Opinion
1:22-CV-23823-WILLIAMS/REID
04-02-2024
ABIGAIL GOMEZ, Plaintiff, v. NEIGHBORHOOD HEALTH PARTNERSHIP, INC., Defendant.
REPORT AND RECOMMENDATION ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
LISETTE M. REID UNITED STATES MAGISTRATE JUDGE
This matter is before the Court on Neighborhood Health Partnership Inc.'s Motion for Summary Judgment as to Plaintiff's Complaint seeking reimbursement for health care benefits pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001, et seq. (“ERISA”). [ECF No. 29]. The Honorable Kathleen M. Williams referred this matter to the Undersigned for a Report and Recommendation. [ECF No. 5]. Plaintiff filed a response in opposition to the Motion [ECF No. 30], and Defendant filed a reply memorandum in support of the Motion [ECF No. 32]. After careful consideration of the parties' arguments, the briefs, the record, and the relevant legal authorities, the Undersigned RECOMMENDS that Defendant's Motion for Summary Judgment be GRANTED.
BACKGROUND
Abigail Gomez (“Plaintiff”) is insured through her employer by Neighborhood Health Partnership, Inc. (“Defendant”). [ECF No. 1 ¶¶ 6, 7]. Defendant uses United Healthcare to administer health insurance claims. [Id. at ¶ 12]. According to Plaintiff's Complaint, she is entitled to payment for “medically necessary health benefits[,]” which includes in-network and out-of- network benefits. [Id. at ¶¶ 10, 11]. Defendant fully approved medical services to treat a “[r]hinoplasty incident to [s]eptoplasty due to nose trauma[,]” [Id. at ¶ 20], with Dr. Richard Davis, M.D., of the Center For Facial Restoration, Inc. [ECF No. 27-3 at 258]. According to the medical billing codes Dr. Davis provided, Defendant was to cover the cost of a cartilage graft, rhinoplasty (nasal tip work and osteotomies), and repair of nasal vestibular stenosis. [ECF No. 1-2 at 2]. Defendant approved the procedure. [ECF No. 1 at ¶ 21].
Before the surgery, however, Dr. Davis declined to perform the surgery. [ECF No. 27-3 at 258]. He explained to Plaintiff in a letter that he “no longer fe[lt] comfortable performing your revision nasal surgery. I feel the nose is too traumatized from prior surgery and the risk of complications from elective cosmetic surgery is simply too high. This decision was made on the basis of medical considerations.” [Id.]. Dr. Davis recommended a colleague to Plaintiff, Dr. Jeffery Epstein, M.D. [Id.].
a) Dr. Epstein
Plaintiff contacted Dr. Epstein, and Defendant later received a claim from Dr. Epstein for a similar procedure, but not the same. See [ECF No. 29 at 3]. Unlike her experience with Dr. Davis, Plaintiff did not request preauthorization from Defendant prior to the medical procedure. Dr. Epstein's claim sent to Defendant after the procedure used three different medical billing codes to repair Plaintiff's nasal vestibular stenosis. See id. at 2-3. Only one was the same as the authorized codes Dr. Davis had submitted. Defendant summarily denied this claim, explaining that the procedure was not a “medical necessity.” Id. at 4; see also ([ECF 27-1 at 263] (explanation of denial) (the procedure “‘must be recognized as safe and effective for the diagnosis or treatment of a specified condition according to clinical evidence published in the peer reviewed [sic] medical literature' and that the clinical staff ‘determined that this service has not been proven effective for the documented clinical circumstances.'”).
Plaintiff appealed the decision to Neighborhood Health's review board, which denied the appeal. [ECF No. 27-1 at 464-68]. A medical director specializing in plastic surgery reviewed the appeal and determined that Dr. Epstein's surgery was mainly cosmetic, rather than medically necessary. See [Id. at 465]. The insurance policy defined cosmetic surgeries as “procedures or services that change or improve appearance without significantly improving physiological function.” Id. Essentially, the medical billing codes Dr. Epstein used would “correct an anatomical [c]ongenital [a]nomaly without improving or restoring physiologic functions.” Id. Defendant's medical director who reviewed the claim found “a lack of documentation that there is a physiologic functional impairment that will be addressed by the surgery as defined in the code submitted for review (30410). Id.
Plaintiff appealed to a second-level review board and included Dr. Epstein's medical notes and photographs, and Defendant denied the claim again. See [ECF No. 1 at ¶¶ 5-6]; [ECF No. 273 at 300]. A different medical director oversaw this appeal. [ECF No. 27-3 at 340]. That medical director pointed to language used in Dr. Epstein's notes, which included “revision cosmetic rhinoplasty.” Id. The director added:
Your records do not show documentation of a one month [sic] trial of medical treatments. They do not show that the bones and septum are the main cause of your breathing issue. Photos do not show significant displacement of the nasal bones. There is no CAT scan to show a nose fracture which blocks your airway....Moreover, some of these procedures would not meet the guidelines for outpatient surgery in a hospital had they been performed. Your records do not show that you have a serious medical illness. They do not show that there were no ambulatory surgery centers (ASC's) in your area. These could have been done in an ASC. These treatments are not considered medically necessary. They are not covered under your plan.Id.
b) Dr. Toriumi
Dr. Epstein ultimately performed five surgeries on Plaintiff's nose; Plaintiff paid out of pocket for the procedures. See [ECF No. 27-3 at 313]. Given the unsuccessful fifth surgery, Dr. Epstein “no longer felt comfortable” performing another surgery and referred Plaintiff to an out-of-network revision specialist, Dr. Toriumi, M.D., in Chicago, Illinois. Id. Dr. Toriumi added “fat injections” to Plaintiff's nose and ordered her to begin “hyperbaric oxygen treatment to repair the skin before surgery.” [ECF No. 29 at 7].
Defendant denied coverage for any portion of Dr. Toriumi's $11,173.98 bill. See [ECF No. 27-4 at 317]. Defendant explained that Plaintiff did not provide additional information needed and still had a remaining out-of-network deductible of $5,000 and a $10,000 out-of-pocket requirement. [ECF No. 29 at 7-8].
Defendant later admitted it failed to send Plaintiff a letter requesting further information, which informed, in part, Defendant's denial of claims for Dr. Toriumi. See [ECF No. 32 at 6]. Defendant offered to rectify its wrong by remanding the denial for further consideration. [ECF No. 32-3 at 2]. This would consist of Defendant making another determination if the services were covered, and a right to a second-level appeal by Plaintiff. [ECF No. 32-3 at 2]. According to Defendant, however, “Plaintiff never submitted an appeal of the denial of the Toriumi claim after the September 30, 2022, EOB was issued, [sic] therefore Plaintiff did not exhaust her administrative remedies as to the Toriumi claim and the claim was not ripe for inclusion in this action in the first instance.” [ECF No. 32 at 8]. Plaintiff argues it did request an appeal on the denial, but “[n]o response was received.” [ECF No. 1 at ¶ 52].
In this ERISA Complaint, Plaintiff contends Defendant “failed to make full payment of benefits to Plaintiff although she had a condition for which services are expressly covered under the policy, in violation of ERISA.” [Id. at ¶ 3]. Defendant also violated ERISA “by interpreting and implementing ERISA plan terms in a way that was systematically arbitrary and capricious, and failed to provide a benefit determination and appeal process that provides for a full and meaningful review of benefit claims and determinations.” [Id. at ¶ 43].
Plaintiff also alleges that Defendant erred in denying her claim for reimbursement of services rendered by Dr. Toriumi, an out-of-network plastic surgeon who performed another procedure on Plaintiff after Dr. Epstein. [Id. at ¶ 43]. According to Plaintiff, the post-service claim “required medically necessary, urgent, and emergency services which were provided by [Dr.] Toriumi....” [Id. at ¶ 48]. Again, Plaintiff did not seek prior authorization for the claim.
Ultimately, Plaintiff requests monetary damages and civil penalties, reasonable attorney's fees and costs of suit, damages allowed under ERISA, declaring that Defendant breached the terms of the 2019 and 2021 summary plan description, declaring that Defendant breached its fiduciary duties under ERISA, awarding pre-judgment and post-judgment interest, and any other relief the Courts deems proper against Defendant. [Id. at 11].
c) The arguments
Defendant moved for summary judgment, arguing its decision to deny coverage was, first, proper because Plaintiff's procedures were not medically necessary, and she failed to prove otherwise. [ECF No. 29 at 10]. Secondly, Dr. Toriumi's claim is time-barred since Plaintiff failed to appeal the denial within 180 days after receipt. Id. at 15; see also [ECF No. 32 at 7] (“[Plaintiff] failed to provide any verification (via declaration or affidavit) as actual evidence to dispute NHP's [Statement of Material Fact]).” But see [ECF No. 32 at 6] (Defendant later admitted it failed to send Plaintiff a letter requesting further information, which informed, in part, Defendant's denial of claims for Dr. Toriumi).
Third, Defendant had “vested discretionary authority” to make claims decisions. [ECF No. 29 at 16]. Fourth, Defendant had reasonable grounds to support its decision. [Id.]. Fifth, there was no conflict of interest in Defendant determining eligibility for benefits and paying claims with its assets.
Plaintiff argues “not true” in her Response to Defendant's Motion for Summary Judgment. See generally [ECF No. 30]. She argues all the procedures were medically necessary, the administrative record regarding Dr. Toriumi's claim is incomplete and contains procedural irregularities, and a further discovery process should be granted. [Id. at 16, 18, 20].
LEGAL STANDARD
Typically, a court will grant a motion for summary judgment “if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). In the context of ERISA, however, summary judgment motions are construed as a Motion for Final Judgment, and the court sits in more of an appellate capacity. Providence v. Hartford Life & Accident Ins. Co., 357 F.Supp.2d 1341, 1342 (M.D. Fla. 2005); see also Curran v. Kemper Nat'l Servs., Inc., No. 04-14097, 2005 WL 894840, at *7 (11th Cir. 2005) (“In an ERISA benefit denial case . . . in a very real sense, the district court sits more as an appellate tribunal than as a trial court.”) (quoting Leahy v. Raytheon Co., 315 F.3d 11, 17-18 (1st Cir. 2002)).
Thus, in an ERISA case, “the usual tests of summary judgment, such as whether a genuine dispute of material fact exists, do not apply.” Crume v. Met. Life Ins. Co., 417 F.Supp.2d 1258, 1272 (M.D. Fla. 2006) (quoting Bendixen v. Standard Ins. Co., 185 F.3d 939, 942 (9th Cir. 1999)). “A plaintiff suing for insurance benefits under 29 U.S.C. § 1132(a)(1)(B) bears the burden of proving her entitlement to those benefits under the plan.” Delucca v. Guardian Life Ins. Co. of Am., No. 9:22-CV-80903-DMM, 2023 WL 7129986, at *6 (S.D. Fla. Sept. 15, 2023).
“ERISA itself provides no standard for courts reviewing the benefits decisions of plan administrators or fiduciaries.” Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350, 1354 (11th Cir. 2011). A multi-step framework developed because of the Supreme Court's decisions in Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989) and Metro. Life Ins. Co. v. Glenn, 554 U.S. 105 (2008). The Eleventh Circuit defines the framework as a six-part test:
(1) Apply the de novo standard to determine whether the claim administrator's benefits-denial decision is “wrong” (i.e., the court disagrees with the administrator's decision); if it is not, then end the inquiry and affirm the decision.
(2) If the administrator's decision in fact is “de novo wrong,” then determine whether he was vested with discretion in reviewing claims; if not, end judicial inquiry and reverse the decision.
(3) If the administrator's decision is “de novo wrong” and he was vested with discretion in reviewing claims, then determine whether “reasonable” grounds supported it (hence, review his decision under the more deferential arbitrary and capricious standard).
(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator's decision; if reasonable grounds do exist, then determine if he operated under a conflict of interest.
(5) If there is no conflict, then end the inquiry and affirm the decision.
(6) If there is a conflict, the conflict should merely be a factor for the court to take into account when determining whether an administrator's decision was arbitrary and capricious. Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350, 1355 (11th Cir. 2011).
Courts are limited to reviewing only the documents that the administrator had at the time the decision was made. Id. at 1354. “Whether the administrator's decision was either de novo correct or reasonable . . . is a question of law.” Id. “As long as a reasonable basis appears for [the] decision [of the administrator], it must be upheld as not being arbitrary or capricious, even if there is evidence that would support a contrary decision.” White v. Coca-Cola Co., 542 F.3d 848, 856 (11th Cir. 2008) (quoting Jett v. Blue Cross & Blue Shield of Ala., Inc., 890 F.2d 1137, 1140 (11th Cir.1989)).
ANALYSIS
a) Dr. Toriumi
Dr. Toriumi's claim does not fall neatly into the six-prong test. The crux of Defendant's argument concerning Dr. Toriumi is that Plaintiff incorrectly asserts that the “Administrative Record is incomplete and contains procedural irregulates.” [ECF No. 30 at 18] (citing Jett, 890 F.2d at 1140). Among other reasons, Defendant failed to send its letter requesting further information; thus, denying the claim created “procedural unfairness.” See id. at 19 (citing Browning v. Hartford Life & Accident Ins. Co., No. 18-80991-CV, 2019 WL 7841719, at *6 (S.D. Fla. Apr. 23, 2019) (“If a court finds that the administrative record was incomplete, the appropriate remedy is to remand the case to the claims administrator for further review.”).
Certainly, the error on Defendant's part is concerning. But, after Defendant acknowledged its error, Plaintiff did not take Defendant's offer to remand Dr. Toriumi's claim. [ECF No. 32 at 8]. Indeed, “Plaintiff never submitted an appeal of the denial of the Toriumi claim after the September 30, 2022 [Explanation of Benefits] was issued, [sic] therefore Plaintiff did not exhaust her administrative remedies . . . and the claim was not ripe for inclusion.” Id. In sum, Plaintiff must appeal the denial of her benefits before bringing suit in federal court.
This Circuit believes plaintiffs must exhaust “available remedies under their ERISA-governed plans before they may bring suit in federal court.” Alexandra H. v. Oxford Health Ins. Inc. Freedom Access Plan, 833 F.3d 1299, 1314 (11th Cir. 2016) (quoting Springer v. Wal-Mart Associates' Grp. Health Plan, 908 F.2d 897, 899 (11th Cir. 1990)). So, it is proper is to dismiss this portion of Plaintiff's claim. Therefore, Plaintiff can proceed correctly with Defendant's Appeals and Grievances department, where she can present all her evidence. If the appeal does not go in her favor, she may return to this Court under with an ERISA action.
b) Dr. Epstein
I. The administrator's decision
Based on a review of the administrative record, I find that Defendant's decision was correct. Nonetheless, the decision was not arbitrary and capricious even assuming Defendant's denial was de novo wrong because the evidence raised by Defendant show that these claims were cosmetic operations not covered by its policy. Defendant reached this conclusion based on medical records from Plaintiff, her physicians, and the appeal board.
II. Vested discretion
The policy states Defendant has authority to “[m]ake factual determinations related to the [p]olicy and its [b]enefits.” [ECF No. 27-1 at 58]. The clear language here brings no doubt Defendant had vested discretion. See Fla. Tube Corp. v. MetLife Ins. Co. of Connecticut, 603 Fed.Appx. 904, 908 (11th Cir. 2015)).
III. Reasonable grounds
Section one of Plaintiff's policy states, “The health care service, including supplies or Pharmaceutical Products, is only a Covered Health Care Service if it is Medically Necessary.” [ECF No. 29 at 10]. “Medically necessary” means:
• In accordance with Generally Accepted Standards of Medical Practice.
• Clinically appropriate, in terms of type, frequency, extent, service site and duration, and considered effective for your Sickness, Injury, Mental Illness, substance-related and addictive disorders, disease or its symptoms.
• Not mainly for your convenience or that of your doctor or other health care provider.
• Not more costly than an alternative drug, service(s), service site or supply that is at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of your Sickness, Injury, disease or symptoms.Id. at 11.
That is, “standards that are based on credible scientific evidence published in peer-reviewed medical literature generally recognized by the relevant medical community, relying primarily on controlled clinical trials, or, if not available, observational studies from more than one institution that suggest a causal relationship between the service or treatment and health outcomes.” Id. at 11. Defendant retains the right to consult experts to determine what procedures are medically necessary. Id.
The Court is unpersuaded by Plaintiff's argument that there is total overlap between the procedures Dr. Davis wanted to perform and those Dr. Epstein actually performed. See [ECF No. 30 at 1]. First, however, both doctors agree that the procedures were not entirely medically necessary surgeries. See [ECF No. 27-3 at 258] (Dr. Davis informing Plaintiff that her “nose is too traumatized from prior surgery and the risk of complications from elective cosmetic surgery is simply too high); cf. [ECF No. 29 at 13] (Dr. Epstein noting Plaintiff underwent “nasal surgery in the past and was quite unhappy with the esthetic results which creates some function issues.”). (quoting Administrative Record).
Secondly, nothing in the policy indicated a pre-authorization by one doctor for a particular procedure would transfer to another doctor for a different procedure. In fact, Defendant argues it never approved Dr. Epstein's operation, and Dr. Epstein only filed a claim post-surgery. See [ECF No. 32 at 3]. The biggest concern here is that Dr. Epstein's medical billing codes differed from Dr. Davis's. [ECF No. 29 at 12]. Plaintiff then exercised her right to appeal-twice-which was denied after two medical directors with experience in plastic and general surgery determined that Dr. Epstein's medical codes and Plaintiff's medical records indicated the procedures were not medically necessary. See id. at 13. Nothing here seems improper on a de novo or arbitrary and capricious standard. Moreover, a treating physician is not the arbiter of whether a procedure is medically necessary: Case law states reviewing specialists' opinions can inform claim administrators. See Blankenship, 644 F.3d at 1356 (“Even where [appellant's] own doctors offered different medical opinions than MetLife's independent doctors, the plan administrator may give different weight to those opinions without acting arbitrarily and capriciously.”); accord Carter v. Nationwide Mut. Ins. Co., 338 Fed.Appx. 377, 378 (5th Cir. 2009).
IV. Conflict of interest
“A pertinent conflict of interest exists where the ERISA plan administrator both makes eligibility decisions and pays awarded benefits out of its own funds.” Blankenship, 644 F.3d at 1355 (citing Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 111 (2008)). Here, Defendant decides eligibility and uses its funds to award benefits. A structural conflict of interest exists, and the Court must advance to step six.
VI. Arbitrary and capricious
A plan administrator may still prevail on its decision despite a conflict of interest. Blankenship, 644 F.3d at 1355. “[C]ourts still ‘owe deference' to the plan administrator's ‘discretionary decision-making' as a whole.” Id. (quoting Doyle v. Liberty Life Assur. Co. of Bos., 542 F.3d 1352, 1363 (11th Cir. 2008)). In other words, a conflict is one part of an analysis trying to answer “whether a reasonable basis existed or the administrator's benefits decision.” Id. (citing Conkright v. Frommert, 559 U.S. 506, 520 (2010)). Nothing in the record shows Defendant based its decision to deny Plaintiff's coverage simply on financial considerations. See Blankenship, 644 F.3d at 1357. Returning to the Court's reasoning above, see supra Section III, Defendant denied the claims since neither were medically necessary as defined by the insurance policy.
The Court fails to see “persuasive evidence in the record of procedural unreasonableness.” Id. Plaintiff “has not sufficiently shown, and [this Court's] independent review of the record has not indicated, that the structural conflict of interest in this case had sufficient ‘inherent or case-specific importance,' for [this Court] to overturn [Defendant's] benefits decisions.” Id. (citations omitted). Ultimately, Plaintiff did not carry her burden to show that the decision was “arbitrary [or] . . . tainted by self-interest.” Id. (internal citation and quotation marks omitted).
c) Further discovery
The Court denied Plaintiff's Motion to Allow Discovery in January. [ECF No. 36]. This dispute between the parties is now moot.
CONCLUSION
For the foregoing reasons, it is RECOMMENDED that Defendant's Motion for Summary Judgment [ECF No. 29] be GRANTED. The Count II of Plaintiff's Complaint relating to Dr. Toriumi should be dismissed without prejudice.
Objections to this Report may be filed with the District Judge within seven days of receipt of a copy of the Report. Failure to timely file objections will bar a de novo determination by the District Judge of anything in this recommendation and shall constitute a waiver of a party's “right to challenge on appeal the district court's order based on unobjected-to factual and legal conclusions.” 11th Cir. R. 3-1; see also Harrigan v. Metro-Dade Police Dep't Station #4, 977 F.3d 1185, 1191-92 (11th Cir. 2020); 28 U.S.C. § 636(b)(1)(C).
Kathleen M. Williams; and U.S. District Judge