David Shillcutt Quoted in “9th Circ. Reopens Door to Reprocessing in UBH Battle”

The Ninth Circuit’s third version of its ruling in a consolidated class action pitting United Behavioral Health against patients challenging coverage denials largely came out in UBH’s favor, but it reopened the door for health plan participants to demand claim reprocessing on a class basis, experts say. …

Similar to the panel’s opinion from January, Tuesday’s decision kept the district court’s class certification order on an ERISA fiduciary breach claim in place, and partially upheld judgment on that claim.

Part of the district court’s judgment upheld by the panel on the fiduciary breach claim, which was also upheld in January, was a finding that the insurer’s guidelines for making medical necessity or coverage determinations when processing behavioral health claims impermissibly conflicted with state-mandated criteria. The panel said that portion of the ruling would remain intact because UBH didn’t appeal it. But the panel reversed judgment on the fiduciary breach claim to the extent that the judgment was based on the court’s erroneous finding that UBH was required to cover all care that was consistent with generally accepted standards of care, or GASC.

Epstein Becker Green’s David Shillcutt said he didn’t see the panel’s Tuesday decision as “disturbing the core substantive holdings from January,” particularly regarding plan responsibilities on medical necessity criteria and GASC.

“There is no single place to look to, to figure out what generally accepted standards of care are,” Shillcutt said. “So if we interpret this standard plan term, that most plans have, to mean that medical necessity criteria means generally accepted standards of care, then that puts the courts in the position of creating a new set of medical necessity criteria like we saw the district court do,” Shillcutt said.