- Filing. Published in U.S. District Court for the District of Utah, Central Division on September 11, 2020 (Case no. 2:19-cv-364-JNP).
- Background. Plaintiff’s son deals with anger control, attention deficit disorder, suicide ideation, autism, eating disorders and addiction issues. He was enrolled into two different RTC programs providing sub-acute inpatient adolescent treatment. Beacon as the TPA denied coverage and upheld the denial using different reasons including the care was not medically necessary and both RTCs did not qualify as a mental health residential treatment program under the terms of the plan. The coverage denials were upheld through appeals process including external review.
- Holding. Judge Jill N. Parrish denied Defendant’s motion to dismiss Plaintiff’s Parity Act claim but granted dismissal of the mother who lacks standing in this lawsuit because she is not a plan participant.
- Analysis. The Court reviewed the merits and appropriateness of filing both ERISA recovery of benefit 502(a)(1)(B) claim and a Parity Act violation 502(a)(3) claim. Judge Parrish noted “Taken together, ERISA’s remedial provisions empower plan participants or beneficiaries to pursue two types of remedies: one for monetary relief seeking to ‘recover benefits due’ under the terms of their insurance plan, and another ‘to obtain other appropriate equitable relief’ for violations of the plan or other ERISA statutory rights.” The Court noted that the Plaintiffs have sufficiently pleaded MH/SUD services at issue meet the criteria imposed by the insurance plan and that the insurer imposed some additional criteria to deny coverage of the services at issue. In addition, Plaintiffs have identified comparable med/surgical treatment services and sufficiently pleaded that the Defendant does not similarly impose acute care medical necessity criteria on plan participants seeking coverage for those services.
The Court also rejected Defendants assertion that the two claims are duplicative and noted that there is no absolute prohibition on bringing simultaneous cause of actions under Section 502(a)(1)(B) and 502(a)(3). In summary, Judge Parish writes:
The (C)ourt concludes that dismissal of Plaintiffs’ Parity Act cause of action would be improper at the motion to dismiss stage. First, Plaintiffs have pleaded alternative theories of liability and identified distinct injuries, rather than simply repackaging their wrongful denial of benefits claim into a Section 502(a)(3) claim. Second, the court cannot at this stage of the litigation determine whether Plaintiffs’ wrongful denial of benefits claim will provide adequate relief to remedy the injury alleged under their Parity Act cause of action.