M. S. v. Premera Blue Cross
Decision Date | 10 August 2021 |
Docket Number | Case No. 2:19-cv-00199-RJS-CMR |
Citation | 553 F.Supp.3d 1000 |
Parties | M. S., L. S., and C.J.S., Plaintiffs, v. PREMERA BLUE CROSS, Microsoft Corporation, and the Microsoft Corporation Welfare Plan, Defendants. |
Court | U.S. District Court — District of Utah |
Brian S. King, Brent J. Newton, Brian S. King PC, Nediha Hadzikadunic, Gross & Rooney, Salt Lake City, UT, for Plaintiffs.
Gwendolyn Cecilia Payton, Pro Hac Vice, Kilpatrick Townsend & Stockton LLP, Seattle, WA, for Defendant Premera Blue Cross.
Gwendolyn Cecilia Payton, Kilpatrick Townsend & Stockton LLP, Seattle, WA, Timothy C. Houpt, Mark D. Tolman, Jones Waldo Holbrook & McDonough, Salt Lake City, UT, for Defendants Microsoft Corporation, Microsoft Corporation Welfare Plan.
This case arises under the Employee Retirement Income Security Act of 1974 (ERISA). Plaintiffs M.S., L.S., and C.J.S. filed this lawsuit against Defendants Premera Blue Cross (Premera), Microsoft Corporation (Microsoft), and Microsoft Corporation Welfare Plan (the Plan) after the Plan's claim administrator denied the S. Family's claim for residential treatment benefits rendered to their minor son, C.S., for oppositional defiant disorder
, autism spectrum disorder, pervasive developmental disorder, and anxiety. The S. Family and Defendants cross-move for summary judgment on the S. Family's three claims: (1) denial of benefits, (2) violations of the Parity Act, and (3) statutory penalties under ERISA. For the reasons stated below, both motions are GRANTED in part and DENIED in part.
The S. Family lives in King County, Washington. Microsoft employed M.S. and provided the Family with group health coverage through a self-funded benefit plan. C.S. was a beneficiary of the Plan. Before addressing the legal issues presented, the court first discusses the relevant Plan language, C.S.’s medical treatment, and the procedural history of the case.
The Plan designates Microsoft as the Named Fiduciary and Plan Administrator.2 Pursuant to the Plan documents, Microsoft delegated its claim procedure duties to the claim administrator, Premera.3
The Plan requires mental health treatment to be "medically necessary" for coverage.4 The Plan defines "medically necessary" as covered services meeting certain criteria, including:
As used in this definition, "generally accepted standards of medical practice," means "standards that are based on credible scientific evidence published in peer reviewed medical literature that is generally recognized by the relevant medical community, Physician Specialty Society recommendations, the views of physicians practicing in relevant clinical areas, and any other relevant factors."6
Premera uses the McKesson InterQual Criteria as a factor to determine whether residential treatment care is appropriate for a mental health condition.7 These criteria require all the following for extended stays (sixteen days or more) at a residential treatment center due to serious emotional disturbance:
• Persistent rule violations, or
• Psychiatric medication refractory or resistant and symptoms increasing or persisting.8
Premera also uses separately formulated InterQual Criteria to determine whether services rendered at skilled nursing facilities and inpatient rehabilitation facilities are medically necessary.9 Premera does not use any separately formulated criteria beyond the language of the Plan to determine whether inpatient hospice services are medically necessary.10
In the event a claim for benefits is denied "in whole or in part," the Plan provides that Premera will send the claimant a written notice including: (1) the specific reason or reasons for denial; and (2) reference to the specific Plan provisions on which the denial is based.11 The Plan also provides for this written notice to be provided by Premera when a claimant appeals the denial.12 The Plan states Premera will send the claimant notice of "the specific reason or reasons for denial" if it denies the claimant's appeal.13
When C.S. began attending kindergarten, he started exhibiting violent and aggressive behavior.14 At age five, C.S. began receiving ongoing behavioral, social, occupational, and language therapies.15 After several evaluations, C.S. was diagnosed with anxiety, emotional issues, and Pervasive Developmental Disorder—Not Otherwise Specified.16
Throughout his teenage years, C.S. became increasingly socially isolated and addicted to electronics, the internet, and technology.17 C.S. also displayed aggressive and violent behavior centered on parental boundaries on his technology use.18 C.S.’s violent behavior was severe enough that it sometimes required local police assistance and for C.S.’s therapist, Dr. Erin Milhelm, to implement a "Safety Intervention Plan" to help keep C.S.’s family safe during his episodes.19 C.S. would also sometimes threaten self-harm or suicide during his outbursts and would become aggressive with family members beyond his parents.20 Because of C.S.’s episodic violence and aggression, his parents found it "extremely difficult" to enforce boundaries and rules.21
In late 2016, C.S.’s parents met with an educational consultant to guide them in their selection of therapeutic programs for him.22 They eventually decided to send C.S. to "Pacific Quest," an outdoor behavioral health program in Hawaii.23 The Family enrolled C.S. at Pacific Quest on June 15, 2017.24 On July 17, 2017, C.S. left the program.25 A therapist at Pacific Quest explained C.S. left "due to escalations both verbal and physical[ ] with staff."26
Spectrum Disorder. Given the seriousness of these test findings, it is recommended that following his stay at Pacific Quest, [C.S.] go onto a longer term residential program that can continue addressing each of these issues in depth. [C.S.] requires placement in a structured, therapeutic, residential school outside of the home where he understands expectations and is given direct in vivo feedback when he gets overwhelmed. He will need a variety of therapeutic interventions, including individual, group, and family therapy.... Such a program will also need to provide [C.S.] with an academic environment that includes small class sizes with individualized attention and instruction.28
After C.S.’s discharge from Pacific Quest, his parents enrolled C.S. in Daniels Academy for mental health residential treatment.29 Although C.S. was initially unable to transfer directly to Daniels Academy from Pacific Quest due to his "poor emotional regulation," he later...
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