Doe v. Aetna Life Ins. Co.

JOHN DOE and JANE DOE,as parent and guardian of JULIE DOE, Plaintiffs, v. AETNA LIFE INSURANCE COMPANYa/k/a AETNA HEALTH INCORPORATED, Defendant.

Civil Action No. 1:17-cv-01167-SDG

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION

January 27, 2020

ORDER

This matter is before the Court on the parties' cross-motions for judgment on the administrative record. For the reasons set forth below, the Court GRANTS Plaintiffs' Motion for Judgment on the Administrative Record [ECF 49] and DENIES Defendant's motion [ECF 50].

I. STANDARD OF REVIEW

The procedural vehicle for resolving motions for judgment based on the administrative record is Federal Rule of Civil Procedure 52(a)(1), which states: "[i]n an action tried on the facts without a jury . . . the court must find the facts specially and state its conclusions of law separately. The findings and conclusions may be stated on the record after the close of the evidence or may appear in an opinion or a memorandum of decision filed by the court." Presenting findings and conclusions in a written order "has been accepted as the preferable practice" by this Court. Garlington v. Metro. Life Ins. Co., No. 1:11-CV-1260-SCJ, 2012 WL 7589403, at *5 (N.D. Ga. Dec. 31, 2012).

II. FINDINGS OF FACT

These findings of fact are based on the evidence contained in the administrative record.

A. Medical History

Aetna funded a health-insurance plan (the "Plan") issued to "John and Jane Doe" that covered their daughter, "Julie Doe," as a Member.¹ Julie was born in 1999.² At a young age, Julie's parents noticed she exhibited defiant and dangerous behavior beyond the level of a normal child.³ In January 2005, after Julie Doe's parents divorced, she began living with her father and was exposed to certain inappropriate adult information.⁴ Shortly thereafter, Julie began to experience"serious behavior problems" that required professional counseling and medications.⁵

In 2011, Julie was transferred from private school to public school, where her inappropriate behavior escalated and became sexual in nature.⁶ At this time, while in the seventh grade, Julie began to engage in self-harm and self-mutilation, and experienced suicidal ideations.⁷ Julie also began experimenting with tobacco, alcohol, and illegal drugs.⁸ This led to Julie's hospitalization, enrollment in behavioral therapy, counseling from therapists, and change in medications.⁹ From June 2012 to January 2015, with only brief respites, Julie continued this pattern of inappropriate and dangerous behavior, including self-harm, high-risk sexual activity, lying, stealing, and different reactions to medications.¹⁰ During this period, Julie attended two residential treatment programs: Pacific Quest Wilderness Program and Alpine Academy Therapeutic Residency.¹¹

In January 2015, after exhibiting slight improvement at the residency programs, Julie returned home and immediately returned to stealing and self-harm.¹² In response, Julie was sent to Brandon Hall, a small boarding school, where she was administered anti-depressants and attended therapy sessions.¹³ While at Brandon Hall, Julie engaged in extremely high-risk sexual activities and continued to exhibit inappropriate and dangerous behavior.¹⁴ She was also raped.¹⁵ Based on Julie's dramatic regression, the decision was made to send her back to a structured wilderness treatment program.¹⁶

After leaving Brandon Hall, from May 2015 until August 2015, Julie attended Trails Carolina, a wilderness treatment facility, and began a medication regimen that included treatments for bipolar disorder and depression.¹⁷ After eleven weeks at Trails Carolina, it was recommended that Julie follow up with a step-down residential treatment facility.¹⁸ Following that recommendation, Juliewas sent to Solstice East in August 2015.¹⁹ Julie was extremely angry upon intake into Solstice East.²⁰ She reacted by breaking a glass bottle over her own head to intentionally harm and cut herself.²¹ Solstice East diagnosed Julie with unspecified anxiety disorder, family disruption, post-traumatic stress disorder, and major depressive disorder; it immediately increased the dose of her medications.²² While Julie showed slight improvement at Solstice East, she continued to experience issues with social functioning, inappropriate behavior, and mental stability.²³

B. The Plan

The dispute in this case concerns whether the residential care Julie received at Solstice East was "medically necessary" and therefore covered by the Plan. The Plan defines "medically necessary" as services provided by a health care provider exercising prudent clinical judgment to a patient for the purpose of preventing, evaluating, diagnosing, or treating an illness, injury, disease, or its symptoms.²⁴ The provisions of the service must be:

(a) In accordance with generally accepted standards of medical practice; (b) Clinically appropriate, in terms of type, frequency, extent, site and duration, and considered effective for the patient's illness, injury or disease; and (c) Not primarily for the convenience of the patient, physician or other health care provider; (d) And not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient's illness, injury, or disease.²⁵

Aetna utilizes a Level of Care Assessment Tool ("LOCAT") as a guideline to "assist in determining whether a level of care is medically necessary."²⁶ The LOCAT also states that, "[a]s a general guideline, medically necessary services are those services that are appropriate and consistent with the diagnosis in accordance with accepted medical standards," and that the LOCAT "is not a replacement for good clinical judgment, which should be exercised both in connection with applying the LOCAT Guidelines . . . and more broadly in assessing the medical necessity of particular levels of treatment in light of the specific condition for which the Member is seeking treatment."²⁷

The LOCAT defines residential care as "under the care of an attending psychiatrist" and a "licensed behavioral health professional . . . must be on-siteand actively on duty 24 hours a day, 7 days a week."²⁸ On the level of care intensity spectrum, the LOCAT places residential care below "inpatient" and above "partial hospitalization," "intensive outpatient program," and "stabilization."²⁹ For Aetna to cover behavioral health care, there must be an objective evaluation of the patient's current condition and symptoms indicating a level of severity appropriate to the requested care evidenced by features of one or more of the following admission criteria:

1. Acute Dangerousness: Member presents with a level of risk related to harm towards themselves through suicide, self-injury, irritability or mania; or to others through aggression, assaultive, or homicidal behavior.

2. Functional impairment: Member presents a temporary and reversible reduction in ability to function such as performing personal hygiene and bodily care activities, obtaining adequate nutrition, sleep, functioning in the work place or at school, or becoming socially isolated.

3. Mental status changes or co-occurring conditions: Member presents with disrupted mood, disordered thinking, disorientation, or other mental status changes that need care at the level requested; or there are medical or substance related issues that require care at the level requested.

4. Psychosocial factors: The Member's challenges related to stress from family members, non-family members, housing, and work or school that have an impact.

5. Additional modifiers: The Member's history or response to prior treatment, their personal resources such as intellect, characterological issues, and past history of violence or self-harm.³⁰

For Aetna to continue covering care after admission, the patient must "continue to require the level of care provided by that facility (that is treatment at a lower, less restrictive level of care is not medically appropriate)."³¹ The LOCAT lists six criteria for Aetna to objectively consider in determining whether to continue covering a medical treatment regimen.³² Moreover, for continued treatment at any level to be covered, "progress must be evident to show that the condition or its symptoms are treatment responsive."³³

The Plan also contains a section entitled "EXCLUSIONS AND LIMITATIONS," which Aetna cited in its denial of Plaintiffs' claim for coverage of the care Julie received at Solstice East.³⁴ This section states that "Non-MedicallyNecessary services" are "not Covered Benefits" and include services "[w]hich are not Medically Necessary, as determined by Aetna, for the diagnosis and treatment of illness, injury, restoration of physiological functions, or covered preventive services."³⁵

C. Claim History

On August 13, 2015, Aetna, through its Medical Director Dr. Lawrence Nardozzi, denied Plaintiffs' claim for coverage of Julie's stay at Solstice East.³⁶ Aetna concluded the treatment was excluded from coverage under the Plan's exception for "non-medically necessary services" because: "The information received does not show that [Julie's] behavior problems are so severe that [she] cannot take care of [herself]. Treatment could be provided at a less intensive level of care or in another setting."³⁷ In other words, Aetna found that Julie did not meet the "Functional Impairment" LOCAT criteria. Aetna did not refer to any of the other LOCAT criteria in its rejection.

On January 26, 2016, Plaintiffs appealed this denial, arguing Aetna erred by denying coverage based solely on one LOCAT criteria (Functional Impairment)and not analyzing the other five criteria, any one of which Plaintiffs contend would have supported coverage.³⁸ Plaintiffs also submitted Julie's updated medical records from August 2015 through January 2016 as part of the appeal.³⁹

On March 28, 2016, Aetna denied Plaintiffs' appeal, upholding its determination...