Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Health insurers are not subject to tort liability for tightening the definition of “medically necessary” treatment and denying payment based on the new definition, New York’s Appellate Division, 2nd Department, has ruled. The four-judge panel unanimously affirmed the summary judgment granted against the tort causes of action in a case in which plaintiffs alleged that Empire Blue Cross and Blue Shield violated a duty of care when it refused to pay for intravenous antibiotic treatment of Lyme disease. The justices, however, left open the possibility that there may have been a breach of contract. Nonetheless, the decision forecloses any possibility of punitive damages stemming from the health insurer’s denial of coverage, since that is not possible without independent tort liability. In Logan v. Empire Blue Cross and Blue Shield, 1999-04253, plaintiffs said that the insurer’s refusal to pay for intravenous antibiotic treatment constituted a tort independent of any breach of the insurance contract. They asked for punitive damages based on the tortious conduct. The 2nd Department, in a decision by Justice William D. Friedmann, upheld Westchester County Supreme Court Justice John D. DiBlasi’s decision to excise from the complaint the causes of action for fraud and other torts. Empire Blue Cross, before 1993, had no consistent policy regarding intravenous antibiotic treatment of Lyme disease sufferers. Some physicians who reviewed claims denied the coverage as experimental, while others allowed it as medically necessary. On Oct. 1, 1993, Empire Blue Cross instituted a policy requiring preapproval of Lyme disease treatment, and limiting intravenous antibiotic treatment. The plaintiffs were Lyme disease sufferers who were denied coverage on 30 occasions between 1993 and 1996 when they presented claims for the intravenous treatment. They claimed that the new definition of “medical necessity” reflected in the 1993 policy on Lyme disease treatment constituted tortious wrongdoing separate and apart from any breach of contract. Furthermore, plaintiffs argued, health insurance contracts are “so affected with the public interest” that Empire Blue Cross should face tortious liability if it failed to perform its contractual obligations with due care. But the 2nd Department panel did not agree, holding there was no duty of care independent of the insurance contract. Empire Blue Cross’ periodic review and updating of its medical policies can not be seen, as plaintiffs argued, as an attempt to “raise the bar” for those seeking coverage for medical treatment. “While … amendments and revisions of its policy may have resulted in stricter standards that made it more difficult for policyholders to establish that intravenous antibiotic therapy was ‘medically necessary’ to treat Lyme disease, it cannot be concluded that such conduct was intended to defeat the contract,” Justice Friedmann wrote. The court said that periodic review, based on medical literature, and conducted by the insurer, could not be viewed as a manipulation of corporate medical policy intended to circumvent contractual obligations. To punish Empire Blue Cross for updating its standards, Friedmann reasoned, would “essentially require Empire to ignore the latest research and findings within the medical community concerning what is appropriate treatment for a given medical condition.” Friedmann was joined by Justices Thomas R. Sullivan, Sondra Miller, and Robert W. Schmidt. The attorneys for the plaintiffs were Ira M. Maurer and Marc Wietzke, of Elkind, Flynn & Maurer in White Plains, N.Y. Representing Empire Blue Cross were Justin E. Driscoll III and Gary I. Selinger, of Plunkett & Jaffe in Manhattan.

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.