California Court Refuses to Decertify Class Action Based on Ninth Circuit’s Decision in Wit

In Wit v. United Behavioral Health, the Ninth Circuit recently rejected a lower court’s order certifying a class of participants in a dispute over behavioral health guidelines used to process claims for benefits. A California district court recently rejected Aetna’s motion to decertify an existing class based on that decision.

In Hendricks v. Aetna Life Insurance Company, plaintiffs alleged that Aetna’s policy of denying coverage for lumbar artificial disc replacement surgery (L-ADR) as “experimental or investigational” was inconsistent with the terms of their health plans and the existing medical standards. The court originally certified a class of participants in ERISA plans administered by Aetna, whose requests for L-ADR surgery were, or will be, denied based upon Aetna’s classification of the treatment as experimental.

Following Wit, Aetna asked the court to reevaluate its decision. The court declined the invitation. It rejected Aetna’s argument that the named plaintiffs’ failure to exhaust contractually required administrative remedies precluded them from representing the class. Aetna had categorically concluded that L-ADR surgery was experimental, and thus exhausting administrative remedies was futile. That was true both under ERISA itself, as well as general contract law—by refusing to even consider whether L-ADR might be appropriate in any case, Aetna effectively repudiated any contractual right it might have to require exhaustion. The court also rejected Aetna’s argument that after Wit there were no common questions and that the class could not be certified under any of the subdivisions of 23(b). Although Wit had rejected an argument that a class of disparate participants allegedly affected by allegedly improper medical guidelines could uniformly have their claims reprocess, here the court held that was not dispositive. The court held that the question of whether Aetna’s determination that L-ADR treatments were uniformly experimental was one that could be made on a class-wide basis.

Andrew Holly

Andrew represents clients in a wide range of complex civil matters.

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