Alexandra H. v. Oxford Health Insurance Inc. Freedom Access Plan
833 F.3d 1299
11th Cir.2016Background
- Alexandra H. sought ERISA benefits for continued partial hospitalization for anorexia; Oxford denied as not medically necessary after internal appeals and an external New York external appeal.
- The plan provides two internal review tracks and an external appeal under New York Insurance Law § 4910, with the external decision stated to be binding and admissible in court.
- Alexandra’s external appeal, heard by MCMC, upheld Oxford’s denial of coverage for continued partial hospitalization as not medically necessary.
- The district court initially struck the external appeal from the ERISA record, then later admitted it, and allowed limited discovery into potential conflicts of interest at MCMC.
- Oxord moved for summary judgment; the magistrate and district court concluded the external review bound the medical-necessity issue, leading to judgment for Oxford.
- The Eleventh Circuit ultimately held the external review is part of the administrative record but not binding on the merits, and ERISA review is not precluded or preempted by New York external-review law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the external review part of the administrative record? | Alexandra: external review should be in record only if part of admin review. | Oxford: external review informs the agency’s decision, thus part of record. | External review is part of the administrative record. |
| Does external review bind merits and bar ERISA action? | Alexandra argues binding external review precludes court challenge. | Oxford argues binding external review precludes merits review. | External review is not binding on merits; ERISA suit may proceed. |
| Is New York external-review law preempted by ERISA? | If binding is read to bar ERISA relief, preemption may apply. | External review operates alongside ERISA; not preempted. | New York external-review regime is not preempted by ERISA. |
Key Cases Cited
- Tippitt v. Reliance Standard Life Ins. Co., 457 F.3d 1227 (11th Cir. 2006) (framework for federal common law in ERISA interpretation)
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (Supreme Court 1989) (establishes de novo vs discretionary review framework)
- Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41 (Supreme Court 1987) (ERISA remedy and internal/external review context)
- Buce v. Allianz Life Ins. Co., 247 F.3d 1133 (11th Cir. 2001) (respect for choice-of-law provisions in ERISA plans)
- Capone v. Aetna Life Ins. Co., 592 F.3d 1189 (11th Cir. 2010) (honors choice-of-law provisions if not unreasonable)
- Nenno v. Blue Cross & Blue Shield of W. New York, 303 A.D.2d 930 (N.Y. App. Div. 2003) (binding external review does not bar court review)
- Vellios v. IPRO, External Review Agent, 1 Misc. 3d 468 (N.Y. Sup. Ct. 2003) (external review marks end of admin but not court review)
- Schulman v. Grp. Health Inc., 39 A.D.3d 223 (N.Y. App. Div. 2007) (external review not to preclude judicial review)
- Mercy Flight Cent., Inc. v. Kondolf, 41 Misc. 3d 483 (N.Y. City Ct. 2013) (external review not dispositive of medical-necessity merit)
- Mercy Flight Cent., Inc. v. Kondolf, Mercy Flight (N.Y. City Ct. 2013) (external review not binding on merits under NY law)