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W.P. v. Anthem Insurance Companies Inc.

United States District Court, S.D. Indiana, Indianapolis Division

February 15, 2017

W.P., a minor by and through his parents and guardians KATHRYN PIERCE and CHESTER PIERCE, on behalf of themselves and similarly situated individuals, and A.B., a minor by and through his parents and guardians MICHAEL BECK and JOANNE KEHOE, on behalf of themselves and similarly situated individuals, Plaintiffs,
v.
ANTHEM INSURANCE COMPANIES INC., an Indiana corporation, Defendant.

          ENTRY ON MOTION FOR PARTIAL JUDGMENT ON THE PLEADINGS

          TANYA WALTON PRATT, JUDGE.

         Before the Court is a Motion for Partial Judgment on the Pleadings filed by Defendant Anthem Insurance Companies Inc. (“Anthem”), pursuant to Federal Rule of Civil Procedure 12(c). (Filing No. 48.) On April 9, 2015, Plaintiff W.P. and his parents, Kathryn and Chester Pierce (collectively “Plaintiffs”), brought this putative class action against Anthem under the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq. W.P. is a thirteen-year-old child who suffers from autism and Anthem is his health insurance provider. W.P.'s physician prescribed forty hours per week of Applied Behavioral Analysis (“ABA”) therapy to treat W.P.'s autism, but Anthem covers only twenty hours per week of ABA therapy. Plaintiffs allege that Anthem violated state and federal laws because it has a policy of limiting the number of ABA hours it covers for children ages seven or older. (Filing No. 1.) Anthem now moves for partial judgment on the pleadings. For the following reasons, Anthem's Motion is GRANTED.

         I. BACKGROUND

         The following undisputed facts are taken from Plaintiffs' Complaint and the parties' briefs.

         A. Indiana's Autism Mandate.

         In 2001, the Indiana General Assembly amended the Indiana Code, requiring individual and group health insurance policies to provide coverage for autism treatment. See Ind. Code § 27-8-14.2. This amendment is known as the “Autism Mandate.” The Autism Mandate states:

(a) An accident and sickness insurance policy that is issued on a group basis must provide coverage for the treatment of an autism spectrum disorder of an insured. Coverage provided under this section is limited to treatment that is prescribed by the insured's treating physician in accordance with a treatment plan. An insurer may not deny or refuse to issue coverage on, refuse to contract with, or refuse to renew, refuse to reissue, or otherwise terminate or restrict coverage on an individual under an insurance policy solely because the individual is diagnosed with an autism spectrum disorder.
(b) The coverage required under this section may not be subject to dollar limits, deductibles, or coinsurance provisions that are less favorable to an insured than the dollar limits, deductibles, or coinsurance provisions that apply to physical illness generally under the accident and sickness insurance policy.

Ind. Code Ann. § 27-8-14.2-4.

         On March 30, 2006, the Indiana Department of Insurance (“IDOI”), an agency charged with enforcing the Indiana Insurance Code, issued Bulletin 136 interpreting the Autism Mandate. See Ind. Ins. Bulletin 136, 2006 WL 1584562 (Mar. 30, 2006). Bulletin 136 states that an insurer has the right to “request an updated treatment plan not more than once every six (6) months from the treating physician to review medical necessity” and “[a]ny challenge to medical necessity will be viewed as reasonable only if the review is by a specialist in the treatment of [autism spectrum disorder].” Id. at 1, 3. Bulletin 136 also states that services to treat autism spectrum disorders “will be provided without interruption, as long as those services are consistent with the treatment plan and with medical necessity decisions.” Id. at 2. “Service exclusions contained in the insurance policy…that are inconsistent with the treatment plan will be considered invalid .…” Id.

         B. Factual Background.

         W.P. is a thirteen year-old who suffers from severe autism. W.P. has limited verbal skills, is unable to navigate stairs without assistance, and frequently exhibits repetitive behaviors including rocking, flapping his arms and hands, and heavy breathing. W.P.'s treating physician prescribed forty hours per week of ABA therapy to treat W.P.'s autism. In February 2011, W.P. began receiving ABA therapy and his parents observed almost immediate improvements in his ability to walk, use words, and respond appropriately to prompts. W.P.'s repetitive behaviors also decreased.

         W.P. is the beneficiary of a health insurance plan (“the Plan”) sponsored by his father's employer. Anthem is the insurer and claims administrator for the Plan. Anthem initially covered W.P.'s forty hours of ABA therapy but, in July 2013, Anthem reduced the number of covered ABA therapy hours for W.P. to twenty-five hours per week. In July 2014, Anthem further reduced the number of covered hours to twenty hours per week.

         C. Procedural Background.

         On July 29, 2014, Plaintiffs filed a written appeal to Anthem regarding its coverage decision. On October 31, 2014, Anthem issued a written denial of the appeal, upholding its decision to limit the amount of ABA therapy hours it covered. Thereafter, in January 2015, Anthem contacted W.P.'s therapy provider and made a “take-it-or-leave-it” offer to temporarily increase the ...


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