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Blue Shield of California routinley denies procedure as “investigational” despite having been approved by the Govt. for over a decade.

On July 14, 2015 a federal judge certified a class of members suing California Physician’s Service dba Blue Shield of CA (BSCA) for alleged improper medical claim denials in violation of ERISA. The court found that because members are seeking “declaratory and injunctive relief, allowing a class action to be brought would be in the interests of judicial economy”.

Defendant BSCA members have requested approval for back surgery only to be denied based on BSCA’s company policies that the procedure is deemed “investigational”. BSCA denied the procedure, artificial disk replacement (ADR) because “the efficacy of [ADR] has not been validated by the peer reviewed literature”.

Court records show that between April 2010 and October 2014, 19 members of BSCA have requested approval for the surgery and all 19 have been denied coverage for the ADR procedure.

Additionally, the FDA first approved of a type of ADR in 2004 and that the type of ADR sought by the Plaintiff was approved in 2006, according to court records.

According to court records, plaintiffs allege that defendant BSCA’s “medical policy of categorically excluding lumbar ADR procedures from coverage” is a violation of ERISA. The court goes on to say “Plaintiff’s proposed definition on includes individuals who were advised or learned that Defendant deemed ADR surgery “for their back conditions” was “investigational” and thus not covered. The relief sought is for Defendant to change their policy and to review previously denied claims. None of the relief requested requires individualized inquiry.”

Case file info: Luis Escalante v. California Physicians’ Service dba Blue Shield of CA case number 2:14-cv-03021, in the U.S. District Court for the Central District of California.

According to Judge Pregerson, “A judgment either affirming or overturning Defendant’s classification of ADR procedures as “investigational” on a classwide basis would avoid duplicative suits brought by other class members demanding coverage for ADR procedures.”

Avym is dedicated to empowering providers with ERISA appeal compliance and ERISA litigation support in all cases as well as ERISA class actions.  All medical providers and Health Plans should understand critical issues regarding the profound impact of this and other court decisions on the nation’s medical claim denial epidemic, including how to correctly appeal every wrongful claim denial and overpayment demand and subsequent claims offsetting with valid ERISA assignment and the first ERISA permanent injunction.  In addition, when faced with pending litigation and or offsets or recoupments, providers should look for proper litigation support against all wrongful claim denials and overpayment recoupment and offsetting, to seek for enforcement and compliance with ERISA & PPACA claim regulations.