Parsons v. Sisters of Charity of Leavenworth Health Sys., Inc.
| Decision Date | 31 May 2011 |
| Docket Number | Cause No. CV 10–47–BLG–RFC. |
| Citation | 832 F.Supp.2d 1222 |
| Parties | Randee PARSONS and Peggy Parsons, Plaintiffs, v. SISTERS OF CHARITY OF LEAVENWORTH HEALTH SYSTEM, INC., A Kansas Corporation; Blue Cross and Blue Shield of Kansas City, A Missouri Corporation; and Blue Cross Blue Shield of South Carolina Foundation, A South Carolina Corporation, Defendants. |
| Court | U.S. District Court — District of Montana |
OPINION TEXT STARTS HERE
Neel Hammond, Hammond Law, Missoula, MT, Donald L. Harris, Harman Warren & Harris, Billings, MT, for Plaintiffs.
Gregory G. Murphy, Moulton Bellingham Longo & Mather, Billings, MT, Michael F. McMahon, Bernard F. Hubley, Stefan T. Wall, McMahon Wall & Hubley Law Firm, Helena, MT, for Defendants.
ORDER GRANTING DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT
Presently before the Court are Defendants Sisters of Charity of Leavenworth (“Sisters of Charity”) and Blue Cross Blue Shield of South Carolina and Blue Cross Blue Shield of Kansas City's (“BCBS” collectively) motions for summary judgment. Docs. 21 & 27. At the Court's direction the Parties have supplemented their motions and responses with additional briefing regarding the application of Dr. Richard Burt's deposition to the issues of the case. Doc. 67. Having reviewed and considered the briefing in this case, this Court is prepared to rule. Given that many of the Defendants' summary judgment arguments overlap and all turn on the Defendants' denial of coverage for Plaintiff Randee Parsons's (“Parsons”) participation in a clinical trial for ABMT/stem-cell transplant treatment, they will be treated, for purposes of this Order, as a single motion for summary judgment.
Twenty year old Randee Parsons suffers from refractory Crohn's disease, a severe autoimmune disease that inflames and attacks the victim's gastrointestinal tract. Crohn's disease is a chronic disease for which there is no known cure. Recently, treatment of Crohn's disease with autologous bone marrow transplants (“ABMT”), a type of stem cell transplant treatment, has been shown to be partially successful. Dr. Richard Burt, an immunologist at Northwestern Medical School, has been conducting a clinical trial on treating Crohn's disease with ABMT techniques. According to Plaintiffs, Dr. Burt's ABMT trial was approved, at least in part, by the Food and Drug Administration as well as the National Institutes of Health.
In December 2009, Parsons sought and was granted admission into Dr. Burt's clinical trial. Plaintiffs allege that other patients in Dr. Burt's trial had received insurance coverage by their respective insurance companies. Parsons was covered by a Medical Plan issued to her mother through her employ at St. Vincent Healthcare Hospital, an affiliate of Defendant Sisters of Charity of Leavenworth Health System. Sisters of Charity's employee medical plan is self-insured and does not contract with any health insurance company against risk of loss, but it does contract with third-party administrators Defendants BCBS South Carolina and BCBS Kansas City for administrative services.
Parsons sought coverage for the clinical trial through the Sisters of Charity Medical Plan, but was denied. Based on the review of application and the terms of the Plan, on February 2, 2010, BCBS sent Plaintiffs a letter denying coverage of the ABMT treatment on the grounds that Dr. Burt's trial was “investigational and experimental” and not medically necessary.
Plaintiffs appealed BCBS' denial to Sisters of Charity's Benefit Administration Committee. As part of the appeals process, Sisters of Charity sought external independent review from gastroenterologists who had experience in Crohn's disease. These reviewers concluded that only a limited number of Crohn's patients had ever been treated with ABMT techniques and that Dr. Burt's clinical trial was experimental and investigational and not medically necessary. In addition, this procedure was only available at “investigational centers of excellence under the overview of institutional research boards.” 1 Ultimately, in a February 19, 2010 letter, the Benefits Administration Committee affirmed the denial of Plaintiffs' requested benefits.
Plaintiffs appealed a second time. This time, Dr. James Koren, the Associate Medical Director for Defendant BCBS of South Carolina contacted Dr. Burt in order to initiate a peer-to-peer discussion regarding Dr. Burt's research, as well as the ABMT procedure that he was seeking to perform on Parsons. Dr. Koren avers that during the conversation, Dr. Burt stated that other investigators in his field did not recognize his research and that there was a controversy within the clinical community regarding the effectiveness of ABMT/stem-cell transplant therapy for Crohn's disease. 2 Dr. Burt subsequently forwarded to Dr. Koren numerous abstracts and studies that Dr. Koren contends lead him to the conclusion that the ABMT procedure was still in the investigational and experimental stage.
In addition, on April 29 or 30th, Dr. Koren had a second conversation with Dr. Burt. Dr. Koren states that this second conversation was at Sisters of Charity's request. It appears that no new information was gained from this conversation due to a deterioration in the cordial relationship of both participants.3
The relevant language in Sisters of Charity's Medical Plan makes clear that:
REGARDLESS OF LANGUAGE CONTAINED ELSEWHERE IN THIS PLAN OF BENEFITS, THE FOLLOWING ARE NOT BENEFITS UNDER THE PLAN OF BENEFITS ... BCBS WILL NOT PAY ANY AMOUNT FOR THE FOLLOWING ... 1. Services and supplies that are not medically necessary as determined by the Plan Administrator ... 5. Services, supplies or drugs that are Experimental and Investigational ...4
The Plan defines “experimental and investigational” as,
Surgical procedures or medical procedures, supplies, devices or drugs which, at the time provided or sought to be provided, are in the judgment of BCBS not recognized as conforming to generally accepted medical practice, or the procedure, drug or device:
• Is one in which the improvement claimed is not demonstrated to be obtainable outside the Experimental and Investigational settings.5
The Court notes that the criteria for “experimental and investigational” are stated in the disjunctive.
The Plan defines “medically necessary/medical necessity” as,
Benefits determined by BCBS (in the exercise of its discretion) to be:
• Required for reasons other than convenience of the Covered Member or the Covered Member's Physician; and
• not to be services, supplies or drugs that are Experimental or Investigational.6
In addition, Article IV, 4.1(b) of Sisters of Charity System Health Benefits Plan states, in relevant part, that:
The Committee shall have complete discretion to interpret the provisions of the Plan, make findings of fact, correct errors, supply omissions, and determine the benefits payable under a Welfare Program. All decisions and interpretations of the Committee made in good faith pursuant to the Plan shall be final, conclusive and binding on all persons, subject only to the claims procedure, and may not be overturned unless found by a court to be arbitrary and capricious.7
Having exhausted their administrative remedies, Plaintiffs filed the instant action alleging the following claims: (1) Count I—breach of fiduciary duty in violation of Mont.Code Ann. § 33–32–201; (2) Count II—negligent utilization review pursuant to Mont.Code Ann. § 33–32–201; (3) Count III—breach of insurance contract; (4) Count IV—causation; and (5) Count V—violation of Montana's Unfair Claim Settlement Practices Act pursuant to Mont.Code Ann. § 33–18–201, et seq.
Summary judgment is appropriate only when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The moving party has the initial burden of “identifying for the court those portions of the materials on file in the case that it believes demonstrate the absence of any genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party meets its burden, then the opposing party may not defeat a motion for summary judgment in the absence of any significant probative evidence tending to support its legal theory. Commodity Futures Trading Comm'n v. Savage, 611 F.2d 270, 282 (9th Cir.1979). In a motion for summary judgment, the court must view the facts in the light most favorable to the non-moving party. State Farm Fire and Cas. Co. v. Martin, 872 F.2d 319, 320 (9th Cir.1989).
Defendants contend that the plain language of their medical plan grants them the clear discretion and authority to determine whether a procedure is experimental or investigational.8 In contrast, Plaintiffs claim that this Plan language is ambiguous. In support, Plaintiffs rely on excerpts of other portions of the Plan that do not deal specifically with experimental or investigational treatments.
The Court has reviewed those excerpts cited by Plaintiffs in the context of their surrounding language and find that they give no indication of saving coverage for experimental or investigational treatment. Moreover, Plaintiffs fail to specifically point to or conclusively explain how...
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