06-001183 Health Options, Inc. vs. Office Of Insurance Regulation Status: Closed DOAH Final Order on Monday, September 11, 2006.

Summary: Petitioner is not required to pay for subscriber`s gastric pacemaker, even though it was shown to be medically necessary. The device is "experimental or investigational" as defined in the HMO plan, and is therefore excluded from coverage under the plan.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HEALTH OPTIONS, INC., )

)

Petitioner, )

)

vs. ) Case No. 06 - 1183

)

OFFICE OF INSURANCE REGULATION, )

)

Respondent. )

)

FINAL ORDER

This case is bef ore Administrative Law Judge T. Kent

Wetherell, II, on a stipulated record pursuant to the agreement

of the parties. Closing argument s were heard by telephone on

August 8 , 2006.

APPEARANCES

For Petitioner: Daniel Alter, Esquire

Gray Robinson, P.A.

4 01 East Las Olas Boulevard

Suite 1850

Fort Lauderdale, Florida 33301

For Respondent: Paul A. Norman, Esquire

Office of Insurance Regulation

200 East Gaines Street

612 Larson Building, Room 646 - C

Tallahassee, Florida 32399

STATEMENT OF THE ISSUE

The issue is whether Petitioner is required to provide

coverage for the gastri c electrical stimulation device requested

by subscriber B.N. 1

PRELIMINARY STATEMENT

By letter dated January 27, 2006, the Office of Insurance

Regulation (Office) approved the recommendation of t he

Subscriber Assistance Panel and directed Petitioner , Health

Options, Inc. (HOI), to “authorize coverage for the Subscriber’s

Medtronic Enterra Therapy S ystem.” HOI timely filed a petition

for hearing , and later an amended petiti on for hearing ,

contesting that directive.

O n April 5, 2006, the Office referred this case to the

Division of Administrative Hearings (D OAH) for the assignment of

an Administrative Law J udge to conduct the hearing requested by

HOI . The final hearin g was s cheduled for June 14, 2006.

On June 8, 2006, during the telephonic hearing on a J oint

M otion to Continue Final Hearing, the parties agreed that an

evidentiary hearing was not necessary and that this case could

be decided based upon a stipulated record. Se e Order Cancel ing

Hearing dated June 8, 2006. A Scheduling Order was issued on

June 20, 2006, to establish deadlines for filing the agreed upon

components of the stipulated record.

In accordance with the Scheduling Order, on July 10, 2006,

the parties fil ed J oint E xhibits 1 through 27 , and on July 28,

2006, the Office filed the deposition D r. Thomas Abell and HOI

filed the deposition of Dr. Paul Hyman . On August 24, 2006, the

Office filed a typed errata sheet for Dr. Abell’s deposition

because the handwri tten errata sheet included in the deposition

was illegible. On August 28, 2006, HOI filed two pages that had

been inadvertently omitted from Joint Exhibit 1. The stipulated

record comprises those materials and the stipulat ions of fact

and law contained i n the Amended/Supplemented Joint Pre - hearing

Stipulation, filed June 27 , 2006 .

HOI’s motion to exclude a document that the Office intended

to offer into evidence was granted through a detailed Order

dated July 7, 2006. That document -- a letter from HOI t o

another subscriber dated November 24, 2003 -- is not part of the

stipulated record.

The parties were afforded an opportunity to present closing

argument s by telephone on August 8, 2006. The original deadline

for the parties’ proposed final orders was Au gust 18, 2006, but

the deadline was extended to August 25, 2006, at the parties’

request. Each party timely filed a " proposed recommended order "

even though, as noted in the Order Granting Extension of Time

dated August 16, 2006, and as discussed in the C onclusions of

Law, DOAH has final order authority in this case. The parties’

post - hearing filings and oral arguments have been given due

consideration in preparing this Final Order .

All statutory references in this Final Order are to the

2005 version of t he Florida Statutes.

FINDINGS OF FACT

A. H OI and the HMO Plan

1. HOI is a health maintenance organization (HMO) licensed

to do business in Florida.

2. HOI issued a small group HMO contract to Austin Nunez

Creative Solutions, Inc. , for the benefit of the company’ s

employees and their eligible beneficiaries ( hereafter “the HMO

Plan”) .

3. The effective date of the HMO Plan was April 15, 2003.

4. The operative provisions of the HMO Plan are contained

in the Certificate of Coverage, which was received i nto evidence

as Joint Exhibit 1.

5. The Certificate of Coverage provides that expenses for

health care services will be covered if, among other things not

implicated in this case, the services are “Medically Necessary”

and “not specifically limited or e xcluded.” One type of service

specifically excluded from coverage under the HMO Plan is

“Experimental or Investigational services.”

6. With respect to medical necessity, t he Certificate of

Coverage states:

HOI does not cover or provide benefits for

any s ervice which is otherwise covered if,

in the opinion of HOI, such service is not

Medically Necessary, as defined in the

Glossary Section. . . . .

HOI’s Medical Necessity decisions under this

Certificate of Coverage are solely for the

purpose of coverage or payment. In this

respect, HOI may review medical facts in

making a coverage or payment decision,

however , any and all decisions that require

or pertain to independent professional

medical judgment or training, or the need

for medical services, must be made solely by

the Covered Person and the Covered Person’s

treating Physicians. It is possible that a

Covered Person or the Covered Person’s

treating Physic i an may conclude that a

particular service is beneficial,

appropriate, or desirable even though

exp enses for such services may be denied as

not being Medically Necessary.

( E mphasis in original).

7. “Medically Nec essary” is defined in the Certificate of

Coverage to mean that:

a medical service or supply is required for

the identification, treatment or management

of a Condition, and is, in the opinion of

HOI:

A. consistent with the symptom,

diagnosis, and treatment of the Covered

Person’s Condition;

B. widely accepted by the practitioners’

peer group as efficacious and reasonably

safe based upon scientific evidence;

C. universally accepted in clinical use

such that omission of the service or supply

in these circumstances raises questions

regarding the accuracy of diagnosis or the

appropriateness of the treatment;

D. not Experimental or In vestigational;

E. not for cosmetic purposes;

F. not primarily for the convenience of

the Covered Person, the Covered Person’s

family, the Physician or other provider; and

G. the most appropriate level of service,

care or supply which can be saf ely provided

to the Covered Person. . . . .

(Emphasis supplied).

8. The use of the word “and” to connect the paragraphs in

this definition means that a service or supply is medically

necessary only if it meets each paragraph . Thus, a service or

supply is not medically necessary if any of the paragraphs in

the definition are not met.

9. “Experimental or Investigational” is defined in the

Certificate of Coverage t o mean:

any evaluation, treatment, therapy, or

device . . . if, as determined solely by

HO I:

A. such evaluation, treatment, therapy,

or device cannot be lawfully marketed

without approval of the United States Food

and Drug Administration or the Florida

Department of Health and approval for

marketing has not, in fact, been given at

the time such is furnished to the Covered

Person;

B. such evaluation, treatment, therapy,

or device is provided pursuant to a written

protocol which describes as among its

objectives the following: determination of

safety, efficacy , or efficacy in comparison

t o the standard evaluation, treatment,

therapy, or device;

C. such evaluation, treatment, therapy,

or device is delivered or should be

delivered subject to the approval and

supervision of an institutional review board

or other entity as required and def ined by

federal regulations;

D. reliable evidence shows that such

evaluation, treatment, therapy, or device is

the subject of an ongoing Phase I or II

clinical investigation, or the experimental

or research arm of a Phase II I clinical

investigation, or under study to determine :

maximum tolerated dosage(s), toxicity,

safety, efficacy, or efficacy as compared

with the standard means for treatment or

diagnosis of the Condition in question;

E. reliable evidence shows that the

consensus of opinion among experts is that

further studies, research, or clinical

investigations are necessary to determine:

maximum tolerated dosage(s), toxicity,

safety, efficacy, or efficacy as compared

with the standard means for treatment or

diagnosis of the Condition in ques tion;

F. reliable evidence shows that such

evaluation, treatment, therapy, or device

has not been proven safe and effective for

treatment of the Condition in question , as

evidenced in the most recently published

medical literature in the Untied States,

Canada, or Great Britain, using generally

accepted scientific, medical, or public

health methodologies or statistical

practices;

G. there is no consensus among practicing

Physicians that the treatment, therapy, or

device is safe and effective for the

Condition in question; or

H. such evaluation, treatment, therapy,

or device is not the standard treatment,

therapy, or device utilized by practicing

Physicians in treating other patients with

the same or similar Condition.

(Emphasis supplied).

10. The use of the word “or” to connect the paragraphs in

th is definition means that a service or supply is considered to

be experimental or investigational if any of the paragraphs a re

met. Thus, t he fact that one paragraph is not met does not mean

that a s ervice or supply is not considered to be e xperimental or

investigational, if one of the other paragraphs is met.

11. “Reliable evidence,” as used in the definition of

“Experimental or Investigational,” is defined in the Certificate

of Coverage to mean :

A. records maintained by physicians or

hospitals rendering care or treatment to

Covered Person or other patients with the

same or similar Condition;

B. reports, articles, or written

assessments in authoritative medical and

scientific literature publis hed in the

United States, Canada, or Great Britain;

C. published reports, articles, or other

literature of the United States Department

of Health and Human Services or the United

States Public Health Service, including any

of the National Institutes of Health, or the

United States Office of Technology

Assessment;

D. the written protocol or protocols

relied upon by the treating physician or

institution or the protocols of another

physician or institution studying

substantially the same evaluation,

tr eatment, therapy, or device;

E. the written informed consent used by

the treating physician or inst it ution or by

another physic i an or institution studying

the substantially the s ame evaluation,

treatment, ther apy, or device; or

F. the records (incl uding any reports) of

an y institutional review board of any

institution which has reviewed the

evaluation, treatment therapy, or device for

the Condition in question.

12. The Certificate of Coverage also includes this

notation following the definitions of “experimental or

investigational” and “reliable evidence”:

Services or supplies which are determined by

HOI to be Experimental or Investigational

are excluded . . . . In making benefit

determinations, HOI may also rely on

predominant opinion among expe rts, as

expressed in the published authoritative

literature, that usage of a particular

evaluation, treatment, therapy, or device

should be substantially confined to research

settings or that further studies are

necessary in order to define safety,

toxicit y, effectiveness, or effectiveness

compared with standard alternatives. [ 2 ]

B . The Subscriber

(1) Generally

13. The subscriber whose treatment is at issue in this

case is a 45 - year old female who, at all material times, was

insured under the HMO Plan.

14. The s ubscriber is not diabetic.

15. The subscriber has been diagnosed with intestinal

dysmotility with gastroparesis, resulting in secondary symptoms

of recurrent nausea and vomiting .

16. The subscriber has a history of depression.

17. The subsc riber has a history of bulimia, which is an

eating disorder. Her medical records include a handwritten

notation that the bulimi a was present at the time of her divorce

and that the condition has been “resolved.” 3

18. The subscriber is obese. She is five fee t, two inches

tall and , as of March 200 6 , she weig hed 192 pounds.

(2) Pertinent Medical History

19. In January 2005, the s ubscriber saw her primary care

physician, Dr. Christine Norton, complaining of stomach pain,

nausea , and vomiting.

20. Dr. No rton referred the subscriber for radiological

evaluations of her liver and gallbladder. The results of the

evaluations were normal.

21. Dr. Norton also referred the s ubscriber for an

esophagogastroduodenoscopy. The procedure was performed by Dr.

Iswari Prasad on February 18, 2005 .

22. Dr. Prasad observed a small hiatal hernia in the

subscriber’s esophagus , and reported an impression of “erosive

antral gastritis.” He prescribed Nexium, Zelnorm, Reglan , and

herbal preparations.

23. Dr. Prasad referre d the subscriber for a gastric

emptying study to determine whether she had gastroparesis. A

gastric emptying study is the “gold standard” for diagnosing and

evaluating that condition.

24. Gastroparesis is a chronic medical condition

characterized by a de lay in stomach emptying in the absence of a

mechanical obstruction. The symptoms of gastroparesis include

nausea, vomiting, bloating, and upper abdominal discomfort after

eating.

25. Gastroparesis differs from the related condition of

dyspepsia in that patients with dyspepsia have bloating or

discomfort after eating, but they typically do not have the

nausea and vomiting associated with gastroparesis .

26. A gastric emptying study is performed by a nuclear

medicine physician using radioactivity to measur e how food is

emptying from the stomach. The patient eats a meal containing

radioactive material, and images are taken as the food passes

through the stomach into the digestive system. If more than 10

percent of the material remains in the stomach after a period of

four hours, the patient has gastroparesis.

27. The medical literature reflects that a gastric

emptying study should be performed over a two to four hour

period. It is possible to make a diagnosis of gastroparesis

based upon a study lasting le ss than two hours, but t he shorter

the study, th e less reliable its results are because of normal

variations in gastric emptying.

28. The subscriber’s gastric emptying study was performed

on March 3, 2005 . The stud y was only 90 minutes in length.

29. The study showed that the subscriber had “ 74 % gastric

retention at 90 minutes ” and a “calculated T one half of 207

minutes,” which resulted in an impression of “delayed gastric

emptying.”

30. The subscriber next saw Dr. Hasan Hashmi, a board

certified co lon and rectal surgeon . The subscriber’s medical

records reflect that Dr. Hashmi surgically removed all or part

of the subscriber’s colon in 2003 in an effort to address her

colonic dysmotility or hypomotility.

31. Dr. Has h mi reviewed the results of the gastri c

emptying study and referred the subscriber to Dr. Juan Cendan , a

surgeon with the Shands Clinic at the University of Florida

(Shands) .

32. The subscriber met with Dr. Cendan for an initial

evaluation on April 27, 2005. Dr. Cenden reviewed the

sub scriber’ s medical history and physically examined her at that

visit . He prescribed a six - week trial of eryth romycin , which is

a prokinetic drug intended to promote gastric motility.

33. The subscriber agreed to proceed with the trial of

erythromycin, but according to Dr. Cendan’s notes, she was

“disheartened” by th at recommended course of treatment because

“she was hoping [Dr. Cendan] could simply put in a gastric

pacemaker and fix the problem.” Dr. Cendan’s notes reflect that

he explained to the subscri ber that a “gastric pacemaker” was

not a “fix for [her] problem” because even though it “allows a

significant improvement in gastroparesis symptoms,” it “does not

cause her stomach to empty any faster.”

34. The subscriber returned for a follow - up visit wi th Dr.

Cendan on June 8, 2005. Dr. Cendan’s notes from that visit

state that the subscriber “has had some improvement in her

colonic function with the erythromycin, but continues to have

nausea and vomiting, and notes not much change with that since

her l ast visit.” Dr. Cendan’s notes also state that the

subscriber “has had some difficulty with erythromycin from a

rash standpoint,” but that she was taking another medication to

counteract the rash and “that she is doing better with it.”

35. Dr. Cendan’s n otes from the June 8, 2005, visit state

that the subscriber was referred to Shands’ internal

gastroenterology group “for any further recommendations in an

effort to avoid surgical intervention.” The record does not

reflect whether the subscriber ever saw anyone in that group.

36. At the June 8, 2005, visit, the subscriber completed a

screening form for “consideration towards a gastric pacemaker

placement.” On the s creening f orm, the subscriber indicated a

frequency of nausea of seven days per week and a frequency of

vomiting of three to four times per week, with no

hospitalizations due to her illness in the preceding year.

37. In a letter to HOI dated July 5, 2005, Dr. Cendan

requested a predetermination of coverage/prior authorization

“ for the use of M edtronic Enterra Therapy for Gastroparesis,”

and in that letter, he referred to the subscriber as “an

excellent candidate for this therapy.” HOI denied coverage, as

described below.

38. The subscriber saw Dr. Norton again in April 2006,

complaining that her nausea and vomiting were worsening, and

that she was suffering from dizziness. Dr. Norton diagnosed

these symptoms as side effects of the subscriber’s recurrent

nausea and vomiting secondary to gastroparesis.

39. In a letter dated April 17, 2006, D r. Norton described

the subscriber’s symptoms to include “nausea and vomiting daily”

and she characterized the Enterra Therapy System recommended by

Dr. Cendan as the subscriber’s “last and only option to regain

her health. "

(3) Denial o f Coverage and In ternal Review b y HOI

40. In a letter to Dr. Cendan dated August 2, 2005, HOI

denied coverage of the Medtronic Enterra Therapy System (METS)

recommended for the subscriber (hereafter “original denial

letter”) . The letter explained the basis of the denial as

follows:

The medtronic enterra therapy for

gastroparesis meets the definition of

Experimental/Investigational as defined in

the Member Handbook. Spec i fically, it meets

this definition because the consensus of

opinion among experts is that further

studi es, research, or clinical

investigations are necessary to determine

its safety, efficacy, or efficacy as

compared to standard means for the treatment

of the Condition in question.

41. The subscriber “appealed” the denial of coverage to

HOI’s Internal Re view Panel (IRP).

42. The IRP affirmed the denial of coverage in a letter to

the subscriber dated September 1, 2005 . The basis of the IRP’s

decision was the same as that set forth in the original denial

le tter, i.e. , the METS is experimental or investiga tional as

defined in the HMO Plan.

43. In making its decision, the IRP received the input of

an external medical consultant who was board certified in

in ternal medicine and gastroenterolog y and who reviewed the

subscriber’s medical records. The consultan t’s report noted the

limited published studies on the efficacy of the METS,

particularly with respect to idiopathic, non - diabetic patients

such as the subscriber.

44. The subscriber requested review of the IRP’s decision

by HOI’s Board of Directors Griev ance Committee.

45. In a letter to the subscriber dated September 19,

2005, t he Grievance Committee affirmed the denial of coverage

for the same reason as set forth in the original denial letter,

i.e. , the METS is experimental or investigational as defi ned in

the HMO Plan.

46. The Grievance Committee’s letter advised the

subscriber of her right under Section 408.7056, Florida

Statu t es, to seek review of the denial of coverage through the

Subscriber Assistance Panel (Panel).

(4) Review of the Denial by the Panel and the Office

47. T he subscrib er timely requested that the Panel review

HOI’s denial of coverage for the METS recommended by Dr. Cendan.

48. The Panel obtained a medical consu ltation from Dr.

Eugene Trowers at the Florida State University Col lege of

Medicine.

49. Drowers is board certified in internal medicine

with a subspecialty in gastroenterology.

50. Drowers was of the opinion that the METS is not

experimental because it has received approval from the U.S. Food

and Drug Adminis tration (FDA) under the humanitarian device

exemption. Drowers did not refer to the definition of

“experimental or investigational” in the HMO Plan.

51. The Panel held a hearing on December 19, 2005. The

subscriber made a presentation at the hearing , as did a

representative of HOI.

52. The Panel issued its proposed recommended order on

December 27, 2005, finding in favor of the subscriber and

recommending that HOI be ordered to provide coverage for the

subscriber’s METS.

53. The Office approved th e Panel’s decision in a letter

dated January 27, 2006. The letter stated that “[t]he Office

concurs with the Panel’s Proposed Recommended Order that the

Enterra Therapy system is not ‘experimental’ and hereby orders

[HOI] to authorize coverage for the Sub scriber’s Medtronic

Enterra Therapy System.”

54. The letter advised HOI of its right to request a

summary hearing to contest the Office’s decision pursuant to

Sections 120.574 and 408.7056(13), Florida Statutes.

55. HOI timely requested a hearing, whic h gave rise to

this DOAH proceeding.

56. HOI argues that it is not required to provide coverage

for the METS requested by the subscriber for two reasons : (1)

the device meets the definition of “Experimental or

Investigational” in the HMO Plan and, theref ore, is specif ically

excluded from coverage ; and (2) the subscriber is not an

appropriate candidate for gastric electrical stimulation based

upon her medical history and, therefore, the device is not

“Medically Necessary” for the subscriber as that term is defined

in the HMO Plan.

57. The first point is the basis upon which coverage was

denied in the original denial letter and throughout the review

process that culminated in the Panel’s recommendation, which was

accepted by the Office. The second point was not raised during

the review process, but rather was raised for the first time in

this DOAH proceeding.

C. Medtronic Enterra Therapy System

(1) Generally

58. The METS is a gastric electrical stimulation device

(GESD) , and has been described in layma n’s terms as a “stomach

pacemaker . ”

59. The METS is for use in patients with “chronic

intractable (drug - refractory) nausea and vomiting secondary to

gastroparesis of diabetic or idiopathic etiology.”

60. The METS is surgically implanted in the patient and

delivers an electrical pulse that stimulates the stomach muscle

and/or the enteric nervous system. The surgical procedure was

described by Dr. Cendan as follows in his letter requesting pre -

authorization coverage f or the subscriber’s device :

The [sub scriber] will be admitted to the

hospital as an inpatient. Hospitalization

for the procedure is overnight. The implant

procedure takes approximately 1 - 3 hours and

is performed while the [subscriber] is under

general anesthesia. Two unipolar

intramuscula r leads are implanted in the

muscle wall of the stomach, about 1.0 cm

apart, either via laparotomy or laparoscopic

technique. (To reduce the possibility of

stomach wall perforation, endoscopy is used

interoperatively.) The leads are connected

to the neur ostimulator, which is placed in a

surgically created subcutaneous pocket in

the abdomin.

61. Gastric electric stimulation is an emerging therapy

for gastroparesis, but as discussed below, its efficacy for

treating and managing gastroparesis has not yet been proven .

62. Gas troparesis is typically treated/managed with

dietary restrictions, drug therapies, and /or supplemental

nutrition through enteral or parenteral feeding . The drug

therapies include combinations of prokinetic drugs (such as

erthomycin) to promote gastric motility, and antiemetic drugs to

alleviate symptoms of nausea and vomiting. The use of a GESD is

appropriate only where the patient does not respond to the other

treatments.

(2) FDA Approval

63. The METS was approved for use by the FDA in March 2000

as a Humanita rian Use Device (HUD) pursuant to the humanitarian

device exemption (HDE) in federal law.

64. A HUD is a device that is intended to benefit patients

by treating or diagnosing a condition that affects fewer than

4,000 individ uals per year in the United States.

65. The METS may be lawfully marketed in the United States

by virtue of its status as an HUD.

66. The M ETS is the only GESD that has received approval

under the HDE and, as a result, it is the only GESD available

for use in the United States.

67. FDA approval of a device under the HDE does not

require a showing that the device is effective . It only

requires a showing that the device is probably effective.

68. A manufacturer that seeks a pproval of a device under

the HDE is not required to present results of scientifically

valid clinical investigations demonstrating that the device is

effective for its intended purpose. However, the applicant must

present sufficient information for the FDA to determine that the

devic e does not pose an unreasonable or significant risk of

illness or injury, and that the probable benefit to health

outweighs the risk of injury or illness from use. Additionally,

the applicant must demonstrate that no comparable devices are

available to tr eat or diagnose the disease or condition, and

that the applicant could not otherwise bring the device to

market.

69. The data presented to the FDA to demonstrate the

probable effectiveness of the METS was primarily from a 33 -

patient clinical study referr ed as the WAVESS Study. The study

showed reductions in vomiting episodes for patients using the

METS, but the reductions were more significant for diabetic

patients than for idiopathic patients.

70. The FDA imposes restrictions on manufacturers whose

m edical devices are approved under the HDE . For example, the

manufacturer must include a label on the device stating that

even though the sale/use of the device is authorized by federal

law, its effectiveness for a specific indication has not been

proven .

71. The label for the METS complies with this requirement,

and specifically states that “[t]he effectiveness of this device

has not been demonstrated.”

72. The use of a HUD is subject to the review and approval

of a health care facility’s institutional review board (IRB).

The IRB is responsible for initial and continuing review of the

HUD, and it may approve the use of the device under a protocol

or on a case - by - case basis.

73. The FDA does not require i nformed consent from the

patient prior to using a HUD, but each of the university health

centers where the parties’ testifying experts are affiliated

require patients to sign special consent forms. The forms

advise patients that the safety and efficacy of the METS has not

been proven, but that it is p robably effective and that it has

received approval from the FDA under the HDE.

74 . The consent form used by the Office’s testifying

expert witness at the University of Mississippi Medical Center

also advises patients that their data will be collected an d

analyzed “to determine the sa f ety and effectiveness of the

device over time.” The record does not reflect whether or not

Shands, the facility where the subscriber’s device will be

implanted , uses a consent form with similar language.

(3 ) Medical Literat ure

75. The stipulated record includes a number of articles

discussing gastric electrical stimulation and the treatment of

gastroparesis . 4

76. The articles are peer - reviewed articles published in

authoritative medical journals and meet the definition o f

“rel iable evidence” in the HMO Plan , even though some of the

studies discussed in the articles have been criticized for their

limitations . 5

77. Several of t he articles conclude that gastric

electrical stimulation benefits patients with severe

gast r op aresis by decreasing vomiting frequency and improving

quality of life. However, as discussed below, t he articles do

not reflect a consensus of opinion that gastric electric

stimulation is a safe and efficacious treatment for

gastroparesis, particularly wi th respect to idiopathic patients

such as the subscriber .

78. Many of the articles, including several of those that

have favorable conclusions about gastric electrical stimulation,

were “sponsored in part” or “supported in part” by Medtronic,

Inc., wh ich m anufactur es the METS . Medtronic has an obvious

financial interest in the METS gaining as much legitimacy as

possi ble in the scientific community, and favorable articles in

the medical literature is one way for it to do so .

79. The most current a rtic le received into evidence is an

April 2006 article published in the Journal of

Neurogastroenterology and Motility titled “Treatment of

Gastroparesis: A Multidisciplinary Clinical Review” (hereafter

“the April 2006 article”). 6

80. Th e April 2006 article is a comprehensive “consensus

document” developed by the American Motility Society Task Force

on Gastroparesis 7 to “review[] the current treatment options for

management of gastroparesis.” The article summarizes the

research studies on gastroparesis that have been published in

the medical literature from 196 6 to 2005 in an effort to provide

“ practical ther ape utic guidelines” for treating and managing

patients with gastroparesis.

81. T he April 2006 article reports that only two multi -

center trials have been co nducted to e valuate the efficacy of

gastric electrical stimulation . Only one of those studies --

the WAVESS Study -- was a “s ham - simulation controlled study. ”

82. T he WAVESS S tudy showed a statistically significant

reduction in vomiting when the GESD was on, but it found that

“the benefits of treatment were predominately, if not

exclusively, ex perienced by the diabetic group . ” On this point ,

the August 2003 article that presented the results of the WAVESS

Study stated:

The symptom improvement observed in this

study was more consistent in the diabetic

(vs. idiopathic) subgroup. This may be

because the idiopathic patients reflect a

relatively heterogeneous population when

compared with the diabetic patients. More

specifically, idiopathic gastroparesis may

be related to any of a number of factors,

including viral illness, gastroespohageal

reflux, nonnuclear dyspepsia, abdominal

pain, and depression. Idiopathic patients

tend to have a longer symptom duration and

poorer quality of life than that seen in

othe r subgroups with gastroparesis, perhaps

explaining the more limited improvement we

observed with that etiology. 8

83. After discussing the limited clinical studies that

have been performed to date , the April 2006 article concludes

t hat “[w]hile the resu lts of these investigations are

encouraging, the clinical benefits of gastric electrical

stimulation have not been unequivocally demonstrated . . . .”

84. The April 2006 article also notes that “[t]he

mechanism(s) underlying the clinical benefits of the [GESD] are

not fully understood .” In layman’s terms, this means that the

researchers do not k now why gastric electrical stimulation

appears to provide symptom reductions for some patients in the

studies.

85. The medical literature suggests that gastric

electrical stimulation may provide a “placebo effect” for the

patient, which means that the patient feels better simply

because he or she has the device and is being closely monitored

by physicians . In this regard, one of the articles n oted that

the plac ebo effect of the device “could not be ruled out.” 9

86. The April 2006 article states that “[c]andidates for

implantation of the [GESD] include patients with chronic

diabetic or idiopathic gastroparesis with relentless nausea or

vomiting who are not respo nding to appropriate diet and

medication thereapy.” The article does not explain what is

meant by “relentless” nausea or vomiting.

87. The April 2006 article includes a table listing the

“consensus opinions of the authors . . . regarding the organized

ap proach to treating [gastroparesis] . ” The table i ncludes

gastric electrical stimulation as a treatment option, but it is

the last option listed in the antiemetic therapy category after

vario us types of drugs.

88. Thus, it appears from the April 2006 art icle that

there is now a consensus of opinion that gastric electric

stimulation may be appropriate for certain patients with

gastroparesis, but only in the most severe cases. This is a

change from November 2004, when it was noted that “[t]here is no

conse nsus regarding management of patients with gastroparesis

who do not respond to simple antiemetic or prokinetic therapy or

who develop severe medication - induced side effects.” 10

89. There are additional ongoing studies designed to,

among other things, confi rm the safety and efficacy of the GESD

and to help determine which patients are the most appropriate

candidates for gastric electrical stimulation.

90. On this point, the American Gastroenterology

Association noted in a comprehensive November 2004 technic al

review article that “[f]urther investigation is needed to

confirm the effectiv e ness of gastric stimulation in long - term

blinded fashion, which patients are likely to respond, the

optimal electrode position, and the optimal stimulation

parameters, none o f which have been rigorously evaluated to

date .” 11 Other articles also recommended further studies and

evaluation of the safety, efficacy, and optimal use of gastric

electrical stimulation.

(4 ) Expert Opinions

91. HOI’s testifying expert witness, Dr. Pa ul Hyman, is

employed by the University of Kansas Medical Center. He is a

professor of pediatrics and the head of pediatric

gastroenterology at the university.

92. Dr. Hyman is board certified in pediatrics and

pediatric gastroenterology. He is not boar d certified in

gastroenterology or internal medicine.

93. Dr. Hyman has not authored any peer - reviewed articles

regarding gastric electrical stimulation; he has not conducted

any published clinical trials involving the use of the METS ; and

he h as never p erformed a gastric emptying study on an adult.

94. Almost all of Dr. Hyman’s gastroenterological

experience is in the context of pediatric patients , but he

testified that he collaborates with Dr. Richard McCallum on a

daily basis about difficult adult gas troenterological patients

that Dr. McCallum is seeing, including patients for whom

“electrical pacing may be the answer to help them.” Dr. Hyman

described the nature of the collaboration as “ very informal,

everyday, kind of, back and forth” discussions, a nd the evidence

was not persuasive that Dr. Hyman is responsible for or directly

involved in the treatment of such patients.

95. Dr. Mc Callum is a recognized leader in the field of

gastric electrical stimulation. He has im planted 200 to 300

METS, and he has published a number of articles detailing the

reductions in nausea and vomiting episodes observed in patients

who have received a METS. Dr. Thomas Abell, the Office’s

testifying expert witness , was a coauthor with Dr. McCallum on

several of the article s.

96. Dr. Hyman opined that the subscriber is not an

appropriate candidate for a GESD because she h ad not been

properly diagnosed with gastroparesis because her 90 - minute

gastric emptying study was not long enough to fully assess the

extent that her stom ach emptied ; because an antroduodenal

manometry has not been performed to determine whether the

subscriber has central nervous system issues rath er than

digestive system issues ; because she has not pursued all

possible drug therapies, such as doperidone an d metoclopramide

(which are prokenetic agents) and a trycyclic antidepressant

such as Neurontin (which is an antiemetic agent) ; and because

her history of bulimia exclude s her f rom being a candidate for

the METS since an eating disorder is “highly suggesti ve that

there’s central nervous system abnormalities” rath er than

digestive abnormalities.

97. Dr. Hyman also opined that the re is not consensus in

the medical literature that the METS is an efficacious treatment

for idiopathic gastroparesi s. In his opin ion, the only

scientifically valid study was the WAVESS Study and, as noted

above, that study showed no significant reduction in the number

of vomiting e pisodes for idiopathic patients.

98. Dr. Hyman recognized Dr. Abell, the Office’s

testifying expert wi tness, as a leader in the field of gastric

electrical stimulation who he respects and admires for his

intelligence and compassion. He testified that Dr. Abell is the

“best person to ask” about certain characteristics of idiopathic

patients with gastropare sis.

99. Dr. Abell is employed by the University of Mississippi

Medical Center in the internal medicine/digestive disease

department.

100. Dr. Abell is board certified in family medicine,

internal medicine, and gastroenterology.

101. Dr. Abell is reco gnized as leader in the field of

gastric electric al stimulation. He has authored or coauthored

numerous peer - reviewed articles regarding gastroparesis and

gastric electrical stimulation, and he has been involved in

several clinical trials involving the us e of the METS.

102. Dr. Abell and the University of Mississippi Medical

Center implant more METS than any other physician/center in the

country.

103. Dr. Abell described himself as “a Medtronic guy . ” He

does not own stock in the company, but he does hav e a contract

with the company that has paid him an average of $2,000 per year

for the past 10 years. Medtronic also provided funds to the

University of Mississippi Medical Center to sponsor Dr. Abell’s

work, although he testified that the support provided by the

company “doesn’t come anywhere close to covering our expenses.”

104. Dr. Abell opined that the subscriber is “a good

candidate” for the METS. In support of his opinion, Dr. Abell

testified that the 74 percent retention reflected in the

subscriber ’s 90 - minute gastric emptying study was adequate for

him to diagnose the patient with gastroparesis even though he

acknowledged that a four - hour test is “helpful and better”; that

an ant roduodenal manometry would not add anything in the

subscriber’s case b ecause that test is used when the patient’s

gastric emptying is clos e to normal or the patient had nausea

but no vomiting , or pain and no nausea or vomiting; and that the

subscriber’s past history of bulimia and depression does not

necessarily exclude her as a candidate for the METS even though

those conditions were used as a basis to exclude patients from

some of the studies that Dr. Abell conducted.

105. Dr. Abell considers the METS to be “a proven device ”

and not experimental or investigational. I n his opinion, the

efficacy of the device has been accepted by the medical

community as reflected in the April 2006 article discussed

above. Another reason that Dr. Abell does not consider the METS

to be experimental or investigational is that it has been

appr oved by the FDA under the HDE . 12

D . Ultimate Findings

106. The preponderance of the evidence establishes that

the subscriber is an appropriate candidate for the METS. She

has been diagnosed with gastrop aresis, and efforts to

treat/manage her condition w ith drugs and other therapies have

proven to be unsuccessful.

107. Dr. Abell’s testimony that the subscriber is "a good

candidate " for the device -- and not excluded because of the

eating disorder in her past and/or the fact that she had only a

90 - minute gastric emptying test -- was consistent with the

assessments of the subscriber’s treating physicians and is found

more persuasive that Dr. Hyman’s contrary testimony .

108. In making th e foregoing finding, the undersigned took

into account the reasons give n by Dr. Hyman for his opinion that

the subscriber is not an appropriate candidate for the METS as

well as Dr. Abell’s relationship with Medtronic and its interest

in legitimizing the device. The weight given to Dr. Hyman’s

opinion is tempered significant ly by his limited direct personal

experience in diagnosing and treating a dult patients with

gastroparesis. Dr. Abell’s relationship with Medtronic affected

the weight given to his opinion, but it did not, in the

undersigned’s view, undermine his ultimate opinion that the

subscriber is “a good candidate” for the device.

109. Thus, contrary to HOI’s argument, coverage for the

METS recommended for the subscriber may not be denied on the

basis that the device does not meet paragraphs A and G of the

HMO Plan's definition of “Medically Necessary.” 13

110. However, t he preponderance of the evidence

establishes that the M ETS is “experimental or investigational”

as that phrase is defined in the HMO Plan.

111. The evidence establishes that, at a minimum, t he

devi ce falls within paragraphs C, E, and F of the definition of

“experimental or investigational” in the HMO Plan because the

use of the device is subject to the review and supervision of an

IRB; the medical literature reflects a consensus of opinion that

furt her studies are necessary to determine the device’s efficacy

(as compared to its probable efficacy that was shown to obtain

FDA approval under the HDE ); and the medical lit erature does not

reflect a consensus of opinion that the device has been proven

effe ctive (as compared to probably effective), particularly in

idiopathic patients such as the subscriber.

112. Because the METS is “experimental or investigational”

as that phrase is defined in the HMO Plan, HOI is not required

to provide coverage for the s ubscriber’s device.

CONCLUSIONS OF LAW

113. DOAH has jurisdiction over the parties to and subject

matter of this proceeding pursuant to Section 408. 7056 , Florida

Statutes.

114. This de novo proceeding is subject to the summary

hearing procedures in Sec tion 120.574, Florida Statues. See

§ 408.7056(13), Fla. Stat.

115. The A dministrative L aw J udge’s decision in a

proceeding under Section 120.574, Florida Statutes, is final

agency action subject to judicial review and, therefore, is in

the form of a Fin al Order rather than a Recommended Order. See

§ 120.574(2)(f), Fla. Stat. ; Health Options, Inc. v. Agency for

Health Care Admin. , Case No. 02 - 3762, 2003 Fla. Div. Adm. Hear.

LEXIS 299 (DOAH Mar. 3, 2003) (final order issued by

Admin istrative Law Judge in a case arising under Section

408.7056, Florida Statutes); Foundation Health v. Dept. of

Insurance , Case No. 00 - 5007, 2001 Fla. Div. Adm. Hear. LEXIS

2479 (DOAH Feb. 28, 2001) (same).

116. The HMO P lan is an “employee welfare benefit plan”

under the Empl oyee Retirement Income Security Act (ERISA), 29

U.S.C. Section 1001, et seq.

117. The rights and obligations of Petitioner and the

s ubscriber under the HMO P lan are governed by the terms of the

plan, as well as all applicable state and federal laws and

r egulations.

118. When construing an insurance policy such as the HMO

Plan , the policy must be read as a whole and each provision must

be given its full meaning and operative effect. See Excelsior

Ins. Co. v. Pomona Park Bar & Package Store , 369 So. 2d 93 8, 941

(Fla. 1979).

119. When the language of an insurance policy is clear and

unambiguous, it must be interpreted according to its plain

meaning, giving effect to the policy as it was written. See

Swire Pacific Holdings, Inc. v. Zurich Ins. Co. , 845 S o. 2d 161,

165 (Fla. 2003). The court may not rewrite the policy, add

meaning that is not present, or otherwise reach a result that is

contrary to the intention of the parties. Id. (quoting

Excelsior , supra ).

120. However, i f the language of the policy is susceptible

to more than one reasonable interpretation, it is ambiguous, and

the court will resolve the ambiguity in favor of the insured and

against the insurer who drafted the policy . Id. ; Auto - Owners

Ins. Co. v. Anderson , 756 So. 2d 29, 34 (Fla. 200 0).

121. An insurance policy is not automatically rendered

ambiguous simply because a provision in the policy is complex

and requires analysis for application. See Swire Pacific

Holdings , 845 So. 2d at 165.

122. If the insurer fails to define a term in a policy,

the insurer cannot take the position that the term should be

given a narrow, restrictive interpretation. See State Farm Fire

& Casualty Co. v. CTC Development Corp. , 720 So. 2d 1072, 1076

(Fla. 1998). However, where, as here , the policy defines an

operative term, the term should be construed in accordance with

the definition in the policy e ven if that definition is more

narrow than the ordinary understanding or usage of the term.

123. The HMO Plan is not ambiguous with respec t to the

scope of coverage for medically necessary services or the scope

of the exclusion of experimental or investigational services .

T he HMO Plan defines the operative terms “medically necessary”

and “experimental or investigational” with great specificity and

even defi nes some of the terms -- e.g. , “reliable evidence” --

used in those definitions.

124. Under ERISA, insured has the burden to prove that she

is entitled to the benefits being sought. See Horton v.

Reliance Standard Life Ins. Co. , 141 F.3d 1038, 1040 (11t h Cir.

1998).

125. Similarly, Florida law governing the interpretation

of insurance contracts provides that the insured has the initial

burden to establish coverage under the policy. See , e.g. , East

Florida Hauling, Inc. v. Lexington Ins. Co. , 913 So. 2 d 673, 678

(Fla. 3d DCA 2005).

126. Thus, the Office (on be half of the subscriber) has

the burden to prove by a preponderance of the evidence that the

subscriber is an ap propriate candidate for the METS based upon

her medical history and presentation.

12 7. The Office met its burden of proof on this issue .

See Finding s of Fact 106 - 109 .

128. Once the insured establishes that a claim falls

within the scope of coverage provided by the policy, the insurer

has the burden to prove that the loss arose from a cause that is

excepted under the policy. State Farm Mutual Automobile Ins.

Co. v. Pridgen , 498 So. 2d 1245, 1248 (Fla. 1986). See also

East Florida Hauling , 913 So. 2d at 678 (“Once the insured shows

coverage, the burden shifts to the insurer to prove an exclusion

applies to the coverage.”)

129. Thus, HOI has the burden to prove by a preponderanc e

of the evidence that the METS is excluded from coverage under

the terms of the HMO Plan and, specifically, the definition of

“experimental or investigational. ”

130. The definition of “experimental or investigational”

in the HMO Plan must be given effect as written even though, as

suggested in Dr. Abell’s testimony and Drowers report, the

definition in the plan differs from the FDA's usage of the t erm s

ex perimental and investigational .

131. HOI met its burden of proof on this issue . See

Finding s of Fact 110 - 112 .

132. Section 408.7056(13), Florida Statutes, provides that

“[i]f the managed care entity does not prevail at the hearing,

the managed care enti ty must pay reasonable costs and attorney’s

fees of the . . . office incurred in that proceeding.”

133. There is no corresponding provision requiring the

Office to pay the managed care entity’s costs and attorney’s

fees where, as here, the managed care en tity prevails at the

hearing.

134. Therefore, no costs or attorney’s fees are awarded to

either party.

ORDER

Based upon the foregoing F indings of F act and C onclusions

of L aw, it is

ORDER ED that HOI is not required to provide coverage for

the gastric ele ctrical stimulation device requested by the

subscriber .

DONE AND ORDERED this 11th day of September , 200 6 , in

Tallahassee, Leon County, Florida.

S

T. KENT WETHERELL, II

Administrative Law Judge

Division of Administrativ e Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 11th day of Septemb er, 2006.

ENDNOTES

1 / Identifying information about the subscriber was redacted

from the medical records and other documents included in the

joint exhibits, and she will be referred to only as “the

subscriber” in this Final Order. See § 408.7056(14)(a), Fla.

Stat.

2 / Certificate of Coverage, page 1 - 7 (supplement to Joint

Exhibit 1 filed by HOI on August 28, 2006).

3 / Joint Exhibit 2 (second page of Enterra Therapy Screening

Form). See also Joint Exhibit 26, at 12 (subscriber’s

presentation to the Subscriber Assistance Panel that her divorce

was “15 years ago,” that she went through counseling for her

eating disorder, and that it “has been resolved and was resolved

many years ago”).

4 / See Joint Exhibits 3, 19(1) - (5), 25(1) - (9). Each article was

reviewed , but particular focus was given to the articles

referred to by the parties at oral argument -- e.g. , Joint

Exhibits 19(3), 19(5), 25(1) - (4), 25(6) and 25(9).

5 / See , e.g. , Joint Exhibit 19(4), at 13 (raising a number of

questions about the “validity and generalizability” of the

existing studies, including the WAVESS Study).

6 / The article is Exhibit 2 to Dr. Thomas Abell’s deposition.

7 / The Office’s testifying expert, Dr. Thomas Abell was a member

of the ta sk force and a coauthor of the article, as was Dr.

Richard McCallum, who works with HOI’s testifying expert witness

at the University of Kansas Medical Center.

8 / Joint Exhibit 25(1), at 427.

9 / See Joint Exhibit 25(9), at 25. That article, published in

January 2006, also stated that “[f]uture well - controlled studies

to investigate the efficacy of GES therapy and to clarify the

major contributing mechanisms will be important and are

currently being conducted.” Id.

10 / Joint Exhibit 19(3), at 1610.

11 / Joint Exhibit 19(3), at 1612.

12 / See Dr. Abell 's deposition, at 17 - 18 (explaining his opinion

that the METS is not experimental or investigational in relation

to the FDA standards related to those terms) and 127 (explaining

that “experimental [is] str ictly for experiment like one patient

which is the FDA definition of the word” and that

“[i]nvestigation is something that has an IDE, Investigational

Device Exemption”).

13 / Those paragraphs were the focus of HOI’s argument that the

subscriber is not an appropriate candidate for the METS. See

HOI’s Proposed Recommended Order, at ¶ 59.

COPIES FURNISHED:

Kevin M. McCarty, Commissioner

Office of Insurance Regulation

Financial Services Commission

Department of Financial Services

200 East Gaines Street

Tal lahassee, Florida 32399 - 0305

Steve Parton, General Counsel

Office of Insurance Regulation

Financial Services Commission

Department of Financial Services

200 East Gaines Street

Tallahassee, Florida 32399 - 0305

Paul A. Norman, Esquire

Office of Insurance Regulation

200 East Gaines Street

612 Larson Building, Room 646 - C

Tallahassee, Florida 32399

Daniel Alter, Esquire

Gray Robinson, P.A.

401 East Las Olas Boulevard, Suite 1850

Fort Lauderdale, Florida 33301

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party w ho is adversely affected by this Final Order is

entitled to judicial review pursuant to Section 120.68, Florida

Statutes. Review proceedings are governed by the Florida Rules

of Appellate Procedure. Such proceedings are commenced by

filing the original N otice of Appeal with the agency clerk of

the Division of Administrative Hearings and a copy, accompanied

by filing fees prescribed by law, with the District Court of

Appeal, First District, or with the District Court of Appeal in

the Appellate District whe re the party resides. The notice of

appeal must be filed within 30 days of rendition of the order to

be reviewed.