Mulready v. OPM

• Court: District Court, D. New Hampshire
• Decided: July 15, 1999
• Docket: CV-98-045-M
• Status: Published

Opinion

Mulready v. OPM CV-98-045-M 07/15/99 UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

Joanne Mulready, Administratrix of the Estate of James C. Mulready, Plaintiff

v. Civil No. 98-45-SM

United States Office of Personnel Management, Defendant

O R D E R

Plaintiff Joanne Mulready, Administratrix of the Estate of

James C. Mulready, brings this action to compel Defendant United

States Office of Personnel Management ("OPM") to reguire Blue

Cross and Blue Shield of Rhode Island ("Blue Cross-RI") to pay

for cancer treatment provided to Mr. Mulready.1 Both parties

have filed motions for summary judgment.

Summary judgment is appropriate when the record reveals "no

genuine issue as to any material fact and . . . the moving party

is entitled to a judgment as a matter of law." Fed. R. Civ. P.

56(c). Neither party asserts that a genuine dispute as to any

material fact exists, and both agree that the case is appropriate

for disposition on summary judgment. The court's review is

1Although plaintiff's complaint purports to seek a declaratory judgment pursuant to 28 U.S.C. § 2201, the relief reguested is an order directing OPM to reguire Blue Cross to pay the disputed benefits. See 5 C.F.R. § 890.107 (1999) (providing for judicial review of OPM's denial of health benefits and limiting recovery to an order directing OPM to reguire the insurance carrier to pay the benefit). limited to the record that was before OPM at the time it made the

challenged decision. See 5 C.F.R. § 890.107(3).

Background

The Federal Employee Health Benefits Act, 5 U.S.C. §§ 8901

et seg., authorizes OPM to contract with private carriers to

provide health insurance to federal employees under certain

statutorily-described health benefits plans. See 5 U.S.C.A. §§

8902, 8903 and 8903a (West 1996 and Supp. 1999). Mr. Mulready, a

federal employee at the Portsmouth Naval Yard, was insured under

such a plan, administered by the Blue Cross and Blue Shield

Association (the Blue Cross and Blue Shield Service Benefit Plan

or the "Plan") .

In 1987, Mr. Mulready was diagnosed as suffering from Dukes

B Stage rectal cancer. He underwent surgery and did well until

the cancer recurred in 1992 or 1993. He had additional surgery

and was treated with radiation and chemotherapy. The condition

arose again in 1995, but because he had had the maximum dose of

radiation, and standard chemotherapy had failed, his oncologist

recommended passive care. By August, 1996, Mr. Mulready's tumor

had doubled in size and he was referred to Dr. Harold J. Wanebo,

Chief of Surgery at Roger Williams Hospital in Providence, Rhode

Island, for pelvic perfusion treatment. Pelvic perfusion

involves delivering high doses of chemotherapy locally to the

pelvis. The procedure involves isolating the bloodstream

2 supplying the pelvic region, running the blood through a

hemodialysis pump, and administering drugs into the bloodstream.

Because the procedure was to be performed in Rhode Island,

Mr. Mulready sought precertification from Blue Cross-RI. By

letter dated November 8, 1996, Blue Cross-RI informed Mr.

Mulready that the procedure was excluded from coverage under the

Plan because it was "experimental/investigational in nature."

(R. at 68.) Dr. Wanebo and Dr. Dennis B. Hammond, Mr. Mulready's

local oncologist, wrote to Blue Cross-RI reguesting

reconsideration of the denial of benefits. See 5 C.F.R.

§ 890.105(a)(1) (1999) (providing for reconsideration by the

carrier). Dr. Wanebo wrote that pelvic perfusion was "the only

option we are aware of that might produce significant regression

of tumor as well as controlling his severe pain." (R. at 63.)

By letter dated December 4, 1996, Blue Cross-RI again denied

coverage, with the following explanation:

The medical documentation was first reviewed by our Medical Director and externally by a surgical oncologist who confirms that high dose chemotherapy by way of pelvic perfusion with the intent to palliate pelvic pain in an individual who is otherwise unresectable [i.e., not a candidate for further surgery] is considered experimental.

(R. at 67 .)

Mr. Mulready sought review of Blue Cross-RI's decision by

OPM, and Drs. Wanebo and Hammond again wrote supportive letters

on his behalf. See 5 C.F.R. § 890.105(e) (1999) (providing for

OPM review of carrier's denial of benefits). Dr. Wanebo stated

that his plan was to treat Mr. Mulready with pelvic perfusion "in

3 order to palliate and control [his] local disease." (R. at 61.)

He also noted that "[b]oth Mr. Mulready and his wife understand

that the technique is not a cure and they are not anticipating

this as a goal." (R. at 62.)

Following its review of Mr. Mulready's appeal, OPM concluded

that it could not find a contractual basis on which to require

the Plan to pay for the proposed pelvic profusion therapy. OPM

noted that its "medical consultant has reviewed all the

documentation submitted to support Mr. Mulready's appeal and he

has determined that pelvic perfusion therapy is an

experimental/investigative procedure." (R. at 301.) OPM

suggested that Mr. Mulready attempt to secure payment under the

Plan's Flexible Service Option which provides benefits under

certain conditions for procedures not expressly covered under the

Plan. Blue Cross-RI, however, determined that benefits were not

available under the Flexible Service Option for experimental/

investigational procedures.

Despite his inability to secure payment from Blue Cross-RI,

Mr. Mulready underwent two pelvic profusion treatments, which he

paid for with the help of his family and community. Mr. Mulready

died in August of 1997.

By letter dated September 16, 1997, counsel for Mr.

Mulready's estate requested that OPM re-open and reconsider Mr.

Mulready's case based on new evidence. See 5 C.F.R.

§ 890.105(e)(5) (providing for re-opening of OPM case). Appended

to the letter were a number of exhibits, including an excerpt

4 from a book published in 1997 and therefore not available to OPM

at the time of its decision. OPM responded that the supplemental

information did not warrant reversal of its decision, and this

suit for judicial review of OPM's decision followed.

Discussion

The standard of review applicable to OPM's decision is

supplied by the Administrative Procedure Act ("APA"). See

Caudill v. Blue Cross and Blue Shield of North Carolina, 999 F.2d

74, 80 (4th Cir. 1993); Harris v. Mutual of Omaha Companies, 992

F.2d 706, 712 (7th Cir. 1993). Under the APA, the court may set

aside OPM's decision if it was "arbitrary, capricious, an abuse

of discretion, or otherwise not in accordance with law." 5

U.S.C.A. § 706(2)(A) (West 1996). This standard requires the

court to "consider whether the decision was based on a

consideration of the relevant factors and whether there has been

a clear error of judgment." Citizens to Preserve Overton Park,

Inc. v. Volpe, 401 U.S. 402, 416 (1971). The court cannot

substitute its judgment for that of OPM, see Caudill, 999 F.2d at

80, or set aside OPM's decision because it is "unhappy with the

result reached," Dubois v. United States Dep't of Agriculture,

102 F.3d 1273, 1284 (1st Cir. 1996) (internal quotation marks

omitted). Nevertheless, the standard of review, while highly

deferential, is not a "rubber stamp." Id. at 1285.

5 Plaintiff argues that the reasoning behind OPM's decision is

not set forth with sufficient clarity to be upheld by the court.

The Supreme Court has noted:

[A] reviewing court, in dealing with a determination or judgment which an administrative agency alone is authorized to make, must judge the propriety of such action solely by the grounds invoked by the agency. If those grounds are inadeguate or improper, the court is powerless to affirm the administrative action by substituting what it considers to be a more adeguate or proper basis.

Securities and Exchange Comm'n v. Chenery Corp., 332 U.S. 194,

196 (1947). A court may, however, "uphold a decision of less

than ideal clarity if the agency's path may reasonably be

discerned." Bowman Transp., Inc. v. Arkansas-Best Freight Svs.,

Inc., 419 U.S. 281, 286 (1974).

Like Blue Cross-RI, OPM concluded that the proposed pelvic

perfusion treatment was not covered under the Plan because it was

an experimental/investigational procedure. The Plan defines an

investigational/experimental procedure as follows:

A drug, device or medical treatment or procedure is experimental or investigational:

1) if the drug or device cannot be lawfully marketed without approval of the U.S. Food and Drug Administration and approval for marketing has not been given at the time the drug or device is furnished; or 2) if reliable evidence shows that the drug, device or medical treatment or procedure is the subject of ongoing phase I, II, or III clinical trials or under study to determine its maximum tolerated dose, its toxicity, its safety, its efficacy, or its efficacy as compared with a standard means of treatment or diagnosis; or 3) if reliable evidence shows that the prevailing opinion among experts regarding the drug, device or medical treatment or procedure is that further studies or clinical trials are necessary to

6 determine its maximum tolerated dose, its toxicity, its safety, its efficacy or its efficacy as compared with a standard means of treatment or diagnosis.

Reliable evidence shall mean only published reports and articles in the authoritative medical and scientific literature; the written protocol or protocols used by the treating facility or the protocol (s) of another facility studying substantially the same drug, device or medical treatment or procedure; or the written informed consent used by the treating facility or by another facility studying substantially the same drug, device or medical treatment or procedure.

(R. at 49.)

OPM's medical consultant. Dr. James Vorosmarti, Jr., on whom

OPM apparently relied in determining that the proposed treatment

was experimental/investigational, did not reveal his reasoning in

great detail. His complete written analysis consisted of the

following note:

The plan reviewer, an oncologist and a surgeon have all stated that pelvic perfusion therapy is an experimental/investigative procedure. After reviewing the abstracts presented and recent surgical, oncology + medical texts (none of which reference pelvic perfusion) I must arrive at the same opinion. Regional chemotherapeutic perfusion has been in use for colon cancer metasteses to the liver, head + neck skin cancer, etc. for about 30 years.

(R. at 220.) However, as Dr. Vorosmarti essentially concurred

with the opinions of Blue Cross-RI's medical reviewers, the court

finds that it can reasonably look to their reasoning to discern

the grounds for OPM's decision. Cf. Harris, 992 F.2d at 712

(agreeing with district court that although OPM made no explicit

factual findings, "the letter affirming the company's denial of

benefits, together with . . . [a list of] the documents that were

7 before [OPM] for review, was sufficient record evidence to

support [OPM's] determination).

Blue Cross-RI's Medical Director, Dr. Rosario Noto, wrote an

appeal summary on November 19, 1996. Dr. Noto noted that "Dr.

Wanebo has recommended pelvic perfusion as the only option that

might produce significant regression of tumor as well as

controlling [Mr. Mulready's] severe pain." (R. at 257.)

Nevertheless, in analyzing whether the procedure was

"experimental or investigational," Dr. Noto only discussed, and

therefore presumably only considered, its use in controlling

pain. Dr. Noto wrote:

On review of twelve articles with reference to pelvic perfusion in various methods of administration (chemofiltration, balloon occlusion, closed circuit perfusion) there was not sufficient evidence to say that pelvic perfusion was superior to other methods of pain control in pelvic cancers. . . . None of the studies reviewed compared the efficacy of pelvic perfusion to conventional methods of pain management. It was therefore concluded that there was not sufficient evidence to consider the use of pelvic perfusion for pain palliation other than investigational at this time.

Id. The point is more clearly made in a letter from Blue Cross-

RI' s general counsel to Mr. Mulready's former attorney:

I noted in your letter dated December 5, 1996 that you made the statement that this pelvic perfusion procedure is the only hope that Mr. Mulready has to again achieve remission and lead a productive life. It is my understanding that the pelvic perfusion procedure here is only being used to administer pain medication. The treatment is not curative but palliative.

(R. at 330 .)

Mr. Mulready's treating physicians, however, plainly

recommended the procedure not only as a means of controlling

8 pain, but also as a potential means of shrinking Mr. Mulready's

tumor and obtaining remission. Concededly, pain control was

likely a major anticipated result of the procedure. Dr. Wanebo

informed Blue Cross-RI that "[i]n patients receiving this for

palliative therapy, the primary effect is a significant reduction

of pain which is the most incapacitating insult that these

patients face." (R. at 63.) He continued, however, to advise

that "[i]n addition, it produces an associated tumor regression

in many though not all patients." JCd. (emphasis added) .

Although the treatment was expected to be palliative, and

not expected to be a cure, part of the anticipated result

included controlling tumor growth. Dr. Wanebo's office notes of

November 5, 1996, state: "The only thing remaining is to provide

palliation by pelvic perfusion - This will reduce pain +

hopefully induce tumor regression. The perfusion can be repeated

to maintain local tumor control." (R. at 276.) In a letter to

Dr. Gary Friedman of Blue Cross-RI, Dr. Wanebo described the

treatment as an alternative to radiation and resection, for which

Mr. Mulready was clearly not a candidate, as a means of providing

local control of the disease. He stated that the procedure "can

produce tumor shrinkage as well as reduce or eliminate pelvic

pain for a reasonable period of time i.e. similar to radiation."

(R. at 272 .)

The Supreme Court has recognized four specific instances in

which an agency may be found to have acted arbitrarily and

capriciously: Normally, an agency rule would be arbitrary and capricious if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.

Motor Vehicle Mfrs. Ass'n of the United States, Inc. v. State

Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). OPM's decision

in this case falls within the second (and arguably the third)

categories. With respect to the second category, OPM completely

failed to consider whether pelvic perfusion for the purpose of

inducing tumor regression and providing local tumor control (and

attaining remission) constituted an experimental or

investigational procedure as defined in the Plan. With respect

to the third category, OPM based its decision on the premise that

the treatment for which Mr. Mulready sought precertification was

for the sole purpose of controlling pain, which appears to be

directly contrary to the evidence OPM had before it. Thus, OPM's

decision was necessarily arbitrary and capricious, since it did

not consider an important aspect of the problem — the

experimental/investigatory nature of the treatment related to

tumor management.

Where the agency has failed to consider a relevant factor,

the reviewing court should remand the case to the agency "for

additional investigation or explanation." Florida Power & Light

Co. v. Lorion, 470 U.S. 729, 744 (1985). The court generally may

not make a de novo determination of the matter before it. Id.

10 Accordingly, the court remands this case to OPM for further

review.

An additional point should be made. In determining whether

the proposed procedure was experimental or investigational as

defined by the plan. Dr. Noto reviewed the relevant literature

and concluded that since none of the studies compared the

efficacy of the proposed treatment (for the purpose of pain

palliation) with that of standard pain treatment, the procedure

had not been shown to be other than experimental or

investigational. Dr. Noto probably reasoned that since there

were no studies of relative efficacy, "further studies or

clinical trials are necessary to determine . . . [the

procedure's] efficacy as compared with a standard means of

treatment or diagnosis," rendering the procedure

experimental/investigational under the Plan.2 (R. at 49.) Dr.

Note's approach was incorrect. As defined by the Plan, a

procedure is experimental or investigational "if reliable

evidence shows that the prevailing opinion among experts

regarding the . . . procedure is that further studies or clinical

trials are necessary . . . ." Jd. (emphasis added). Dr. Note's

personal opinion regarding the need for further studies is of

course not germane, given the Plan's definitions. It is also not

"reliable evidence" as defined by the Plan The Plan states that

"[r]eliable evidence shall mean only published reports and

2Actually, the record does not reveal whether Dr. Noto was aware of the Plan's definition of an experimental or investigative procedure. 11 articles in the authoritative medical and scientific literature"

(as well as other forms of evidence not applicable here). Id.

(emphasis added). Thus, the determination that further studies

are necessary must be reflected in the authoritative medical and

scientific literature.3

For similar reasons, the opinions Dr. Noto obtained from

other physicians are not particularly germane either. Dr. James

A. Edney wrote that it was his "opinion that high dose

chemotherapy by way of pelvic perfusion with the intent to

palliate pelvic pain in an individual who is otherwise

unresectable would be considered experimental treatment." (R. at

256.) Another doctor wrote that he had consulted with a rectal

surgeon and an oncologic surgeon and that they all agreed that

"pain palliation . . . is not substantiated by significant

literature to leave the realm of the investigative." (R. at

270.) Again, the personal opinions of these physicians are not

"reliable evidence" as defined by the Plan. Nor do the personal

opinions of physicians, such as Dr. Hammond and Dr. Paul H.

Sugarbaker, who wrote supportive letters on Mr. Mulready's behalf

(stating that pelvic perfusion was not experimental) constitute

"reliable evidence" under the Plan. The court has relied on

3The Plan's choice of language might create substantial difficulty in cases in which the contemplated procedure is so new and obviously experimental that the "authoritative medical and scientific literature" has not had an opportunity to declare it so. But this case does not seem to fall into that category, or, at least no one has argued that the plain language of the Plan should not govern what is and is not "reliable evidence" of the "prevailing opinion among experts" in this case. 12 those letters only to establish the purpose for which pelvic

perfusion was recommended for Mr. Mulready. On remand, OPM must

ensure that it considers only "reliable evidence" as defined by

the Plan in determining whether the pelvic perfusion recommended

was experimental or investigational in nature in this case.

Conclusion

For the foregoing reasons, defendant's motion for summary

judgment is denied. Plaintiff's motion for summary judgment is

granted to the extent that the court sets aside OPM's decision

and remands for further administrative consideration, and is

otherwise denied. OPM's decision is vacated and the case

remanded to OPM for further consideration. The court will retain

jurisdiction over the matter, but for administrative purposes

only will close the case.

SO ORDERED.

Steven J. McAuliffe United States District Judge July 15, 1999

cc: Lynmarie C. Cusack, Esg. Gretchen Leah Witt, Esg.