As discussed here and here, D.K. et al. v. United Behavioral Health et al. is a case that has been carefully watched in the health benefits space for its impact on what health plan administrators must include in adverse benefit determination letters. In D.K., the Tenth Circuit held health plan administrators cannot rely on compliance with ERISA’s claims procedure regulations to establish that the plan engaged in a “meaningful dialogue” with a claimant. Following the May 15, 2023 decision, United Behavioral Health (UBH) petitioned for rehearing and rehearing en banc. On August 1, 2023, the Tenth Circuit panel denied those petitions.
UBH made three arguments for rehearing. First, UBH contended that the decision’s requirement that plan administrators explain in the denial letter any disagreement with the opinions of treating providers conflicts with the Supreme Court’s decision in Black & Decker Disability Plan v. Nord. Nord held that courts may not “impose on plan administrators a discrete burden of explanation when they credit reliable evidence that conflicts with a treating physician’s evaluation.” Second, UBH argued that the appellate court’s approval of a district court limiting the scope of its review to only the information given in the denial letters conflicts with prior Tenth Circuit precedent, which required review of the record as a whole to determine whether a decision was arbitrary and capricious. Third, UBH asserted that by demanding more of plan administrators than the requirements set forth in ERISA’s claims-processing regulations, the decision effectively (and impermissibly) heightened the regulatory requirements for adverse benefit determinations outside of the Department of Labor’s administrative rulemaking process.
The Tenth Circuit appears to have given little credence to these arguments, as the panel denied the petition for rehearing without calling for a response, and no member of the court called for a vote that would have permitted en banc rehearing. It remains to be seen whether UBH will request the Supreme Court take up this issue.
Troutman Pepper will continue to monitor developments in the area of health care denial letters and provide further updates.