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Ariana M. v. Humana Health Plan of Texas, Inc.

United States Court of Appeals, Fifth Circuit

April 21, 2017

ARIANA M., Plaintiff - Appellant
v.
HUMANA HEALTH PLAN OF TEXAS, INCORPORATED, Defendant-Appellee

         Appeal from the United States District Court for the Southern District of Texas

          Before PRADO, HIGGINSON, and COSTA, Circuit Judges.

          STEPHEN A. HIGGINSON, Circuit Judge

         Plaintiff-Appellant Ariana M. challenges Defendant-Appellee Humana Health Plan of Texas's denial of coverage for continued partial hospitalization. After reviewing the administrative record, the district court granted Defendant's motion for summary judgment. We AFFIRM.

         I.

         Plaintiff is a dependent eligible for benefits under the Eyesys Vision Inc. group health plan (the "Plan"), which is insured and administrated by Humana. The Plan's benefits include coverage for partial hospitalization for mental health treatment. However, benefits are payable only for treatments that are "medically necessary." "Medically necessary" is defined as health care services that a health care practitioner exercising prudent clinical judgment would provide to his or her patient for the purpose of preventing, evaluating, diagnosing or treating an illness or bodily injury, or its symptoms. Such health care service must be:

• In accordance with nationally recognized standards of medical practice;
• Clinically appropriate in terms of type, frequency, extent, site and duration, and considered effective for the patient's illness or bodily injury;
• Not primarily for the convenience of the patient, physician or other health care provider; and
• Not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of the patient's sickness or bodily injury.
For the purpose of medically necessary, generally accepted standards of medical practice means standards that are based on credible scientific evidence published in peer-reviewed medical literature generally recognized by the relevant medical community, Physician Specialty Society recommendations, the views of physicians practicing in relevant clinical areas and any other relevant factors.

         Plaintiff has a long history of mental illness, eating disorders, and engaging in self-harm. On April 15, 2013, Plaintiff was admitted to Avalon Hills's intensive partial hospitalization program. Partial hospitalization refers to a level of care in which a patient attends medical programming for approximately eight hours per day. This form of care is more intensive than either intensive outpatient or outpatient care.

         Defendant initially found the treatment medically necessary and approved partial hospitalization through April 19, 2013, ultimately extending authorization through June 4, 2013, for a total of 49 days. On June 5, 2013, Defendant denied continued partial hospitalization treatment, finding that it was no longer medically necessary. In making its determination, Defendant asked two doctors to review Plaintiff's medical treatment, using the Mihalik criteria, a privately licensed review criteria created by the Mihalik Group.

         Plaintiff filed her Complaint on November 7, 2014. On February 12, 2015, Plaintiff filed a motion to determine the standard of review, arguing that Defendant's denial of benefits should be reviewed de novo. Defendant responded, conceding that de novo review applies to plan term interpretations; however, Defendant also noted that under Fifth Circuit law, even when de novo review applies, factual determinations are reviewed for abuse of discretion. Noting the parties' agreement, the district court granted Plaintiff's motion. Defendant next filed a motion for summary judgment along with the administrative record. Plaintiff responded. The district court granted the motion for summary judgment. Plaintiff appealed.

         II.

         Plaintiff argues that the district court erred by applying an abuse of discretion, instead of a de novo, standard to assess Defendant's factual determinations. We disagree.

         The Employee Retirement Income Security Act of 1974's ("ERISA") text "does not directly resolve" the question of the appropriate standard of review of an ERISA plan administrator's decision to deny plan benefits. Conkright v. Frommert, 559 U.S. 506, 512 (2010). In Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989), the Supreme Court held that "[c]onsistent with established principles of trust law, . . . a denial of benefits challenged under [ERISA] is to be reviewed under a de novo standard unless the benefit plan gives the administrator . . . discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Id. at 115. Accordingly, where an ERISA plan delegates discretionary authority to the plan administrator (a "discretionary clause") courts review the plan administrator's decisions for abuse of discretion. See, e.g., Barhan v. Ry-Ron Inc., 121 F.3d 198, 201 (5th Cir. 1997).

         In Pierre v. Connecticut General Life Insurance Co./Life Insurance Co. of North America, 932 F.2d 1552 (5th Cir. 1991), we interpreted Firestone to "not require de novo review for factual determinations" and instead found that "an abuse of discretion standard of review is appropriate" for reviewing a plan administrator's factual determinations. Id. at 1553. Accordingly, in this Circuit, "with or without a discretion[ary] clause, a district court rejects an administrator's factual determinations in the course of a benefits review only upon the showing of an abuse of discretion." Dutka ex rel. Estate of T.M. v. AIG Life Ins. Co., 573 F.3d 210, 212 (5th Cir. 2009); see also Green v. Life Ins. Co. of N. Am., 754 F.3d 324, 329 (5th ...


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