Polonczyk v. Anthem Bluecross & Blueshield

586 F.Supp.3d 648

Teeanna J. POLONCZYK, Plaintiff

v.ANTHEM BLUECROSS AND BLUESHIELD, et al., Defendants

CIVIL ACTION NO. 20-176-DLB-CJS

United States District Court, E.D. Kentucky, Northern Division. at Covington.

Signed February 23, 2022

Jessica N. Wimsatt, Michael J. O'Hara, O'Hara, Taylor, Sloan & Cassidy, Covington, KY, Aaron M. Beck, O'Hara, Taylor, Sloan & Cassidy, Crestview Hills, KY, for Plaintiff.

Kent A. Britt, Wesley Reese Abrams, Vorys, Sater, Seymour & Pease, Cincinnati, OH, for Defendants Anthem BlueCross and BlueShield, Anthem UM Services, Inc.

Jennifer Orr Mitchell, Dinsmore & Shohl, LLP, Cincinnati, OH, for Defendant Plans Administration Committee of Citigroup, Inc.

MEMORANDUM OPINION AND ORDER

David L. Bunning, United States District Judge

I. INTRODUCTION

This matter is before the Court on Defendants’ Motion to Dismiss. (Doc. # 26). Defendants’ Motion has been fully briefed (Docs. # 34 and 43), and is now ripe for review. For the reasons set forth herein, Defendants’ Motion (Doc. # 26) will be GRANTED .

II. FACTUAL AND PROCEDURAL BACKGROUND

On December 9, 2020, Plaintiff Teeanna Polonczyk filed a Complaint alleging a number of claims under the Employee Retirement Income Security Act ("ERISA") and the Affordable Care Act against Defendants Anthem BlueCross and BlueShield and Anthem UM Services, Inc.¹ related to Defendants denial of benefits owed to Plaintiff. (Doc. # 1).

Plaintiff Polonczyk was assigned the male gender at birth and has been clinically diagnosed with Gender Dysphoria as an adult. (Doc. # 30 ¶ 15). Since 2011, Plaintiff has undergone medical procedures to transition from male to female. (Id. ). In 2019, Plaintiff, who is employed by Citibank, N.A., sought healthcare benefits for facial surgery to assist in her transition under her employer-sponsored plan entitled "ChoicePlan 500" ("the Plan"). (Id. ¶¶ 15, 25). Plaintiff's Plan generally "does cover procedures, treatments and related services designed to alter a participant's physical characteristics from his or her biologically determined sex to those of another sex." (Doc. # 1-1 at 137).

Plaintiff's facial surgery was supposed to be completed on February 12, 2019 by Dr. William Tobler, following a pre-operation exam on January 15, 2019, conducted by Plaintiff's primary care physician, Dr. Walters. (Doc. # 1 ¶¶ 17, 25). Following this visit, Dr. Tobler submitted a pre-certification request regarding Plaintiff's facial surgeries, which allows the insurer an opportunity to determine whether a specific medical procedure is necessary or covered by the insured's policy. (Id. ¶ 25). That pre-certification request outlined the following procedures that were supposed to be performed: (1) Rhytidectomy—Cheek, Chin, & Neck, (2) Rhytidectomy—Neck with Platysmal Tightening, (3) Repair Brow Ptosis, (4) Osteoplasty—Facial Bones Reduction, (5) Genioplasty—Sliding Osteotomies, (6) Osteoplasty—Facial Bones Augmentation, and (7) Tissue Grafts—Other. (Id. ¶ 30).

Plaintiff's pre-certification request was ultimately denied following a multi-step review process. On February 6, 2019, Defendants Anthem BlueCross and Blue Shield and Anthem UM Services, Inc. ("Defendants") performed an Initial Clinical Review on Dr. Tobler's precertification request. (Id. ¶ 30). During this review, Defendants referenced a document entitled "Clinical Guideline for CG-SURG-27," which states that "[t]he following procedures are considered cosmetic when used to improve the gender specific appearance of an individual who has undergone or is planning to undergo sex reassignment surgery, including, but not limited to, the following: Blepharoplasty [,] Brow lift [,] Facial bone reconstruction [, and] Jaw reduction (jaw contouring)." (Doc. # 1-2 at 10). Based on this document, the physician reviewer determined that the procedures requested by Dr. Tobler were not approvable under the plan criteria because "[w]hile it may change appearance it does not improve health." (Id. ). On February 11, 2019, Defendants internally denied Plaintiff's pre-certification request and cancelled her surgery, without issuing Plaintiff an adverse benefits determination. (Doc. # 1 ¶¶ 40-41). Defendants did not contact any of Polonczyk's doctors to perform a peer-to-peer evaluation at that time. (Id. ¶ 45).

According to Plaintiff, she finally received a written denial of the procedures in late March or early April, but the notice was purportedly backdated to February 11, 2019. (Docs. # 1 ¶ 48 and 1-3 at 1). This notice did not include information regarding review procedures or the timing of such procedures. (Doc. # 1 ¶ 57). On May 21, 2019, Defendants informed Polonczyk that her peer-to-peer review was completed on March 15, 2019. (Id. ¶ 63). On or about June 25, 2019, Plaintiff submitted her notice of appeal and on July 2, 2019, she submitted her actual appeal to Defendants. (Id. ¶¶ 66, 68). On July 24, 2019, Plaintiff received notice that Defendants upheld their decision to deny coverage of her facial surgeries due to the procedures being considered "cosmetic" and therefore "not medically necessary." (Docs. # 1 ¶¶ 82-83 and 1-6 at 1).

Thereafter, on September 7, 2019, Polonczyk submitted an additional appeal where she challenged Defendants previous denials of her benefits. (Docs. # 1 ¶¶ 87-88 and 1-5). On September 25, 2019, the denial of benefits was again upheld because Defendants "believe[d] this surgery [was] not medically necessary for [her]" and "[was] considered cosmetic." (Doc. # 1-8 at 2). On November 9, 2019, Polonczyk submitted a level two appeal to Defendants. (Doc. # 1-9). Ultimately, on December 9, 2019, Defendants issued a final denial of Plaintiff's benefits, again considering the surgeries to be "not medically necessary" and "cosmetic." (Doc. # 1-10). Plaintiff filed the complaint following that denial.

III. ANALYSIS

A. Motion to Dismiss

1. Standard of Review

Granting a motion to dismiss is appropriate if a plaintiff fails "to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). Further, "to survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim for relief that is plausible on its face." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). In order to have "facial plausibility," the plaintiff must "plead[ ] factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." ( Id. ) (quoting Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ). In evaluating a motion to dismiss, a court should "construe the complaint in the light most favorable to the plaintiff" and "accept all well pleaded factual allegations as true." Hill v. Snyder , 878 F.3d 193, 203 (6th Cir. 2017) (citing Ashcroft , 556 U.S. at 678, 129 S.Ct. 1937 ; Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ). However, "mere conclusory statements, do not suffice" and legal conclusions "must be supported by factual allegations." Ashcroft , 556 U.S. at 678-79, 129 S.Ct. 1937.

2. Plaintiff's ERISA Claim under 29 U.S.C. § 1132(a)(1)(B)

Plaintiff first brings an ERISA claim under 29 U.S.C. § 1132(a)(1)(B) alleging that Defendants wrongly denied her claim for benefits without a basis in the Plan document. (Doc. # 1 ¶¶ 102-109). Section 1132(a)(1)(B) provides that "[a] civil action may be brought by a participant or beneficiary to recover benefits due to [her] under the terms of [her] plan, or to clarify [her] rights to future benefits under the terms of the plan." Where the ERISA plan at issue gives the administrator "discretionary authority to determine eligibility for benefits or construe the terms of the plan," Firestone Tire & Rubber Co. v. Bruch , 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989), the Court reviews the decision under the arbitrary and capricious standard. Davis v. Hartford Life & Accident Ins. Co. , 980 F.3d 541, 545 (6th Cir. 2020).² Under the arbitrary and capricious standard, the plan administrator's decision only needs to be rational "in light of the plan's provisions." Calvert v. Firstar Fin., Inc. , 409 F.3d 286, 292 (6th Cir. 2005). Therefore, "when it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that outcome is not arbitrary and capricious." McDonald v. Western-Southern Life Ins. Co. , 347 F.3d 161, 169 (6th Cir. 2003) (quoting Williams v. Int'l Paper Co. , 227 F.3d 706, 712 (6th Cir. 2000) ).

First, the arbitrary and capricious standard applies because the Plan document provides the administrator discretionary authority to interpret the terms of the Plan. The Plan specifically states: "the Plan Administrator and the Claims Administrator have the full discretionary authority to construe and interpret the provision of the Plans." (Doc. # 1-1 at 303).

The Plan serviced by Anthem BlueCross BlueShield specifically contemplates "[g]ender reassignment surgery." (Doc. # 1-1 at 138-139). The Plan dictates that gender reassignment surgery may include the following procedures: (1) Orchiectomy, (2) Penectomy, (3) Vaginoplasty, (4) Clitoroplasty, and (5) Labiaplasty. (Id. at 139). It also specifically lists a number of surgeries that "are considered cosmetic and not medically necessary when used to improve the gender-specific appearance of a patient who has undergone or is planning to undergo gender reassignment surgery : [1] Reduction thyroid chondroplasty ; [2] Liposuction ; [3] Rhinoplasty ; [4] Facial bone reconstruction ; [5] Face-lift; [6] Blepharoplasty ; [7] Voice modification surgery; [8] Hair removal/hairplasty; and [9] Breast augmentation." (Id. at 140). The Plan further explains that "[c]osmetic surgery or surgical procedures primarily for the purpose of changing the appearance of any part of the body to improve appearance or self-esteem" are not covered. (Id. at 141-142).

Plaintiff sought benefits for the...