Russell Howard v. Bcbs-Az

• Court: Court of Appeals for the Ninth Circuit
• Decided: September 21, 2020
• Docket: 19-16554
• Status: Unpublished

Opinion

FILED NOT FOR PUBLICATION SEP 21 2020 UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

RUSSELL KEITH HOWARD, No. 19-16554

Plaintiff-Appellant, D.C. No. 2:16-cv-03769-JJT

v. MEMORANDUM* BLUE CROSS BLUE SHIELD OF ARIZONA; SUNSTATE EQUIPMENT CO. LLC EMPLOYEE BENEFIT PLAN,

Defendants-Appellees.

Appeal from the United States District Court for the District of Arizona John Joseph Tuchi, District Judge, Presiding

Submitted September 17, 2020** San Francisco, California

Before: SCHROEDER, W. FLETCHER, and HUNSAKER, Circuit Judges.

Plaintiff-Appellant Russell Howard appeals the district court’s order

granting summary judgment to Defendant-Appellee Blue Cross Blue Shield of

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). Arizona (Blue Cross). Howard challenges Blue Cross’s denial of his claim for

reimbursement of medical treatment under the Employee Retirement Income

Security Act (ERISA). See 29 U.S.C. § 1132(a)(1)(B). We have jurisdiction under

28 U.S.C. § 1291, and we affirm.

Blue Cross denied Howard’s pre-treatment authorization requests. Blue

Cross concluded that Howard’s preferred course of treatment promised no better

outcomes than established alternatives. Blue Cross informed Howard that, under

applicable guidelines, it was not medically necessary. After Howard nevertheless

obtained this treatment, Blue Cross again denied coverage, citing the relevant

terms of the Sunstate insurance plan (the Plan).

The Plan language provides that Blue Cross has discretion to make coverage

determinations, so we will review those determinations for abuse of discretion

unless there are major procedural irregularities or unless Blue Cross failed to

exercise its discretion. See Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955,

963, 971–72 (9th Cir. 2006) (en banc). There are no procedural irregularities in

this case that warrant de novo review. See, e.g., id. at 971 (quoting Gatti v.

Reliance Standard Life Ins. Co., 415 F.3d 978, 985 (9th Cir. 2005)) (explaining

that procedural violations will change the standard of review only where the

“violations are so flagrant as to alter the substantive relationship between the

2 employer and employee, thereby causing the beneficiary substantive harm”). Blue

Cross provided an explanation for each of its decisions and did not violate any

procedural requirements of the Plan in doing so. Blue Cross also did not fail to

exercise its discretion. See, e.g., Jebian v. Hewlett-Packard Co. Employee Benefits

Org. Income Prot. Plan, 349 F.3d 1098, 1106 (9th Cir. 2003) (holding that an

administrator failed to exercise its discretion where it did not make a benefits

determination within the 60 days as required by the terms of the Plan). Blue Cross

provided Howard with a timely explanation, in writing, to support its

determinations. We therefore review for abuse of discretion.

A plan administrator abuses its discretion under ERISA where its decision is

“(1) illogical, (2) implausible, or (3) without support in inferences that may be

drawn from facts in the record.” Salomaa v. Honda Long Term Disability Plan,

642 F.3d 666, 676 (9th Cir. 2011)(citation omitted); see also Harlick v. Blue Shield

of Cal., 686 F.3d 699, 720 (9th Cir. 2012) (explaining that administrators generally

have “discretion to determine whether [a] treatment was medically necessary

during the administrative review process” of a claim). Blue Cross did not violate

the terms of the Plan by denying Howard’s requests for coverage. In fact, the Plan

specifically provided that Howard’s treatment for his medical condition was not

considered medically necessary. Blue Cross also provided the required

3 explanation under ERISA; each time Howard requested a coverage determination,

Blue Cross informed him that the treatment was not medically necessary and

would not be covered. See Booton v. Lockheed Med. Benefit Plan, 110 F.3d 1461,

1463 (9th Cir. 1997).

Blue Cross reasonably relied upon medical studies that showed no net

benefit over other courses of treatment. We cannot conclude that this finding,

supported by medical evidence in the record, was “clearly erroneous.” See Boyd v.

Bert Bell/Pete Rozelle NFL Players Ret. Plan, 410 F.3d 1173, 1178 (9th Cir.

2005). There was no conflict of interest in this case that would alter our analysis.

Blue Cross was liable only for claims above 200,000 dollars, and Howard’s claims

did not approach that amount. Blue Cross therefore did not abuse its discretion in

denying Howard coverage under the Plan.

Howard’s last argument is that the district court abused its discretion by

denying his requests for additional discovery. See Burke v. Pitney Bowes

Long–Term Disability Plan, 544 F.3d 1016, 1028 n.15 (9th Cir. 2008). The

additional materials Howard sought were unlikely to be relevant to his case

because they involved different medical insurance plans and different insured

individuals. Moreover, producing all 74 determinations would have been

4 burdensome for Blue Cross. Accordingly, the district court did not abuse its

discretion in denying Howard’s requests for additional discovery.

AFFIRMED.