Health Administration Responsibility Project
Summary of an article by Edward G. Connette
Challenging coverage denials under ERISA
in Trial, May, 1998, p.20
- High Dose Chemo/Peripheral Stem Cell Rescue
for breast, ovary or brain cancer
is the most commonly litigated denial.
- What does the Policy Say?
- Get copies of the SPD, the Plan, and all amendments.
- Plan language should control, but
- If SPD appears to give benefits not allowed by
the Plan, Bene has an excellent Estoppel argument.
- Plan will usually exclude "experimental or investigative
- Some exclude procedures which have "not been approved
by US Dept. of HHS or other government agency",
But no government agency approves medical procedures.
- Some reserve complete discretion to themselves.
- Some attempt to treat the procedure as an unlisted "organ
transplant", excluded under the 'surgical procedures'
- This ambiguity may violate 29 USC 1022(a)(1).
- See Wilson v. Group, 791 F.Supp. 309 (DDC 1992)
- Some plans explicitly exclude such treatments. If this is
unambiguous, and there was adequate notice, the patient
probably has no recourse.
- Questions to ask when analyzing the plan
- Is the language clear and consistent?
- Could claimant reasonably know that procedure would be excluded?
- Was claimant given reasonable notice of pertinent amendments?
- Does it give administrator discretion to interpret the language?
- Did claimant get adequate notice of internal review & appeal
- Did administrator act responsibly in review & appeal?
- Exceptions to ERISA preemption.
- Government or church employers.
- "Pass-Through Plan" - a group plan where
- no contributions made by employer or union
- voluntary participation
- employer only collects premiums through payroll deduction
- employer receives no consideration, except costs
- Purchased coverage is subject to state insurance regulations.
- The Administrative Appeal.
- DOL minimum requirements for denial notice includes
requirement for telling claimant "any additional
information necessary to perfect the claim, and why
it is necessary"
Defective notice may remove plan time limits for appeal.
- Must exhaust administrative remedies before filing suit.
- May file for emergency relief while appeal pending if necessary.
- It is imperative to make a complete record at this stage.
- Courts may not allow anything else to be submitted later.
- Load the record with supporting material.
- Preserve any evidence of arbitrary or capricious conduct.
- Obtain copies of all relevant documents from plan administrator.
- ERISA requires his compliance within 30 days.
- Talk to the treating doctor - he can be your strongest ally
- Effect of non-examining Dr's conclusion:
- Bedrick v. Travelers, 93 F3d 149 (4th Cir. 1996)
court gave no weight to non-examining Dr's conclusion
- Social Security cases, "treating physician rule".
treating doctor gets great deference
Can advance the argument in ERISA cases
Less deference if he has financial interest
- Talk to treating Institution - also allies
- Physicians may be nationally recognized experts
- Accustomed to fielding 'experimental' denials
- Survey the medical literature
- Get leads from treating doctor and institution
- Forward to the administrator
- Include in the record
- Find out how the HMO has handled the procedure in the past.
- Find out how other HMOs handle the procedure.
- The treating institution may be able to tell you.
- One study showed 77% of ABMT were covered 1989-1992
Peters & Rogers, 330 NEJM 473 (1994)
- Find out if other institutions do the procedure.
- Humanize the record. Include photos, statements, etc.
- Judicial Review
- Defendant will usually remove to federal court
- Venue is up to plaintiff: where he, administrator,
or employer is located, or where claim arose.
- Defendant will usually move for summary judgment
- Defendant will usually argue for deferential standard
of review, ie: "arbitrary & capricious" or "abuse of
- Firestone v. Bruch, 489 US 101, sets standards
- Financial interest of administrator will lower
standard to 'modified abuse of discretion'
or 'de novo'.
- See also Brown v. Blue Cross, 898 F2d 1556 (11th Cir,1990)
- Damages are limited to payment of benefits.
- Attorneys fees can be awarded under 29 USC 1132(g)
- On remand, administrator may ask for remand back to him for
reconsideration. This should be contested.
See Halpin v. Grainger, 962 F2d 685 (7th Cir. 1992)