NINTH CIRCUIT RULES THAT UNITED BEHAVIORAL HEALTH IMPROPERLY DENIED BENEFITS TO WELLS FARGO EMPLOYEE

On January 25, 2015, a Wells Fargo employee was hospitalized at Pacific Shores Hospital for severe depression, anorexia and pneumonia and was described to be “skeletal in appearance.”  The patient had been eating 200 calories per day, inducing vomiting and abusing laxatives and was 88 pounds at the time of her hospital admission.  United Behavioral Health relied on erroneous information regarding the patient and refused to authorize in-patient services beyond February 14, 2010.  On the patient’s last covered date, she weighed a mere 83 pounds.  The patient was released on February 25, 2010, and in August 2010, Pacific Shores Hospital sued United Behavioral Health for the11 days of treatment that United failed to pay.  The lower court judge ruled in favor of United, and the hospital appealed.  The Ninth Circuit reversed and ruled that the lower court abused its discretion and held that United improperly denied benefits under ERISA.

This ruling is important because it shows that when a health insurer unreasonably denies a patient benefits, the patient may be able to force the company to make a reimbursement through the courts.

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