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S.B. v. Oxford Health Insurance, Inc.

United States District Court, D. Connecticut

November 5, 2019

S.B., Plaintiff,


          Michael P. Shea, U.S.D.J.


         Plaintiff S.B. (“Plaintiff”) sued Defendant Oxford Health Insurance, Inc. (“Oxford”) under the Employment Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et seq., after Oxford denied Plaintiff coverage for residential mental health treatment under an employee benefit plan. The parties have filed cross motions for summary judgment. For the reasons set forth below, I find that Oxford's denial was arbitrary and capricious; consequently, Plaintiff's motion is GRANTED IN PART AND DENIED IN PART and Oxford's motion is DENIED.


         The following relevant facts are taken from the parties' Local Rule 56(a) Statements and the Administrative Record (“AR”) and are undisputed unless otherwise indicated.

         A. The Plan

         At all relevant times, Plaintiff S.B.-referred to by her initials because she was a minor during the relevant time period-was a covered beneficiary under the TechStyle Contract Fabrics Freedom PPO Plan (the “Plan”), which is an employee welfare benefit plan funded by a group policy of insurance issued by Oxford. (ECF No. 49-5 (“Defendant's 56(a)1 Statement”) at ¶ 3; ECF No. 57 (“Plaintiff's 56(a)2 Statement”) at ¶ 3; ECF No. 54 (“Defendant's 56(a)2 Statement”) at ¶ 2.) The Plan provides benefits for “medically necessary” treatment. (ECF No. 48-5 (“Plaintiff's 56(a)1 Statement”) at ¶ 3; Defendant's 56(a)2 Statement at ¶ 3.) Services are deemed “medically necessary” under the Plan only if:

• They are clinically appropriate in terms of type, frequency, extent, site, and duration, and considered effective for Your illness, injury, or disease;
• They are required for the direct care and treatment or management of that condition;
• Your condition would be adversely affected if the services were not provided;
• They are provided in accordance with generally-accepted standards of medical practice;
• They are not primarily for the convenience of You, Your family, or Your Provider;
• They are not more costly than an alternative service or sequence of services, that is at least as likely to produce equivalent therapeutic or diagnostic results;
• When setting or place of service is part of the review, services that can be safely provided to You in a lower cost setting will not be Medically Necessary if they are performed in a higher cost setting. For example we will not provide coverage for an inpatient admission for surgery if the surgery could have been performed on an outpatient basis.

(AR 173.[1]) By itself, the fact that a provider has furnished, prescribed, ordered, recommended or approved a service does not make it medically necessary for the purposes of the Plan. (AR 173.)

         The Plan further provides that Oxford “may base [its] decision on a review of:

• [the beneficiary's] medical records;
• [Oxford's[2] medical policies and clinical guidelines;
• Medical opinions of a professional society, peer review committee or other groups of Physicians;
• Reports in peer-reviewed medical literature;
• Reports and guidelines published by nationally-recognized health care organizations that include supporting scientific data;
• Professional standards of safety and effectiveness, which are generally recognized in the United States for diagnosis, care, or treatment;
• The opinion of Health Care Professionals in the generally-recognized health specialty involved;
• The opinion of the attending Providers, which have credence but do not overrule contrary opinions.

(Id.) Under the Plan, Oxford “review[s] health services to determine whether the services are or were Medically Necessary . . . .” (AR 237.) “All determination that services are not Medically Necessary will be made by: (1) licensed Physicians; or (2) licensed, certified, registered or credentialed Health Care Professionals who are in the same profession and same or similar specialty as the health care Provider who typically manages [the member's] medical condition or disease or provides the health care service under review.” (AR 237.) Reviewers are not compensated or provided financial incentives for determining that services are not medically necessary. (AR 237.) According to the Plan, Oxford “may develop or adopt standards that describe in more detail when [it] will or will not make payments under [the] Certificate.” (AR 262.) Such standards, however, cannot be “contrary to the descriptions in this Certificate.” (Id.) The Plan further gives Oxford “all the powers necessary or appropriate to enable [it] to carry out [its] duties in connection with the administration of” the Plan. (Id.)

         United Behavioral Health Services, Inc. (“UBH”) administers mental health benefits under the Plan. (Plaintiff's 56(a)1 Statement at ¶ 2; Defendant's 56(a)2 Statement at ¶ 2.) UBH's 2015 Level of Care Guidelines (the “UBH Guidelines”) define “Residential Treatment Center” as “[a] sub-acute facility-based program which delivers 24-hour/7-day assessment and diagnostic services, and active behavioral health treatment to members who do not require the intensity of nursing care, medical monitoring and physician availability offered in Inpatient.” (AR 1852.) The UBH Guidelines further provide that “[t]he course of treatment in a Residential Treatment Center is focused on addressing the ‘why now' factors that precipitated admission (e.g., changes in the member's signs and symptoms, psychosocial and environmental factors, or level of functioning) to the point that the member's condition can be safely, efficiently and effectively treated in a less intensive level of care.” (Id.)

         The UBH Guidelines provide the following admissions criteria for residential treatment centers:

1. Admission Criteria
1.1. (See Common Criteria for All Levels of Care)
1.2. The member is not in imminent or current risk of harm to self, others, and/or property.
1.3. The “why now” factors leading to admission cannot be safely, efficiently or effectively assessed and/or treated in a less intensive setting due to acute changes in the member's signs and symptoms and/or psychosocial and environmental factors. Examples include:
1.3.1. Acute impairment of behavior or cognition that interferes with activities of daily living to the extent that the welfare of the member or others is endangered.
1.3.2. Psychosocial and environmental problems that are likely to threaten the member's safety or undermine engagement in a less intensive level of care without the intensity of services offered in this level of care.

(Id.) The UBH Guidelines provide the following “Continued Service Criteria”:

2. Continued Service Criteria
2.1. (See Common Criteria for All Levels of Care) and 2.2. Treatment is not primarily for the purpose of providing custodial care. Services are custodial when they are any of the following:
2.2.1. Non-health-related services, such as assistance in activities of daily living (examples include feeding, dressing, bathing, transferring and ambulating).
2.2.2. Health-related services that are provided for the primary purpose of meeting the personal needs of the patient or maintaining a level of function (even if the specific services are considered to be skilled services), as opposed to improving that function to an extent that might allow for a more independent existence.
2.2.3. Services that do not require continued administration by trained medical personnel in order to be delivered safely and effectively.

(AR 1853.)

         Finally, the Plan provides that a member may internally appeal an adverse medical necessity determination. (Defendant's 56(a)1 Statement at ¶ 21; Plaintiff's 56(a)2 Statement at ¶ 21.) If the internal appeal process results in a final adverse medical necessity determination, a member may appeal externally to an independent third party certified by the State to conduct such appeals. (AR 243.)

         B. Plaintiff's Admission to Avalon and Treatment History

         On February 11, 2015, Plaintiff was admitted to residential treatment at Avalon Hills Eating Disorder Programs (“Avalon”), a facility that treats patients with eating disorders. (Plaintiff's 56(a)1 Statement at ¶ 6; Defendant's 56(a)2 Statement at ¶ 6.) At the time of her admission, Plaintiff was sixteen years old, her height was 61 inches, and her weight was 103.8 pounds.[3] (Defendant's 56(a)1 Statement at ¶ 25; Plaintiff's 56(a)2 Statement at ¶ 25; AR 526.) According to Avalon's intake ...

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