Scott M. v. Blue Cross & Blue Shield of Mass.

528 F.Supp.3d 1200

SCOTT M. and Lauri M., individually and as guardians of C.M., a minor, Plaintiffs,

v.BLUE CROSS AND BLUE SHIELD OF MASSACHUSETTS d/b/a, Blue Cross Blue Shield HMO Blue, Defendant.

Case No. 1:17-cv-00009

United States District Court, D. Utah.

Signed March 24, 2021

Brian S. King, Brian S. King PC, Salt Lake City, UT, for Plaintiffs.

David P. Friedman, Pro Hac Vice, Murtha Cullina LLP, Stamford, CT, Jonathan M. Horne, Pro Hac Vice, Murtha Cullina LLP, Boston, MA, Scott A. Hagen, Ray Quinney & Nebeker PC, Salt Lake City, UT, for Defendant.

MEMORANDUM DECISION AND ORDER

CLARK WADDOUPS, United States District Judge

I. INTRODUCTION

This action arises under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq., and involves Defendant's denial of insurance coverage for the residential treatment of C.M., a minor. Before the court are Defendant and Plaintiffs’ cross-motions for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. (ECF Nos. 60, 61.) Having considered the parties’ briefs, oral argument, and relevant case law, the court DENIES Defendant's Motion for Summary Judgment and GRANTS in part and DENIES in part Plaintiffs’ Motion for Summary Judgment.

II. BACKGROUND

Plaintiffs sought care for C.M.’s mental health and substance use conditions at Waypoint Academy, a residential treatment center located in the State of Utah. During the relevant time, Plaintiffs had health coverage under a group health benefit plan ("the Plan") sponsored by Scott M.’s employer and insured by Defendant Blue Cross Blue Shield of Massachusetts ("Blue Cross"). Rec. 00744.¹ The Plan provides coverage for medically necessary mental and physical health and/or substance abuse care for its subscribers and beneficiaries.² Rec. 00767 – 00768. Blue Cross denied coverage, however, for C.M.’s fourteen-month stay at Waypoint. Rec. 00123, 00194 – 00196. Plaintiffs now seek to recover all unreimbursed, out-of-pocket expenses due to Blue Cross's adverse benefits determination, as well as an award of pre- and post-judgment interest and attorney fees.

A. The Plan and Blue Cross's Medical Necessity Criteria

The Plan requires that all health care services "be required services that a health care provider, using prudent clinical judgment, would provide to a patient in order to prevent or evaluate or to diagnose or to treat an illness, injury, disease, or its symptoms." Rec. 00767. The Plan further details that the required services must be:

• Furnished in accordance with generally accepted standards of professional medical practice (as recognized by the relevant medical community);

• Clinically appropriate, in terms of type, frequency, extent, site, and duration; and they must be considered effective for your illness, injury, or disease;

• Consistent with the diagnosis and treatment of your condition and in accordance with Blue Cross Blue Shield HMO Blue medical policies and medical technology assessment criteria;

• Essential to improve your net health outcome as beneficial as any established alternatives that are covered by Blue Cross Blue Shield HMO Blue;

• Consistent with the level of skilled services that are furnished and furnished in the least intensive type of medical care setting that is required by your medical condition; and

• Not more costly than an alternative service or sequence of services at least as likely to produce the same therapeutic or diagnostic results to diagnose or treat your illness, injury, or disease.

Id.

The Plan provides for inpatient, intermediate and outpatient services to treat a mental health condition. Rec. 00794 – 00796. The Plan states that intermediate care "may include (but is not limited to)," acute residential treatment, partial hospital programs and intensive outpatient treatment. Rec. 00795 – 00796. The Schedule of Benefits for covered Mental Health and Substance Abuse Treatment refers to Inpatient admission at a General Hospital, Inpatient admissions in a Mental Hospital or Substance Abuse Facility and Outpatient Services. Rec. 00113-00115. Neither the Plan nor the Schedule of Benefits makes any reference to subacute residential treatment.

The Plan defines Covered Providers as:

• Hospital and Other Covered Facilities. These kinds of health care providers are: alcohol and drug treatment facilities; ambulatory surgical facilities; chronic disease hospitals (sometimes referred to as a chronic care or long term care hospital for medically necessary covered services ); community health centers; day care centers; detoxification facilities; free-standing diagnostic imaging facilities; free-standing dialysis facilities; free-standing radiation therapy and chemotherapy facilities; general hospitals; independent labs; limited services clinics; mental health centers; mental hospitals; rehabilitation hospitals; and skilled nursing facilities.

• Physician and Other Covered Professional Providers. These kinds of health care providers are: certified registered nurse anesthetists; chiropractors, clinical specialists in psychiatric and mental health nursing; dentists; licensed audiologists; licensed dietitian nutritionists (or a dietitian or a nutritionist or dietitian nutritionist who is licensed or certified by the state in which the provider practices); licensed hearing instrument specialists; licensed independent clinical social workers; licensed marriage and family therapists; licensed mental health counselors; licensed speech-language pathologists; nurse midwives; nurse practitioners; occupational therapists; optometrists; physical therapists, physicians, physician assistants; podiatrists, psychiatric nurse practitioners; psychologists; and urgent care centers.

Rec. 00761 – 00762.

While the Plan states that Blue Cross "decides which health care services and supplies that [a claimant] receive[s] ... are medically necessary and appropriate for coverage," Rec. 00767 (emphasis in original), a member can initiate an appeal or grievance within one year of the receipt of the service or claim denial. Rec. 00825 – 00827. The Plan also provides that a member may request an external review of an adverse benefit determination after completion of the internal appeals process, or when a Plan fails to make a timely decision on an appeal. Rec. 00829 – 00830.

B. C.M.’s Condition

C.M. has struggled with mental health and substance use disorder conditions for many years. C.M. began to show symptoms of anxiety in the fifth grade when he refused to attend school. Rec. 00200. Over the years, C.M.’s behavior and condition continued to deteriorate. C.M. was eventually diagnosed with Major Depressive Disorder, Anxiety Disorder and Attentional Deficit Hyperactivity Disorder ("ADHD"). Rec. 00161. He also has been diagnosed with Cannabis Use Disorder (severe), Alcohol Abuse, and Amphetamine Abuse. Rec. 00238.

To accommodate his symptoms and assist with his education, C.M. received an individual education plan ("IEP"), to little avail. Rec. 00202. C.M. continued to struggle with anxiety and depression while trying different combinations of ADHD and anti-depressant/mood medications. Rec. 00200. As he matured, his symptoms significantly worsened. He lacked self-control and had frequent emotional outbursts, refused to attend school and was often severely depressed. Rec. 00245, 00534.

After struggling with passive suicidal ideation, in January 2014, when C.M. was fourteen, he attempted suicide for the first time. Rec. 00235. C.M. made additional suicide attempts involving overdosing and planning to slit his wrists. Rec 00241, 00245.

In March 2014, C.M. was admitted to the dual diagnosis program at McLean Hospital, an acute-psychiatric hospital, to address his mental health issues that were leading to his suicidal ideations and attempts, as well as his substance use disorder. Rec. 00235. C.M. reported cutting himself on a weekly basis as a coping mechanism to deal with his depression. Rec. 00235, 00245-00246. C.M. acknowledged ongoing drug use and expressed no interest in stopping marijuana use. Rec. 00235. C.M. remained in the Adolescent Residential Treatment Center at McLean Hospital for two weeks. Rec. 00201. Upon his release, C.M. participated in significant outpatient therapy that included individual therapy, psychopharmacological treatment, family therapy, and a bridge program to help him reenter high school. Rec. 00238 – 00239.

Despite this intensive outpatient treatment plan, in May 2014, C.M. made another suicide attempt, this time overdosing on barbiturates and alcohol. Rec. 00201. C.M.’s parents, Scott and Lauri, removed C.M. from the school setting and C.M. completed the year with the help of a tutor. Plaintiffs hired an education consultant to obtain an IEP for C.M. and he continued extensive outpatient therapy.

In August 2014, C.M. was again admitted to McLean in its dual-diagnosis program following another overdose. Rec. 00202. C.M. claimed the overdose was accidental. However, one of his therapists, Dr. Robert Tella, who had previously worked with C.M., believed the overdose was intentional. Rec. 00245-00246.

Plaintiffs again put in place an exhaustive outpatient treatment program. The program included individual therapy, family therapy, neuropsychological assessments, a course of cognitive-behavior therapy, psychopharmacologic therapy and group therapy. C.M. refused to participate in group therapy. Rec. 00246.

In October 2014, C.M. took LSD and attempted to hang himself from a light fixture in his bedroom. Rec. 00202. This last suicide attempt, while key to prompting Plaintiffs to admit C.M. to Waypoint residential treatment center, was not disclosed to Blue Cross at the time of its initial benefits determination or during the internal appeals process. Indeed, Plaintiffs did not disclose the October 2014 suicide attempt until submitting their appeal of Blue Cross's denial decision to the external reviewer on March 27, 2015. Rec. 00197. The external reviewer had full knowledge of the ...