Getting Your Insurer to Cover New HIV Treatments: A Crash Course

[Irwin E. Keller, Esq., Interim Executive Director of the AIDS Legal Referral Panel of the San Francisco Bay Area, wrote the following article for AIDS TREATMENT NEWS.]

Introduction

Most Americans rely on some private insurance system to pay for their health care. Insurance, however, is not a government-provided service or a utility. It is private enterprise, and for that reason insurers have an incentive to maximize their profits by providing as little coverage as contractually and legally possible, while continuing to collect regular premiums from their insureds. Although persuading an insurer to pay for human growth hormone treatment for wasting syndrome may feel like a fight over a
basic right to health care, in the eyes of the law it is only a dispute over the interpretation of a contract.

If you want cutting edge HIV treatment, it is likely that at some point your insurance company will deny a claim for benefits, and you will have a dispute on your hands. Although not intended to give you specific legal advice, this article will introduce you to some legal principles that may be of use in getting and keeping your care covered. As in all matters, it is important to know your rights and be ready to exercise them.

The Requirement of Medical Necessity, and Exclusions for Experimental Treatments

Most health insurance contracts require the insurer to pay for all health care claims that are "medically necessary," unless the treatment is specifically excluded by the terms of
the policy, such as exclusions for "experimental" or "investigational" treatments. If your insurer denied your claim, it is important for you to ascertain the exact grounds
on which it was rejected. Does your insurer claim that the particular use to which it is being put? For each of those grounds, you may need to respond with different arguments and evidence.

A. Demonstrating the Treatment is Medically Necessary

Most insurance contracts oblige insurers to pay only for procedures that are "medically necessary." Coverage for innovative procedures is often denied because these treatments may not have sufficient track records to render them obviously "necessary."

The law can work to your advantage in this kind of coverage dispute. First of all, courts tend to interpret insurance contracts liberally in order to provide the broadest possible coverage. In the course of your dispute, be sure to remind your insurer of this fact.

The focus of a dispute over medical necessity is less on the treatment than on you. Certainly you can and should submit evidence that the treatment has been useful for others. But especially compelling is evidence that you have undergone all the other available treatments for the particular condition, and they have not been or have ceased being effective for you. If you have been able to use the disputed treatment, either paying for it out of pocket or through a trial protocol, and have a personal history of benefit from this procedure, it will be hard for your insurer to defend the position that the treatment is unnecessary.

B. Demonstrating the Treatment is not "Experimental" as Defined in the Policy
It is more likely that your insurer will deny a claim based
on the assertion that the procedure is "experimental" or "investigational" in nature. If so, the first thing you must do is look at the insurance contract itself, to determine how the term "experimental" is defined. The law says that ambiguous terms in an insurance contract must be interpreted by a court in favor of the insured--not in favor of the insurer. The reason for this is that the insurer wrote the contract and had the opportunity to make everything clear. It therefore should not have the right to benefit from its own failure to draft a clear contract.

Many courts across the country have ruled that the term "experimental" is by nature ambiguous if it is not defined in the policy. Without a specific definition, it can be interpreted in numerous ways: procedures performed only for research purposes; procedures performed to benefit a patient, the results of which will be shared with researchers; etc. If "experimental" is not defined in your policy, a court may agree with you that the treatment you need is not experimental, and should be covered.

For this reason, many policies do attempt to define "experimental." Some policies do so by referring to the findings of specific medical authorities, for instance whether or not the treatment has been approved by the FDA. If the treatment you need is considered experimental by the medical body named in the policy, you will not be able to effectively argue that the policy is ambiguous. (You could perhaps go to court and argue that in the context of HIV care, which develops far more rapidly than "official" medical bodies can evaluate, a person with HIV would NEVER be able to get coverage for the newest treatments if the exclusion is constructed this way. Since this catch-22 might cause you irreparable harm, the court should not enforce the policy exclusion, even though the exclusion itself is clear. Be aware that this is a hard type of challenge to win, and you should consult with a lawyer to determine if it is worth pursuing in your case.)

If, on the other hand, your policy's definition of "experimental" does not specifically name a medical authority whose determination will be relied on, but instead refers more vaguely to "appropriate medical bodies," you can once again argue that this definition of "experimental" is ambiguous and that the treatment you need is not experimental as defined in the policy.

By pointing out that your policy's definition of "experimental" is ambiguous, you create an opportunity to
demonstrate why the treatment you need is NOT experimental. Here are some points your evidence should address:

1. Are there other insurers (including Medicaid or Medicare) that do pay for this procedure? If other insurers interpret their own policies to permit coverage, then the procedure is not unambiguously "experimental."

2. Are there scholarly articles or other outside documentation that this treatment is effective? In addressing effectiveness, try to touch upon community experience with the procedure, including the procedure's effect on health outcomes (long term survival, likelihood of recurrence of the condition, risks and side effects) when compared to other treatments as well as to no treatment at all.

3. What is the community experience with this treatment? And your doctor's? Certainly your doctor's assessment will be central to your position. But since the insurer has presumably already heard and discounted your physician's recommendation, seek out testimony from other HIV specialists in the community to support your doctor's opinion. Find out if they consider this procedure to reflect the community standard of care. How long have they been using this procedure? Some courts have ruled that sufficient history of use of a treatment in the community makes it non-experimental, even without literature on it and even if there are side effects to the procedure.

C. Demonstrating that a Particular Use of a Treatment is Not Experimental.

Some insurers will attempt to deny or limit coverage for "off-label" uses of an otherwise FDA-approved drug or treatment. This means that although a drug may be FDA-approved for some uses, it is not specifically approved for treatment of your condition.

In some states there are statutes specifically addressing this question. In California, for example, if an insurance policy pays for FDA-approved drugs, it must also reimburse for "off-label" uses of these drugs for individuals with life-threatening health conditions, provided that you can show that the new use is effective. Under the law, you can do this by pointing to certain medical authorities, or two articles from major peer-reviewed medical journals.

If your state does not have explicit law on the topic of "off-label" coverage, you will have to address the problem as you would if you were fighting for coverage for an experimental treatment, as discussed above.

D. Making the Economic Argument

Although not relevant for determining whether a procedure is experimental, you should make a cost-effectiveness argument if there is any way to do so. Insurers, in their zeal to deny as much coverage as possible, sometimes lose track of the fact that paying for some new treatments may save them money. If the procedure is less expensive than the non-experimental alternatives, state that. If it is less expensive in the long run than not treating the condition at all, say so loudly. Even an expensive preventive measure may be more cost-effective than treating the condition that could have been prevented. Or paying for a diagnostic such as a viral load test may permit a physician and patient to decide against expensive anti-viral therapy.

Handling Your Dispute

A. Available Legal Remedies

If your insurance claim is denied, you should be able to appeal the decision within the insurance company (and you may be required to do so before pursuing the case further). Although it is still the insurer making the decision, many individuals succeed in changing an insurer's mind at the appeal level, using the arguments and evidence suggested above.

If your insurer does not budge, you can consider suing it for failure to pay the claim. If you succeed, you will be reimbursed for any money you advanced in order to undergo the treatment. In a few instances--namely if your policy is an individually purchased policy, rather than a benefit of your employment--you can sue your insurer for additional damages. For instance you might have a "bad faith" claim if the insurer's behavior was particularly outrageous. Or you
may have a claim for other consequential damages, for instance for a worsening of your condition due to their failure to pay for a procedure. If your insurer is unwilling to settle the case out of court, be aware that a lawsuit could take years to complete and may cause you more stress than you are willing to put up with. Talk to an attorney and consider these questions seriously when determining how far you are willing to go.

If you need the procedure in question immediately, and do not have the money to pay for it in hopes you will win your court case later, you can consider having an attorney file in court for an injunction. By doing this, you would be asking a court to interpret the insurance policy and rule in advance that the insurer must pay. If you have your medical evidence gathered, a hearing could be held within days of filing. This procedure can be expensive, and you may be required to post a bond while your full court case is pending.

B. Obstacles to Exercising Your Rights

1. Arbitration Requirements

Some HMOs have provisions in their policies requiring members to submit to binding arbitration regarding all disputes with the carrier. If you are a member of such a system you will be required to have your dispute adjudicated through arbitration --a less formal proceeding than a court trial. The arbitrators will resolve the dispute based on the same legal principles that would guide a court of law. The arbitrators' decision will be final, unless there was some impropriety in rendering the decision, in which case you could then appeal to a court. Simply rendering a decision that is unfavorable to you does not give you grounds to appeal.

2. Employer-Provided Insurance

If you receive your health care coverage through an employer, your rights are substantially less than if you individually purchased an insurance policy. This is due to a federal law known as ERISA (Employee Retirement Income Security Act of 1974) which was passed to protect employees against the risk of their employers squandering their pension money. The law addresses not merely retirement plans, but all benefits plans, including health benefits. Unfortunately, ERISA says virtually nothing about the contents of health benefits plans, while at the same time it supersedes all state laws touching on those plans.

The net effect is this. All state law-based claims against your insurer, such as bad faith, fraud, negligence and infliction of emotional distress disappear. You may sue only for payment of the claim itself, and not for other damages arising out of the insurer's failure to pay. Insurers therefore have little incentive to pay your claim, because the worst that can happen to them if you sue is that they will have to pay the claim and possibly your attorney's fees. They will not be on the hook for any greater damages.

ERISA will also affect how a court rules on the coverage question. If the health benefits plan grants the plan administrator (the insurance company, or sometimes the employer itself in cases of large "self-insured" plans) discretion to interpret the terms of the plan, the court can only overturn the insurer's coverage decision if that decision was "arbitrary and capricious" or an "abuse of discretion." In practice, as long as the coverage decision reflects a reasonable interpretation of the policy--even if the policy language is ambiguous--the insurer will prevail. If, however, the policy does not specifically grant that discretion to the plan administrator, the court is free to examine the coverage decision afresh.

This is a very basic outline of ERISA and insurance coverage. If you have an employer-provided health plan and are in a coverage dispute, you will need to consult a lawyer.

Going Public: Using Outside Pressure

A. Organizing a Campaign Against Your Insurer or HMO

If your insurance carrier refuses to cover a particular promising HIV treatment or procedure, such as human growth hormone for wasting syndrome, or viral load tests as an immune system marker, you may be able to achieve a change in the policy by banding together with other HIV positive individuals using the same carrier. Although you may be skeptical, insurance companies, and especially regional HMOs, are concerned about their public image. They must compete to attract members, and denying coverage of treatments for people with a life-threatening illness does not inspire confidence among their potential insureds.

You may wish to seek out activists, through organizations such as ACT UP or the People With AIDS Coalition. Consider having demonstrations or sending out press releases regarding the particular practice. The threat of public exposure is especially effective immediately before "open enrollment,"
when employees are choosing their health care delivery system. Open enrollment periods most frequently occur around the new year. You may wish to consider letters to large progressive employers asking them not to renew their contracts with this insurer until it changes its policy regarding coverage of this treatment.

Remember that a public campaign is a means to achieve your purpose (e.g. coverage of certain treatments, changes in policy, etc.), and not an end in itself. For that reason, you should be sure to inform the insurer of all the steps you are taking and when you are taking them, so that it always has the option to give in to your demands.

B. Using the Government

Find out for certain which governmental body in your state regulates your insurer. In California, for instance, the Department of Insurance regulates only a small number of health insurers, while the Department of Corporations regulates the vast bulk of them, including all HMOs. The federal Department of Labor regulates ERISA claims. Find out what that body can do for you. Is there a consumer complaint line? What powers does it have? Be sure to send that body copies of all your correspondence with the insurer.

Your elected officials may be of use also. No insurer likes getting calls from members of Congress. Also, local officials may have the power to cease contracting with the insurer for health care for city or county employees. Your insurer may very much want to keep your county or municipality as a happy customer.

Conclusion

Getting proper care for HIV often requires you to be your own advocate. With some effort, you can also be an effective advocate in dealing with your insurance company. Do not accept denials of coverage as "done deals." Find an AIDS legal service organization in your area by calling an AIDS service provider or a local bar association, and consult with a lawyer to learn your rights. The decision to exercise them is yours.

For more information: The AIDS Legal Referral Panel, 415/291-5454, focuses on the San Francisco Bay Area, but can refer people to similar agencies throughout the country.