Court Opinion

ID: 9691751
Source: CourtListenerOpinion
Date Created: 2023-08-25 05:09:16.209074+00
Date Added: 2024-06-11T11:19:07.482447
License: Public Domain

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
                 revision until final publication in the Michigan Appeals Reports.

                          STATE OF MICHIGAN

                           COURT OF APPEALS

MATTHEW GERHARDT,                                                  UNPUBLISHED
                                                                   August 24, 2023
              Petitioner-Appellant,

v                                                                  No. 363825
                                                                   Ingham Circuit Court
MICHIGAN STATE UNIVERSITY, PLAN                                    LC No. 21-000672-AA
SPONSOR and BLUE CROSS BLUE SHIELD OF
MICHIGAN, PLAN ADMINISTRATOR,

              Respondents-Appellees.

Before: GADOLA, P.J., and M. J. KELLY and SWARTZLE, JJ.

PER CURIAM.

        In this case involving a dispute over health insurance benefits, petitioner, Matthew
Gerhardt, had requested 24-hour skilled nursing care from his health insurance provider, Blue
Cross Blue Shield of Michigan, but the request was denied. Gerhardt appealed to the Director of
the Office of Financial and Insurance Services. The director, acting under the Patient’s Right to
Independent Review Act (PRIRA), MCL 550.1901 et seq., assigned an independent review
organization (IRO) to analyze the medical issues presented in Gerhardt’s appeal. Following a
review of Gerhardt’s medical records, the IRO determined that 24-hour skilled nursing care was
not required in Gerhardt’s case and recommended that the denial of benefits be upheld. The
director entered an order adopting that recommendation. Gerhardt appealed to the trial court,
which affirmed the director’s order. Gerhardt appeals now as of right. We affirm for the reasons
stated in this opinion.

                                       I. BASIC FACTS

        Gerhardt is a 44-year old man with a diagnosis of respiratory failure caused by the
progression of Duchenne Muscular Dystrophy. It is undisputed that he had a prolonged
hospitalization from July 2019 until December 2019 due to respiratory failure, that he was
discharged to a long-term acute care hospital, and then discharged home in December 2019. He
has a tracheostomy, a PEG feeding tube, and a ventilator to aid breathing between the hours of
11:00 p.m. and 11:00 a.m. Additionally, he relies upon room ventilation to aid his breathing,

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occasionally requires inline (through vent tubing) suction and nebulizer treatments. Gerhardt
receives nutrition, hydration, and medication via his PEG tube, but also has oral feedings. Gerhardt
has a power wheelchair, a Hoyer lift for transfers, and a condom catheter. Finally, he requires total
care to bathe and dress, and he must be turned every two hours while in bed.

         Gerhardt receives 16 hours per day of skilled nursing care in his home. He lives alone, and
his parents have previously provided him with his continuing care. However, Gerhardt’s parents
are elderly, his father requires dialysis three times a week, and his mother is the primary caregiver
for his father.

       Gerhardt requested 24-hour skilled nursing care coverage from Blue Cross Blue Shield;
however, the request was denied. Gerhardt appealed that decision to the director, requesting an
external review of the coverage dispute under PRIRA. The director, as indicated above, assigned
the matter to an IRO. The IRO reviewer, a physician who is board-certified in physical medicine
and rehabilitation and who had been in active practice for 18 years, concluded:

       Medical necessity is not present for the patient to receive 24-hour, home skilled
       nursing services for his health condition.

       -- The available medical records indicate that since the end of December 2019 the
       patient has been in stable conditions. In 2020-2021, the patient did not have a
       significant deterioration in his health condition requiring an ambulance visit or
       unscheduled hospitalization. Per the multiple nursing notes, the patient is alert,
       orientated in person, place, and time, [and] has stable vital signs. The medical
       records do not contain evidence of aspiration pneumonia, urinary tract infections,
       or skill infections, or other infection processes.

       -- Since the end of December 2019, there was no additional nursing care tasks such
       as administration of intravenous and intramuscular injections, complex wound care,
       or other procedures that can be defined as a new, complex medical care.

       -- In December 2019, the patient underwent tracheostomy and feeding tube
       placement (PEG). The established tracheostomy tube requires care, which is
       usually delivered by trained caregivers, who do not have to be health professionals
       and does not require 24-hour skilled nursing services on a daily basis. The
       established PEG tube feedings and daily tube care can be performed either by a
       properly instructed patient or trained caregivers and do not require 24-hour skilled
       nursing services. The routine care of the ventilator machine, non-complex wound
       care, administration of medications via feeding tube, and assisting with daily living
       activities do not require the skills of a licensed nurse. The custodial care services
       also do not require the skills of a licensed nurse.

       -- The patient’s care does not meet certain criteria for the 24 hours of continuous
       care for private duty nursing as it is defined in the Blue Cross Blue Shield of
       Michigan Medical Policy manual.

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       In particular, the following criteria are not met:

       -- “Ventilator management record initial settings of mode of ventilation, tidal
       volume, respiratory rate, and wave form modifications, if any, (PEEP), and FI20 at
       the beginning of the shift. Oxygen saturation must be measured continuously for
       ventilator patients and any changes from baseline recorded thereafter. Hourly
       observations of the patient’s clinical condition related to the ventilator management
       must be documented along with any changes in oxygen saturation.”

              * Per the available medical records, there is no documentation provided
       about measurement of the mode of ventilation, tidal volume, respiratory rate, and
       wave form modifications, if any, (PEEP), and FI02.

       -- “Management of tube drainage, complex wounds, cavities, irrigations require
       documentation of services on the record when they occur.”

             * The patient does not have complex wounds or cavities, and his tube
       management does not require skills [sic] medical care.

       -- “Complex medication administration (excluding PO medications that would
       ordinarily be taken by self administration) of drugs with potential for serious side
       effects or drug interactions require documentation and appropriate monitoring.
       This includes intravenous administration of drugs or nutrition.”

               * The patient doesn’t require intravenous administration of drugs or
       nutrition.

       -- “Tube feedings that require frequent changes in formulation or administration
       rate or have conditions that increase the aspiration risk requires documentation.”

              * The patient does not require frequent changes in formulation of
       administration rate of the tube feeding.

Additionally, the IRO reviewer noted that under the Community Blue Group Benefits Certificate,
covered services include part-time health aid services—which includes preparing meals,
laundering, bathing, and feeding—if the patient (1) is receiving skilled nursing care, physical
therapy, or speech and language pathology services; (2) the patient’s family cannot provide the
services and there is an identified need for the services; (3) the services are provided by a home
health aide and supervised by a registered nurse. The IRO reviewer concluded that, based on that
criterion,

       [t]he patient does not require the skilled nursing care and does not receive and does
       not require physical therapy, occupational therapy, or speech and language
       pathology services.

       The services such as management of an established tracheostomy and feeding tube,
       routine care of ventilator machine, non-complex wound care, administration of
       medications via feeding tube, and assisting with daily living activities do not require

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       the skills of a licensed nurse. All of the above services should be done by properly
       instructed caregivers . . . .

       The patient is in need [of] help with custodial or nonskilled care services such as
       cleaning bathroom/bedroom/kitchen, emptying of the urine collection bag and
       bedpan, sweeping, washing dishes, doing laundry, changing bed linens, as well as
       custodial care including bathing, dressing, wiping after defecation, and cleaning
       after changing a condom catheter. The medical records indicated that the patient’s
       parents are currently involved in his care and will be overseeing his care.

       According to the Community Blue Group Benefits Certificate . . . custodial or
       nonskilled care services are not covered. Uncovered services include “general
       housekeeping services, transportation to and from a hospital or other facility,
       private duty nursing, elastic stockings, sheepskin or comfort items (lotion,
       mouthwash, body powder, etc.), durable medical equipment, physician services
       (when billed by the home health care agency), custodial or nonskilled care services,
       services performed by a nonparticipating home health care provider.

Overall, the IRO reviewer recommended that the director uphold the denial of coverage.

        The director noted that the IRO’s recommendation was based on extensive experience,
expertise, and professional judgment, and that it was “not contrary to any provision” of Gerhardt’s
certificate of coverage. Moreover, the director indicated that she could discern “no reason” to
reject the recommendation, so she found that “the requested nursing care is not medically
necessary” and was “not a covered benefit” under Gerhardt’s benefit plan. Accordingly, the
director upheld Blue Cross Blue Shield’s decision to deny coverage.

        Gerhardt then petitioned the circuit court for judicial review. He asserted that the director’s
decision was not based on competent, material, and substantial evidence on the whole record, and
that the decision was arbitrary and capricious. He argued that the director, in particular, failed to
give sufficient weight to the letters of medical necessity provided by his physicians. In support,
he provided letters from three of his treating physicians, each of whom addressed the need for 24-
hour nursing care. First, Dr. Cory O’Brien, a pulmonary and critical care consultant, indicated that
Gerhardt was a patient of his since early 2020. He opined that 24-hour skilled nursing care was
required, explaining:

       [Gerhardt] has a diagnosis of muscular dystrophy with severe neuromuscular
       weakness as a result. This has been a progressive disorder that eventually led to
       chronic respiratory failure. He has been hospitalized for respiratory failure and
       subsequently underwent tracheostomy for continued need of mechanical
       ventilation. He is currenting receiving mechanical ventilation 18 out of 24 hours
       per day. His neuromuscular weakness is significant, to the point that if he were in
       any respiratory distress or had any problems on the ventilator, he would be unable
       to get his hands up to take care of this problem. As a result, he requires 24-hour
       nursing care due to his complex neuromuscular and respiratory compromise. It is
       my understanding that insurance currently feels that he only requires 16 hours of
       nursing care and this is completely unacceptable. He cannot have eight hours of

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       the day where there is not somebody there tending to his respiratory failure. Should
       he develop a mucus plug or some sort of mechanical problem with the ventilator,
       this could lead to death.

Second, Dr. Edward Rosick, Gerhardt’s family physician, stated that Gerhardt required 24-hour
nursing care in his home for the following reasons:

       * The patient continues to use the ventilator as needed during the day, and the
       ventilator is required at night during sleep. He has needed, almost daily, to be
       placed on the ventilator without notice at any time during the day, requiring a nurse
       to continuously observe for signs of respiratory distress, including O2 monitoring,
       and then placing on the vent as needed.

       * Frequent suctioning of tracheostomy is required, along with proper trach care and
       cleaning to prevent infection.

       * He requires total care assist with transfers (using Hoyer lift), bed mobility and
       repositioning in bed and wheelchair to decrease skin breakdown.

       * He requires total assist with feedings via PEG Tube, care of feeding tube and
       maintaining PEG Tube patency.

       * He requires total assist with ADLs, including bathing, dressing, grooming,
       toileting, and condom catheter placement in the am and off in pm.

       * He requires daily wound care to wound of lower abdomen that was acquired in
       the hospital during 07-12-19 hospitalization.

       * He requires a daily nursing assessment, which includes a bowel assessment due
       to history and risk for bowel obstructions.

       * He requires close monitoring for infection due to high risk for pneumonia and
       UTI.

       He continues to remain at high risk for respiratory infection and failure, high risk
       for bowel obstruction, and high risk for re-hospitalization due to underlying
       conditions, Nursing 24/7 in the home has and will continue to decrease the risk of
       re-hospitalization.

Lastly, Gerhardt submitted a letter from Dr. Rani Gebara, an internal medicine doctor, who, after
detailing Gerhardt’s medical conditions, noted that if Gerhardt received 24/7 nursing care, “the
occurrences of hospitalization and readmission should be minimal.”1

1
 Gerhardt also asserted in the trial court that Optimal Medical Staffing has continued to provide
him with 24-hour skilled nursing care “due to the obvious necessity for 24-hour care”. However,
he has provided no documentation in support of that assertion.

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       Following review of Gerhardt’s petition, the trial court affirmed the director’s decision to
uphold Blue Cross Blue Shield’s determination that 24-hour nursing care was not required. This
appeal follows.

                      II. REVIEW OF DECISION MADE UNDER PRIRA

                                  A. STANDARD OF REVIEW

        Gerhardt argues that the trial court erred by upholding the director’s decision. Gerhardt
suggests that this Court’s review is limited to determining if the circuit court misapprehended or
grossly misapplies its review of the agency’s facts. In support, he directs this Court to Boyd v Civil
Srv Comm, 220 Mich App 226, 234; 559 NW2d 342 (1996). However, because PRIRA does not
provide for a hearing, the director’s decision is reviewed to determine whether her decision is
“authorized by law.” Ross v Blue Care Network of Mich, 480 Mich 153, 164; 747 NW2d 828
(2008); see also Const 1963, art 6, § 28. A decision is not authorized by law if it “is in violation
of statute [or constitution], in excess of the statutory authority or jurisdiction of the agency, made
upon unlawful procedures resulting in material prejudice, or is arbitrary and capricious.” English
v Blue Cross Blue Shield of Mich, 263 Mich App 449, 455; 688 NW2d 523 (2004) (quotation
marks and citation omitted). Gerhardt contends that the decision was arbitrary and capricious. “A
decision is ‘arbitrary’ if it is without adequate determining principle, fixed or arrived at through
an exercise of will or by caprice, without consideration or adjustment with reference to principles,
circumstances, or significance, decisive but unreasoned.” Id. at 472 (quotation marks, alterations,
and citation omitted). “A decision is ‘capricious’ if it is apt to change suddenly; freakish;
whimsical; humorsome.” Id. (quotation marks and citation omitted).

                                          B. ANALYSIS

       Gerhardt contends that the director’s decision was arbitrary and capricious because, under
the Blue Cross Blue Shield medical policy manual, his tracheostomy and ventilator dependency
are verbatim examples of conditions for which a patient would require private duty nursing,
because the director did not appropriately weigh the letters from his treating physicians, and
because the IRO reviewer’s recommendation was not evidence. We disagree.

        Gerhardt directs this Court to the August 1, 2022 version of Blue Cross Blue Shield’s
medical policy manual. As pointed out by respondent on appeal, the version quoted by Gerhardt
is not the version that was in effect when Blue Cross Blue Shield made its determination that
Gerhardt was not eligible for 24-hour skilled nursing care and when the director upheld that
determination. One key difference between the two versions is that there are no listed examples
of care that would require private duty nursing in the version in effect at the time the director
reviewed Gerhardt’s appeal. Gerhardt’s reliance on the language in the 2022 version, therefore, is
misplaced.

        Moreover, even if this Court were to consider the 2022 language, it does not show that the
director’s decision to uphold the denial was arbitrary and capricious. The 2022 medical policy
provides the following list of examples of conditions for which a patient would require private
duty nursing:

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       * Chronically ill patients who require greater than 8 hours of continuous skilled
       nursing care to remain at home

       * New ventilator dependent patients

       * New tracheostomy patients

       * Patients dependent on other device-based respiratory support, including
       tracheostomy care, suctioning, and oxygen support.

Gerhardt correctly points out that, in light of his medical issues, he requires the type of care for
which private duty nursing is required. Yet, the record reflects that he is, in fact, receiving 16-
hours of private duty nursing. And the quoted sections of the medical policy only provide that
private duty nursing is needed in such situations, not that such care is needed 24 hours per day.
Instead, the version of the policy cited by Gerhardt on appeal and the version in effect when the
director made her decision detail specific criteria that must be met by the insurance plan member
in order to qualify for private duty nursing.

       Gerhardt relies upon the letters submitted by three of his treating physicians as support for
his contention that 24-hour skilled nursing care is required. His physicians, however, do not go
through the medical criteria set forth in the medical policy manual in effect at the time the director
made her decision. Moreover, the director was not required to weigh their recommendations—
which did not consider the relevant medical criteria required for coverage—more favorably than
the recommendation of the IRO reviewer who considered Gerhardt’s medical records and
compared it to the relevant medical coverage criteria.

        Next, Gerhardt argues that the IRO reviewer’s recommendation was not evidence. See
English, 263 Mich App at 464 (“[T]he IRO’s recommendation does not constitute evidence.”). As
a result, he contends that the only evidence in this case is the recommendation for 24-hour care
from his treating physicians. His argument misconstrues the statutory framework. As explained
in English:

       [The PRIRA] details the evidence the IRO must consider in completing the external
       review, MCL 550.1911(13), and requires the IRO to provide reasons for its
       recommendation, including references to the evidence it considered in reaching its
       recommendation. MCL 550.1911(14)(e), (g). [English, 263 Mich App at 466.]

The IRO recommendation, which was considered and referenced by the director in this case,
indicated that the reviewer had considered an extensive list of Gerhardt’s medical records, and the
reviewer referred to that evidence when making the recommendation to uphold the denial of 24-
hour nursing care. Thus, although the IRO reviewer’s recommendation was not, strictly speaking,
evidence, the recommendation relied upon evidence. And, in turn, the director considered that
evidence when making her decision. As recognized in English, the IRO is used to assist the
director “in reaching a decision.” Id. at 464. Thus, consideration of the IRO did not render the
director’s decision arbitrary and capricious. Finally, we note that, as required by the PRIRA, the
director specifically evaluated the IRO’s recommendation to ensure that it complied with the health
plan’s terms of coverage. See MCL 550.1911(17).

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       Given the record in this case, there is no basis upon which to determine that the director’s
decision to uphold the denial of 24-hour skilled nursing care was arbitrary and capricious.

       Affirmed.

                                                            /s/ Michael F. Gadola
                                                            /s/ Michael J. Kelly
                                                            /s/ Brock A. Swartzle

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