Blue Cross Must Defend Class Action Over Hormone Coverage

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Jacklyn Wille

Blue Cross Blue Shield of Michigan can’t escape a proposed class action challenging the way it covers treatments for adults with human growth hormone deficiencies ( Mac v. Blue Cross Blue Shield of Mich. , 2017 BL 189966, E.D. Mich., No. 2:16-cv-13532, 6/6/17 ).

The coverage criteria Blue Cross relied on to deny a man’s claims for the drug Genotropin weren’t necessarily incorporated into the man’s employer-sponsored health plan, a federal judge concluded June 6. In denying the insurer’s motion to dismiss, the judge said he wasn’t convinced that the coverage criteria—which excluded coverage for Genotropin used to treat hormone deficiencies with no known cause—had become a plan term “immune from judicial review.”

The case asks when an insurer’s coverage guidelines become incorporated into a health plan such that a benefit denial based on those guidelines can’t be challenged through a benefit claim under the Employee Retirement Income Security Act. The judge relied on a 2015 district court decision refusing to dismiss a case challenging coverage denials made by United Behavioral Health. In that case, the court declined to find that the challenged coverage guidelines had been incorporated into the relevant ERISA plans because none of the plans contained any reference to the guidelines.

Here, the judge said that coverage criteria must “reasonably interpret the plan” for a benefit denial based on the criteria to be immune from judicial review. Because the judge had “no information explaining how these coverage criteria were determined or by whom,” he allowed the case to move forward for more fact-finding.

Although the case was filed as a proposed class action, the judge declined to address the class claims at this stage of litigation.

Judge Paul D. Borman of the U.S. District Court for the Eastern District of Michigan wrote the decision.

Rossman Saxe PC and Miller Law Firm represent the man who sued for coverage. Jones Day represents Blue Cross.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bna.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com

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