Parsons et al v. Sisters of Charity of Leavenworth Health Systems et al

Filing 76

ORDER denying 73 Motion for Reconsideration, to Amend/Correct, to Alter Judgment. Signed by Judge Richard F. Cebull on 7/25/2011. (EMA)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
BILLINGS DIVISION

RANDEE PARSONS AND PEGGY )
PARSONS,
)
)
Plaintiffs,
)
)
vs.
)
)
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.
)
______________________________ )

Cause No. CV 10-47-BLG-RFC

ORDER

On May 31, 2011, this Court granted judgment as a matter of law for
Defendants, concluding that their Medical Plan did not cover autologous bone

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marrow transplants (“ABMT”) to treat Plaintiff Randee Parsons’s Crohn’s disease,
because ABMT is an experimental and investigational treatment for Crohn’s
disease and the Medical Plan does not cover such treatments. Doc. 71. Plaintiffs
now move the Court for leave to file a motion for reconsideration, contending the
Court erred in reviewing Defendants’ denial of coverage for abuse of discretion
and that the review should have been de novo. Doc. 73.
Plaintiffs assert they did not foresee that the Court would apply anything but
a de novo review and therefore did not argue for de novo review in briefing the
summary judgment motions. According to Plaintiffs, discretionary clauses such as
the one contained in Defendant’s Medical Plan, which ordinarily give rise to an
abuse of discretion review by a reviewing court, are invalid under Montana law,
citing Standard Ins. Co. v. Morrison, 584 F.3d 837 (9th Cir. 2009). But Standard
Ins. Co. held that the Montana insurance commissioner’s practice of disapproving
insurance policies with clauses vesting discretion in insurers did not violate
ERISA–it did not hold that Montana courts must apply a de novo review when
considering denials of coverage under an employer’s self-insured Medical Plan
that vests a third party with discretion to administer the Plan. Plaintiffs provide no
other authority for a de novo review.

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But even if this Court should have reviewed the denial of coverage de novo,
the result would be the same because the Medical Plan plainly excludes coverage
for medical services, supplies, or drugs that are experimental or investigational.
Most importantly, the consent form that Randee Parsons signed in order to
participate in Dr. Burt's ABMT clinical trial specifically stated that the procedure
was experimental, for research, and “is risky, of no proven benefit, and may not
work.” From this undisputed fact alone, the Court must conclude the ABMT
clinical trial was “experimental and investigational.” Accordingly, there is no
coverage for Dr. Burt's ABMT clinical trial even under a de novo standard of
review.
For those reasons, IT IS HEREBY ORDERED that Plaintiffs’ Motion for
Leave to File a Motion for Reconsideration (Doc. 73) is DENIED.
The Clerk of Court shall notify the Parties of the entry of this Order.
DATED this 25th day of July, 2011.

/s/ Richard F. Cebull
RICHARD F. CEBULL
United States District Judge

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