1. Case Name: Michael P, et al. v. Aetna Life Insurance Company, et al.
2. Type of Treatment Services Denied: Residential Treatment
- Plaintiffs: Brian S. King, Brian S. King, PC
- Defendants: Scott M. Petersen and David N. Kelley, Fabian Vancott
4. Format: Order on Motion for Summary Judgment
- ERISA Claim: Yes
- Class Action/or Individual Action: Individual
- Defendant: Insurance Provider and Claims Administrator
- Type of Insurance Plan: Self-funded employer sponsored welfare benefit plan
- Type of Coverage Denial: Medically Necessary
6. Legal Pointer: The Residential Treatment Facility did not meet the Policy definition. Therefore, the treatment was not covered under the policy.
7. Legal Issues and Causes of Action: Plaintiffs sought to recover benefits for Kirstyn’s residential treatment.
Ruling: The Court agreed with Aetna that because New Haven does not meet the Plan’s definition of a Residential Treatment Facility, and because Plaintiff failed to obtain pre-certification as required, Plaintiffs’ claim for coverage at New Haven was properly denied. Defendants’ Motion for Summary Judgment was granted.
8. Narrative Case Description: Kirstyn was admitted at New Haven on June 29, 2015, for treatment of her mental health conditions. A request for authorization of the treatment was submitted to Aetna, as agent for the Plan. On July 13, 2015, Aetna notified the Plaintiffs that Kirstyn’s treatment at New Haven was not eligible for coverage under the terms of the Plan. Aetna asserted that there was “limited or no coverage for this service” under the Plan. Aetna also stated: The following specific Plan Sponsor Criteria were not met: Services are managed by a licensed Behavioral Health Provider who, while not needing to be individually contracted, needs to (1) meet to Aetna credentialing criteria as an individual practitioner, and (2) function under the direction/supervision of a licensed psychiatrist (Medical Director).
The Plaintiffs submitted an appeal of the denial to Aetna on September 19, 2015. In their appeal, Mike and Keri first noted that they were appealing all dates of service and not just the date of Kirstyn’s admission. Mike and Kari then discussed the terms and provisions of the Plan in connection with coverage for residential treatment. The Plan specifically includes coverage for “…charges incurred in a hospital, psychiatric hospital, residential treatment facility or behavioral health provider’s office for the treatment of mental disorders…” Mike and Kari then cited the Plan’s definition of a “Residential Treatment Facility:” This is an institution that meets all of the following requirements: On-site licensed Behavioral Health Provider 24 hours per day/7 days a week; Provides a comprehensive patient assessment (preferably before admission, but at least upon admission); Is admitted by a Physician; Has access to necessary medical services 24 hours per day/7 days a week; Provides living arrangements that foster community living and peer interaction that are consistent with developmental needs; Offers group therapy sessions with at least an RN or Masters-Level Health Professional; Has the ability to involve family/support systems in therapy (required for children and adolescents; encouraged for adults); Provides access to at least weekly sessions with a Psychiatrist or psychologist for individual psychotherapy; Has peer oriented activities; Services are managed by a licensed Behavioral health Provider who, while not needing to be individually contracted, needs to (1) meet the Aetna credentialing criteria as an individual practitioner, and (2) function under the direction/supervision of a licensed psychiatrist (Medical Director); Has individualized active treatment plan directed toward the alleviation of the impairment that caused the admission; Provides a level of skilled intervention consistent with patient risk; Meets any and all applicable licensing standards established by the jurisdiction in which it is located; Is not a Wilderness Treatment Program or any such related or similar program, school and/or education service. The definition of a “Behavioral Health Provider/Practitioner” was also included in Mike and Kari’s appeal as: A licensed organization or professional providing diagnostic, therapeutic or psychological services for behavioral health conditions.
Mike and Kari noted that New Haven is a licensed organization functioning under the Administrative Code regarding residential treatment programs in the State of Utah. Mike and Kari went through the bullet points in Aetna’s definition and argued that New Haven did qualify under the terms found in the Plan. Finally, Mike and Kari argued that the federal Mental Health Parity and Addictions Equity Act of 2008 (“the Act”) mandates coverage of treatment for mental health conditions such as the treatment provided for Kirstyn at New Haven. Included with the appeal were copies of Aetna’s denial, relevant portions of the Plan, a copy of New Haven’s license to operate as a residential treatment program, the Utah Administrative Code standards for residential treatment programs, and a rider included in the Plan documents relating to the Act.
Aetna responded on December 31, 2015, almost six months after the Plaintiffs’ appeal was submitted, and maintained its denial of coverage. Aetna asserted that coverage was not available because the admission at New Haven had not been pre-certified, as required under the terms of the Plan. Aetna went on to state that pre-certification had been denied because New Haven did not meet Aetna’s criteria as a residential treatment facility.
Mike and Kari submitted a second level of appeal on February 8, 2016. First, they addressed multiple administrative errors made by Aetna during its consideration of their first appeal: (1) Aetna did not support its denial utilizing specific plan provisions; (2) Aetna failed to respond to their request to review and apply the terms of the Act in its consideration of the claim; (3) Aetna failed to consider all dates of service for Kirstyn; and (4) Aetna failed to provide a timely response to the appeal as required by ERISA, its underlying regulations, and the terms of the Plan. Mike and Kari then addressed the pre-certification basis for denial. They pointed out that a failure to pre-certify does not require an automatic denial but, rather, may reduce the amount of reimbursement for claims submitted by $250. In addition, they argued that there had not been a failure to seek pre-certification; in fact, the original denial was prompted by Aetna’s refusal to pre-certify based on an alleged failure to meet criteria. Mike and Kari then provided specific references to Plan terms requiring a notice of determination within 30 days of receipt of an appeal in cases involving a pre-service claim. Aetna’s response was well outside the 30-day time frame required. The letter went on to point out that Mike and Kari had had to make multiple phone calls to Aetna before receiving the decision in December. 22. Mike and Kari complained that Aetna’s decisions provided conclusory statements about New Haven’s alleged failure to meet criteria as an eligible healthcare provider, there was no information in the letters from Aetna to tell them why Aetna believed New Haven did not meet the criteria. They reiterated their first appeal arguments about the terms of the Plan and the requirements of the Act. Included with the second appeal were copies of the December, 2015 denial, relevant portions of the Plan, their original appeal letter, New Haven’s license, and New Haven’s accreditation with The Joint Commission Behavioral Health Care Accreditation Program.
Aetna made its final determination on February 24, 2016, and upheld the denial. The basis for the denial provided by Aetna was that Mike and Kari had not complied with precertification procedures and the claims were therefore not eligible for consideration. Aetna did not respond in any way to any of the arguments raised or questions posed by Mike and Kari in their appeals.
9. Additional Comments: The parties filed cross-motions for summary judgment. The Court granted Defendant’s Motion for Summary Judgment.
The Court found that New Haven informed Aetna that it did not have a licensed psychiatrist as a medical director, but that the facility was instead directed by a licensed clinical social worker. Based on that information Aetna informed Plaintiffs that specific Plan Sponsor Criteria were not met and, therefore, the service was not a covered service.
The Court further concluded that Aetna afforded Plaintiffs a full and fair review at both level one and level two appeals as required. Aetna, in its responses to Plaintiffs’ appeals, stated that it considered all available information, including the first appeal request, the second appeal request, the original claims, Aetna policies and procedures, Aetna’s precertification database, Aetna’s provider database, and the summary plan description for Becton Dickinson Health Plan.
The Court also held that a reasonable person giving the Plan language its common and ordinary meaning would understand that services are to be provided by a behavioral health provider who must be under the direction/supervision of someone who is a licensed psychiatrist.
Lastly, the Court stated that because New Haven did not meet Plan criteria for a Residential Treatment Facility, the stay would not have been covered even if precertification had been requested.
10. Website: None.
11. Practical Implications and Lessons Learned: Plaintiffs were not successful in this case because the residential treatment facility did not meet the policy’s definition.
12. All Legal Theories Presented in Case: Violation of ERISA, Breach of Fiduciary Duty
13. Successful Legal Theories in Case: None.