Seymour v. BlueCross BlueShield of South Carolina
Filing
16
ORDER & REASONS granting in part and denying in part 13 Motion for Summary Judgment; denying 15 Motion for Leave to File. Signed by Judge Carl Barbier on 6/30/2016. (mmm)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
SEYMOUR
CIVIL ACTION
VERSUS
NO: 15-3829
BLUECROSS BLUESHIELD OF
SOUTH CAROLINA
SECTION: “J”(4)
ORDER & REASONS
Before the Court is a Motion for Summary Judgment (Rec. Doc.
13) filed by Defendant Blue Cross Blue Shield of South Carolina
(“BCBSSC”) and an opposition thereto (Rec. Doc. 14) filed by
Plaintiff Roderic Seymour. Having considered the motion and legal
memoranda, the record, and the applicable law, the Court finds
that the motion should be GRANTED in part and DENIED in part.
FACTS AND PROCEDURAL BACKGROUND
This case arises out of the denial of benefits pursuant to an
employee
health
benefits
plan
governed
by
the
Employment
Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001
et seq. Specifically, Defendant denied Plaintiff benefits under
the
ERISA
health
care
plan
for
allegedly
“investigational/experimental medical treatment.” (Rec. Doc. 131, at 1). This suit was originally filed in the 32nd Judicial
District Court of Terrebonne Parish. (Rec. Doc. 1.) The suit was
removed and is properly before this Court under 28 U.S.C. § 1331.
(Rec. Doc. 1, at 2.) On May 28, 2013, Plaintiff’s doctor telephoned
BCBSSC to request precertification for a total hip replacement due
to aseptic necrosis of the femur, which was approved. (Rec. Doc.
13-1, at 1; Rec. Doc. 14, at 2.) Later, Plaintiff’s physician
advised BCBSSC that he was considering an alternative outpatient
treatment. (Rec. Doc. 14-2; Rec. 13-1.) BCBSSC indicated that it
does not pre-certify “possible treatments” and that outpatient
procedures do not require pre-certification. (Rec. Doc. 14-2; Rec.
13-1.) Plaintiff alleges that, based on these statements, he was
told that “the procedure was approved because the hospital was not
told the procedure was not covered by the policy of insurance
issued by BCBSSC.” (Rec. Doc. 14, at 3.) On June 13, 2013,
Plaintiff received a core decompression with platelet-rich plasma.
Id.
at
2.
A
“experimental
claim
and
was
submitted
and
ultimately
investigational”
and
thus
denied
excluded
as
under
Plaintiff’s policy. (Rec. Doc. 13-1, at 2.) Plaintiff timely
appealed this denial, and the denial was upheld. Id.
PARTIES’ ARGUMENTS
Defendant
argues
that
BCBSSC
properly
denied
Plaintiff’s
claim pursuant to the experimental and investigational exclusion
in Plaintiff’s plan. Id. at 3. As such, Defendant seeks to limit
this Courts review to whether the insurer and plan administrator
properly denied the claim under an abuse of discretion standard.
2
Id. Pointing to the language in Plaintiff’s plan, Defendant argues
that Plaintiff’s platelet-rich plasma procedure is excluded as
“services or Id. In support of finding that such procedure is
investigational
or
experimental,
Defendant
points
to
“BCBSSC
Policy CAM 20116, entitled ‘Recombinant and Autologous PlateletDerived Growth Factors as a Treatment of Wound Healing and Other
Miscellaneous
Conditions’”,
which
provides
that
procedures
involving platelet-rich plasma are deemed investigational. (Rec.
Doc. 13-1, at 4; Rec. Doc. 13-7, at 29.) Finally, Defendant argues
that to the extent that Plaintiff asserts state law causes of
action that they are preempted by ERISA. (Rec. Doc. 13-1.)
Plaintiff first argues that BCBSSC’s “Medical Guidelines”
conflict
with
the
medical
literature
regarding
treatment
for
osteonecrosis of the hip. (Rec. Doc. 14, at 4.) Plaintiff’s main
argument is that the “Medical Guidelines” used to determine which
procedures are investigational or experimental are “confidential
and are not part of the BCBSSC’s policy of insurance nor is any
reference
made
in
the
policy
by
BCBSSC
to
its
‘Medical
Guidelines.’” (Rec. Doc. 14, at 4.) Further, Plaintiff argues that
he was not provided a copy of the “Medical Guidelines”. (Rec. Doc.
14, at 4.) Finally, Plaintiff argues that his policy is ambiguous
because BCBSSC uses confidential medical guidelines that are not
part
of
his
policy
to
determine
which
procedures
are
investigational. (Rec. Doc. 14, at 6.) Therefore, Plaintiff argues
3
his policy should be construed as ambiguous and in favor of
coverage. (Rec. Doc. 14, at 6.)
LEGAL STANDARD
Summary judgment is appropriate when “the pleadings, the
discovery and disclosure materials on file, and any affidavits
show that there is no genuine issue as to any material fact and
that the movant is entitled to judgment as a matter of law.”
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (citing Fed. R.
Civ. P. 56(c)); Little v. Liquid Air Corp., 37 F.3d 1069, 1075
(5th Cir. 1994). When assessing whether a dispute as to any
material fact exists, a court considers “all of the evidence in
the record but refrains from making credibility determinations or
weighing
the
evidence.”
Delta
&
Pine
Land
Co.
v.
Nationwide
Agribusiness Ins. Co., 530 F.3d 395, 398 (5th Cir. 2008). All
reasonable inferences are drawn in favor of the nonmoving party,
but
a
party
cannot
defeat
summary
judgment
with
conclusory
allegations or unsubstantiated assertions. Little, 37 F.3d at
1075. A court ultimately must be satisfied that “a reasonable jury
could not return a verdict for the nonmoving party.” Delta, 530
F.3d at 399.
If the dispositive issue is one on which the moving party
will bear the burden of proof at trial, the moving party “must
come forward with evidence which would ‘entitle it to a directed
4
verdict if the evidence went uncontroverted at trial.’” Int'l
Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1264-65 (5th Cir.
1991). The nonmoving party can then defeat the motion by either
countering with sufficient evidence of its own, or “showing that
the moving party’s evidence is so sheer that it may not persuade
the reasonable fact-finder to return a verdict in favor of the
moving party.” Id. at 1265.
If the dispositive issue is one on which the nonmoving party
will bear the burden of proof at trial, the moving party may
satisfy its burden by merely pointing out that the evidence in the
record is insufficient with respect to an essential element of the
nonmoving party’s claim. See Celotex, 477 U.S. at 325. The burden
then shifts to the nonmoving party, who must, by submitting or
referring to evidence, set out specific facts showing that a
genuine issue exists. See id. at 324. The nonmovant may not rest
upon the pleadings, but must identify specific facts that establish
a genuine issue for trial. See, e.g., id. at 325; Little, 37 F.3d
at 1075.
DISCUSSION
The parties apparently agree that ERISA governs this dispute
and the employee benefit plan at issue. (Rec. Doc. 13-1, at 3;
Rec. Doc. 14, at 5.) Plaintiff argues that the denial of benefits
was in violation of ERISA. Liberally construed, Plaintiff has
5
brought suit under Section 502(a)(1)(B) of ERISA. 1 A district court
reviews “an administrator’s denial of ERISA benefits for abuse of
discretion ‘if an administrator has discretionary authority with
respect to the decision at issue.’” See Taylor v. Ochsner Found.
Clinic Hosp., No. 09-4179, 2010 WL 3528624, at *3 (E.D. La. Sept.
3, 2010) (quoting Corry v. Liberty Life Assurance Co. of Boston,
499 F.3d 389, 397 (5th Cir. 2007)). While not expressly addressed
by Defendant, it appears that the plan administrator in this case
is given discretionary authority to determine which procedures are
“investigational
or
experimental”.
Plaintiff’s
plan
defines
investigational or experimental as follows:
Investigational or Experimental: surgical procedures or
medical procedures, supplies, devices or drugs which, at
the time provided, or sought to be provided, are in the
judgment of the Corporation not recognized as conforming
to
generally
accepted
medical
practice,
or
the
procedure, drug or device:
1. Has not received required final approval to market
from appropriate government bodies; or,
2. Is one about which the peer-reviewed medical
literature does not permit conclusions concerning its
effect on health outcomes; or,
3. Is not demonstrated to be as beneficial as established
alternatives;
4. Has not been demonstrated to be as beneficial as
established alternatives; or
5. Is one in which the improvement claimed is not
demonstrated
to
be
obtainable
outside
the
investigational or experimental setting.
1 Plaintiff does not expressly argue that this action is brought under Section
502(a)(1)(B) of ERISA. However, Plaintiff was a plan participant and argues
that he was wrongfully denied benefits under his Plan. Further, Section
502(a)(1)(B) provides a plan participant or beneficiary the ability to “recover
benefits due to him under the terms of his plan [or] enforce his rights under
the terms of his plan.” See Taylor, 2010 WL 3528624, at *3.
6
(Rec. Doc. 13-4, at 65-66) (emphasis added). Next, the Fifth
Circuit instructs the Court to perform a “two-step analysis in
determining whether a plan administrator abused its discretion in
construing plan terms.” Pylant v. Hartford Life & Accident Ins.
Co., 497 F.3d 536, 540 (5th Cir. 2007) (citing Rhorer v. Raytheon
Eng'rs & Constructors, Inc., 181 F.3d 634, 639 (5th Cir. 1999)).
First,
the
Court
needs
interpretation
of
the
interpretation
accords
to
plan
with
determine
and
that
“the
whether
legally
the
correct
administrator's
interpretation.”
Id.
(citing
Rhorer, 181 F.3d at 639). If “the administrator has not given the
plan the legally correct interpretation, we determine whether the
administrator's
interpretation
constitutes
an
abuse
of
discretion.” Id. (citing Rhorer, 181 F.3d at 640). “A substantial
factor in determining whether the administrator's interpretation
is a legally correct interpretation is whether the interpretation
is ‘fair and reasonable.’” Id. (quoting Lain v. UNUM Life Ins. Co.
of Am., 279 F.3d 337, 344 (5th Cir. 2002)). “A plan administrator
abuses its discretion where the decision is not based on evidence,
even
if
disputable,
that
clearly
supports
the
basis
for
its
denial.” Holland v. Int’l Paper Co. Retirement Plan, 576 F.3d 240,
246 (5th Cir. 2009).
Therefore, the first issue before the Court is the “legally
correct interpretation of the plan and whether the administrator’s
7
interpretation accords with that interpretation.” Pylant, 497 F.3d
at 540. In order to determine the legally correct interpretation
of the plan, the Court must determine the contents of the plan.
Defendant claims that the plan administrator used BCBSSC’s Policy
Cam
20116
to
determine
if
Plaintiff’s
procedure
was
investigational. (Rec. Doc. 13-1, at 4.) However, Plaintiff argues
that BCBSSC’s “Medical Guidelines” are confidential, not part of
Plaintiff’s plan, not referenced or incorporated into Plaintiff’s
plan, and not provided to Plaintiff. (Rec. Doc. 14.) Defendant
cites to only one out-of-circuit case, Montvale Surgical Ctr., LLC
v. Aetna Ins. Co., to support its position that summary judgment
is appropriate where an insurer relies on a written policy finding
platelet-rich plasma treatments as experimental. (Rec. Doc. 13-1,
at 5.) However, in Montvale, the court expressly found that: “1)
Aetna has made determinations regarding whether certain services
or
supplies
are
investigational,
or
medically
necessary,
cosmetic;
and
2)
experimental
Aetna
publicizes
and
its
determinations, which it updates regularly by issuing Clinical
Policy Bulletins.” Montvale Surgical Ctr., LLC v. Aetna Ins. Co.,
No. 12-2874, 2013 WL 2285952, at *3 (D.N.J. May 22, 2013). Further,
the plaintiff in Montvale did not argue that the Clinical Policy
Bulletin was not provided to him or part of the agreement. See id.
Here,
the
Court
is
unable
to
find
any
reference
in
Plaintiff’s BCBSSC policy to “Medical Guidelines”. (Rec. Doc. 138
4.) Further, Defendant has not asserted that BCBSSC’s “Medical
Guidelines” were provided to Plaintiff or that Plaintiff was made
aware of such guidelines. Additionally, BCBSSC’s ex post facto
determination
investigational
of
whether
or
a
procedure
experimental
appears
is
covered
inherently
or
deemed
unfair
and
unreasonable, weighing against the second step of the Court’s
analysis.
Pylant,
determining
497
whether
F.3d
the
at
540
(“A
administrator's
substantial
factor
interpretation
is
in
a
legally correct interpretation is whether the interpretation is
‘fair and reasonable’”). 2 Therefore, the Court finds that genuine
issues of material fact are still present making summary judgment
inappropriate at this stage of the proceedings.
Defendant’s second argument before the Court is that ERISA
governs all of Plaintiff’s claims. Plaintiff’s original petition
asserted a number of contract and tort-based claims. (Rec. Doc. 13, at 3.) Plaintiff’s opposition does not dispute that ERISA
governs all his claims, but rather Plaintiff appears to agree that
ERISA does in fact govern all of his claims. (Rec. Doc. 14, at 5.)
2
In the present dispute, Plaintiff’s procedure was performed outpatient rather
than inpatient. BCBSSC does not require precertification for outpatient
procedures. (Rec. Doc. 13-1, at 1.) Therefore, despite Plaintiff’s physician
calling to determine whether the alternative outpatient procedure was covered,
BCBSSC would not determine whether such procedure is covered because it was
outpatient. Id. From the facts before the Court it then appears that the
procedure is performed which then allows BCBSSC to retroactively determine which
procedures are or are not covered. To determine which procedures are covered,
it appears that BCBSSC uses a “Medical Policy” which is not directly referenced
in their insureds’ policy, incorporated into their insureds’ policy, or provided
to their insureds.
9
To the extent that Plaintiff’s contractual claims arise under state
law, they are preempted under ERISA’s express preemption clause,
which provides that ERISA is to “supersede any and all State laws
insofar as they may . . . relate to any employee benefit plan”
regulated by that Statute. 29 U.S.C. § 1144(a); Taylor, 2010 WL
3528624, at *3. Plaintiff’s original petition alleges willful
breach of contract and negligent breach of contract. (Rec. Doc. 13.) Plaintiff now appears to allege only that he was wrongfully
denied benefits under his ERISA plan. (Rec. Doc. 14.) Therefore,
to the extent that Plaintiff’s contractual claims arise under state
law, they are preempted.
In
all,
interference
Plaintiff’s
with
tort-based
contract,
claims
negligent
include
infliction
of
distress, and mental anguish. (Rec. Doc. 1-3, at 3.)
tortious
emotional
Plaintiff’s
tortious interference with contract claim, negligent infliction of
emotional
distress
claim,
and
mental
anguish
claim
are
all
preempted by ERISA. See Mayeaux v. Louisiana Health Serv. and
Indem.
Co.,
plaintiff’s
376
claim
F.3d
for
420,
432-33
tortious
(5th
Cir.
2004)
(Finding
interference
with
contract
preempted by ERISA); Estate of Coggins v. Wagner Hopkins, Inc.,
174 F. Supp. 2d 883, 888 (W.D. Wisc. Aug. 3, 2001) (Finding
plaintiff’s claims for bad faith and negligent infliction of
emotional distress were preempted by ERISA); Sublett v. Premier
Bancorp Self-Funded Med. Plan, 683 F.Supp. 153, 155 (M.D. La. 1988)
10
(Holding
that
claim
for
mental
anguish
under
state
law
was
preempted by ERISA). Therefore, to the extent that Plaintiff
continues to allege tortious interference with contract, negligent
infliction of emotional distress, and mental anguish under state
law, these claims are preempted by ERISA.
RECOMMENDATION
Accordingly,
IT IS HEREBY ORDERED that Defendant’s Motion for Summary
Judgment (Rec. Doc. 13) is GRANTED IN PART in so far as Plaintiff’s
(1) willful breach of contract, (2) negligent breach of contract,
(3) tortious interference with contract, (4) negligent infliction
of emotional distress, and (5) mental anguish claims arise under
state law. These claims are DISMISSED as PREEMPTED by ERISA.
IT IS FURTHER ORDERED that Defendant’s Motion for Summary
Judgment (Rec. Doc. 13) is DENIED in all other respects.
IT IS FURTHER ORDERED that Defendant BlueCross BlueShield of
South Carolina’s Motion for Leave to File Reply (Rec. Doc. 15) is
DENIED.
New Orleans, Louisiana, this 30th day of June, 2016.
CARL J. BARBIER
UNITED STATES DISTRICT JUDGE
11
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