David P. v. United Healthcare Ins. Co.

David P. v. United Healthcare Ins. Co. (U.S. Dist. Ct. for the Dist. of UT, case no. 2:19-cv-00225-JNP-JCB, Sept. 29, 2021). In this ruling, Judge Jill Parrish denied Defendant’s summary judgment motion and granted Plaintiff’s motion for summary judgement.  Plaintiffs’ daughter LP received care at two RTCs for a total of about 10 months based on a number of mental health (e.g., self-harming) and substance use disorder (e.g. alcohol abuse) issues.  But United Behavioral Health only covered the first 8 days, leaving about $177,000 in unreimbursed expenses.  All internal and external appeals upheld the denial.  Although Plaintiffs did not seek a precertification for the initial stay, Judge Parrish observed that UBH changed the reason for the denial during the appeals process to a lack of medical necessity focusing only on the mental health issues. She also noted that “while this court determines that UBH’s denials suffered from a number of serious procedural irregularities that warrant de novo review, the defects in UBH’s denials of benefits are serious enough to warrant reversal even under an arbitrary and capricious standard.”  A key issue in the court ruling was the failure of UBH and the external review organization to factor in LP’s “substance use disorder” when determining her care was not medically necessary.  The Judge concluded that “UBH failed to make a medical necessity determination about LP’s substance abuse, failed to engage in meaningful dialogue with Plaintiffs on appeal, and did not provide specific reasoning in its clinical judgement of medical necessity.”  The decision was based only on the ERISA Recovery of Benefits 1132(a)(1)(B) claim and not the ERISA Parity Act 1132(a)(3) claim because of the reversal of UBH coverage determination based on being arbitrary and capricious became the primary legal issue.  In ruling the Plaintiffs have achieved success on the merits of the case, Judge Parrish ordered the Defendant to pay the benefits due, pay prejudgment interest and reimburse for attorney fees and related costs.