Weinreb v. Xerox Bus. Servs., LLC

323 F.Supp.3d 501

Rebecca WEINREB, David M. Weinreb, Plaintiffs,

v.XEROX BUSINESS SERVICES, LLC HEALTH AND WELFARE PLAN, Conduent HR Consulting, LLC, and Caremark PCS Health LLC, Defendants.

16 Civ. 6823 (DAB)

United States District Court, S.D. New York.

Signed August 29, 2018

Bernard Weinreb, Bernard Weinreb, Esq., Spring Valley, NY, for Plaintiffs.

Aimee Leigh Creed, Jodie Leigh Ousley, d'Arcambal Ousley & Cuyler Burk LLP, New York, NY, Richard J Pautler, Thompson Coburn LLP, St. Louis, MO, James William Weller, Nixon Peabody, LLP (J'rcho), Jericho, NY, Kevin P. Shea, Nixon Peabody LLP (Chicago), Chicago, IL, for Defendants.

MEMORANDUM & OPINION

DEBORAH A. BATTS, United States District Judge

This Action involves a dispute between an Employee Retirement Income Security Act ("ERISA") beneficiary and her spouse's employer, health benefits plan, and insurance administrator over prescription drug coverage. At issue is whether the administrator's refusal to cover a prescription for fentanyl violates the mandates of ERISA, Title VII and the Pregnancy Discrimination Act, the Equal Pay Act, and the Affordable Care Act. Before the Court are Defendants' Motions to Dismiss Plaintiffs' Second Amended Complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. As explained in detail below, Plaintiffs have failed at every juncture to articulate how Defendants have discriminated against women on the basis of sex under the law. Thus, Defendants' Motions to Dismiss are GRANTED WITH PREJUDICE without leave to replead.

I. Background

A. Factual History

For the purposes of the Motions to Dismiss, the Court assumes as true the factual allegations in Plaintiffs' Second Amended Complaint (hereinafter "Complaint" or "Compl.").

Plaintiff David M. Weinreb is an employee of Conduent HR Consulting, LLC, formerly a subsidiary of Xerox Corporation ("Employer"). (Compl. ¶ 3.) Mr. Weinreb is a participant in the Xerox Business Services, LLC Health and Welfare Plan (the "Plan"). (Id. ) The Plan, an employee welfare benefit plan as defined by the Employee Retirement Income Security Act, 29 U.S.C. § 1002, provides medical and prescription insurance coverage to its participants and beneficiaries. (Id. ¶ 5.) The Employer is a Plan sponsor and fiduciary within the meaning of ERISA. (Id. ¶¶ 6-7 (citing 29 U.S.C. § 1000(16)(B); § 1002(21).) Though the Plan is self-funded (i.e. - it pays for prescription drugs out of its own assets rather from a separate insurance company), the Plan employs a third-party administrator, Caremark PCS Health LLC ("Caremark"), to make eligibility and coverage determinations. (Id. ¶ 8.) The Plan grants discretionary authority to Caremark to make such determinations and handle appeals. (Id. ).

Plaintiff Rebecca Weinreb, David Weinreb's wife, is a beneficiary of the Plan. Ms. Weinreb has been ill for seventeen years with an orphan disease¹ known as Global Diffuse Adenomyosis ("GDA"). (Id. ¶ 10.) Adenomas are benign tumors that are inoperable because they secrete hormones that cause the body to continuously contract as if it were active labor, without an epidural. (Id. ) GDA only affects women. (Id. ) Ms. Weinreb's body is riddled with adenomas that originated in her uterus and have now spread to other organs. She suffers "constant[,] excruciating pain with no let up and her pain levels are ‘astronomical.’ " (Id. ) She contracted the disease shortly after she underwent a caesarian section to deliver her fourth child on July 11, 2001. (Id. ¶ 11.)

Ms. Weinreb's physician, Dr. Gordon Freedman, experimented with several drug combinations in an effort to provide her with pain relief. (Id. ¶ 12.) After Morphine, Oxycontin, and "numerous other" drugs proved ineffective, he prescribed Actiq, a stick lozenge form of the potent pain-relief opioid fentanyl.² (Id. ¶ 13.) Actiq included sugar in its formula, however, which caused Ms. Weinreb's teeth to dissolve and her gums to bleed and become infected. (Id. ) After four years on Actiq, Dr. Freedman transitioned Ms. Weinreb to newly available tablet and spray forms of fentanyl, known as Fentora and Subsys. (Id. ¶ 15.)³

From January 2009 through January 2014, Medco/Express Scripts was the administrator of Xerox's prescription drug benefit Plan. (Id. ¶ 18.) Though Medco required Ms. Weinreb to receive prior authorization to receive these drugs, "[s]he was always granted approval by Medco at the First Tier Appeal Level for the quantity that she needed fairly quickly and easily." (Id. ¶ 19.)

According to Plaintiffs, "[a]ll this changed on January 1, 2014, when Caremark took over the administration of the drug plan from Medco." (Id. ¶ 20.) Plaintiffs allege that Caremark rescinded Medco's annual prior authorization approvals midway through 2014. (Id. ¶¶ 22-24.) Plaintiffs claim Caremark refused to reinstate coverage for Fentora at all, and only agreed to approve a small amount of Subsys every 25 days. (Id. ¶¶ 26-28.) This provided less pain relief to Ms. Weinreb and increased the amount of time she would have to wait for refills. (Id. ¶¶ 30-31.) Dr. Freedman wrote Caremark that Ms. Weinreb's prescriptions were "medically necessary" to treat her "extremely high level of pain" and irregular flare ups. (Id. ¶ 33.)

On June 29, 2015, Plaintiffs claim Ms. Weinreb received a telephone call from a Caremark representative, Sally, who advised her that Caremark would be denying her Subsys and any other fentanyl drug going forward. (Id. ¶ 37.) Sally allegedly explained that "she retroactively withdrew Ms. Weinreb's Prior Authorizations for fentanyl drugs claiming that fentanyl is approved only for cancer patients with malignant tumors but not for individuals such as Ms. Weinreb suffering from a non-cancer illness." (Id. ¶ 42.) Nonetheless, Dr. Freedman thereafter applied for prior authorization of Ms. Weinreb's initial fentanyl drug, Actiq, which "Caremark approved only the tragically laughable amount of 120 lozenges per month, although Dr. Freedman issued a prescription indicating that Ms. Weinreb needed 24 lozenges per day, 720 units, for each three week period." (Id. ¶¶ 45-48.)

Since 2014, Plaintiffs claim Ms. Weinreb "has become a ghost of her former self, hardly able to move from one room to the next. She has been paralyzed in pain for hours each day ...." (Id. ¶ 53.)

Plaintiffs assert Ms. Weinreb exhausted her internal administrative appeals for the denial of her "fentanyl medication."⁴ Caremark denied Ms. Weinreb's appeals because her requested prescription coverage was outside the terms of the Plan: the Plan only provides coverage for fentanyl prescriptions if they are "medically necessary." (Id. ¶¶ 58-69.) As explained in more detail below, the Plan defines "medically necessary" fentanyl prescriptions as prescribed "only for the management of breakthrough cancer pain in patients." Because Ms. Weinreb does not suffer from cancer or cancer pain, her appeal was denied.

B. Plan Documents and Medical Necessity

For certain medications, such as Actiq and other fentanyl medications, the Plan requires a beneficiary to obtain prior authorization from Caremark. (Administrative Record ("AR") at 980.)⁵ Caremark provides prior authorization for a prescription drug only if it is "medically necessary." (Id. )

The Plan provides a Summary Plan Description (SPD) to all participants and beneficiaries. The SPD defines medical necessity as follows:

Medically necessary or medical necessity: Health care or dental services, and supplies or prescription drugs that a physician, other health care provider or dental provider, exercising prudent clinical judgment, would provide to a patient for the purpose of preventing, evaluating, diagnosing or treating an illness, injury, disease or its symptoms. The provision of the service, supply or prescription drug must:

• Be in accordance with generally accepted standards of medical or dental practice,

• Be clinically appropriate, in terms of type, frequency, extent, site and duration, and considered effective for the patient's illness, injury or disease,

• Not be primarily for the convenience of the patient, physician, other health care or dental provider, and

• Not be 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.

• For these purposes "generally accepted standards of medical or dental practice" means standards that are based on credible scientific evidence published in peer-reviewed literature generally recognized by the relevant medical or dental community, or otherwise consistent with physician or dental specialty society recommendations and the views of physicians or dentists practicing in relevant clinical areas and any other relevant factors.

Medical necessity is determined by the medical or dental plan administrator in accordance with its clinical guidelines.

(AR 1155-56 (emphasis added).) The SPD itself does not mention fentanyl prior authorizations specifically.

The SPD states that the Plan's clinical guidelines are available to anyone by visiting Caremark's website and that if a participant or beneficiary has any questions, they may visit the website or call a toll-free number and request a copy of the guidelines. (AR 999; AR 1022.)

The guidelines state: "Abstral, Actiq, Fentora, Lazanda, Onsolis, and Subsys are indicated ONLY for the management of breakthrough cancer pain in patients with malignancies who are already receiving and who are tolerant to around-the-clock opioid therapy for their underlying persistent cancer pain.... Actiq is indicated in patients 16 years of age or older; Abstral, Fentora, Lazanda, Onsolis, and Subsys are indicated in patients 18 years of age and older." (AR 893.)

As Plaintiffs acknowledge in their Complaint, this guideline is consistent with the Food and Drug Administration's approved "label" for Actiq. See U.S. Food & Drug Administration Label, Actiq,...