Administrator . . . the discretionary responsibility and authority to determine benefit claims under the Plan …. Whenever the Claims Administrators . . . make reasonable determinations that are neither arbitrary nor capricious in their administration of the Plan, those determinations will be final and binding on you . . . .

(AR 000378).

         The plaintiff was diagnosed with and treated for prostate cancer in 2011. (AR 000008). Due to indications of a recurrence of his cancer, the plaintiff's treating physician in Birmingham, Alabama, recommended intensity modulated radiation therapy (“IMRT”). (Id.). Rather than move forward with this Plan-covered procedure, the plaintiff learned from the internet about proton beam radiation treatment (“PBRT”), went to Loma Linda University Medical Center in Loma Linda, California, and sought an opinion about his suitability for PBRT from Dr. Ivan Namihas. (Id.). Dr. Namihas determined the plaintiff was a viable candidate for PBRT, and the plaintiff opted to move forward with that treatment, rather than IMRT, as recommended by the Birmingham oncologist. (AR 000012).[7]

         On November 9, 2012, Dr. Namihas sought a pre-determination opinion from BCBS concerning coverage for the treatment. (AR 000007, 000014). BCBS responded that PBRT:

does not meet medical criteria for coverage under the Plan …. per Policy #348 for treatment of prostate cancer[.] The clinical outcomes with this treatment have not been shown to be superior to other approaches including intensity modulated radiation therapy (IMRT) or conformal radiation therapy.

(AR 000005; see also AR 000018). The plaintiff and Dr. Namihas were provided with information on how to request reconsideration of the pre-determination denial of coverage. (AR 000018). No. request for reconsideration was filed.

         The plaintiff, thus armed with knowledge the Plan would not provide coverage for the costs of PBRT, decided to proceed with the therapy and pay for it himself. (AR 000019). After successfully completing treatment, the plaintiff attempted to appeal the pre-determination denial in March 2013. (Id.). BCBS responded that, because the plaintiff had already received the treatment, he needed to file a claim for the medical services received rather than an appeal of the predetermination decision. (AR 000019, 000021). Instead of filing a claim, on April 3, 2013, Dr. Namihas filed an appeal of the pre-determination decision. (AR 00023). That appeal request states

Dr. Ivan C. Namihas is requesting an appeal for Proton Beam Radiation Treatment for prostate cancer, BCBS Alabama denied (prior authorization) for services, Mr. Jeffery Woodruff paid cash for services and is requesting that Dr. Ivan C. Namihas (Loma Linda Radiation) submit an appeal for review on his behalf. Clinical end of treatment notes, letter of medical necessity, several clinical support documents are attached to support medical necessity and appropriateness for proton radiation services which have been rendered.
Please consider this one time acception (sic) for coverage, this was the best form of treatment for Mr. Woodruff.

(AR 000023).

         By a letter attached to this appeal, Dr. Namihas challenged the conclusions of Medical Policy #348. (AR 000028). After a review of the literature concerning treatment of prostate cancer, Dr. Namihas asserted that, while no randomized clinical trials showing the efficacy of PBRT as opposed to IMRT exist, no such trials should be required because the effects of radiation on human tissue are already known to be harmful.[8] (AR 000028-29). However, Dr. Namihas also recognized that IMRT is considered “the gold standard” for radiation therapy for prostate cancer by “some radiation oncologists.” (AR 000029). In response, BCBS again stated that because the medical services at issue had already been provided, the plaintiff had to submit a claim, rather than a pre-determination appeal, for coverage consideration. (AR 000076-77).

         On November 7, 2013, an attorney on behalf of the plaintiff sent BCBS a letter inquiring as to the status of the plaintiff's appeal and resubmitting the same documents from April 2013. (AR 000079-90). On December 12, 2013, BCBS responded by stating it could not locate a claim for the PBRT treatment. (AR 000153, 000157). The plaintiff then submitted a “Medical Expense Claim Form, ” a letter dated March 4, 2014, and a copy of bills and payments for his treatment. (AR 000167-189). In his letter, the plaintiff states he entered a contract with Lima Linda Medical Center to pay $80, 000.00 for his treatment and requests BCBS reimburse this amount as his out of pocket expense. (AR 000171). BCBS responded to the plaintiff by stating it had not received a claim for the plaintiff's treatment from Loma Linda University Medical Center but, because Loma Linda was a preferred provider with their local Blue Cross and Blue Shield Plan, the plaintiff should have Loma Linda submit a claim with that local Blue Cross and Blue Shield. (AR 000192-193). BCBS stipulates it received two claims from Loma Linda. (Doc. 28 at 11). On April 21, 2014, BCBS again determined the Plan did not provide coverage for PBRT and denied the plaintiff's claim. (AR 000195).

         Through counsel, the plaintiff appealed the denial decision on January 9, 2015. (AR 000227). In that appeal, counsel for the plaintiff asserted that a “recent study … demonstrated the potential for higher biochemical control rates with proton therapy than with even the most advanced forms of other radiation therapies.” (Id.). Thus, he argues, PBRT was medically necessary because the dangers of radiation, including the development of secondary cancers, are well-documented; it was cost-effective because it results in fewer side effects than other treatments; and it was superior to other forms of treatment because protons do less damage than other forms of radiation. (AR 000228-232). BCBS denied that appeal. (AR 000274).

         In August 2015, yet another attorney acting on behalf of the plaintiff requested BCBS reconsider the claim denial. (AR 000282). BCBS responded in October 2015 that although the plaintiff's appeal was untimely, BCBS referred the matter to an Independent Review Organization for a peer clinical review. (AR 000681). Dr. Harold Kim, to whom the matter was referred, responded that PBRT was considered experimental/investigational; was not medically necessary; and did not qualify as a covered benefit under the Plan language. (AR 000682-685). Dr. Kim noted no randomized studies had been published which conclusively showed any advantage to PBRT over the current treatment standard of IMRT. (AR 000682). Because of that lack of published studies, “it is reasonable, at the present time, to consider proton therapy as investigational/experimental.” (AR 000683). Dr. Kim further reported that the 2014 ASTRO[9] model policy stated, “At the present time … the comparable efficacy of proton beam therapy with other prostate cancer treatments is still being developed, and thus the role of proton beam therapy for localized prostate cancer within the current availability of treatment options remains unclear.” (AR 000683).

         BCBS then sought a second opinion regarding whether PBRT was experimental/investigatory and whether it was medically necessary. (AR 000735). Dr. David Hsu, like Dr. Kim, concluded PBRT was considered experimental/investigatory and, therefore, not medically necessary. (Id.). He too stated that insufficient clinical peer review literature existed to allow a conclusion that PBRT was either safer or more effective than standard therapies such as IMRT. (AR 000736).

         This lawsuit followed the denial of the plaintiff's appeal.

         II. Standard of Review

         ERISA itself provides no standards for evaluating a plan administrator's determination. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 (1989). Therefore, the Eleventh Circuit Court of Appeals has set out the following steps to apply in reviewing any ERISA plan benefit decision:

(1) Apply the de novo standard to determine whether the claim administrator's benefits-denial decision is “wrong” (i.e., the court disagrees with the administrator's decision); if it is not, then end the inquiry and affirm the decision.
(2) If the administrator's decision in fact is “de novo wrong, ” then determine whether he was vested with discretion in reviewing claims; if not, end judicial inquiry and reverse the decision.
(3) If the administrator's decision is “de novo wrong” and he was vested with discretion in reviewing claims, then determine whether “reasonable” grounds supported it (hence, review his decision under the more deferential arbitrary and capricious standard).
(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator's decision; if reasonable grounds do exist, then determine if he ...

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