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Haaland v. Presbyterian Health Plan, Inc.

United States District Court, D. New Mexico

February 28, 2018

BRANELDA SUE HAALAND, Individually and as Personal Representative of the Estate of Billie Jo Hall, deceased, RICHARD HALL, and RICHARD WAYNE HALL, Plaintiffs,
PRESBYTERIAN HEALTH PLAN, INC., a New Mexico corporation, and PRESBYTERIAN HEALTHCARE SERVICES, a New Mexico corporation, and GREGG VALENZUELA, Defendants.


         THIS MATTER comes before the Court on Defendant Presbyterian Health Plan, Inc.'s (“PHP's”) Motion for Summary Judgment on Federal Defenses (Doc. 40), filed September 18, 2017. Pursuant to 28 U.S.C. § 636(c) and Fed.R.Civ.P. 73(b), the parties have consented to me serving as the presiding judge and entering final judgment. See Docs. 4-5, 7, 9. Having considered the record, submissions of counsel, and the relevant law, the Court finds that the motion is well-taken and will be granted.


         Plaintiffs initiated this action in state district court on July 15, 2016. See Doc. 1. They alleged that their decedent, Billie Joe Hall (“Ms. Hall”), “died from a wrongful and tortious denial of a liver transplant evaluation, ” for which the “Estate seeks damages for her wrongful death.” Doc. 37 at ¶ 7. PHP removed the action to this Court under the Federal Officer Removal Statute, 28 U.S.C. § 1442(a)(1), and Plaintiffs responded with a motion to remand. Doc. 17. At an April 4, 2017 hearing on the Motion to Remand, Plaintiffs conceded that for three of their causes of action - those asserted under the Insurance Practices Act, NMSA § 59-A-16-20, the Unfair Trade Practices Act, NMSA § 57-12-2, and § of the New Mexico Administrative Code - the Medicare Act's directives and extensive regulation supported removal under Section 1442(a)(1). Doc. 23. Based upon this concession, the Court denied Plaintiff's Motion to Remand. Doc. 24.

         Thereafter, Plaintiffs filed their Third Amended Complaint, omitting those claims for which they had conceded preemption. See Doc. 37. In the now-operative complaint, Plaintiffs assert two claims against PHP under New Mexico's Wrongful Death Act. In Count I, they allege that PHP negligently denied Ms. Hall a liver transplant evaluation, either by “failing to follow its own policies and procedures that were not mandated by federal law” or “by having written or unwritten policies, procedures and practices to deny or hinder liver transplant evaluations and transplantation for persons 70 or older.” Id. at ¶ 19. In Count II, they allege that PHP's denial of the request for a liver transplant evaluation was the product of “age discrimination” in violation of “its own non-discrimination policy.” Id. at 5-6.[1] Plaintiffs maintain, both in their Complaint and in their briefing on PHP's Motion for Summary Judgment that these claims do not arise under the Medicare Act and do not seek Medicare benefits. Id. at ¶ 7; Doc. 47.


         Decedent Ms. Hall purchased from PHP a Medicare Advantage plan - “Presbyterian Senior Plan 2 with Prescriptions (HMO)” - under 42 U.S.C. § § 1395-1395ggg Part C. Def.'s Mot. for Summ. J., Doc. 40 (“Def.'s MSJ”), at Undisputed Fact (“UF”) ¶ 1. A booklet issued in connection with the plan informed Ms. Hall that PHP was required “[to] cover all services covered by Original Medicare and [to] follow Original Medicare's coverage rules.” Id. at UF ¶ 2. Under Ms. Hall's Medicare Advantage plan, PHP was required to cover services deemed to be “medically necessary, ”[3] which the plan defined as “services . . . needed for the prevention, diagnosis, or treatment of [a] medical condition and [that] meet accepted standards of practice.” Id. at UF ¶ 2; Pl.'s Resp. to Def.'s Mot. for Summ. J., Doc. 47 (“Pl.'s Resp.”), at UF ¶ 2.

         Under some circumstances, liver transplants were covered by Ms. Hall's Medicare Advantage plan. Def.'s MSJ, at UF ¶ 3. For instance, liver transplants would be covered when there was advanced approval or “prior authorization.” Id. The plan did not specify, however, that prior authorization by PHP was required for a liver transplant evaluation by a Medicare-approved transplant center. Pl.'s Resp. to Def's UF ¶ 3. Rather, the plan provided that if an enrollee “need[ed] a transplant, [PHP] would arrange to have [the] case reviewed by a Medicare-approved transplant center that [would] decide whether [the enrollee was] a candidate for a transplant.” Def.'s MSJ, at UF ¶ 3.

         On or about August 13, 2014, Gregg A. Valenzuela, M.D., a gastroenterologist working at the Presbyterian Healthcare Services GI Clinic, requested that PHP authorize[4] a liver transplant evaluation for Ms. Hall. Pl.'s Resp. to Def.'s UF ¶ 4; Doc. 39, Ex. B & C. Dr. Valenzuela's request was forwarded to Sandy Brown, R.N. (“Nurse Brown”) of PHP on August 15, 2014. Def.'s MSJ, at UF ¶ 5. The forwarding e-mail indicated that Ms. Hall's model for end-stage liver disease (“MELD”) score had been 13 as of July 10, 2014. Def.'s MSJ, at UF ¶ 5; Doc. 39, Ex. C, at 1. Nurse Brown reviewed Ms. Hall's case on August 18, 2014, and her note on that date stated in part:

[Ms. Hall] is a 70 year old female with a history of [c]irrhosis[, ] kidney disease[, ] and high blood pressure. She also has a history of breast cancer and a density on chest x ray in the right lung. [C]all placed to [Dr. Valenzuela's office] to advise [that Ms. Hall] is over the age limit for transplant evaluation.

         Def.'s MSJ, at UF ¶ 6; Doc. 39, Ex. C, at 1. The following morning, Nurse Brown wrote this upDated: “[Request] ha[s] been sent to [PHP's] medical director for liver transplant evaluation. Per [Presbyterian Health Plan medical policy (MPM 20.6)] member does not meet criteria for transplant eval. . . . [F]amily advised of possible denial related to age.” Def.'s MSJ, at UF ¶ 7; Doc. 39, Ex. C, at 1.

         PHP's medical director, Dr. Norman G. White, received an August 19, 2014 email notifying him of Dr. Valenzuela's request that Ms. Hall receive a liver transplant evaluation. Def.'s MSJ, at UF ¶ 9; Doc. 39, Ex. D. The e-mail mentioned that Ms. Hall was 70 years old and that her diagnosis was non-alcoholic cirrhosis; it also summarized some of her past medical history, set forth her lab values from two weeks earlier, and indicated that her current MELD was 13. Def.'s MSJ, at UF ¶ 9; Doc. 39, Ex. D. Referring to PHP medical policy MPM 20.6, the e-mail suggested that Ms. Hall did “not meet criteria for liver transplant evaluation.” Def.'s MSJ, at UF ¶ 9; Doc. 39, Ex. D. Dr. White wrote an e-mail that same day, indicating that “[b]ased on submitted documentation, [Ms. Hall] does not meet PHP MPM 20.6 criteria for consideration of liver transplant and evaluation for liver transplantation [, and] [b]ased on Presbyterian Health Plan criteria, the degree of liver disease is not severe enough to initiate liver transplant evaluation.” Def.'s MSJ, at UF ¶ 10; Doc. 39, Ex. G.

         At the time, PHP's MPM 20.6 provided that a PHP member could receive a liver transplant evaluation if she had “severe organ injury, dysfunction or symptomatic organ failure that [was] not amendable [sic] to other medical or surgical alternatives” and “[e]nd stage liver disease, as demonstrated by one of the following: [1] current or past history of acute/fulminant hepatic failure and/or variceal hemorrhage or [2] Platelets < 120, 000, increased prothrombin time, decreased albumin, and increased bilirubin.” Def.'s MSJ, at ¶ 11; Doc. 39, Ex. E. The parties disagree about whether Dr. Valenzuela's treatment notes demonstrate that Ms. Hall met these criteria. Compare Doc. 47 at 8-9, with Doc. 49 at 6-7. Plaintiff maintains that Dr. White's stated reasons for the denial were pretextual, and that Ms. Hall's age was the “real reason” for the denial of the liver transplant evaluation. Doc. 47 at 9.

         On or about August 26, 2014, a PHP employee informed a member of the Presbyterian Healthcare Services GI clinic staff that Dr. Valenzuela's request for a liver transplant evaluation had been denied because Ms. Hall “d[id] not meet criteria for transplant evaluation.” Def.'s MSJ, at UF ¶ 12; Doc. 39, Ex. C. Thereafter, Ms. Hall received from PHP a “Notice of Denial of Medical Coverage” for the request for a liver transplant evaluation. Doc. 39, at ¶ 19 & Ex. H. The notice, dated September 24, 2014, stated: “Based on the information we received, you do not meet the Presbyterian Health Plan medical policy (MPM 20.6) criteria for the requested liver transplant evaluation. Based on the Presbyterian Health Plan medical policy, the degree of your liver disease is not severe enough to initiate a liver transplant evaluation.” Def.'s MSJ, at UF ¶ 13; Doc. 39, Ex. H.

         The Notice of Denial of Medical Coverage also informed Ms. Hall that she had the right “to ask [PHP] to review [its] decision by asking for an appeal . . . within 60 days of the date of [the] notice” or later if she had “a good reason for missing the deadline.” Def.'s MSJ at UF ¶ 14; Doc. 39, Ex. H, at 1. The notice assured Ms. Hall that a decision would be made within 30 days for a “Standard Appeal” or within 72 hours for a “Fast Appeal.” Def.'s MSJ, at UF ¶ 14; Doc. 39, Ex. H, at 2. Moreover, it provided instructions for pursuing an appeal and advised that if PHP continued to deny her request following her appeal, it would “send [her] a written decision and automatically send [her] case to an independent reviewer.” Def.'s MSJ, at UF ¶ 14; Doc. 39, Ex. H, at 2-3. The notice did not explain, however, that any rights to sue would be lost if Ms. Hall did not appeal. Pl.'s Resp. to Def.'s UF ¶ 14; see also Doc. 39 at ¶ 19 & Ex. H.

         Ms. Hall's plan booklet also provided information about her appeal rights. Def.'s MSJ at UF ¶ 15; Doc. 39, Ex. A, at 21-22, 171-82. More particularly, it advised that even if an independent reviewer turned down her appeal, Ms. Hall could appeal further - to an administrative law judge, an appeals council, and, finally, to a federal district court. Def.'s MSJ at UF ¶ 15; Doc. 39, Ex. A, at 211-13.

         Ms. Hall did not appeal PHP's decision to deny the request for a liver transplant evaluation. Doc. 39, at ¶ 20. Her husband and daughter would testify that “they heard Dr. Valenzuela tell [Ms. Hall] that she would not be able to get a transplant approved by PHP even if she appealed the denial, and that she could instead go overseas to China and pay for a liver transplant herself.”[5] Id.

         On December 27, 2014, Ms. Hall died of end-stage liver disease. Def.'s MSJ at UF ¶ 17; Doc. 39, at ¶¶ 22-23.


         “The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A “genuine” dispute exists where the evidence is such that a reasonable jury could resolve the issue either way. See Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir. 1998) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A mere scintilla of evidence in the non-movant's favor is not sufficient. Anderson, 477 U.S. at 252. However, the court must consider all the evidence in the light most favorable to the party opposing summary judgment. See Trask v. Franco, 446 F.3d 1036, 1043 (10th Cir. 2006).

         Both the movant and the party opposing summary judgment are obligated to “cit[e] to particular parts of materials in the record” to support their factual positions. Fed.R.Civ.P. 56(c)(1)(A). Alternatively, they may “show[] that materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.” Fed.R.Civ.P. 56(c)(1)(B); see also Medlock v. United Parcel Serv., Inc., 608 F.3d 1185, 1189 (10th Cir. 2010) (“[I]f the matter in issue concerns an essential element of the nonmovant's claim, the moving party may satisfy the summary judgment standard ‘by identifying a lack of evidence for the nonmovant on [that] element.'” (internal quotation and citation omitted) (alteration in original)). Materials cited to establish the presence or absence of a genuine dispute must be capable of being in a form that would be admissible in evidence. Fed.R.Civ.P. 56(c)(2).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IV. ...

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