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Bald Mountain Holdings, LLC v. Aetna Health Insurance Co.

United States District Court, E.D. Michigan, Southern Division

October 3, 2017

BALD MOUNTAIN HOLDINGS, LLC, Plaintiff,
v.
AETNA HEALTH INSURANCE COMPANY, Defendant.

          OPINION AND ORDER

          JOHN CORBETT O'MEARA, UNITED STATES DISTRICT JUDGE

         Before the court is Defendant's motion for entry of judgment affirming its denial of benefits, which has been fully briefed. Upon review, the court determined that oral argument would not significantly aid its decision and decided this matter on the administrative record and the parties' submissions.

         FINDINGS OF FACT

         Plaintiff Bald Mountain Holdings, LLC, operates a surgical center in Lake Orion, Michigan. Bald Mountain provided services to LS, a patient covered under the Costco Employee Benefits Program (“the Plan”). LS received treatment for urinary incontinence, including the insertion of an InterStim device in February 2015. Bald Mountain sought reimbursement under the Plan for the services received by LS.

         Under the Plan, Defendant Aetna Life Insurance Company is the claims fiduciary and “has the sole and exclusive discretionary authority and control to determine claims for benefits.” AR 262, 267-68, 285. Aetna also has discretionary authority to “interpret all Plan and trust documents, booklets, policies, rules or regulations in determining claims for benefits.” AR 262.

         On May 22, 2015, Aetna determined that LS's claim was not covered under the Plan because the InterStim device was considered “experimental or investigative” and not medically necessary. See AR 331-33. Aetna's Clinical Policy Bulletin No. 0223 regarding Urinary Incontinence sets forth the following conditions under which implantation of the InterStim device is considered medically necessary:

Aetna considers implantation of the InterStim (Medtronic, Inc., Minneapolis, MN) a device for unilateral stimulation of the sacral nerve, medically necessary for the treatment of urge UI or symptoms of urge-frequency when all of the following criteria are met:
1. The member has experienced urge UT or symptoms or urge-frequency for at least 12 months and the condition has resulted in significant disability (the frequency and/or severity of symptoms are limiting the member's ability to participate in daily activities); and
2. Pharmacotherapies (i.e. at least 2 different anti-cholinergic drugs or a combination of anti-cholinergic and a tricyclic anti- depressant) as well as behavioral treatments (e.g. pelvic floor exercise, biofeedback, timed voids, and fluid management) have failed; and
3. Test stimulation provides at least 50% decrease in symptoms.

AR 14-16. Aetna determined that LS did not meet the above criteria. See AR 331-33.

         Plaintiff appealed Aetna's decision on June 4, 2015, and provided additional information in support of its appeal on June 19, 2015. Prior to receiving a determination, Plaintiff again requested reconsideration on September 4, 2015, which Aetna noted was a “potential duplicate case.” AR 18. Aetna denied Plaintiff's appeal on September 19, 2015, stating that a medical director had reviewed the matter and determined that the “documentation does not support Aetna's guidelines and criteria for coverage for this procedure. The amount of improvement on the Interstim trial was not provided.” AR 122-23.

         Under the Plan, Plaintiff had sixty days to submit a second level appeal. AR 273. According to Aetna's records, Plaintiff did not submit a second level appeal by the deadline of November 18, 2015. See AR 20-21. Rather, Plaintiff's second level appeal was submitted on December 11, 2015. Id. Aetna denied Plaintiff's second level appeal as untimely on February 8, 2016. AR 399-401.

         On April 1, 2016, Plaintiff sent a letter to Aetna, detailed the difficulty it had in obtaining answers to its phone inquires regarding the status of its claim. AR 32. On April 20, 2016, Aetna responded, indicating that it had performed a final review of Plaintiff's claim and that no further internal review was available. Subsequently, ...


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