Atherley v. Unitedhealthcare of Florida, Inc.

          ORDER

          CAROL MIRANDO United States Magistrate Judge.

         This matter comes before the Court upon review of Plaintiff Mark Atherley's Motion Regarding Applicable Standard of Review filed on December 22, 2017. Doc. 28. Plaintiff is seeking an order setting the standard of review in this case as de novo. Defendant UnitedHealthcare of Florida, Inc. (“United”) filed a Response in Opposition to Plaintiff's Motion on January 5, 2018, requesting that the Court apply the arbitrary and capricious standard of review to this case. Doc. 29. For the reasons discussed below, the Court finds the appropriate standard of review for this case is the arbitrary and capricious standard.

         I. Summary of Background

         This is an action by Plaintiff to enforce rights and seek damages under the Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seq. (“ERISA”) against United for denying health insurance benefits to which Plaintiff allegedly was entitled under his United group health insurance plan (the “Plan”). Doc. 1 at 7-12. Specifically, Plaintiff seeks the recovery of benefits under 29 U.S.C. § 1132(a)(1)(B), administrative penalties under 29 U.S.C. §§ 1132(c)(1), 1024(b) and 29 C.F.R. § 2575.502c-1, and attorneys' fees under 29 U.S.C. § 1132(g)(1). Id.

         Plaintiff had health insurance benefits through the Plan, which was offered by his employer, Southwest Florida Maritime, Inc. (“Southwest”), and administered by United. Id. ¶ 7. Plaintiff needed a life-saving liver transplant, without which he was expected to survive only until July 2015. Id. ¶ 8. United allegedly authorized a liver transplant for Plaintiff, but the in-network medical provider that United referred him to was either unwilling or unable to perform the procedure before July 2015. Id. Plaintiff attempted to find another in-network provider through his United “advocate, ” but the medical provider suggested by the advocate failed to timely communicate with Plaintiff. Id. ¶ 9. Therefore, Plaintiff independently identified a Florida medical provider that could perform the liver transplant- Cleveland Clinic in Weston, FL-and he successfully underwent the procedure in July 2015. Id. ¶ 10.

         Cleveland Clinic billed United for the liver transplant and associated medical services, but United refused to provide coverage for the procedure. Id. ¶ 11. As a result, Plaintiff had to prematurely withdraw from his retirement savings to pay the approximately $290, 000 bill. Id. Plaintiff's counsel attempted to resolve the issue with United through pre-suit communications, but according to Plaintiff, United's in-house counsel “eventually fell off the map.” Id. at ¶¶ 18-19, 28-35. Therefore, Plaintiff initiated this action.

         II. Available Standards of Review

         Although ERISA does not prescribe a particular standard of review for decisions made by plan administrators or fiduciaries, there are two possible options: (1) the arbitrary and capricious standard, which applies when the benefit plan gives the administrator “discretionary authority to determine eligibility benefits or construe the terms of the plan, ” or (2) the de novo standard, which applies in the absence of such discretionary authority. Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 111, 117-19 (2008); Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350, 1355-56 (11th Cir. 2011).^[1] The applicable standard of review ultimately impacts the six-step analysis for reviewing an administrator's benefits decision:

(1) Apply the de novo standard to determine whether the claim administrator's benefits-denial decision is “wrong” (i.e., the court disagrees with the administrator's decision); if it is not, then end the inquiry and affirm the decision.

(2) If the administrator's decision in fact is “de novo wrong, ” then determine whether he was vested with discretion in reviewing claims; if not, end judicial inquiry and reverse the decision.

(3) If the administrator's decision is “de novo wrong” and he was vested with discretion in reviewing claims, then determine whether “reasonable” grounds supported it (hence, review his decision under the more deferential arbitrary and capricious standard).

(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator's decision; if reasonable grounds do exist, then determine if he operated under a conflict of interest.

(5) If there is no conflict, then end the inquiry and affirm the decision.

(6) If there is a conflict, the conflict should merely be a factor for the court to take into account when determining whether an administrator's ...