1. Case Name: Steven Welp. v. Cigna, et al.

2. Type of Treatment Services Denied: In-Patient Wilderness Treatment Program

3. Lawyers:
a. Plaintiff: Jordan Lewis, Jordan Lewis, P.A. and Patrick Sheehan, Whatley Kallas, LLP
b. Defendant: Charles L. Schlumberger, Florida Power & Light Company (counsel for Defendants NextEra Energy, Inc., NextEra Energy, Inc. Employee Health and Welfare Plan, and the Employee Benefit Plans Administrative Committee); Richard Ovelmen, Jason Kairalla, Carlton Fields Jorden Burt, P.A. (counsel for Cigna Health and Life Insurance Company)

4. Format: Order granting Defendant’s Motion to Dismiss Plaintiff’s Second Amended Complaint

5. Outline:
a. ERISA Claim? Yes
b. Class Action/or Individual Action: Class Action
c. Defendant: Employer and Plan Administrator
d. Type of Insurance Plan: Self-insured Plan regulated by ERISA
e. Type of Coverage Denial: Medical Necessity

6. Legal Pointer: The denial of coverage for a requested benefit pursuant to a limitation is not the same thing as an ex ante limitation prohibiting coverage for that benefit. To properly plead a Parity Act violation resulting from the denial of the wilderness program’s coverage, Plaintiff must first correctly identify the relevant limitation and then allege a flaw in the limitation based on a comparison to a relevant analogue. While it is true that plaintiffs asserting Parity Act claims need not plead specific details with respect to the appropriate standards of care, at the very least, a plaintiff must identify the treatments in the medical/surgical arena that are analogous to the sought-after mental health/substance abuse benefit and allege that there is a disparity in their limitation criteria.

7. Legal Issues and Causes of Action: Defendants’ filed Motion to Dismiss Plaintiff’s Second Amended Complaint.
a. Ruling: Plaintiff did not exhaust all available administrative remedies before filing suit and did not put forth any “clear and positive showing of futility” or otherwise persuade the Court that he should be excused from the administrative exhaustion requirement. Plaintiff’s case is dismissed with prejudice. The time for Plaintiff to exhaust his administrative remedies expired, due to no fault of Cigna. Therefore, Plaintiff was not able to refile his ERISA claims against Cigna based on the denial of coverage referenced in the Second Amended Complaint.

8. Narrative Case Description: Plaintiff’s son struggled with mental health issues such as early childhood trauma, complex post-traumatic stress disorder, attention deficit hyperactivity disorder, depression, low self-esteem and drug use. In February 2015, his therapist concluded that he was no longer treatable in an out-patient setting, and recommended intensive, in-patient treatment. He was transmitted to Second Nature Therapeutic Wilderness Program, a mental health service provider based in Utah.

Plaintiff sought coverage under the NextEra health and welfare benefits plan, which was denied. The denial was based on a section of the Cigna Standards, entitled “Residential Mental Health Treatment for Children and Adolescents,” which distinguished between qualifying and non-qualifying residential programs. The site of a qualifying program was a “psychiatric Residential Treatment Facility” (PRTF). The Cigna Standards set forth necessary components of PRTFs, including (a) unlocked sleeping areas; (b) a staff of a multidisciplinary treatment team under the leadership of a Board Certified/Board Eligible Psychiatrist who conduct face-to-face interviews with residents at designated times; (c) the provision of intensive mental health care, physical health care, and access to ongoing education; and (d) the continuous presence of an onsite nurse and psychiatrist. Furthermore, PRTFs must be oriented towards the residents’ stabilization and improvement of functioning and reintegration with parents/relatives or guardians. To illustrate the selectivity of the PRTF class, the Cigna Standards listed examples of residential services that did not meet all of the criteria. Among the non-qualifying programs enumerated were Wilderness Programs.

Plaintiff appealed the denial on March 11, 2015. The denial was reaffirmed on June 23, 2015. Suit was later filed.

Defendants’ Motions to Dismiss Plaintiff’s First Amended Complaint
Two separately filed Motions to Dismiss Plaintiff’s First Amended Complaint were filed, first by Defendants NextEra Energy, Inc., the NextEra Energy, Inc. Employee Health and Welfare Plan and Employee Benefit Plans Administrative Committee and the second by Defendant Cigna Health and Life Insurance Company.

Plaintiff argued that the Committee denied coverage for Second Nature’s services based exclusively on the Plan’s exclusion for all wilderness-related treatment without regard to the services’ medical necessity. However, the Court held that Plaintiff’s argument was not persuasive as neither the Summary Plan Description nor the Cigna Standards contained any terms that limited coverage of a residential program because it was conducted in the wilderness. The Court stated that Cigna’s Standards established a classification of qualifying residential programs and articulated the relevant criteria for a program to be considered as such. None of the criteria created exclusions for treatment of particular mental conditions. In fact, the Court opined that the wilderness program was excluded because it lacked the requirements listed in Cigna’s criteria for qualifying residential treatment facilities, including lack of a multidisciplinary team and consistent supervision by licensed professionals.

The Court found that Plaintiff’s claim considered wilderness programs in isolation. The Amended Complaint was devoid of any comparisons between the limitations imposed on mental health/substance treatments and those on medical surgical analogues. Instead, it rested on the fact that coverage for a mental health treatment was sought and denied. As such, the Court concluded that Plaintiff did not state a claim for relief under the Parity Act because he misidentified the relevant limitations at issue and did not compare those limitations to medical/surgical analogues. The First Amended Complaint was dismissed without prejudice; however, the Court allowed Plaintiff to file a Second Amended Complaint by July 31, 2017.

Plaintiff’s Second Amended Complaint and Defendant’s Motion to Dismiss
Plaintiff filed a Second Amended Complaint against only Cigna Health and Life Insurance Company claiming that because Cigna applied a blanket exclusion, Cigna denied coverage for all mental health services provided by outdoor/wilderness behavioral healthcare programs without exception. Plaintiff further alleged that Cigna paid for the treatment of medical conditions in other types of residential programs, such as skilled nursing care and rehabilitation hospitals. Additionally, Plaintiff argued that no outdoor/wilderness behavioral healthcare program would meet all of the PRTF requirements. Thus, Cigna’s definition, in effect, dictated a blanket exclusion for all services rendered at any outdoor/wilderness behavioral healthcare program without regard to the participant’s needs, medical necessity or any other individual factor. Lastly, Plaintiff argued that he failed to request an external review of his coverage denial because 1) Plaintiff was entitled to request a review, but that the Plan did not mandate that he do so; 2) the exhaustion requirement was a judicially-made doctrine and therefore not ironclad; and 3) the futility exception to the exhaustion requirement applied because Cigna’s claim decision was ironclad and not subject to further debate or good-faith reconsideration.

Defendant filed a Motion to Dismiss Plaintiff’s Second Amended Complaint. Cigna argued that Plaintiff’s failure to allege facts demonstrating that he exhausted all claims procedures available to him, including external review rights, mandated dismissal of the action. Defendant further stated that the narrow exceptions to the exhaustion requirement were not applicable as the Summary Plan Description and Denial Letter clearly described the administrative remedies available to Plaintiff that he was required to exhaust before filing suit in federal court.

The Court found that Plaintiff’s failure to allege that he exercised his right to request an external review and his failure to dispute Cigna’s contention that Plaintiff did not in fact request an external review demonstrated that Plaintiff did not exhaust available administrative remedies before filing suit. Furthermore, the Court opined that Plaintiff’s arguments for why the Court should overlook his failure to request an external review were unpersuasive and that the allegations in the Second Amended Complaint fell short of establishing applicability of the futility exceptions. Specifically, the Court found that the Summary Plan Description required Plaintiff to have exhausted the claims procedures available under the Plan, which included appeal and external review rights, prior to filing suit. Any notion that the appeal’s denial was an ironclad decision was undermined by the fact that the plan would be bound by any decision made by the external reviewer. The Court further opined that Plaintiff put forth no allegations to suggest that he did not have meaningful access to the administrative scheme outlined in the Summary Plan Description or Denial Letter, or that exercising his right to request an independent external review of his claim would have been “an empty exercise in legal formalism.” Since it was undisputed that Plaintiff did not exhaust all available administrative remedies before filing this ERISA suit, and Plaintiff did not put forth any “clear and positive showing of futility” that he should be excused from the administrative exhaustion requirement, Plaintiff’s case was dismissed.

9. Additional Comments: The Court’s decision in the first Amended Complaint assumed arguendo that NextEra and Cigna were proper defendants, that Plaintiff exhausted the administrative appeals process, that his son was not a necessary and indispensable party who must be joint, and that the Committee’s denial of benefits was subject to de novo review.

10. Website:

11. Practical Implications and Lessons Learned: The Court concluded that allowing Plaintiff to bring suit in this case would undermine the Eleventh Circuit’s strong policy of requiring a claimant to exhaust all available administrative remedies before bringing an ERISA claim in court. If the Court were to allow Plaintiff to proceed here, future claimants may be incentivized to wait out review periods until they are time-barred from using the plan’s administrative procedures so that they can bring suit, arguing that the courts provide the only remedy.

12. All Legal Theories Presented in Case: Violation of federal Parity Act, Breach of Fiduciary Duty and Breach of ERISA

13. Successful Legal Theories in Case: None.

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