Davidson v. Wal-Mart Associates Health and Welfare Plan
| Decision Date | 20 February 2004 |
| Docket Number | No. 4:03-CV-40080.,4:03-CV-40080. |
| Parties | Suzy DAVIDSON, Plaintiff, v. WAL-MART ASSOCIATES HEALTH AND WELFARE PLAN, Defendant. |
| Court | U.S. District Court — Southern District of Iowa |
R. Ronald Pogge, Hopkins & Huebner, Des Moines, IA, for plaintiff.
Christopher R. Hedican, Baird Holm McEachen Pedersen Hamann & Strasheim, Omaha, NE, for defendant.
ORDER ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND PLAINTIFF'S CROSS-MOTION FOR SUMMARY JUDGMENT
This matter is before the Court on Defendant's Motion for Summary Judgment and Plaintiff's Cross-Motion for Summary Judgment. Attorneys for Plaintiff are R. Ronald Pogge and Thomas P. Murphy; attorney for Defendant is Christopher R. Hedican. An oral hearing was not requested by either party and the Court finds that a hearing is not necessary. Thus, the matter is fully submitted to the Court for review.
The Plaintiff, Suzy Davidson ("Davidson"), commenced this action against Defendant, Wal-Mart Associates Health and Welfare Plan ("the Plan") on February 13, 2003.1 Jurisdiction is proper pursuant to 28 U.S.C. § 1331, as this case arises under the Employment Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 et seq.
The lawsuit arises out of the Plan's denial of benefits for a surgery requested by Davidson. The final denial followed a precertification denial which was subsequently appealed by Davidson and reviewed by the Plan. After reviewing the final denial letter issued at the end of the internal review process, Davidson filed this action. On July 31, 2003, the Plan filed a Motion for Summary Judgment ("Defendant's Motion") pursuant to Federal Rule of Civil Procedure 56. Davidson responded on August 21, 2003, by opposing the Plan's motion and by filing a Cross-Motion for Summary Judgment ("Plaintiff's Motion").
At all times material hereto, Davidson was a resident of Polk County, Iowa. In February of 2000, she was hired by Wal-Mart Stores, Inc., as a stock person. In May of 2000, Davidson was eligible and became a participant in the Wal-Mart Stores, Inc., Associates Health and Welfare Plan.
The Plan is an employee welfare benefits plan as defined by ERISA. The Plan is self funded within the meaning of ERISA. Wal-Mart Stores, Inc., is a contributor to the Plan. The Administrative Committee of the Plan ("the Committee") is the Plan administrator and "named fiduciary" of the Plan as defined by ERISA. For purposes of this lawsuit, the 2002 Summary Plan Description ("SPD") and 2001 Wal-Mart Stores, Inc., Associates Health and Welfare Plan WRAP Document ("WRAP Document") are the applicable versions of the Plan documents. The SPD and WRAP Document govern the operation of the Plan. The Plan grants the Committee discretionary authority to interpret and apply the terms of the Plan in connection with determining eligibility and entitlement to Plan benefits.2
In February of 1980, Davidson had a nodular growth in her breast and was diagnosed with bilateral fibrocystic disease of the breast by her physician, B.T. Woodburn, M.D. Dr. Woodburn noted a concern "for the development of breast cancer." Based on the diagnosis of fibrocystic disease and the stated concern for cancer,3 Dr. Woodburn performed a bilateral subcutaneous mastectomy on Davidson.
On or about May 9, 1980, Davidson underwent surgical breast reconstruction following her mastectomy to insert silicone implants in her breasts.4 Sometime following her breast reconstruction, the implants ruptured on two separate occasions. After the last of these occurrences, Davidson was given saline implants. All of these occurrences and surgeries happened prior to Davidson's participation in the Plan.
In October of 2001, Davidson began complaining of a frequent sore throat. Shortly thereafter she was diagnosed with throat cancer and began chemotherapy and radiation treatments. On January 15, 2002, Davidson underwent physical examination by two University of Iowa physicians. Surgery related to her throat cancer was performed on January 18, 2002. No breast implant rupture was revealed in her January 15, 2002, examination.
On February 12, 2002, Davidson alerted her physician, Ronald Bergman, D.O., that the breast implant in her right breast had ruptured. The rupture had occurred approximately two weeks prior. Dr. Bergman determined Davidson would need reconstructive surgery with insertion of tissue expanders. Due to the throat cancer and her current treatment, Davidson's attending physicians did not want anything done regarding the ruptured implant until after she finished her radiation and chemotherapy.
Dr. Bergman indicated Davidson would need the surgery when her treatment for throat cancer was finished. Dr. Bergman let Davidson know that he would send a letter to her insurance carrier to determine whether this procedure would be covered. On March 18, 2002, the Plan received from Dr. Bergman a precertification request along with medical records related to the proposed reconstruction surgery.
By letter dated April 15, 2002, the Plan notified Davidson and Dr. Bergman that it would deny benefits for the proposed breast reconstruction. The reason for denial was that the proposed surgery was for complications from an illness or medical treatment not covered under the Plan.5 This letter further advised Davidson of her right to appeal. On July 12, 2002, Davidson's counsel sought an extension of time to submit an appeal of the Plan's decision.
On July 23, 2002, Dr. Bergman again examined Davidson. He noted that she had apparently been cured of the throat cancer with radiation and chemotherapy. He found that she would probably need several surgeries to remove the breast implants, replace them, and possibly perform some autologous tissue reconstruction. Dr. Bergman noted this would not be a cosmetic procedure.
On October 15, 2002, Davidson's counsel submitted additional medical records in support of her appeal to the Plan. This letter also pointed out the references to the Women's Health and Cancer Rights Act of 1998 in the Plan documents6 and reiterated the physician's statement that the requested procedure was medically necessary.
Shortly thereafter, on October 24, 2002, the Plan forwarded Davidson's medical records to Douglas Friesen, M.D., of Mercy Health Center in Arkansas. The Plan sought independent review to determine if the proposed surgery was directly related to cancer. In response, Dr. Friesen stated his conclusion that Davidson's proposed surgery was not related to cancer. Dr. Friesen noted that while there was concern at the time of her mastectomy in 1980 that she might develop breast cancer, Davidson's final diagnosis was bilateral fibrocystic disease of the breast. Dr. Friesen relied on the diagnoses listed in reports related to the mastectomy and the subsequent breast reconstruction. All of the reports listed fibrocystic disease as the diagnosis. In addition, the reports stated that Davidson was admitted for bilateral subcutaneous mastectomy on a prophylactic basis. This indicated to Dr. Friesen that, while there was a concern for cancer, he could infer there was no cancer at that particular time. In conclusion, Dr. Friesen stated,
At this point, the question you are asking me is whether the subcutaneous mastectomy was directly related to cancer and according to the information that you have provided to me, it was not related to cancer .... [A]ccording to the information that you have given me, the subcutaneous mastectomy was related to severe fibrocystic disease.
This response was sent in a letter dated November 6, 2003.
According to the Plan, the Committee completed a full and fair review of Davidson's medical records and claims file and affirmed the Plan's previous conclusion that the benefits sought were excluded by the terms of the Plan. Davidson and her attorney were advised of this decision in a letter dated December 16, 2002, and received by them sometime thereafter. The letter stated that, after conducting a thorough review of Davidson's case, and based on the documentation received, the Plan was denying her benefits based on specified provisions referred to in the "Charges Not Covered" section of the SPD.7
Approximately sixty-two (62) days after the Plan's final denial letter, dated December 16, 2002, Davidson filed this Complaint. The Complaint was originally filed on February 13, 2003, and was amended to name the proper defendant on March 13, 2003. Since the submission of Dr. Bergman's original precertification request, Davidson has been ready to have the requested reconstructive surgery.
Pending before the Court are motions for summary judgment submitted by each of the parties. Prior to considering these motions, the Court must determine whether it is proper to consider a report by the Plan's reviewing physician that is included as part of the administrative record relating to the denial of Davidson's precertification request and the subsequent internal review of that decision. The Court then in turn analyzes the motions for summary judgment.
Prior to discussing the parties' respective motions for summary judgment, the Court will determine whether to consider or exclude Defendant's reviewing physician's report.8 Davidson, in a supplement to her filings relating to the pending motions for summary judgment, asserts that the Court should not consider the report by Dr. Friesen, the reviewing physician used by the Plan, because it was rendered after the Plan's initial determination to deny Plaintiff's request for precertification. Davidson's objection is made pursuant to the recent decision rendered by the Eighth Circuit in Morgan v. UNUM Life Insurance Company of America. See Morgan, 346 F.3d at 1173.
Davidson' s physician requested precertification for her proposed surgery on February...
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