15-005663 Karla Mills vs. Department Of Management Services, Division Of State Group Insurance Status: Closed Recommended Order on Friday, February 19, 2016.

Summary: Petitioner failed to establish that the diabetes medical equipment for which she requested coverage was the most cost effective to treat her condition.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

KARLA MILLS,

Petitioner,

vs. Case No. 15 - 5663

DEPARTMENT OF MANAGEMENT

SERVICES, DIVISION OF STATE

GROUP INSURANCE,

Respondent,

and

UNITEDHEALTHCARE, INC.,

Intervenor.

___________________________ ____/

RECOMMENDED ORDER

A duly - noticed final hearing was held in this matter on

December 21, 2015, at the Division of Administrative Hearings in

Tallahassee, Florida, before Suzanne Van Wyk, Administrative Law

Judge.

APPEARANCES

F or Petitioner: Karla Mills, pro se

7004 Starfish Court

Panama City Beach, Florida 32407

For Respondent: Gavin D. Burgess, Esquire

Department of Management Services

4050 Esplanade W ay, Suite 160

Tallahassee, Florida 32399 - 0950

STATEMENT OF THE ISSUE

Whether PetitionerÓs request for the State EmployeeÓs HMO

Group Insurance Plan to cover an OmniPod insulin pump should be

granted.

PRELIMINARY STATEMENT

On October 30, 2014, Petitioner received a letter from her

insurer denying her request for c overage of durable medical

equipment, namely, the OmniPod insulin pump. Petitioner filed a

level one appeal of the decision, which was upheld by the

insurer. Petitioner requested a level two app eal of the

insurerÓs decision with the Division of State Gro up Insurance,

which denied her appeal as untimely, but gratuitously included

reasons for denial of coverage. The letter informed Petitioner

of her right to request either an informal or formal hearing

contesting the denial.

Petitioner timely filed with the Department of Management

Services a Petition challenging the denial, which was referred

to the Division of Administrative Hearings ( Ð Division Ñ ) on

October 13, 2015 , and assigned to the undersigned. A final

hearing was scheduled for December 21, 2015, in Tallahassee,

Florida.

UnitedHealthcare Inc. ( Ð United Ñ ) moved to intervene for the

limited purpose of protecting proprietary and trade secret

information, namely, the pricing structure of available insulin

pumps, which motion was granted.

The final h earing commenced as scheduled. Petitioner

testified on her own behalf and PetitionerÓs Exhibits 1 through

5 were admitted into evidence. The Respondent presented the

testimony of Kathy Flippo and Dr. Cathy Palmier, and

RespondentÓs Exhibits 1, 2, and 4 t hrough 7 were admitted into

evidence. Intervenor offered neither testimony nor exhibits.

A two - volume Transcript of the proceedings was filed on

January 11, 2016. 1/ Respondent timely filed a Proposed

Recommended Order on January 21, 2016, which has been considered

in preparation of this Recommended Order. Petitioner did not

make any post - hearing filing, and upon inquiry by Division

staff, Petitioner indicated she would not submit a proposed

recommended order.

FINDING S OF FACT

1. Petitioner, Karla Mil ls, was at all times relevant

hereto, an employee of the State of Florida and received medical

benefits under the State EmployeesÓ HMO Plan ( Ð the Plan Ñ ).

2. Respondent, Department of Management Services, Division

of State Group Insurance, is the agency responsible for the

administration of the state group insurance program and the

Plan. See § 110.123, Fla. Stat .

3. Respondent has contracted with United to provide third -

party administrative services for the Plan.

4. Petitioner has Type I diabetes mel litus and requires

insulin to control the disease.

5. In October 2014, PetitionerÓs physician prescribed the

OnmiPod insulin pump to treat PetitionerÓs condition.

6. Petitioner submitted a request with United to cover the

OmniPod pump. On October 30 , 2014, United denied PetitionerÓs

request for coverage of the subject medical equipment. The

denial letter reads, in pertinent part:

Here is the specific clinical reason for our

decision. Your doctor has asked [for] an

insulin pump called the Omnipod for you. We

looked at your doctorÓs notes. You have type

1 diabetes mellitus. You have elevated tests

for your diabetic control. We looked at your

health plan on insulin pumps. If more than

one pump is available the plan will cover the

most cost effe ctive pump. The pump your

doctor requested is not the most cost

effective. Therefore, the asked insulin pump

is not a covered benefit under your health

plan.

7. In the denial letter, United referenced its policy

2014T0347P, ÐContinuous Glucose Monitorin g and Insulin Delivery

for Managing Diabetes.Ñ

8. Neither party introduced the relevant policy into

evidence. Petitioner introduced a version of the policy which

took effect on April 22, 2015.

9. PetitionerÓs physician filed with United a level one

ap peal of the denial, which upheld the denial of coverage. 2/

10. On July 13, 2015, Petitioner exercised her option to

file with Respondent a level two appeal of UnitedÓs decision.

11. On August 21, 2015, Respondent denied PetitionerÓs

level two appeal as untimely.

12. In the denial letter, Respondent gratuitously added

the following: ÐAs a courtesy to you, I would like to address

the primary reasons that UnitedHealthcare will not cover the

Omnipod insulin pump.Ñ The letter referred to UnitedÓs Durabl e

Medical Equipment, Orthotics, Ostomy Supplies, Medical Supplies ,

and Repairs/Replacements Coverage Determination Guideline,

effective May 1, 2015, as follows:

When more than one piece of medical

equipment can meet the enrolleeÓs functional

needs, bene fits are available only for the

equipment that meets the minimum

specifications for enrollee needs. Examples

include but are not limited to: standard

electric wheelchair vs. custom wheelchair;

standard bed vs. simi - electric bed vs. fully

electric or flot ation system. This

limitation is intended to exclude coverage

for deluxe or additional components of a DME

item, not necessary to meet the enrolleeÓs

minimal specifications to treat an injury or

sickness.

* * *

Additional accessories to DME items or

d evices which are primarily for the comfort

or convenience of the enrollee are not

covered.

13. The letter concluded, ÐThe Omnipod is not a basic

insulin pump, and is therefore not covered by your Plan.Ñ

14. Petitioner was understandably frustrated by rec eipt of

a different reason for denial of co verage in response to her

level - two appeal than in the original denial letter.

15. PetitionerÓs frustration was exacerbated when, at

hearing, Respondent withdrew, as grounds for denial, both the

untimeli ness of P etitionerÓs level - two appeal and the assertion

that the Omnipod was not a basic insulin pump. However,

Petitioner was prepared to go forward on the issue of cost -

effectiveness, as well as the other grounds.

16. The only disputed fact at issue in this p roceeding was

whether the Omnipod was the most cost - effective treatment for

PetitionerÓs condition.

17. A typical insulin pump has a computer controller,

approximately the size of a cell phone, which delivers insulin

via a clear tube that connects to a po rt on the skin where the

insulin is delivered.

18. The OmniPod is an insulin pump with a unique

functionality.

19. While the OmniPod has a controller similar to typical

insulin pumps, the controller does not contain insulin and has

no tubing. Instead, the controller communicates wirelessly with

a pod that attaches directly to the skin and contains insulin.

Once the pod is attached to the skin, a small catheter inserts

into the skin for the delivery of insulin.

20. Under the 2014 United Summary Plan Description (SPD),

which governed the health benefits available to members of the

Plan, coverage was provided for only Ðthe most [c]ost -

[e ]ffective piece of equipment.Ñ The 2014 SPD defined Ðcost -

effectiveÑ as Ðthe least expensive equipment that performs the

necessary function.Ñ

21. Insulin pumps have both an up - front cost to purchase

the pump device, and recurring costs for maintenance supplies,

such as tubing, over the lifetime of the pumps.

22. To determine cost - effectiveness, United considers both

the up - front cost and the cost of supplies over the lifetime of

the pump, which is typically four to five years.

23. United does not contract with any vendor to supply

OmniPod pumps, thus the only cost information available at the

final hearing was the retail pricing.

24. The up - front retail cost to purchase the OmniPod is

$500 and supplies cost $300 per month. The total retail cost of

the Omnipod for the lifetime of the product is $21,000.

25. The record contains no competent, non - hearsay eviden ce

to establish the retail price of insulin pumps comparable to

Omnipod. 3/ Thus, the evidence was insufficient to establish cost

of the Omnipod relative to pumps available from other vendors.

As such, there is no basis for a determination whether or not

the Omnipod was Ðthe least expensive equipment to form the

necessary function.Ñ

26. Thus, the undersigned cannot determine from the record

whether the Omnipod pump is the most cost - effective method to

treat PetitionerÓs condition.

CONCLUSIONS OF LAW

27. The Division has jurisdiction of the subject matter of

and the parties to this proceeding. §§ 120.569 and 120.57(1),

Fla. Stat (2015). 4/

28. Section 110.123(5), Florida Statutes, assigns

responsibility to render final decisions on matters of

enrollment , the existence of coverage, or covered benefits under

the Plan to Respondent.

29. Absent a contrary directive, the general rule is that

the burden of proof in an administrative hearing is on the party

asserting the affirmative of an issue. Young v. De pÓt of Cmty.

Aff. , 625 So. 2d 831 833 - 34 (Fla. 1993); Dep't of Transp. v.

J.W.C. Co. , 396 So. 2d 778, 788 (Fla. 1st DCA 1981); Balino v.

Dep't of HRS , 348 So. 2d 349, 350 (Fla. 1st DCA 1977). As the

party asserting the right to coverage of the Omnipod, Pe titioner

had the initial burden of demonstrating by a preponderance of

the evidence that the equipment qualifies for coverage.

Assuming Petitioner met her burden, the burden would have

shifted to the Respondent to prove that the requested relief did

not q ualify for coverage under the terms of the policy. Herrera

v. C.A. Seguros Catatumbo , 844 So. 2d 664, 668 (Fla. 3d DCA

2003); State Comprehensive Health AssÓn v. Carmichael , 706 So.

2d 319, 320 (Fla. 4th DCA 1997).

30. In this case, Petitioner has failed to establish that

the Omnipod is the most cost - effective method to treat her

condition, thus, should be covered under the Plan.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Department of Manag ement

Services, Division of State Group Insurance, enter a final order

denying PetitionerÓs request for coverage of the OmniPod insulin

pump.

DONE AND ENTERED this 19 th day of February, 2016 , in

Tallahassee, Leon County, Florida.

S

SUZANNE VAN WYK

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of th e

Division of Administrative Hearings

this 19th day of February, 2016 .

ENDNOTE S

1/ Portions of the Transcript containing information deemed

confidential by the undersigned, were sealed in a separate

folder.

2/ Neither party introduced the level one de nial letter from

which the undersigned could make a finding as to the reasons for

denial.

3/ RespondentÓs Exhibit 7 contained retail pricing of three

insulin pump brands other than Omnipod, which constituted

hearsay for which no exception exis ts under S e ction 90.803. The

pricing information in Exhibit 7 conflicted with, rather than

corroborated, the pricing information in RespondentÓs Exhibit 4

which was admissible as an admission, relative to the comparable

pumps.

4/ All references herein to the Flori da Statutes are to the 2015

version, unless otherwise noted.

COPIES FURNISHED:

Gavin D. Burgess, Esquire

Department of Management Services

4050 Esplanade Way , Suite 160

Tallahassee, Florida 32399 - 0950

(eServed)

Karla Mills

7004 Starfish Court

Pana ma City Beach, Florida 32407

(eServed)

Thomas Porter Crapps, Esquire

Meenan P.A.

325 West College Avenue

Tallahassee, Florida 32301

(eServed)

J. Andrew Atkinson, General Counsel

Office of the General Counsel

Department of Management Services

4050 Espla nade Way, S uite 160

Tallahassee, Florida 32399 - 0950

(eServed)

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Orde r should be filed with the agency that

will issue the Final Order in this case.