Lawsuit for Insurance Benefits Against a Self Funded ERISA Plan

[REED TOLBER]

Hello.  I'm a lawyer in South Florida desperately trying to obtain an approval for medical treatment needed by my son, and Anthem is refusing to authorize for reimbursment.  Anthem, has indidcated that the insurance provided by my wife's employer is pursuant to a self funded ERISA plan.

Anthem denied the initial request for authorization for the treatment recommended by my son's doctor.  The treatment which requires hospitalization will cost in excess of $40,000.  The denial by Anthem was totally ambiguous.  Anthem's denial letter indicated that the proposed treatment was not "medically necessary."   I appealed the decision and that was denied.  I asked for an external appeal and was told by the State of Virginia Insurance Commissioner,  where I sought the external appeal, that self funded ERISA plans have a different kind of "external appeal."  The external reviewers are not chosen by the State Insurance office, but rather by Anthem who contracts out these external appeals.

Prior to submitting the external appeal file, Anthem asked whether I wanted to supplement the file.  I asked several times whether the denial was based on a decisiion that my son was not suffering the medical illness diagnosed by his doctor or whether the denial was based on the recommended treatement (this was never clarified in the inital denial letter).   I needed to know this in order to determine what kind of additional records to be submitted in support of our claim; to wit:  records suppporting the diagnosis or records supporting the appropriateness of the treatment.   I received several responses that continued to cover both basis.  I questioned how Anthem could challenge the diagnosis based only on the clinical office notes and lab results submitted by my son's treating physician without Anthem's "deciders" conducting a clinical exam of my son.  No response.  Anthem's "external review" folks, have recently declined my request that they speak directly with my son's doctor on the teleophone before making a decision.

I have no hope that the external reviewers selected by Anthem will reverse the decsion denying benefits.  Accordingly, I am going to have to pay for the treatment myself and seek reimsbursment by way of litigation.

This is where I need help.  Who would be the defendant in a lawsuit seeking reimbursement?  Anthem?  The self funding employer (Virginia based).  Both?

Could I file the lawsuit in Florida where I live since I would be the Plaintiff seeking reimbursement?  Would it have to be in Federal District Court?  If not, Florida, would I file it in Virginia where the self funding employer is located and could I leave the employer out of the lawsuit (preferable to me since the insurance is through my ex-wife's employment and wouldn't want to create litigation that would harm her relationship with the employer).  If the suit is only against Anthem, could I file and keep the suit in Florida, state court or more likely, Federal Court?

I am pretty sure that Anthem is doing this with all  children suffering the same ailment as my son.  His treating physician says that a number of other insurance companies approve the treatment based upon her diagnosis but she always has denials from Anthem.  Apparently, Anthem makes the insured parents jump through the appeals process hoops in the hopes that a lot of parents of kids sick with the same ailment as my son will not have the resources or knowlege to get through the process.  

Im quite comfortable that in litigation I have experts who will support both the diagnosis and recommended treatement as appropriate.  One of them would be the Chief of the Pediatrics & Developmental Neuroscience Branch at the US National Institute of Mental Health  Can I bring a class action for declaratory releif to establish that the diagnosis and treatment recommended is appropriate for all similarly situated children who are diagnosed with the same ailment and are fighting for the same treatment and join in any insurer who has been routinely denying reimbursement for the recommended treatement?

Any help will be greatly appreciated...

 

Reed

[leevena]

You have an unfortunate situation here, my sympathies.  I am not an attorney, but do have 35+ years of self-funding experience.  I have some thoughts for you.

You should collect all the plan documents, this is where some of your questions can be answered, and your attorney will ask for them too.  It is quite possible that Anthem is acting as an administrator here and not the fiduciary or Plan administrator.  Because this is a self-Funded plan the employer can design benefits as they want, so it may be possible that Anthem covers these expenses in their fully insured plans, but not for this group.

There is at least one other person on here who could be of help, on the legal aspect, and that is Chaz, hopefully you will get a reply.

Good luck.

[jpod]

I see this as a claim for benefits under ERISA, in which case the Plan itself is a defendant, but because it is self-funded if you are successful in litigation your wife's employer pays, and the employer will have to pay for the defense.  You may also wish to sue Anthem too, and the employer as well, if you think there are viable breach of fiduciary duty claims against either or both.  If your wife works at an employer location in Florida there should be venue in Florida Federal Court under ERISA's expansive venue rule.  CAUTION:  Get a copy of the claims procedures for the Plan and make sure you adhere to them before filing a lawsuit.  They are probably in, or attached to, the actual Plan document and/or the Summary Plan Description.        

[CBD]

Have your wife talk to her Benefits department @ work first (if you have not done this already) and see if they can help, or explain why the claim was not getting approved. That's what they're there for! Litigation may not help here and you'll have to pay your attorney which could be more than the costs you are seeking for your son's work.  There could be a simple answer here.  Your Benefits department can also reach out to Anthem, which sounds like is the TPA for the self-funded plans (which means the employer is paying the claims under the plan, not an insurance company). 

[leevena]

On 7/11/2019 at 1:31 PM, jpod said:

I see this as a claim for benefits under ERISA, in which case the Plan itself is a defendant, but because it is self-funded if you are successful in litigation your wife's employer pays, and the employer will have to pay for the defense.  You may also wish to sue Anthem too, and the employer as well, if you think there are viable breach of fiduciary duty claims against either or both.  If your wife works at an employer location in Florida there should be venue in Florida Federal Court under ERISA's expansive venue rule.  CAUTION:  Get a copy of the claims procedures for the Plan and make sure you adhere to them before filing a lawsuit.  They are probably in, or attached to, the actual Plan document and/or the Summary Plan Description.        

Reed...Jpod is another good person for you to listen to.

[sharonfoster]

Reed,

The plan administrator is required to provide your wife a copy of the plan document, inclusive of any contract or other instruments under which the plan is established or operated), upon her written request. As part of the request, I recommend stating you want the established policies setting the objective criteria for the determination of Medically Necessity under the health plan. It is important to be as specific as possible in your request for all the materials that make up the plan document while at the same time making a broad request. I also recommend documenting in your request your need for the documents to prepare you appeal.

The Plan Administrator should be named in the health plan’s Summary Plan Description, however, it is most likely the employer.

As to the parties to name in litigation, the plan document should identify the plan named fiduciary (again, usually the employer) as well as any ‘person’ to whom claim fiduciary authority has been delegated. It is likely the claim fiduciary authority has been delegated to Anthem. If this is the case, both the health plan and Anthem would be the appropriate parties in litigation.

The plan administrator must comply with a written request for copies of documents, within 30 days of receipt, by mailing the material requested to the last-known address of the requesting participant or beneficiary or to the address provided by the participant.

Submitting a proper, thorough appeal identifying any information the plan failed to provide will be important in litigation. The outcome of litigation can (and frequently is) hampered by steps not taken during the appeals process.

I have been in your shoes and it is incredibly frustrating, but employers/plan administrators and claim fiduciaries are frequently ineffectual and, assuming you have facts on your side you can obtain the benefits you believe are due.

Sharon