Justia Insurance Law Opinion Summaries

Articles Posted in Health Law
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Plaintiffs M.S. and L.S. sought insurance coverage for mental health treatments for their child, C.S., under a health benefits plan provided by M.S.'s employer, Microsoft Corporation. The plan, administered by Premera Blue Cross, is subject to ERISA and the Parity Act. Premera denied the claim, stating the treatment was not medically necessary. Plaintiffs pursued internal and external appeals, which upheld the denial. Plaintiffs then sued in federal district court, alleging improper denial of benefits under ERISA, failure to produce documents in violation of ERISA’s disclosure requirements, and a Parity Act violation for applying disparate treatment limitations to mental health claims.The United States District Court for the District of Utah granted summary judgment to Defendants on the denial-of-benefits claim but ruled in favor of Plaintiffs on the Parity Act and ERISA disclosure claims. The court found that Defendants violated the Parity Act by using additional criteria for mental health claims and failed to disclose certain documents required under ERISA. The court awarded statutory penalties and attorneys’ fees to Plaintiffs.The United States Court of Appeals for the Tenth Circuit reviewed the case. The court vacated the district court’s grant of summary judgment on the Parity Act claim, finding that Plaintiffs lacked standing to bring the claim. The court reversed the district court’s ruling that Defendants violated ERISA by not disclosing the Skilled Nursing InterQual Criteria but affirmed the ruling regarding the failure to disclose the Administrative Services Agreement (ASA). The court upheld the statutory penalty for the ASA disclosure violation and affirmed the award of attorneys’ fees and costs to Plaintiffs. View "M.S. v. Premera Blue Cross" on Justia Law

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Elizabeth Holt, a former insurance agent for Medicare Medicaid Advisors, Inc. (MMA), alleged that MMA and several insurance carriers (Aetna, Humana, and UnitedHealthcare) violated the False Claims Act (FCA). Holt claimed that MMA engaged in fraudulent practices, including falsifying agent certifications and violating Medicare marketing regulations, which led to the submission of false claims to the Centers for Medicare and Medicaid Services (CMS).The United States District Court for the Western District of Missouri dismissed Holt's complaint. The court found that no claims were submitted to the government, the alleged regulatory violations were not material to CMS’s contract with the carriers, and the complaint did not meet the particularity standard required by Federal Rule of Civil Procedure 9(b). The court also denied Holt's motion for reconsideration, which introduced a fraudulent inducement theory and requested leave to amend the complaint.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court affirmed the district court's dismissal, agreeing that Holt's allegations did not meet the materiality requirement under the FCA. The court applied the materiality standard from Universal Health Services, Inc. v. United States ex rel. Escobar, considering factors such as whether the government designated compliance as a condition of payment, whether the violations were minor or substantial, and whether the government continued to pay claims despite knowing of the violations. The court found that the alleged violations did not go to the essence of CMS’s contract with the carriers and were not material to the government's payment decisions.The Eighth Circuit also upheld the district court's denial of Holt's motion for reconsideration and request to amend the complaint, concluding that adding a fraudulent inducement claim would be futile given the immateriality of the alleged violations. View "United States ex rel. Holt v. Medicare Medicaid Advisors" on Justia Law

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Nevada Health CO-OP, a health insurance provider, received two loans from the Centers for Medicare & Medicaid Services (CMS) under the Affordable Care Act’s CO-OP program. These loans included a start-up loan and a solvency loan. In 2015, Nevada Health faced financial difficulties and was placed into receivership by the Nevada Commissioner of Insurance. CMS subsequently terminated the loan agreement and began offsetting payments owed to Nevada Health against the start-up loan debt.The United States Court of Federal Claims reviewed the case and granted summary judgment in favor of the Nevada Commissioner of Insurance, acting as the receiver for Nevada Health. The court found that the government improperly withheld statutory payments owed to Nevada Health under the ACA. The court also held that the government could not invoke 31 U.S.C. § 3728 to withhold these payments in the future.The United States Court of Appeals for the Federal Circuit reviewed the case. The court affirmed the lower court’s judgment that the government improperly withheld payments owed to Nevada Health. The court held that the loan agreement subordinated the government’s claim to those of policyholders and basic operating expenses, thus precluding the government from asserting offset rights to jump ahead of these senior creditors. However, the appellate court vacated the portion of the lower court’s order that addressed the government’s ability to invoke 31 U.S.C. § 3728, ruling that the lower court exceeded its jurisdiction by addressing this issue, which was not raised by the parties. View "Richardson v. United States" on Justia Law

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Angela Midthun-Hensen and Tony Hensen sought insurance coverage for therapies for their daughter K.H.'s autism from Group Health Cooperative between 2017 and 2019. The insurer denied coverage, citing a lack of evidence supporting the effectiveness of speech therapy for a child K.H.'s age and sensory-integration therapy for autism at any age. The family's employer-sponsored plan only covered "evidence-based" treatments. After several medical reviews and appeals upheld the insurer's decision, the parents sued, alleging violations of the Employee Retirement Income Security Act (ERISA) and state law regarding autism coverage.The United States District Court for the Western District of Wisconsin ruled in favor of the insurer, finding no violations of state law or ERISA. The plaintiffs then focused on their claim that the insurer's actions violated the Mental Health Parity and Addiction Equity Act (MHPAEA), which mandates equal treatment limitations for mental and physical health benefits. They argued that the insurer applied the "evidence-based" requirement more stringently to autism therapies than to chiropractic care, which they claimed lacked scientific support.The United States Court of Appeals for the Seventh Circuit reviewed the case and affirmed the district court's decision. The appellate court found that the insurer's reliance on medical literature, which varied in its recommendations based on patient age, was permissible under the Parity Act. The court also noted that the plaintiffs failed to demonstrate that the insurer's treatment limitations for mental health benefits were more restrictive than those applied to "substantially all" medical and surgical benefits, as required by the statute. The court concluded that the plaintiffs' focus on a single medical benefit was insufficient to prove a violation of the Parity Act. View "Midthun-Hensen v. Group Health Cooperative of South Central, Inc.," on Justia Law

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Kelsey Weyer applied for long-term disability benefits under a policy issued by Reliance Standard Life Insurance Company through her employer. Weyer suffers from multiple medical conditions, including chronic fatigue syndrome, Lyme disease, migraines, neurocognitive disorder, and others. The policy defines "Totally Disabled" differently for the first twenty-four months and thereafter. Initially, it means being unable to perform the duties of one's regular occupation, and after twenty-four months, it means being unable to perform any occupation. Reliance Standard initially approved Weyer’s claim and paid benefits for twenty-four months but later terminated them, arguing she could perform sedentary jobs and that her anxiety and depression contributed to her disability.The United States District Court for the District of Minnesota reviewed the case and ruled in favor of Weyer. The court found that the evidence did not support Reliance Standard’s claim that Weyer’s mental health issues contributed to her inability to work. It also held that Weyer was totally disabled under the policy’s "Any Occupation" standard, based on evidence from Weyer’s physicians and independent reviews.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court affirmed the district court’s decision, finding no clear error in its determination that Weyer was totally disabled and that her physical conditions alone rendered her unable to work. The appellate court also agreed that the mental health disorders did not contribute to her total disability under the policy’s terms. The court applied a "but-for" causation standard, concluding that Weyer’s physical conditions independently caused her total disability, thus the mental health limitation clause did not apply. The court affirmed the district court’s judgment in favor of Weyer. View "Weyer v. Reliance Standard Life Insurance Company" on Justia Law

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The case involves the United States of America, et al. ex rel. Michael Angelo and MSP WB, LLC (Relators-Appellants) against Allstate Insurance Company, et al. (Defendants-Appellees). The relators alleged that Allstate Insurance violated the False Claims Act by avoiding its obligations under the Medicare Secondary Payer Act. They claimed that Allstate failed to report or inaccurately reported to the Centers for Medicare & Medicaid Services (CMS) information regarding its beneficiaries, which led to Allstate failing to reimburse Medicare for auto-accident-related medical costs incurred by beneficiaries insured by Allstate.The United States District Court for the Eastern District of Michigan dismissed the case with prejudice, deeming the relators' second amended complaint deficient in numerous respects. The relators then moved for reconsideration, which the district court denied. They also filed a motion to amend or correct under Rule 59(e), asking the district court to amend its judgment to dismiss the case without prejudice to allow them to file another amended complaint. The district court denied the motion on all grounds.The United States Court of Appeals for the Sixth Circuit affirmed the district court's decision. The court found that the relators failed to state a claim for a violation of the False Claims Act. The court noted that the relators did not provide sufficient facts demonstrating that Allstate had an "established duty" to pay money or property owed to the government. The court also found that the relators did not demonstrate Allstate's understanding that its conduct violated its obligations under federal law. Furthermore, the court found that the relators' claim for conspiracy also failed as they did not provide any specific details regarding the alleged plan or an agreement to execute the plan. The court also affirmed the district court's decision to deny the relators leave to amend their complaint again. View "United States ex rel. Angelo v. Allstate Insurance Co." on Justia Law

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The case involves Bristol SL Holdings, Inc., the successor-in-interest to Sure Haven, Inc., a defunct drug rehabilitation and mental health treatment center, and Cigna Health and Life Insurance Company and Cigna Behavioral Health, Inc. Bristol alleged that Sure Haven's calls to Cigna verifying out-of-network coverage and seeking authorization to provide health services created independent contractual obligations. Cigna, however, denied payment based on fee-forgiving, a practice prohibited by the health plans. Bristol brought state law claims for breach of contract and promissory estoppel against Cigna.The district court initially dismissed Bristol’s claims, but the Ninth Circuit Court of Appeals reversed the dismissal, holding that Bristol had derivative standing to sue for unpaid benefits as Sure Haven’s successor-in-interest. On remand, the district court granted Cigna’s motion for summary judgment, ruling that the Employee Retirement Income Security Act of 1974 (ERISA) preempted Bristol’s state law claims.On appeal, the Ninth Circuit Court of Appeals affirmed the district court's decision. The court held that Bristol’s state law claims were preempted by ERISA because they had both a “reference to” and an “impermissible connection with” the ERISA plans that Cigna administered. The court reasoned that Bristol’s claims were not independent of an ERISA plan because they concerned the denial of reimbursement to patients who were covered under such plans. The court also held that allowing liability on Bristol’s state law claims would interfere with nationally uniform plan administration, a central matter of plan administration. View "Bristol SL Holdings, Inc. v. Cigna Health and Life Insurance Co." on Justia Law

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A teacher, who was involved in a car accident caused by a third party, sustained serious injuries. The teacher was covered under his employer’s self-insured healthcare plan, which stipulates that the employer has a right of reimbursement for medical expenses if a covered person receives a separate settlement. The employer paid for the teacher’s medical expenses and the teacher also received $500,000 in settlements from two separate insurers. The teacher requested that the employer waive its right to reimbursement twice, but the employer never agreed. Two years after the teacher notified the employer of his insurance settlements, the employer requested reimbursement and later sued him for breach of contract.The Superior Court of the State of Alaska granted summary judgment to the employer on the issue of whether the teacher breached the contract to reimburse the employer. The employer then moved for summary judgment on the amount of damages, providing an affidavit from its Plan Administrator and a claims ledger. The teacher opposed the motion, providing his own affidavit and a self-created spreadsheet in support of his argument that some of the medical costs paid by the employer were not associated with the accident. The court granted the employer’s motion for summary judgment on contract damages.The Supreme Court of the State of Alaska affirmed the lower court’s summary judgment order regarding breach of contract, but held that the teacher raised a genuine dispute of material fact regarding damages. Therefore, the Supreme Court reversed and remanded the lower court’s summary judgment order regarding contract damages. View "Fischer v. Kenai Peninsula Borough School District" on Justia Law

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The case revolves around a dispute over the amount of reimbursements for medical expenses that an insurer, Allstate Insurance Company, was required to pay under a personal injury protection (PIP) policy. The dispute arose when Revival Chiropractic, LLC, a medical provider, submitted charges for services rendered to two of Allstate's policyholders. Allstate paid 80% of the submitted charges, which was less than the amount that would have been reimbursable under the statutory schedule of maximum charges. Revival Chiropractic argued that Allstate was required to pay either 80% of the maximum charge under the schedule or the full amount of the submitted charge.The United States District Court for the Middle District of Florida agreed with Revival Chiropractic, ruling that Allstate violated Florida law by paying only 80% of the submitted charges when the charges were less than the amounts allowed under the statutory schedule of maximum charges. Allstate appealed the decision to the United States Court of Appeals for the Eleventh Circuit, which certified a question to the Supreme Court of Florida due to the lack of controlling precedent.The Supreme Court of Florida, after reviewing the relevant statutory provisions and the terms of Allstate's PIP policy, concluded that Allstate was entitled to pay 80% of the billed charges. The court found that the PIP policy expressly authorized such a payment and that nothing in the statutory scheme stood in the way of that policy provision. The court held that the PIP statute contemplates that an insurer providing notice that it may use the schedule of maximum charges will not thereby be precluded from paying 80% of reasonable charges as otherwise determined under the provisions of the statute. The court also rejected the argument that the statutory provision requiring an insurer to pay the full amount of the charge submitted when that amount is below the reimbursement payable under the schedule was mandatory. The court concluded that the provision was permissive and did not displace the statutory provision limiting reimbursements to 80% of reasonable charges. The court answered the certified question in the affirmative and returned the case to the Eleventh Circuit Court of Appeals. View "Allstate Insurance Company v. Revival Chiropractic, LLC" on Justia Law

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The case revolves around a patient, Tommy Harris, who contracted bacterial sepsis due to repeated infections from his dialysis treatment at a clinic in Belleville, Illinois. Harris filed a malpractice lawsuit against the operators of the clinic and later included a claim against Durham Enterprises, Inc., the janitorial company responsible for cleaning the facility. The case primarily concerns Durham’s insurance coverage. Durham submitted the lawsuit to Ohio Security Insurance Company, its insurer, which denied coverage based on the insurance policy’s exclusion for injuries caused by fungi or bacteria. Harris and Durham then negotiated an agreement in which Durham promised not to mount a defense and Harris promised to seek recovery only from the insurer. The state trial judge granted a motion to sever Harris's claim against Durham and set it for a bench trial. The judge held a short, uncontested bench trial and entered judgment against Durham for more than $2 million.Ohio Security was not a party to the state court proceedings and the insurance policy was not in the record. However, the consent judgment includes findings on insurance issues, notably, that the insurer breached its duty to defend and is estopped from asserting any policy defenses. After the judgment became final, Harris filed an amended complaint purporting to add Ohio Security as a defendant. Ohio Security removed the action to federal court and sought a declaration of its coverage obligations. The district court held that the bacteria exclusion precludes coverage.In the United States Court of Appeals for the Seventh Circuit, Harris and Durham jointly appealed, challenging the no-coverage ruling but also raising a belated challenge to subject-matter jurisdiction under the Rooker–Feldman doctrine. The court found the jurisdictional argument meritless, as the Rooker–Feldman doctrine does not block federal jurisdiction over claims by nonparties to state-court judgments. The court also affirmed the district court's ruling that the policy’s bacteria exclusion precludes coverage for this loss. View "Mitchell v. Durham Enterprises, Inc." on Justia Law