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Holl v. Amalgamated Sugar Company LLC

United States District Court, D. Idaho

April 28, 2014

RANDY HOLL, Plaintiff,
THE AMALGAMATED SUGAR COMPANY LLC, a Delaware Limited Liability Company; and BLUE CROSS OF IDAHO, a corporation, Defendants.


CANDY W. DALE, District Judge.


The Court has before it cross-motions for summary judgment relating to the refusal to authorize and pay for medical treatment. Plaintiff Randy Holl filed this action alleging a violation of Section 502 of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. ยง 1132, and seeking a declaration of coverage; damages, including general and emotional damages and reimbursement for medical services; and attorney fees. The Court heard oral argument on April 24, 2014, and took the matter under advisement. For the reasons explained below, the Court will grant Defendants' Motion for Summary Judgment and deny Plaintiff's Motion for Partial Summary Judgment.


The parties do not dispute that this is an ERISA case. Holl is a participant of a health insurance plan with Defendant Blue Cross of Idaho through his employer, The Amalgamated Sugar Company, LLC (Amalgamated). The Plan under which Holl is a participant provides that the Plan Administrator, Amalgamated, is the "sole fiduciary of the Plan, [and] has all discretionary authority to interpret the provisions and to control the operation and the administration of the Plan." Blue Cross is the third party Claim Administrator of the Plan.

Holl suffers from Seropositive Myasthenia Gravis ("SMG"), an autoimmune condition which causes muscle fatigability and weakness, and can involve all four limbs, the diaphragm, bulbar muscles and ocular muscles. Holl's treating physicians have prescribed IvIG infusion therapy for treatment of Holl's SMG. Blue Cross paid for prior IvIG infusions during 2006 and 2007. In January of 2010, Holl again requested preapproval for treatment of his SMG with IvIG infusions. His request was the subject of prior litigation in this Court, and the matter was settled. See Holl v. The Amalgamated Sugar Co. LLC, No. 1:11-cv-198-EJL-CWD. Holl released any request for IvIG up to the date of the Release, signed April 5, 2012.[1]

The present case involves the denial of a pre-authorization request for coverage for IvIG infusions submitted in July of 2012, and Blue Cross's continued refusal to authorize IvIG therapy. Pl. Reply at 2 (Dkt. 36.) According to the administrative record, [2] the following information was presented to and considered by Blue Cross.

Holl's physician, Dr. Cline, submitted a Pharmacy Prior Authorization Request, dated July 6, 2012, requesting pre-authorization for five IvIG infusions on a monthly basis from July 9, 2012, through December 31, 2012. Blue Cross denied the Pre-Authorization Request as not medically necessary on September 6, 2012. (Dkt. 23-1 at 13.) As a reason for its decision, Blue Cross relied upon the General Exclusions and Limitations Section of the Plan, which excludes benefits for services, supplies, drugs or other charges that are "Not Medically Necessary. If services requiring Prior Authorization by Blue Cross of Idaho are performed by a Contracting Provider and benefits are denied as not Medically Necessary, the cost of said services are not the financial responsibility of the Participant."

The Plan states that the fact a Covered Provider may prescribe, order or recommend a service does not determine Medical Necessity. Medical Necessity under the Plan is defined as follows:

Medically Necessary (or Medical Necessity)-the Covered Service or Supply Recommended by the treating Covered Provider to identify or treat a Participant's condition, Disease, Illness or Accidental Injury and which is determined by BCI to be:
1. The most appropriate supply or level of service, considering potential benefit and harm to the Participant.
2. Proven to be effective in improving health outcomes;
a. For new treatment, effectiveness is determined by peer reviewed scientific evidence;
b. For existing treatment, effectiveness is determined first by peer reviewed scientific evidence, then by professional standards, then by expert opinion.
3. Not primarily for the convenience of the participant or Covered Provider.
4. Cost Effective for this condition.[3]

The September 6, 2012[4] denial letter explained that Blue Cross considered Holl's medical records, Blue Cross Blue Shield Association Technology Evaluation Center (TEC) assessments, the Blue Cross Blue Shield Association Medical Policy Reference Manual, Blue Cross of Idaho Medical Policies, and other guidelines. According to Blue Cross, IvIG infusions are considered of treatment with cholinesterase inhibitors, or complications from or failure of corticosteroids and/or azathioprine."

The letter further explained that, according to Blue Cross's review of Holl's records, his use of alternative treatments was not consistent, and there was a gap in prescription history between December 26, 2011, and May 9, 2012. Efforts to obtain additional information from Holl regarding Holl's prescription history were unsuccessful. Without information regarding prescription history and medication use, Blue Cross determined there was insufficient information to substantiate the medical necessity of the service. Further, Blue Cross cited Holl's other medical conditions, including gout, hypertension, pulmonary disease/bronchitis, osteoporosis, depression, history of acute renal failure, and recent injury. Consequently, Blue Cross determined that there was insufficient information in the medical record to demonstrate that SMG was the cause of Holl's chronic debilitating disease, or that IvIG would resolve his debilitating condition.

On January 9, 2013, Holl appealed the denial of pre-authorization. (Dkt. 23-3 at 33.) With his appeal letter, Holl submitted a letter dated January 3, 2013, from his treating physician, Dr. Cline. (Dkt. 23-3 at 34.) Dr. Cline's letter was submitted to justify Holl's ongoing treatment for SMG with IvIG therapy. In response to Blue Cross's determination that Holl's use of corticosteroids and Azathioprine had been inconsistent, Dr. Cline explained that the gap in prescriptions could be explained by Holl's hospitalizations, during which medications would have been given in the hospital. But Dr. Cline could "not answer whether or not Mr. Holl took the medicines as proscribed."

In Dr. Cline's opinion, however, any failure to take prescribed medications "does not have any bearing on his current treatment, as we know from past history this [drug therapy regimen] was not sufficient to control his disease." Dr. Cline further explained Holl's drug therapy regimen, and supported her conclusion that IvIG therapy would be beneficial for treatment of Holl's generalized myasthenia gravis, because the disease was interfering with his daily life and drug therapy was not controlling Holl's symptoms. (Dkt. 23-3 at 35.) Dr. Cline explained that Azathioprine had been causing side effects, CellCept had been insufficient to control Holl's disease, and Cyclosporine was not a viable option given Holl's chronic kidney disease. Id. Dr. Cline was of the opinion also that Holl had recuperated from the March 2012 auto accident, and that the "sole cause for his weakness and fatigability is myasthenia gravis." Id.

Following receipt of Dr. Cline's letter and the appeal, BCI requested additional medical records from Holl's healthcare providers and conducted a second medical review. The medical records submitted for review established the following.

On January 1, 2011, Holl was admitted to the hospital suffering from renal insufficiency. (Dkt. 23-1 at 81.) Significant medical history was noted as myasthenia gravis. At that time, Dr. Swenson noted Holl was taking his medications, including Mestonin and CellCept. Holl was admitted to the hospital to treat his renal insufficiency. On May 2, 2011, Dr. Swenson evaluated Holl and noted that, over the "past several years and more acutely over the past several months, [Holl's] functional status has declined rapidly." (Dkt. 23-1 at 77.) Dr. Swenson's assessment was myasthenia gravis, with resulting disability.

On July 19, 2011, Holl was admitted to the emergency room for evaluation of lower extremity edema. (Dkt. 23-2 at 44; 26-2 at 60.) Past medical history was noted as atrial fibrillation, myasthenia gravis, hypertension, renal insufficiency, asthma, gout, arthritis, depression, insomnia, and obesity. Holl was discharged to the care of his physicians for treatment of his renal insufficiency and advised to see a kidney specialist.

On November 23, 2011, Holl saw nephrologist Dr. Narasimhan for a follow up visit for Holl's chronic kidney disease. (Dkt. 23-4 at 6.) Dr. Narasimhan noted that Holl's energy level was "good to fair, " and observed improvement of his lower extremity edema with elevation. Dr. Narasimhan noted that Holl's acute kidney injury had resolved, but that Holl appeared hypervolemic and did not provide any symptoms of obstructive nephropathy. (Dkt. 23-4 at 10.) Dr. Narasimhan noted that the use of IvIG can cause acute kidney failure, although it was a rare complication and could be avoided by good hydration and avoidance of sucrose.

On March 14, 2012, Dr. Swenson admitted Holl to the hospital based upon laboratory reports reviewed from the day prior indicating low creatinine levels. (Dkt. 23-1 at 63.) Dr. Swenson noted that, based upon Holl's laboratory reports, Holl was suffering from multi-organ failure and cardiogenic shock. Holl was transferred to the intensive care unit following admission. Dr. Swenson was unsure of the etiology of Holl's condition, but suspected it was secondary to the injuries Holl sustained in a recent motor vehicle accident that occurred on March 11, 2012.

On April 4, 2012, Holl's physician, Dr. Swenson, saw Holl for follow up after the motor vehicle accident and multi-organ failure following the accident. (Dkt. 23-1 at 59, 26-2 at 63.) Dr. Swenson reported that Holl was doing much better after having suffered renal, hepatic, and cardiogenic shock and pulmonary ...

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