Seymour v. BlueCross BlueShield of South Carolina
ORDER & REASONS. It is ORDERED that Plaintiff's Motion for Summary Judgment (Rec. Doc. 28 ) is DENIED. It is ORDERED that Defendant's Motion for Summary Judgment (Rec. Doc. 27 ) is GRANTED as stated within document. Signed by Judge Carl Barbier. (gec)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
BLUECROSS BLUESHIELD OF
ORDER & REASONS
Before the Court are Cross-Motions for Summary Judgment filed
by Plaintiff Roderic Seymour (Rec. Doc. 28) and Defendant BlueCross
BlueShield of South Carolina (BCBSSC) (Rec. Doc. 27.) Defendant
also filed a Reply in support of its motion. (Rec. Doc. 30.) Having
considered the motions and legal memoranda, the record, and the
applicable law, the Court finds that Defendant’s motion should be
GRANTED and Plaintiff’s motion should be DENIED.
FACTS AND PROCEDURAL BACKGROUND
This lawsuit arises from the denial of health benefits
pursuant to an employee health benefits plan (the Plan) governed
by the Employment Retirement Income Security Act of 1974 (“ERISA”),
29 U.S.C. § 1001, et seq. Specifically, Plaintiff was denied
benefits under the Plan for an allegedly “investigational or
experimental medical treatment.” (Rec. Doc. 13-1 at 1.) This action
Terrebonne Parish. (Rec. Doc. 1.) The lawsuit was removed and is
properly before this Court pursuant to 28 U.S.C. § 1331. (Rec.
Doc. 1, at 2.)
The following facts are undisputed. 1 Plaintiff was employed
by Buffets, Inc. (Buffets). Buffets maintained an employee group
health plan which BCBSSC administered on its behalf. On May 28,
2014, Plaintiff’s doctor called BCBSSC to request precertification
for a total hip replacement due to aseptic necrosis of the femur.
BCBSSC pre-certified Plaintiff for the total hip replacement.
considering an alternative outpatient procedure. BCBSSC informed
decompression procedure which involves drilling holes into the
plasma. Plaintiff submitted a claim for benefits for the procedure.
BCBSSC ultimately denied the claim as investigational. BCBSSC’s
investigational using an internal medical policy. (Rec. Doc. 24-3
decision to deny Plaintiff’s claim as investigational.
Rec. Doc. 27-2; 28-2.
Judgment. (Rec. Doc. 13.) On June 30, 2016 this Court issued an
Order and Reasons denying the motion in part and granting the
motion in part. (Rec. Doc. 16.) The Court granted the motion with
respect to Plaintiff’s state law claims, finding that they were
preempted by ERISA, and denied the motion in all other respects.
Id. at 11. Thereafter, the Court ordered the parties to submit
cross-motions for summary judgment to determine whether Defendant
properly denied Plaintiff’s benefits under the employee health
judgment are now before the Court.
Plaintiff argues that he was wrongfully denied coverage under
the health benefits plan. First, Plaintiff argues that the Plan
administrator’s interpretation of the Plan was legally incorrect,
procedure and advised that pre-authorization was not required.
(Rec. Doc. 28-1 at 4.) Second, Plaintiff argues that the “Court
cannot determine if the interpretation of the policy was legally
correct because the [medical policy] used by BCBSSC is not part of
its policy.” Id. at 5. Third, Plaintiff argues that BCBSSC abused
its discretion in interpreting the Plan. Id. Plaintiff argues that
“the Plan was not internally consistent,” that the policy violated
administrative regulations by failing to identify which procedures
are investigational, and that BCBSSC acted in bad faith by failing
to determine if the procedure was investigational when he initially
sought precertification. Id. at 5-6.
Defendant argues that BCBSSC was legally correct in excluding
Plaintiff’s claim as investigational. (Rec. Doc. 27-1.) Defendant
argues that Plaintiff’s health benefits Plan excludes coverage for
services, supplies, and drugs that are deemed investigational or
Defendant argues that the Plan affords BCBSSC the discretion to
consider peer-reviewed literature to determine whether a procedure
is investigational or experimental. Id. at 10. BCBSSC used a
“medical policy” that summarizes this peer-reviewed literature and
received is excluded from coverage as investigational. Id. Thus,
Defendant argues it was legally correct in excluding Plaintiff’s
claim. Alternatively, Defendant argues that even if it was not
legally correct in denying Plaintiff coverage, BCBSSC did not abuse
its discretion in denying Plaintiff’s coverage. Id. at 1.
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
Agribusiness Ins. Co., 530 F.3d 395, 398 (5th Cir. 2008). All
reasonable inferences are drawn in favor of the nonmoving party,
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
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
As decided in this Court’s previous Order, ERISA governs the
employee benefits plan at issue. (Rec. Doc. 16.) This Court’s
review is limited to the factual evidence in the administrative
record, considering only the facts known to the Plan administrator
at the time the benefits decision was made. Meditrust Fin. Servs.
Corp. v. Sterling Chems., Inc., 168 F.3d 211, 215 (5th Cir. 1999)
(citing Wildbur v. Arco Chem. Co., 974 F.2d 631, 639 (5th Cir.
1992)). Plaintiff’s claim can be characterized as a claim for
denial of benefits under Section 502(a)(1)(B) of ERISA. See id.
That section authorizes a plan participant or beneficiary to file
an action to “recover benefits due to him under the terms of his
plan [or] to enforce his rights under the terms of his Plan.” 29
U.S.C. § 1132(a)(1)(B); Taylor v. Ochsner Found. Clinic Hosp., No.
09-4179, 2010 WL 3528624, at *3 (E.D. La. Sept. 3, 2010). BCBSSC
has discretion to determine whether a particular surgical or
medical procedure is investigational. (Rec. Doc. 16 at 6.) A
discretionary authority with respect to the decision at issue.’”
Taylor, 2010 WL 3528624, at *3 (citing Corry v. Liberty Life
Assurance Co. of Boston, 499 F.3d 389, 397 (5th Cir.2007)). The
burden is upon an ERISA claimant to show that the administrator
abused its discretion in denying his claim for health benefits.
Barrois v. Reliance Standard Life Ins. Co., No. 14-2343, 2015 WL
4937894, at *10 (E.D. La. Aug. 18, 2015) (citing George v. Reliance
Standard Life Ins. Co., 776 F.3d 349, 352 (5th Cir. 2015).
The Fifth Circuit uses a two-step inquiry to determine whether
a plan administrator abused its discretion in construing plan
terms. Pylant v. Hartford Life & Accident Ins. Co., 497 F.3d 536,
Constructors, Inc., 181 F.3d 634, 639 (5th Cir. 1999)). First, the
Court must “determine the legally correct interpretation of the
plan and whether the administrator’s interpretation accords with
that interpretation.” Id. If that construction is legally sound,
then no abuse of discretion occurred and the inquiry ends. Crowell
v. Shell Oil Co., 541 F.3d 295, 312 (5th Cir. 2008). In determining
whether an administrator’s interpretation is legally correct, a
court must consider three factors: “(1) whether the administrator
interpretation is consistent with a fair reading of the Plan, and
interpretations of the Plan.” Shedrick v. Marriot Int’l, Inc., No.
11-0820, 2012 WL 601881, at *8 (E.D. La. Feb. 23, 2012) (citations
determining whether the administrator’s interpretation is legally
correct is whether the interpretation is “fair and reasonable.”
Lain v. UNUM Life Ins. Co. of Am., 279 F.3d 337, 344 (5th Cir.
Second, if the Court concludes that the administrator has not
given the plan the legally correct interpretation, the Court must
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. Ret. Plan, 576 F.3d
240, 246 (5th Cir. 2009) (citations omitted). In other words,
arbitrary only if made without a rational connection between the
known facts and the decision or between the found facts and the
evidence.”) A court’s “review of the administrator's decision need
not be particularly complex or technical; it need only assure that
the administrator's decision fall somewhere on a continuum of
reasonableness—even if on the low end.” Id. (quoting Corry, 499
F.3d at 398 (5th Cir. 2007) (internal quotation marks omitted)).
The first step is for the Court to determine whether the Plan
administrator’s interpretation of the Plan is legally correct. If
legally correct, no abuse of discretion occurred and the inquiry
ends. Crowell, 541 F.3d at 312. The first factor to examine in
determining whether an administrator’s interpretation was legally
correct is whether the administrator has given the Plan a uniform
scrutinizes whether the administrator consistently applied the
Plan to similarly situated persons covered under the policy. Id.
at *9 (citing Stone v. UNOCAL Termination Allowance Plan, 570 F.3d
252, 258 (5th Cir. 2009)). Neither Plaintiff nor Defendant raised
arguments in support of or against this factor. 2 Accordingly, the
Court will not draw any inferences in favor of either party
regarding this factor. See Shedrick, 2012 WL 601881, at *10 (not
drawing inferences in favor of either party where neither party
raised an argument for or against a particular factor).
2 Plaintiff argued that “since the ‘Medical Guidelines’ was [sic] not referenced
in the policy nor were part of the policy” that the plan was not internally
consistent. (Rec. Doc. 28-1 at 5.) However, this does not reveal whether the
plan administrator consistently applied the Plan to similarly situated persons.
See Shedrick, 2012 WL 601881, at *8.
interpretation is consistent with a “fair reading of the plan”—is
administrator’s interpretation was legally correct. Id. (citing
Stone, 570 F.3d at 260). With respect to a “fair reading of the
Plan,” the Fifth Circuit provides that “eligibility for benefits
is governed in the first instance by the plain meaning of the plan
language.” Id. “ERISA Plans are interpreted in their ordinary and
experience.” Id. “Thus, plan provisions must be interpreted as
they are likely to be understood by the average Plan participant.”
Id. Plaintiff argues that the administrator’s interpretation of
the Plan was not consistent with a fair reading of the Plan. (Rec.
Doc. 28-1 at 4-5). Specifically, Plaintiff argues that “the Court
cannot determine if the interpretation of the policy was legally
correct because the [medical policy] used by BCBSSC [to render
Plaintiff’s procedure investigational is] not part of its policy
and, therefore, cannot be interpreted in a fair and reasonable
manner. . . .” Id. at 5. However, Plaintiff does not argue that
the platelet-rich plasma treatment is not investigational. See id.
Plaintiff’s Plan excludes “services or supplies or drugs that
are Investigational or Experimental” from coverage. (Rec. Doc. 24
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
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
4. Has not been demonstrated to be as beneficial as
established alternatives; or
5. Is one in which the improvement claimed is not
investigational or experimental setting.
(Rec. Doc. 24 at 65-66.) A plain reading of the Plan shows that
the Plan administrator is permitted to consider peer-reviewed
conclusive concerning the procedure’s effect on health outcomes.
discussing platelet-rich plasma treatments and summarized those
conclusions in its Medical Policy. (Rec. Doc. 24-3 at 29.) As a
result of its periodic review, BCBSSC determined that “[c]urrent
review found that a greater proportion of studies reported no
benefit from [platelet-rich plasma] than studies that reported a
benefit. Therefore, [platelet-rich plasma] as a primary treatment
procedures, is considered investigational.” Id. at 34. Plaintiff’s
Plan excludes a procedure as investigational if that procedure
“[i]s one about which the peer-reviewed medical literature does
not permit conclusions concerning its effect on health outcomes.”
permitted to review peer-reviewed medical literature, and as a
result of such literature found no conclusions on platelet-rich
plasma treatments concerning its effect on health outcomes can be
determined, the Court finds that denial of Plaintiff’s plateletrich plasma treatment as investigational was a “fair reading of
the Plan.” This factor weighs in favor of finding that the Plan
administrator’s interpretation of the Plan was legally correct.
The third factor—whether a claimant’s Plan interpretations
would result in unanticipated costs to the Plan—was not argued by
either party. Therefore, the Court will not draw any inferences in
favor of either party regarding this factor. See Shedrick, 2012 WL
601881, at *10.
After weighing these three factors, the Court concludes that
BCBSSC’s interpretation of the Plan to exclude the platelet-rich
Consequently, the plan administrator did not abuse its discretion
IT IS HEREBY ORDERED that Plaintiff’s Motion for Summary
Judgment (Rec. Doc. 28) is DENIED.
IT IS HEREBY ORDERED that Defendant’s Motion for Summary
Judgment (Rec. Doc. 27) is GRANTED
New Orleans, Louisiana, this 8th day of September, 2016.
CARL J. BARBIER
UNITED STATES DISTRICT JUDGE
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