Health Insurer Refuses to Pay for Surgery; Confidential Settlement

An Oregon woman had several potentially life-threatening health problems associated with morbid obesity. After years of unsuccessfully trying diets and various weight loss programs, her physicians recommended a surgical procedure to cause her to lose weight. They did so because of the health risks she faced and because no other treatment had been or was likely to be successful in curing those problems.

The woman had health insurance which provided that “medically necessary services are covered when ordered, provided, or pre-authorized by a primary care physician.” The health insurance policy had no exception for treatment, including surgical treatment, for morbid obesity. The proper pre-authorization paperwork was submitted by her physicians but the insurance company denied coverage for the surgery, saying that the surgery was not medically necessary because she did not have a sufficient number of health risks. She appealed the insurance company’s decision through its administrative channels with the help of an attorney who specializes in representing people who seek insurance coverage for gastric bypass surgery. When this was unsuccessful, she asked us to bring a legal claim.

We brought an action for breach of contract, bad faith, and negligence. After litigation, including extensive document discovery and depositions, the insurance company asked for a mediation. The case was settled through mediation for a confidential amount.