A.H. v. Anthem Blue Cross

• Court: District Court, N.D. California
• Decided: June 5, 2023
• Docket: 4:22-cv-07660
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 A.H., Case No. 22-cv-07660-HSG

8 Plaintiff, ORDER GRANTING IN PART AND DENYING IN PART MOTION TO 9 v. DISMISS

10 ANTHEM BLUE CROSS, Re: Dkt. No. 47 11 Defendant.

12 13 Pending before the Court is Defendant Anthem Blue Cross’s motion to dismiss. Dkt. No. 14 47. The Court finds this matter appropriate for disposition without oral argument and the matter is 15 deemed submitted. See Civil L.R. 7-1(b). For the reasons detailed below, the Court GRANTS IN 16 PART and DENIES IN PART the motion. 17 I. BACKGROUND 18 Plaintiff A.H. initially filed this action individually and on behalf of B.H., a minor, in the 19 District of Utah. See Dkt. No. 2 (“Compl.”). The case was transferred in December 2022, Dkt. 20 No. 27, at which point Defendant filed a renewed motion to dismiss, Dkt. No. 47. 21 Plaintiff alleges that Defendant wrongly denied coverage under a health benefits plan for 22 treatment that B.H. received at blueFire Wilderness Therapy in Idaho from June to September 23 2020. See Compl. at ¶¶ 4–5. According to the complaint, blueFire “provides sub-acute inpatient 24 treatment to adolescents with mental health, behavioral, and/or substance abuse problems.” Id. at 25 ¶ 4. Plaintiff asserts that B.H.’s treatment at blueFire should have been covered under the plan 26 because it “was medically necessary, was appropriate for the treatment of his conditions, was not 27 more costly than an alternative service, and was rendered in accordance with generally accepted 1 Based on these facts, Plaintiff brings causes of action under the Employee Retirement 2 Income Security Act (“ERISA”) for violating the terms of the plan, and under the Mental Health 3 Parity and Addiction Equity Act (“Parity Act”). See id. at ¶¶ 28–56. Defendant moves to dismiss 4 the complaint in its entirety. Dkt. No. 47. 5 II. LEGAL STANDARD 6 Federal Rule of Civil Procedure 8(a) requires that a complaint contain “a short and plain 7 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A 8 defendant may move to dismiss a complaint for failing to state a claim upon which relief can be 9 granted under Rule 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the 10 complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” 11 Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To survive a Rule 12 12(b)(6) motion, a plaintiff need only plead “enough facts to state a claim to relief that is plausible 13 on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible 14 when a plaintiff pleads “factual content that allows the court to draw the reasonable inference that 15 the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 16 In reviewing the plausibility of a complaint, courts “accept factual allegations in the 17 complaint as true and construe the pleadings in the light most favorable to the nonmoving party.” 18 Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Nevertheless, 19 courts do not “accept as true allegations that are merely conclusory, unwarranted deductions of 20 fact, or unreasonable inferences.” In re Gilead Scis. Secs. Litig., 536 F.3d 1049, 1055 (9th Cir. 21 2008) (quoting Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001)). 22 III. DISCUSSION 23 Defendant argues that the plan does not provide benefits for wilderness programs like 24 blueFire, so Plaintiff’s ERISA claim fails. See Dkt. No. 47-1 at 4–7. Defendant further argues 25 that because the restriction on wilderness programs applies to all treatment—both medical and 26 behavioral—Plaintiff’s Parity Act claim similarly fails. Id. at 8–15. 27 A. ERISA 1 does not adequately allege that Plaintiff is entitled to benefits for B.H.’s treatment at blueFire 2 under the terms of the plan. Dkt. No. 47-1 at 5–7. 3 As an initial matter, the parties do not appear to dispute the relevant terms of the plan.1 4 Plaintiff acknowledges that by its terms, the plan “exclude[s] payment for ‘wilderness camps.’” 5 See Compl. at ¶¶ 19, 43; see also Dkt. No. 47-5, Ex. 1 (“Anthem Plan”) at 116.2 In a section titled 6 “What’s Not Covered,” the plan lists: 7 Residential accommodations to treat medical or behavioral health 8 conditions, except when provided in a Hospital, Hospice, Skilled Nursing Facility, or Residential Treatment Center. This Exclusion 9 includes procedures, equipment, services, supplies or charges for the following: 10 a. Domiciliary care provided in a residential institution, 11 treatment center, halfway house, or school because a Member’s own home arrangements are not available or are 12 unsuitable, and consisting chiefly of room and board, even if therapy is included. 13 b. Care provided or billed by a hotel, health resort, convalescent 14 home, rest home, nursing home or other extended care facility home for the aged, infirmary, school infirmary, institution 15 providing education in special environments, supervised living or halfway house, or any similar facility or institution. 16 c. Services or care provided or billed by a school, Custodial Care 17 center for the developmentally disabled, or outward bound programs, even if psychotherapy is included. 18

19 d. Wilderness camps.

20 This exclusion does not apply to Medically Necessary treatment of Severe Mental Illness (SMI) of a person of any age or Serious 21 Emotional Disturbances of a Child (SED) as required by state law. 22 Anthem Plan at 116 (emphasis added). Defendant points out that Plaintiff does not allege that 23 blueFire is a hospital, hospice, skilled nursing facility, or residential treatment center.3 Dkt. No. 24 1 Defendant argues that the Court should consider the plan itself as incorporated by reference. See 25 Dkt. No. 47-4. Plaintiff does not appear to object. The Court finds Defendant’s request appropriate under the circumstances and GRANTS the request. See Khoja v. Orexigen 26 Therapeutics, Inc., 899 F.3d 988, 1002 (9th Cir. 2018) (finding incorporation by reference appropriate “if the plaintiff refers exclusively to the document or the document forms the basis of 27 plaintiff's claim”). 1 47-1 at 5–7. Rather, it is a wilderness camp, and therefore is explicitly excluded under the plan. 2 Id. According to Defendant, Plaintiff’s contention that it violated the terms of the plan is thus 3 implausible even from the face of the complaint. Id. 4 In opposition, Plaintiff does not appear to argue that blueFire is a hospital, residential 5 treatment center, or other covered facility. But instead, Plaintiff points out that by its terms, this 6 exclusion does not apply “to Medically Necessary treatment of Severe Mental Illness (SMI) of a 7 person of any age or Serious Emotional Disturbances of a Child (SED).” See Dkt. No. 50 at 4–6; 8 see also Compl. at ¶ 18. Plaintiff alleges that treatment at blueFire was medically necessary and 9 that B.H. met the qualifications for an emotionally disturbed child. See Compl. at ¶¶ 17–19. 10 However, Plaintiff appears to selectively quote language from the plan. Under the plan, benefits 11 are only provided for medically necessary treatment of an emotionally disturbed child if “state 12 law” requires coverage. See Anthem Plan at 116 (“This exclusion does not apply to Medically 13 Necessary treatment of Severe Mental Illness (SMI) of a person of any age or Serious Emotional 14 Disturbances of a Child (SED) as required by state law.”) (emphasis added). 15 Critically, Plaintiff does not identify what state law requires coverage for wilderness camps 16 for the treatment of children with severe mental illness or serious emotional disturbances. In the 17 complaint, Plaintiff concludes that “failing to provide coverage for B.H.’s medically necessary 18 treatment” violated “the requirements of California state law.” See id. at ¶ 35. But Plaintiff does 19 not identify any California law in the complaint or the opposition that requires such coverage. 20 Defendant should not have to speculate as to the nature of Plaintiff’s claims. Plaintiff has not 21 plausibly alleged that she is entitled to benefits under the plan, and the Court therefore GRANTS 22 the motion to dismiss the ERISA claim. 23 B. Parity Act 24 Defendant next argues that Plaintiff has failed to allege sufficient facts to support her 25 Parity Act claim. Dkt. No. 47-1 at 8–14. The Federal Parity Act “require[s] that health plans 26 provide equal coverage for mental illnesses and physical illnesses.” Stone v. UnitedHealthcare 27 Ins. Co., 979 F.3d 770, 771–72 (9th Cir. 2020) (citing 29 U.S.C. § 1185a(3)(A)). Accordingly, 1 those for medical and surgical problems.” Id. at 774 (quotation omitted). 2 Here, Plaintiff appears to acknowledge that at least on its face, the plan does not 3 distinguish between treatment for mental health and treatment for medical or surgical problems. 4 See Dkt. No. 50 at 11–12. The limitations on the covered residential accommodations—including 5 the exclusion of wilderness camps—apply equally to “[r]esidential accommodations to treat 6 medical or behavioral health conditions.” See Anthem Plan at 116 (emphasis added). However, 7 Plaintiff responds that she is bringing an as-applied challenge and that a disparity does in fact exist 8 in the way Defendant applies these limitations in practice. See Dkt. No. 50 at 11–14. In support 9 of this as-applied challenge, Plaintiff alleges: 10 11 • Despite the language of the plan, Defendant “applies its wilderness camp exclusion 12 exclusively to substance use and mental health benefits . . . .” Compl. at ¶¶ 48. 13 • Unlike for mental health treatment, when Defendant “receive[s] claims for intermediate 14 level treatment of medical and surgical conditions, [it] provide[s] benefits and pay[s] 15 the claims as outlined in the terms of the Plan based on generally accepted standards of 16 medical practice.” Id. at ¶ 42. 17 • Defendant provides “more stringent or restrictive” medical necessity criteria for 18 intermediate level mental health treatment benefits” than for “analogous intermediate 19 levels of medical or surgical benefits.” See id. at ¶ 40. 20 • Defendant also offers “[c]omparable benefits” for medical and surgical treatment to the 21 excluded facilities such as “sub-acute inpatient treatment settings such as skilled 22 nursing facilities, inpatient hospice care, and rehabilitation facilities.” See id. at ¶ 41. 23 24 The Court finds that these allegations, when taken in the light most favorable to Plaintiff as 25 they must be at this stage, are sufficient to state a Parity Act claim. Despite Defendant’s urging, 26 Plaintiff does not simply “state conceptually that [she was] treated worse than others.” See Dkt. 27 No. 51 at 6. Rather, she contends that Defendant has a policy of applying coverage limitations 1 ways in which Defendant applies more restrictive limitations for mental health benefits, such as 2 || through more stringent medical necessity criteria. Defendant obviously disputes that it in fact 3 applies benefit limitations more strictly to mental health benefits than for medical or surgical 4 || benefits. See, e.g., id. at 3-7. But the Court need not—and as a matter of law may not—resolve 5 such disputes at this time. The Court therefore DENIES the motion to dismiss the Parity Act 6 || claim. 7 IV. CONCLUSION 8 The Court GRANTS the motion to dismiss as to Plaintiff's ERISA claim and DENIES the 9 || motion as to Plaintiffs Parity Act claim. At this stage in the litigation, the Court cannot say that 10 || amendment would be futile. Plaintiff may therefore file an amended complaint within 21 days of 11 the date of this order. This order terminates Dkt. No. 18. 12 The Court further SETS a case management conference on July 25, 2023, at 2:00 p.m. All 5 13 counsel shall use the following dial-in information to access the call: Dial-In: 888-808-6929: 3 15 Passcode: 6064255 16 || All attorneys and pro se litigants appearing for a telephonic case management conference are 3 17 || required to dial in at least 15 minutes before the hearing to check in with the courtroom deputy. 18 For call clarity, parties shall NOT use speaker phone or earpieces for these calls, and where at all 19 || possible, parties shall use landlines. 20 The Court further DIRECTS the parties to meet and confer and submit a revised joint case 21 management statement by July 18, 2023. The parties should be prepared to discuss how to move 22 || this case forward efficiently. 23 IT IS SO ORDERED. 24 || Dated: 6/5/2023 : Absurd SM). 6 HAYWOOD S. GILLIAM, JR. United States District Judge 27 28