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Washington State Insurance Commissioner Fines United Healthcare for Denying Women's Health Claims

Posted Thursday, October 18, 2018 by Pivotal Law Group

On September 13, 2018, Washington’s Insurance Commissioner entered into a Consent Order with United Healthcare regarding violations of Washington insurance law governing women’s health claims. United Healthcare is a health care service contractor that sells individual and family health insurance coverage.

The Insurance Commissioner’s investigation was prompted by a consumer complaint that United Healthcare improperly denied coverage. According to the complaint, United Healthcare told the consumer her claim was denied because she needed a referral for the women’s health services she received.

That violated Washington’s Direct Access law, which gives women the right to access women’s healthcare from the provider of their choice without having to obtain a referral.

In the course of the investigation, United Healthcare admitted it improperly denied similar claims for 276 insureds. As a result, many women were improperly told they needed a referral in order to obtain coverage for medical treatment.

The investigation is a reminder to insureds to know their rights under Washington law, and to carefully scrutinize coverage denials to make sure the insurer followed the law.

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ERISA Plan Administrator Cannot Unilaterally Ignore Treating Physicians, Appeals Court Confirms

Posted Thursday, October 11, 2018 by Pivotal Law Group

A recent appeals court ruling emphasizes that ERISA plan administrators cannot ignore the opinions of a claimant’s treating physicians absent tangible evidence those opinions are wrong. In Hennen v. Metropolitan Life Insurance Company, the appellate court ruled the plan administrator acted arbitrarily in discounting the opinions of the claimant’s treating physicians and remanded the claim for a full and fair review.

After a back injury, Hennen applied for long-term disability (“LTD”) benefits with her employer’s group policy insured by MetLife. MetLife agreed that Hennen was disabled and paid benefits for two years. But after two years, MetLife terminated Hennen’s benefits, finding that the Plan’s limitation for neuromusculoskeletal disorders cut off Hennen’s benefits after two years of payments. Hennen sued under ERISA, arguing she fell within an exception to the two-year cutoff because she had radiculopathy.

The U.S. Court of Appeals for the Seventh Circuit ruled for Hennen. Although the court acknowledge ERISA required deference to MetLife’s decision because the plan contained discretionary language, the court noted discretionary authority did not permit MetLife to act arbitrarily in deciding Hennen’s entitlement to benefits. The court determined MetLife acted arbitrarily when it discounted the opinions of four doctors who diagnosed Hennen with radiculopathy in favor of the opinion of one physician who ultimately disagreed, but only while recommending additional testing that MetLife declined to pursue.

The court noted that even though a plan administrator is typically permitted to chose which medical opinions to rely on, its decision must still have a rational explanation. Every physician who examined Hennen since 2012 concluded she had radiculopathy. These doctors’ opinions had substantial medical support. While MetLife chose to ignore these doctors’ opinions in favor of its own employee Dr. McPhee, that decision was arbitrary. Dr. McPhee recommended Hennen undergo further testing and an independent medical examination in order to determine whether Hennen’s radiculopathy diagnosis was correct, but MetLife ignored that suggestion. The court emphasized:

“Here, MetLife took an extra step for its own benefit when it referred Hennen’s file to Dr. McPhee for review. But when Dr. McPhee recommended that MetLife take an additional step for Hennen’s benefit — to confirm whether his lone opinion that she did not suffer from radiculopathy was accurate—MetLife declined to take that step.That was arbitrary and capricious.”

The court also emphasized “Although it is reasonable for MetLife to require objective support for a diagnosis of radiculopathy, it would be unreasonable to discount clinical observations of Hennen’s treating physicians in favor of testing that is inconclusive for the condition.”

The court ordered Hennen’s claims be remanded to MetLife for the full and fair evaluation ERISA mandates.

The Hennen decisions represents an important enforcement of ERISA’s requirement that insureds and claimants be afforded a fair and objective determination of their entitlement to benefits, even where the Plan affords the plan administrator discretionary authority.

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ERISA Guide by Pivotal Attorney McKean Evans Published in WSAJ Trial News

Posted Wednesday, October 10, 2018 by Pivotal Law Group

Attorney McKean J. Evans published a guide to handling insurance claims under the Employee Retirement Income Security Act (“ERISA”) in the October edition of the Washington State Association for Justice Trial News.

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Seattle's Domestic Workers Bill of Rights

Posted Tuesday, September 25, 2018 by Pivotal Law Group

Are domestic workers like nannies, gardeners and housekeepers entitled to basic worker protections like breaks and minimum wages? The answer used to be no, but under Seattle’s new Domestic Worker Bill of Rights, domestic workers have new and important legal rights with which employers must comply.

On July 27th, 2018, Seattle Mayor Jenny Durkan signed Ordinance 125627, the Domestic Workers Bill of Rights, establishing new rights and protections for domestic workers. The Ordinance generally does three things: (1) imposes a minimum wage for domestic workers; (2) requires regular breaks for domestic workers; and (3) adds miscellaneous additional protections aimed at curbing some reported abuses of domestic workers that are common in the industry. However, the Ordinance is complex and the devil is in the details.

The Domestic Workers Bill of Rights has its background in the lack of existing legal protections for domestic workers. The mayor’s office noted:

For more than 80 years, domestic workers have been exempted from federal laws that allow workers the legal right to join in union to demand better working conditions. That exclusion has historically led to the exploitation of these workers who are mostly immigrant and mostly women of color. Many domestic employees are covered by federal, state, and municipal laws on minimum wage and overtime but don’t know their rights. They fear retaliation and loss of employment for speaking out. According to the Seattle Domestic Workers Association estimates there are at least 30,000 domestic workers within city limits.

The activist organization Working Washington lauded the Domestic Workers Bill of Rights as “a groundbreaking step forward for nannies and housecleaners.”
In practice, the Domestic Workers Bill of Rights imposes three important new requirements on employers of domestic workers:

1. Minimum wage. Domestic workers are now entitled to a minimum wage. Calculating the specific minimum wage is complex because the specific hourly minimum wage takes into account whether the worker receives health insurance benefits and also accounts for the size of the employer. For example, a domestic worker employed by an employer with less than 500 employees in 2018 is entitled to $14.00 per hour if they receive no health insurance. These wage amounts increase annually.
2. Rest and Meal Breaks. Domestic workers are now entitled to regular rest and meal breaks. Again, the specific rights involved depend on the details of the job. Generally, domestic workers are entitled to a 30-minute uninterrupted meal break for every 5 hours worked; the break is with pay unless the nanny is “on call” during the break. Domestic workers must also receive a 10-minute paid rest break every four hours worked, or a 10-minute unpaid uninterrupted rest break every three hours worked. In the event the worker’s duties prevent them from taking these breaks, the worker must receive additional compensation for the missed break. Domestic workers residing at the place of employment must receive an unpaid day off for every six consecutive days worked.
3. Additional Rights. The Domestic Workers Bill of Rights also aims to curb some of the abuses to which domestic workers have been subjected. Among other things, employers may not keep the domestic workers original documents or personal effects (aimed at correcting practices where, for instance, domestic workers’ immigration papers are held hostage by the employer to keep the worker from reporting abusive labor practices to the authorities).

Domestic workers whose rights are violated have the right to file a lawsuit to recover double their lost pay, attorneys’ fees, and a $5,000 penalty for violations of the new law.

The law also includes an important protection for individuals hiring domestic workers through an agency: in such a relationship, the agency and not the individual is exclusively responsible for ensuring compliance with the Domestic Workers Bill of Rights.

Pivotal Law Group Attorney McKean Evans advises both workers and employers regarding their legal rights. If you have questions about Seattle’s Domestic Workers Bill of Rights or other employment law concerns, contact McKean for a free consultation.

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Inverse Condemnation Claims – Sound Transit

Posted Thursday, September 20, 2018 by Christopher L. Thayer

Division II of the Washington Court of Appeals recently addressed a situation where a landowner asserted an inverse condemnation claim against Sound Transit and the City of Tacoma for flood damage which plaintiff claimed was caused by the negligence of Sound Transit and the City of Tacoma. * See, Ruth v. Sound Transit and City of Tacoma*, No. 50458-8-II (September 11, 2018). This is an unpublished decision, but provides a nice primer on the law of inverse condemnation in Washington.

Article I, section 16 of the Washington Constitution limits the State’s inherent power of eminent domain by requiring the government to pay reasonable compensation for taking or damaging private property for public use. Phillips v. King County, 136 Wn.2d 946 (1998).

Inverse condemnation is an action instituted by a landowner “to recover the value of property which has been appropriated in fact, but with no formal exercise of the power of eminent domain.” Id., at 957. The elements of an inverse condemnation claim are (1) a taking or damaging (2) of private property (3) for public use (4) without just compensation (5) by a governmental entity that has not instituted formal eminent domain proceedings. Id. Under such circumstances, a private land owner may sue the appropriate governmental entity seeking compensation for their loss of their property or the damages to the property.

With regard to the first element, a taking or damaging occurs when the government invades or interferes with the use and enjoyment of a person’s property, causing the property to decline in market value. Martin v. Port of Seattle, 64 Wn. 2d 309 (1964). A landowner alleging an inverse condemnation must show more than a tortious interference with the use or enjoyment of his property. Borden v. City of Olympia, 113 Wn. App. 359 (2002). Flooding can provide the bases for an inverse condemnation as an “invasion” of property if the invasion is “permanent or recurring” or involves “‘a chronic and unreasonable pattern of behavior by the government.’” Gaines v. Pierce County, 66 Wn. App. 715 (1992).

More specifically, a municipality may not collect surface water by artificial means, channel the water, and deposit it on private property, thereby causing damage, unless the municipality compensates the owner. Wilber Dev. Corp. v. Les Rowland Constr., Inc., 83 Wn.2d 871 (1974).

An inverse condemnation claim may be proven by (1) the “diversion of waters from the direction in which they would naturally flow and onto the land of plaintiff” or (2) where “the amount of water has been increased.” Id. The measure of damages in an inverse condemnation case is the diminution in the fair market value of the property caused by the governmental taking or damage to the property. Peterson v. Port of Seattle, 94 Wn. 2d 479 (1980).

In Ruth, the Court of Appeals noted plaintiff had not retained an expert to testify about the issue of damages or the diminution in value to the property. Without this, and based on some other procedural issues (including lapse of the applicable statute of limitations), the Court of Appeals affirmed the trial court’s dismissal of plaintiff’s case.

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