W. v. Anthem Blue Cross and Blue Shield, 444 F.Supp.3d 1305

Kerry W. (plan participant) and her son N.W. (beneficiary) sought coverage for N.W.’s long-term residential treatment at Elevations RTC; Anthem was the insurer and claims administrator under the Plan.
Anthem’s member booklet defined “Medically Necessary” in terms that gave Anthem the sole authority to decide medical necessity and said Anthem would apply its clinical coverage guidelines.
N.W. received roughly 66 weeks of RTC care (50 weeks while Anthem insured him); Anthem approved under eight weeks of care and denied coverage after February 2, 2016 and after October 25, 2016, citing lack of need for 24‑hour care and poor participation.
Kerry exhausted Anthem’s internal appeals; Anthem upheld denials. An external reviewer (MCN) also affirmed Anthem’s determinations.
Plaintiffs sued under ERISA § 502(a)(1)(B); the court considered whether review should be de novo or arbitrary-and-capricious, whether Anthem complied with ERISA claims-procedure rules, and whether Anthem’s denials were supported by reasoned analysis.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Standard of review: de novo vs. arbitrary-and-capricious	Plan language does not sufficiently confer discretion; de novo review warranted	Booklet vests Anthem with sole authority to decide medical necessity; deferential review applies	Court: Arbitrary-and-capricious review applies (Plan language grants Anthem discretion)
Effect of ERISA claims-procedure compliance on deference (Halo v. Yale)	Anthem failed to strictly comply with ERISA regs; under Halo, no deference	Anthem substantially complied with ERISA regs; Tenth Circuit does not adopt Halo strictness	Court: Declines Halo; applies Tenth Circuit substantial-compliance approach and affords deference to Anthem
Sufficiency of Anthem’s reasons for denial	Denials lack factual findings and fail to address submitted medical evidence; decision arbitrary and capricious	Denials cited medical-necessity criteria and clinical conclusions supporting denials	Court: Denials were conclusory, lacked analysis and citation to evidence; arbitrary and capricious
Remedy: remand vs. award of benefits	Plaintiffs seek benefits or remand for full reconsideration	Anthem opposes benefits and seeks affirmation or remand with instructions	Court: Remands to plan administrator for further findings/explanation (not an immediate award of benefits)

Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (establishes de novo baseline; deferential review when plan grants administrator discretion)
Eugene S. v. Horizon Blue Cross Blue Shield of New Jersey, 663 F.3d 1124 (10th Cir.) (plan language granting insurer decision-making supports deferential review)
Nance v. Sun Life Assurance Co. of Canada, 294 F.3d 1263 (10th Cir.) (courts broadly construe plan language to trigger deferential review)
McGraw v. Prudential Ins. Co. of Am., 137 F.3d 1253 (10th Cir.) (upholding administrator discretion where plan language tied decisions to administrator)
Chambers v. Family Health Plan Corp., 100 F.3d 818 (10th Cir.) (plan may designate procedures as experimental under administrator authority)
Gilbertson v. Allied Signal, Inc., 328 F.3d 625 (10th Cir.) (Tenth Circuit’s substantial-compliance standard for ERISA procedures)
Halo v. Yale Health Plan, 819 F.3d 42 (2d Cir.) (advocates strict regulatory compliance to obtain deference; not adopted here)
Kimber v. Thiokol Corp., 196 F.3d 1092 (10th Cir.) (arbitrary-and-capricious review: decision upheld unless not grounded on any reasonable basis)
DeGrado v. Jefferson Pilot Financial Ins. Co., 451 F.3d 1161 (10th Cir.) (remand appropriate when administrator fails to explain decision)
Caldwell v. Life Ins. Co. of N. Am., 287 F.3d 1276 (10th Cir.) (remedy guidance where administrator fails to make adequate findings)