Articles Posted in ERISA

California Department of Insurance Commissioner Dave Jones has opened an investigation into allegations that health insurer, Aetna, denies insureds’ claims and requests for prior authorization for medical care without ever reviewing medical records. Although Aetna’s improper utilization review practices come as no surprise to the attorneys at our office, this revelation has sparked widespread, national media attention.

The allegations giving rise to Commissioner Jones’ investigation into Aetna’s claims handling practices come from videotaped deposition testimony of Dr. Jay Ken Iinuma who served as medical director for Aetna’s Southern California business operations between March 2012 and February 2015. During the deposition, Dr. Iinuma said he was following Aetna’s training when he never once looked at patients’ medical records himself before denying their claims for coverage.

Dr. Iinuma’s deposition was taken as part of a lawsuit filed by a college student, Gillen Washington, who was denied coverage for an infusion of intravenous immunoglobin (IVIG) when he was 19 to treat a rare auto-immune disorder.  Washington sued Aetna in Orange County Superior Court for breach of contract and bad faith, alleging that Aetna’s “reckless withholding of benefits almost killed him.”  Aetna initially paid for Washington’s treatments (each fusion can cost up to $20,000) but when Washington asked Aetna to pre-authorize a November 2014 infusion, Aetna said it was obligated to review Washington’s medical records.  Aetna claims that Washington’s treating provider failed to timely provide medical records in response to Aetna’s pre-authorization review.  Washington counters Aetna’s narrative of the events surrounding Washington’s ongoing requests and medical need for IVIG treatment.  However, it was during Dr. Iinuma’s deposition, where the real bombshell in the case was revealed. The former Aetna medical director testified that he never read Washington’s medical records and knew nothing about the disorder Washington was suffering from despite denying Washington’s pre-authorization request and signing the denial letter.  Dr. Iinuma further testified that most of his work was done online and he would rarely if ever consult with an Aetna nurse about a particular claim prior to denying it.

In a story that’s far too common, Montreal writer Samuel Archibald recently shared his story of what he called “abandonment by his insurer.” While away from work on leave to treat his depression, Archibald was unknowingly tracked on social media by his insurance company – and everyday simple information about his life was used against him to deny his health claim. Out for a run? He must not be depressed. Eating a meal with family? He must not be depressed. Or at least these are the hasty judgments that his insurer made about his mental health. Did they take into account that exercise can be a wonderful natural anti-depressant? Did they take into account that eating is necessary to survive, and spending time with family can be a healthy part of treatment and recovery? Were they even medically trained to make this type of conclusion, and if so, is it ethical to make this type of conclusion without actually treating a patient in person? The questions go on and on, and in Archibald’s outrage, he took pen to paper and brought light to a very complicated issue in the insurance world. If their job is to help people when they are sick and in need, why are they so often leaving people hanging? Why are they causing harm?

Insurance companies have a bad reputation for paying health claims, and here’s why – they have a long history of denying claims and leaving people in the dark. Leaving people confused. Leaving people in financial distress. Leaving people to suffer without the support they are entitled to.

So what’s the reasoning behind all the denials? The insurer has a bottom line – and unfortunately the bottom line is not your health and wellness. “It’s an insurance company that administers the plan, that decides on the claim, and ultimately has to foot the bill if the benefit is granted – and that’s a conflict of interest that everyone can easily see,” said Sean M. Anderson, a University of Illinois expert in employee benefit plan policy and regulation.