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Lyn M. v. Premera Blue Cross

United States District Court, D. Utah

May 23, 2018

LYN M., and DAVID M., as Legal Guardians of L.M., a minor, Plaintiff,


          Bruce S. Jenkins, United States Senior District Judge.

         Plaintiffs' Motion for Summary Judgment and Defendants' Cross-Motion for Summary Judgment came before the Court on May 15, 2018, Brian King and Nediha Hadzikadunic appearing on behalf of Plaintiffs Lyn M. and David M. as legal guardians of L.M., and Gwendolyn Payton appearing on behalf of Defendant Premera. Plaintiff filed its Motion for Summary Judgment on April 6, 2018, and Defendants filed their Cross-Motion for Summary Judgment on that same date. At the May 15, 2018 hearing, the Court heard oral arguments on the motions and took the matter under advisement.

         Having considered the parties' briefs, the evidence presented, the oral arguments of counsel, the relevant law, as well as the full record in this matter, the Court concludes that Defendants' Motion for Summary Judgment should be GRANTED and Plaintiffs' Motion for Summary Judgment should be DENIED.

         I. Background

         This is a dispute over insurance coverage under an ERISA health insurance plan for L.M's fourteen-month stay at Eva Carlston Academy, a residential treatment center in Salt Lake County, Utah, with related costs in excess of $80, 000.

         L.M. suffered from mental health issues from an early age, exhibiting symptoms of anxiety and panic attacks early in her childhood and beginning therapy at eight years old. Around this time she also began seeing a psychiatrist, was diagnosed with attention deficit hyperactivity disorder and prescribed a variety of medications. Her conditions worsened throughout elementary school and negatively impacted her academic performance.

         L.M.'s parents enrolled her in a number of schools in attempts to find an environment suitable for her mental health conditions, including a school for "bright children who had difficulty functioning in a traditional school environment." The new school environments proved ineffective, as L.M. struggled to pay attention in class and maintain an adequate attendance record. L.M.'s condition continued to deteriorate as the anxiety and depression intensified, leading her to spend most of her time in her room and to self-harm by cutting on her upper thighs and wrists. She attended her freshmen year of high school for only two-weeks before transferring to the school's "homebound" program for students who could not physically attend school. Her participation in this program ultimately stopped as well, as she stopped interacting with her family and focused solely on the internet.

         A session with L.M.'s therapist led to L.M. being placed on suicide watch in an acute inpatient mental health facility for four days, because she was planning to kill herself. She subsequently participated in a two-week outpatient follow-up program. A few months later, L.M.'s parents decided to place her in Eva Carlston Academy, a long-term residential treatment center in Salt Lake County, Utah, where she was admitted on March 21, 2015. She remained in the treatment center for roughly fourteen months and showed moderate improvement over the length of her stay.

         L.M.'s parents and legal guardians Lyn and David M. submitted claims to Premera, the claims administrator of the insurance plan, for coverage for the treatment costs, which were denied by letter on March 31, 2015. The stated basis was that the treatment center did not meet the "intensity of treatment" requirements under the health plan's guidelines for inpatient stays, which require in-person evaluation by a psychiatrist at least once every seven days and weekly individual therapy. Specifically, Premera provided the following justification for its denial:

The information that your provider gave to your health plan shows that the psychiatrist in charge of your treatment evaluates you in-person once a month, not once every seven days. The information also shows that you are receiving individual therapy every other week, not weekly. Therefore, mental health residential treatment is denied as not medically necessary after 3/30/15. Your health plan covers only medically necessary services.

Dkt. No. 20-1, The Administrative Record, p. 66.

         On April 19, 2016, Lyn and David appealed Premera's denial of coverage, requesting a review of the adverse benefit determination for services provided from April 1, 2015 - forward, as L.M. was still in treatment. On June 3, 2016, Premera denied Lyn and David's appeal on the basis of reviews made by a physician board certified in Child and Adolescent Psychiatry, along with Premera's internal medical director. They gave the following rationale for their denial:

[L.M] is a 15-year-old female with depression and anxiety. She was admitted to residential treatment due to problems with depressed mood and anxiety and a history of suicidal thoughts. The documentation does not indicate that [L.M.] continued to experience severe mental health symptoms requiring 24-hour residential treatment as of April 1, 2015. This is because there was no documented evidence of ongoing suicidal and homicidal ideation, self-injury, psychosis, or severe difficulties in self-care. She could have been treated in a less restrictive setting, such as a partial hospitalization program (PHP), instead. As such, continued residential treatment services would not be considered standard of care or medically necessary. To be covered, all mental health treatment must be medically necessary to be eligible for coverage.
.. .the criterion [of being medically necessary] has not been met because there is no documented evidence of ongoing suicidal or homicidal ideation, self-injury, psychosis, or severe difficulties in self-care.

Dkt. No. 20-1, The Administrative Record, p. 45.

         Premera further specified that the treatment was not covered because of its failure to comply with the following provisions delineating the required components of "medically necessary" treatment:

• [The treatment must be] appropriate for the medical condition as specified in accordance with authoritative medical or scientific literature and generally accepted standards of medical practice.
• [The treatment must be] essential to the diagnosis or the treatment of an illness, accidental injury, or condition that is harmful or threatening to the enrollee's life or health, unless it is provided for preventative services when specified as covered under this plan.
• [The treatment must be] cost-effective, as determined by being the least expensive of the alternative supplies or level of service that are medically effective and that can be safely provided to the enrollee. A health intervention is cost-effective if no Other available health intervention offers a clinically appropriate benefit of a lower cost.
• [The treatment must not be] primarily for the comfort or convenience of the enrollee, the enrollee's family, the ...

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