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Patient Information

The patient is a 15-year old female with a diagnosis of major depression.

Provider Information

Services were rendered to this patient at an adolescent residential treatment center located in Utah, from September 8, 2003 through July 27, 2004. The total charges for her services were $149,688.00. The family’s insurance, Blue Cross of California, authorized and paid for services under the provider’s contracted rate up until October 10, 2003. However, they did not authorize all days of service and denied the balance of the confinement as not being medically necessary.

History of Patient’s Condition

The patient had a history of depression starting in the 5^th grade which had worsened in year prior to admission. This worsening of her condition was the result of acute and enduring psychosocial stressors associated with her brother’s death, family, social, and school problems. The patient had lost the ability to focus on anything. She had decreased appetite, decreased energy and motivation, lack of interest and pleasure, feelings of hopelessness and guilt, low self-esteem and worthlessness. She had also been abusing alcohol.

Reason for Referral

The family’s insurance provider covered only minimal expenses – 33 days of treatment - and then refused additional claims citing no medical necessity.

Claim Evaluation and Document Needs

We went about gathering the necessary documents needed to address a continued stay medical necessity denial. This included the residential treatment center medical records, a copy of the plan booklet from Blue Cross, the clinical criteria used by Blue Cross of California to determine medical necessity, letters of medical necessity from prior treating providers, all other reports and testing documents and a chronological history of the child’s behaviors drafted by the parents.

Barriers to Overcome

We needed to convince the claim payer that the patient was indeed currently exhibiting self-abusive behaviors, uncontrolled risk-taking, or other distressing symptoms causing an inability to function in several areas of life which required continued treatment in a residential level of care.

Appeal Process

A formal standard written appeal letter was sent to the payer within 180 days (as required by most health plans) of the denial date listed on the first denial letter.

The appeal letter outlined the patient’s history of her present illness and recent worsening of this condition. We specifically pointed to the patient’s worsening symptoms of major depression due in part to her brother’s death, as well as her alcohol abuse and continued failure both socially and academically, which made it critical for her to receive continued treatment in this residential facility. We highlighted the monthly documentation from the patient’s therapist at the residential treatment facility which clearly justified and advocated for her continued treatment. The plan also had a parity benefit giving unlimited benefits for mental health claims in adolescents. The definition found on page 82, in the Blue Cross of California Small Group, Combined Evidence of Coverage and Disclosure Form, defined Serious Emotional Disturbances of a Child and stated that those claims would be paid the same as any other illness as long as the child met the criteria in the Plan. Blue Cross of California argued that the benefit was limited to 100 days per calendar year under a SNF (Skilled Nursing Facility) benefit limit. This conflicted with the parity law in California.

Final Outcome

After receiving and reviewing the initial appeal letter, the Blue Cross of California maintained denial, insisting that there was no evidence of current self abuse, uncontrolled risk-raking behaviors or other distressing symptoms causing an inability to function in several areas of life and requiring treatment in a 24-hour sub-acute treatment setting. Additionally, the Plan stated that the facility did not meet the Behavioral Health medical necessity criteria for intensity of service criteria for a psychiatric residential treatment center.

Only one level of appeal was required under this plan to exhaust the administrative appeal remedies. Since this process was completed, the file was referred to an attorney to litigate the claim against the Blue Cross of California.

Claim Payment--Settlement

The attorney took the case on a contingency fee basis and settled the case for the family. Both the family and provider were reimbursed a percentage of the monies still owing under the per diem contracted rate with the Blue Cross participating provider up to the 100 day benefit. Benefits were settled for both claim years since the patient was confined in the facility in both 2003 and 2004.

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