The US 2 nd Circuit Court of Appeals made the ruling in a case involving a lawsuit against an HMO by the health plan participant’s wife who challenged the coverage decision by Vytra Healthcare after her husband’s death. Vytra initially denied coverage for a double stem-cell transplant, but later approved a single stem-cell transplant.
Circuit Judge Robert Sack said an HMO medical director’s decision denying an HMO participant one form of treatment as experimental and later approving another was both a medical treatment decision and a contract-interpretation decision. Sack wrote “a state law malpractice action, if based on a ‘mixed eligibility and treatment decision,’ is not subject to ERISA preemption when that state law cause of action challenges an allegedly flawed medical judgment as applied to a particular patient’s symptoms.”
Cicio’s malpractice suit was based on the denial of coverage for the double stem cell transplant, which was made in the course of a utilization review, the court said. The court noted that this form of review, where a third-party decides in advance whether a form of treatment is necessary for a participant, blurs the boundaries between the autonomy of the medical profession and the managerial domain. As such, the court said, “it represents a development apparently unforeseen at the time of ERISA’s enactment.”
Bonnie Cicio’s sued Vytra and nine Vytra doctors for medical malpractice after her husband Carmine Cicio died in May 1998. The suit claimed that Vytra medical director Dr. Brent Spears was wrong when he first denied coverage for Carmine Cicio for the double stem-cell treatment. Spears’ eventual approval of the single stem-cell transplant procedure came after Carmine Cicio was medically ineligible for it. A federal trial judge granted Vytra’s request to throw out the Cicio suit and Bonnie Cicio appealed.
The case is Cicio v. Does, 2d Cir., No. 01-9248, 2/11/03.