UnitedHealthcare Tried to Deny Coverage to a Chronically Ill Patient.
He Fought Back, Exposing the Insurer’s Inner Workings.
After a college student finally found a treatment that worked, the insurance giant decided it wouldn’t pay for the costly drugs. His fight to get coverage exposed the insurer’s hidden procedures for rejecting claims.
In May 2021,
a nurse at UnitedHealthcare called a colleague to share some welcome news about
a problem the two had been grappling with for weeks.
United
provided the health insurance plan for students at Penn State University. It
was a large and potentially lucrative account: lots of young, healthy students
paying premiums in, not too many huge medical reimbursements going out.
But one
student was costing United a lot of money. Christopher McNaughton suffered from
a crippling case of ulcerative colitis — an ailment that caused him to
develop severe arthritis, debilitating diarrhea, numbing fatigue and
life-threatening blood clots. His medical bills were running nearly $2 million
a year.
United had
flagged McNaughton’s case as a “high dollar account,” and the company was
reviewing whether it needed to keep paying for the expensive cocktail of drugs
crafted by a Mayo Clinic specialist that had brought McNaughton’s disease under
control after he’d been through years of misery.
On the 2021
phone call, which was recorded by the company, nurse Victoria Kavanaugh told
her colleague that a doctor contracted by United to review the case had
concluded that McNaughton’s treatment was “not medically necessary.” Her
colleague, Dave Opperman, reacted to the news with a long laugh.
“I knew that
was coming,” said Opperman, who heads up a United subsidiary that brokered the
health insurance contract between United and Penn State. “I did too,” Kavanaugh
replied.
Opperman
then complained about McNaughton’s mother, whom he referred to as “this woman,”
for “screaming and yelling” and “throwing tantrums” during calls with United.
The pair
agreed that any appeal of the United doctor’s denial of the treatment would be
a waste of the family’s time and money.
“We’re still
gonna say no,” Opperman said.
More than
200 million Americans are covered by private health insurance. But data from
state and federal regulators shows that insurers reject about 1 in 7 claims for
treatment. Many people, faced with fighting insurance companies, simply give
up: One
study found that Americans
file formal appeals on only 0.1% of claims denied by insurers under
the Affordable Care Act.
Insurers
have wide discretion in crafting what is covered by their policies, beyond some
basic services mandated by federal and state law. They often deny claims for
services that they deem not “medically necessary.”
When United
refused to pay for McNaughton's treatment for that reason, his family did
something unusual. They fought back with a lawsuit, which uncovered a trove of
materials, including internal emails and tape-recorded exchanges among company
employees. Those records offer an extraordinary behind-the-scenes look at how
one of America's leading health care insurers relentlessly fought to reduce
spending on care, even as its profits rose to record levels.
As United
reviewed McNaughton’s treatment, he and his family were often in the dark about
what was happening or their rights. Meanwhile, United employees misrepresented
critical findings and ignored warnings from doctors about the risks of altering
McNaughton’s drug plan.
At one
point, court records show, United inaccurately reported to Penn State and the
family that McNaughton’s doctor had agreed to lower the doses of his
medication. Another time, a doctor paid by United concluded that denying
payments for McNaughton’s treatment could put his health at risk, but the
company buried his report and did not consider its findings. The insurer did,
however, consider a report submitted by a company doctor who rubber-stamped the
recommendation of a United nurse to reject paying for the treatment.
United
declined to answer specific questions about the case, even after McNaughton
signed a release provided by the insurer to allow it to discuss details of his
interactions with the company. United noted that it ultimately paid for all of
McNaughton’s treatments. In a written response, United spokesperson Maria
Gordon Shydlo wrote that the company’s guiding concern was McNaughton’s
well-being.
“Mr.
McNaughton’s treatment involves medication dosages that far exceed FDA
guidelines,” the statement said. “In cases like this, we review treatment plans
based on current clinical guidelines to help ensure patient safety.”
But the
records reviewed by ProPublica show that United had another, equally urgent
goal in dealing with McNaughton. In emails, officials calculated what
McNaughton was costing them to keep his crippling disease at bay and how much
they would save if they forced him to undergo a cheaper treatment that had
already failed him. As the family pressed the company to back down, first
through Penn State and then through a lawsuit, the United officials handling
the case bristled.
“This is
just unbelievable,” Kavanaugh said of McNaughton’s family in one call to
discuss his case. ”They’re just really pushing the envelope, and I’m surprised,
like I don’t even know what to say.”
The Same
Meal Every Day
Now 31,
McNaughton grew up in State College, Pennsylvania, just blocks from the Penn
State campus. Both of his parents are faculty members at the university.
In the
winter of 2014, McNaughton was halfway through his junior year at Bard College
in New York. At 6 feet, 4 inches tall, he was a guard on the basketball team
and had started most of the team’s games since the start of his sophomore year.
He was majoring in psychology.
When
McNaughton returned to school after the winter holiday break, he started to
experience frequent bouts of bloody diarrhea. After just a few days on campus,
he went home to State College, where doctors diagnosed him with a severe case
of ulcerative colitis.
A chronic
inflammatory bowel disease that causes swelling and ulcers in the digestive
tract, ulcerative colitis has no cure, and ongoing treatment is needed to
alleviate symptoms and prevent serious health complications. The majority of
cases produce mild to moderate symptoms. McNaughton’s case was severe.
Treatments
for ulcerative colitis include steroids and special drugs known as biologics
that work to reduce inflammation in the large intestine.
McNaughton,
however, failed to get meaningful relief from the drugs his doctors initially
prescribed. He was experiencing bloody diarrhea up to 20 times a day, with such
severe stomach pain that he spent much of his day curled up on a couch. He had
little appetite and lost 50 pounds. Severe anemia left him fatigued. He
suffered from other conditions related to his colitis, including crippling
arthritis. He was hospitalized several times to treat dangerous blood clots.
For two
years, in an effort to help alleviate his symptoms, he ate the same meals every
day: Rice Chex cereal and scrambled eggs for breakfast, a cup of white rice
with plain chicken breast for lunch and a similar meal for dinner, occasionally
swapping in tilapia.
His hometown
doctors referred him to a specialist at the University of Pittsburgh, who tried
unsuccessfully to bring his disease under control. That doctor ended up
referring McNaughton to Dr. Edward Loftus Jr. at the Mayo Clinic in Minnesota,
which has been ranked as the best
gastroenterology hospital in the country every year since 1990 by U.S.
News & World Report.
For his
first visit with Loftus in May 2015, McNaughton and his mother, Janice Light,
charted hospitals along the 900-mile drive from Pennsylvania to Minnesota in
case they needed medical help along the way.
Mornings
were the hardest. McNaughton often spent several hours in the bathroom at the
start of the day. To prepare for his meeting with Loftus, he set his alarm for
3:30 a.m. so he could be ready for the 7:30 a.m. appointment. Even with that
preparation, he had to stop twice to use a bathroom on the five-minute walk
from the hotel to the clinic. When they met, Loftus looked at McNaughton and
told him that he appeared incapacitated. It was, he told the student, as if
McNaughton were chained to the bathroom, with no outside life. He had not been
able to return to school and spent most days indoors, managing his symptoms as
best he could.
McNaughton
had tried a number of medications by this point, none of which worked. This
pattern would repeat itself during the first couple of years that Loftus
treated him.
In addition
to trying to find a treatment that would bring McNaughton’s colitis into
remission, Loftus wanted to wean him off the steroid prednisone, which he had
been taking since his initial diagnosis in 2014. The drug is commonly
prescribed to colitis patients to control inflammation, but prolonged use can
lead to severe side effects including cataracts, osteoporosis, increased risk
of infection and fatigue. McNaughton also experienced “moon face,” a side
effect caused by the shifting of fat deposits that results in the face becoming
puffy and rounder.
In 2018,
Loftus and McNaughton decided to try an unusual regimen. Many patients with
inflammatory bowel diseases like colitis take a single biologic drug as
treatment. Whereas traditional drugs are chemically synthesized, biologics are
manufactured in living systems, such as plant or animal cells. A year’s supply
of an individual biologic drug can cost up to $500,000. They are often given
through infusions in a medical facility, which adds to the cost.
McNaughton
had tried individual biologics, and then two in combination, without much
success. He and Loftus then agreed to try two biologic drugs together at doses
well above those recommended by the U.S. Food and Drug Administration.
Prescribing drugs for purposes other than what they are approved for or at
higher doses than those approved by the FDA is a common practice in medicine
referred to as off-label prescribing. The federal Agency for Healthcare
Research and Quality estimates 1
in 5 prescriptions written today are for off-label uses.
There are
drawbacks to the practice. Since some uses and doses of particular drugs have
not been extensively studied, the risks and efficacy of using them off-label
are not well known. Also, some drug manufacturers have improperly pushed
off-label usage of their products to boost sales despite little or no evidence
to support their use in those situations. Like many leading experts and
researchers in his field, Loftus has been paid to do consulting related
to the biologic drugs taken by McNaughton. The payments related to those drugs
have ranged from a total of $1,440 in 2020 to $51,235 in 2018. Loftus said much
of his work with pharmaceutical companies was related to conducting clinical
trials on new drugs.
In cases of
off-label prescribing, patients are depending upon their doctor’s expertise and
experience with the drug.“In this case, I was comfortable that the potential
benefits to Chris outweighed the risks,” Loftus said.
There was
evidence that the treatment plan for McNaughton might work, including studies
that had found dual biologic therapy to be efficacious and safe. The two drugs
he takes, Entyvio and Remicade, have the same purpose — to reduce inflammation
in the large intestine — but each works differently in the body. Remicade,
marketed by Janssen Biotech, targets a protein that causes inflammation.
Entyvio, made by Takeda Pharmaceuticals, works by preventing an excess of white
blood cells from entering into the gastrointestinal tract.
As for any
suggestion by United doctors that his treatment plan for McNaughton was out of
bounds or dangerous, Loftus said “my treatment of Chris was not clinically
inappropriate — as was shown by Chris’ positive outcome.”
The unusual
high-dose combination of two biologic drugs produced a remarkable change in
McNaughton. He no longer had blood in his stool, and his trips to the bathroom
were cut from 20 times a day to three or four. He was able to eat different
foods and put on weight. He had more energy. He tapered off prednisone.
“If you told
me in 2015 that I would be living like this, I would have asked where do I sign
up,” McNaughton said of the change he experienced with the new drug regimen.
When he
first started the new treatment, McNaughton was covered under his family’s
plan, and all his bills were paid. McNaughton enrolled at the university in
2020. Before switching to United’s plan for students, McNaughton and his
parents consulted with a health advocacy service offered to faculty members. A
benefits specialist assured them the drugs taken by McNaughton would be covered
by United.
McNaughton
joined the student plan in July 2020, and his infusions that month and the
following month were paid for by United. In September, the insurer indicated
payment on his claims was “pending,” something it did for his other claims that
came in during the rest of the year.
McNaughton
and his family were worried. They called United to make sure there wasn’t a
problem; the insurer told them, they said, that it only needed to check his
medical records. When the family called again, United told them it had the
documentation needed, they said. United, in a court filing last year, said it
received two calls from the family and each time indicated that all of the
necessary medical records had not yet been received.
In January
2021, McNaughton received a new explanation of benefits for the prior months.
All of the claims for his care, beginning in September, were no longer
“pending.” They were stamped “DENIED.” The total outstanding bill for his
treatment was $807,086.
When
McNaughton’s mother reached a United customer service representative the next
day to ask why bills that had been paid in the summer were being denied for the
fall, the representative told her the account was being reviewed because of “a
high dollar amount on the claims,” according to a recording of the call.
Misrepresentations
With United
refusing to pay, the family was terrified of being stuck with medical bills
that would bankrupt them and deprive McNaugton of treatment that they
considered miraculous.
They turned
to Penn State for help. Light and McNaughton’s father, David, hoped their
position as faculty members would make the school more willing to intervene on
their behalf.
“After more
than 30 years on faculty, my husband and I know that this is not how Penn State
would want its students to be treated,” Light wrote to a school official in
February 2021.
In response
to questions from ProPublica, Penn State spokesperson Lisa Powers wrote that
“supporting the health and well-being of our students is always of primary
importance” and that “our hearts go out to any student and family impacted by a
serious medical condition.” The university, she wrote, does “not comment on
students’ individual circumstances or disclose information from their records.”
McNaughton offered to grant Penn State whatever permissions it needed to speak
about his case with ProPublica. The school, however, wrote that it would not
comment “even if confidentiality has been waived.”
The family
appealed to school administrators. Because the effectiveness of biologics wanes
in some patients if doses are skipped, McNaughton and his parents were worried
about even a delay in treatment. His doctor wrote that if he missed scheduled
infusions of the drugs, there was “a high likelihood they would no longer be
effective.”
During a
conference call arranged by Penn State officials on March 5, 2021, United
agreed to pay for McNaughton’s care through the end of the plan year that
August. Penn State immediately notified the family of the “wonderful news”
while also apologizing for “the stress this has caused Chris and your family.”
Behind the
scenes, McNaughton’s review had “gone all the way to the top” at United’s
student health plan division, Kavanaugh, the nurse, said in a recorded
conversation.
The family’s
relief was short-lived. A month later, United started another review of
McNaughton’s care, overseen by Kavanaugh, to determine if it would pay for the
treatment in the upcoming plan year.
The nurse
sent the McNaughton case to a company called Medical Review Institute of America. Insurers
often turn to companies like MRIoA to review coverage decisions involving
expensive treatments or specialized care.
Kavanaugh,
who was assigned to a special investigations unit at United, let her feelings
about the matter be known in a recorded telephone call with a representative of
MRIoA.
“This school
apparently is a big client of ours,” she said. She then shared her opinion of
McNaughton’s treatment. “Really this is a case of a kid who’s getting a drug
way too much, like too much of a dose,” Kavanaugh said. She said it was “insane
that they would even think that this is reasonable” and “to be honest with you,
they’re awfully pushy considering that we are paying through the end of this
school year.”
MRIoA sent
the case to Dr. Vikas
Pabby, a gastroenterologist at UCLA Health and a professor at the
university’s medical school. His May 2021 review of McNaughton’s case was just
one of more than 300 Pabby did for MRIoA that month, for which he was paid
$23,000 in total, according to a log of his work produced in the lawsuit.
In a May 4,
2021 report, Pabby concluded McNaughton’s treatment was not medically
necessary, because United’s policies for the two drugs taken by McNaughton did
not support using them in combination.
Insurers
spell out what services they cover in plan policies, lengthy documents that can
be confusing and difficult to understand. Many policies, such as McNaughton’s,
contain a provision that treatments and procedures must be “medically
necessary” in order to be covered. The definition of medically necessary
differs by plan. Some don’t even define the term. McNaughton’s policy contains
a five-part definition, including that the treatment must be “in accordance
with the standards of good medical policy” and “the most appropriate supply or
level of service which can be safely provided.”
Behind the
scenes at United, Opperman and Kavanaugh agreed that if McNaughton were to
appeal Pabby’s decision, the insurer would simply rule against him. “I just
think it’s a waste of money and time to appeal and send it to another one when
we know we’re gonna get the same answer,” Opperman said, according to a
recording in court files. At Opperman’s urging, United decided to skip the
usual appeals process and arrange for Pabby to have a so-called “peer-to-peer”
discussion with Loftus, the Mayo physician treating McNaughton. Such a
conversation, in which a patient’s doctor talks with an insurance company’s
doctor to advocate for the prescribed treatment, usually only occurs after a
customer has appealed a denial and the appeal has been rejected.
When
Kavanaugh called Loftus’ office to set up a conversation with Pabby, she
explained it was an urgent matter and had been requested by McNaughton. “You
know I’ve just gotten to know Christopher,” she explained, although she had
never spoken with him. “We’re trying to advocate and help and get this
peer-to-peer set up.”
McNaughton,
meanwhile, had no idea at the time that a United doctor had decided his
treatment was unnecessary and that the insurer was trying to set up a phone
call with his physician.
In the
peer-to-peer conversation, Loftus told Pabby that McNaughton had “a very
complicated case” and that lower doses had not worked for him, according to an
internal MRIoA memo.
Following
his conversation with Loftus, Pabby created a second report for United. He
recommended the insurer pay for both drugs, but at reduced doses. He added new
language saying that the safety of using both drugs at the higher levels “is
not established.”
When
Kavanaugh shared the May 12 decision from Pabby with others at United, her boss
responded with an email calling it “great news.”
Then
Opperman sent an email that puzzled the McNaughtons.
In it,
Opperman claimed that Loftus and Pabby had agreed that McNaughton should be on
significantly lower doses of both drugs. He said Loftus “will work with the
patient to start titrating them down” — or reducing the dosage — “to a normal
dose range.” Opperman wrote that United would cover McNaughton’s treatment in
the coming year, but only at the reduced doses. Opperman did not respond to
emails and phone messages seeking comment.
McNaughton
didn’t believe a word of it. He had already tried and failed treatment with
those drugs at lower doses, and it was Loftus who had upped the doses, leading
to his remission from severe colitis.
The only
thing that made sense to McNaughton was that the treatment United said it would
now pay for was dramatically cheaper — saving the company at least hundreds of
thousands of dollars a year — than his prescribed treatment because it sliced
the size of the doses by more than half.
When the
family contacted Loftus for an explanation, they were outraged by what they
heard. Loftus told them that he had never recommended lowering the dosage. In a
letter, Loftus wrote that changing McNaughton’s treatment “would have serious
detrimental effects on both his short term and long term health and could
potentially involve life threatening complications. This would ultimately incur
far greater medical costs. Chris was on the doses suggested by United
Healthcare before, and they were not at all effective.”
It would not
be until the lawsuit that it would become clear how Loftus’ conversations had
been so seriously misrepresented.
Under
questioning by McNaughton’s lawyers, Kavanaugh acknowledged that she was the
source of the incorrect claim that McNaughton’s doctor had agreed to a change
in treatment.
“I
incorrectly made an assumption that they had come to some sort of agreement,”
she said in a deposition last August. “It was my first peer-to-peer. I did not
realize that that simply does not occur.”
Kavanaugh
did not respond to emails and telephone messages seeking comment.
When the
McNaughtons first learned of Opperman’s inaccurate report of the phone call
with Loftus, it unnerved them. They started to question if their case would be
fairly reviewed.
“When we got
the denial and they lied about what Dr. Loftus said, it just hit me that none
of this matters,” McNaughton said. “They will just say or do anything to get
rid of me. It delegitimized the entire review process. When I got that denial,
I was crushed.”
A Buried
Report
While the
family tried to sort out the inaccurate report, United continued putting the
McNaughton case in front of more company doctors.
On May 21,
2021, United sent the case to one of its own doctors, Dr. Nady Cates, for an
additional review. The review was marked “escalated issue.” Cates is a United
medical director, a title used by many insurers for physicians who review
cases. It is work he has been doing as an employee of health insurers since
1989 and at United since 2010. He has not practiced medicine since the early
1990s.
Cates, in a
deposition, said he stopped seeing patients because of the long hours involved
and because “AIDS was coming around then. I was seeing a lot of military folks
who had venereal diseases, and I guess I was concerned about being exposed.” He
transitioned to reviewing paperwork for the insurance industry, he said,
because “I guess I was a chicken.”
When he had
practiced, Cates said, he hadn’t treated patients with ulcerative colitis and
had referred those cases to a gastroenterologist.
He said his
review of McNaughton’s case primarily involved reading a United nurse’s
recommendation to deny his care and making sure “that there wasn't a decimal
place that was out of line.” He said he copied and pasted the nurse’s
recommendation and typed “agree” on his review of McNaughton’s case.
Cates said
that he does about a hundred reviews a week. He said that in his reviews he
typically checks to see if any medications are prescribed in accordance with
the insurer’s guidelines, and if not, he denies it. United’s policies, he said,
prevented him from considering that McNaughton had failed other treatments or
that Loftus was a leading expert in his field.
“You are
giving zero weight to the treating doctor’s opinion on the necessity of the
treatment regimen?” a lawyer asked Cates in his deposition. He responded,
“Yeah.”
Attempts to
contact Cates for comment were unsuccessful.
At the same
time Cates was looking at McNaughton’s case, yet another review was underway at
MRIoA. United said it sent the case back to MRIoA after the insurer received
the letter from Loftus warning of the life-threatening complications that might
occur if the dosages were reduced.
On May 24,
2021, the new report requested by MRIoA arrived. It came to a completely
different conclusion than all of the previous reviews.
Dr. Nitin
Kumar, a gastroenterologist in Illinois, concluded that McNaughton’s
established treatment plan was not only medically necessary and appropriate but
that lowering his doses “can result in a lack of effective therapy of
Ulcerative Colitis, with complications of uncontrolled disease (including
dysplasia leading to colorectal cancer), flare, hospitalization, need for
surgery, and toxic megacolon.”
Unlike other
doctors who produced reports for United, Kumar discussed the harm that
McNaughton might suffer if United required him to change his treatment. “His
disease is significantly severe, with diagnosis at a young age,” Kumar wrote.
“He has failed every biologic medication class recommended by guidelines.
Therefore, guidelines can no longer be applied in this case.” He cited six
studies of patients using two biologic drugs together and wrote that they
revealed no significant safety issues and found the therapy to be “broadly
successful.”
When
Kavanaugh learned of Kumar’s report, she quickly moved to quash it and get the
case returned to Pabby, according to her deposition.
In a
recorded telephone call, Kavanaugh told an MRIoA representative that “I had
asked that this go back through Dr. Pabby, and it went through a different
doctor and they had a much different result.” After further discussion, the
MRIoA representative agreed to send the case back to Pabby. “I appreciate
that,” Kavanaugh replied. “I just want to make sure, because, I mean, it’s
obviously a very different result than what we’ve been getting on this case.”
MRIoA case
notes show that at 7:04 a.m. on May 25, 2021, Pabby was assigned to take a look
at the case for the third time. At 7:27 a.m., the notes indicate, Pabby again
rejected McNaughton’s treatment plan. While noting it was “difficult to
control” McNaughton’s ulcerative colitis, Pabby added that his doses “far
exceed what is approved by literature” and that the “safety of the requested
doses is not supported by literature.”
In a
deposition, Kavanaugh said that after she opened the Kumar report and read that
he was supporting McNaughton’s current treatment plan, she immediately spoke to
her supervisor, who told her to call MRIoA and have the case sent back to Pabby
for review.
Kavanaugh
said she didn’t save a copy of the Kumar report, nor did she forward it to
anyone at United or to officials at Penn State who had been inquiring about the
McNaughton case. “I didn’t because it shouldn’t have existed,” she said. “It
should have gone back to Dr. Pabby.”
When asked
if the Kumar report caused her any concerns given his warning that McNaughton
risked cancer or hospitalization if his regimen were changed, Kavanaugh said
she didn’t read his full report. “I saw that it was not the correct doctor, I
saw the initial outcome and I was asked to send it back,” she said. Kavanaugh
added, “I have a lot of empathy for this member, but it needed to go back to
the peer-to-peer reviewer.”
In a court
filing, United said Kavanaugh was correct in insisting that Pabby conduct the
review and that MRIoA confirmed that Pabby should have been the one doing the
review.
The Kumar
report was not provided to McNaughton when his lawyer, Jonathan Gesk, first
asked United and MRIoA for any reviews of the case. Gesk discovered it by
accident when he was listening to a recorded telephone call produced by United
in which Kavanaugh mentioned a report number Gesk had not heard before. He then
called MRIoA, which confirmed the report existed and eventually provided it to
him.
Pabby asked
ProPublica to direct any questions about his involvement in the matter to
MRIoA. The company did not respond to questions from ProPublica about the case.
A Sense
of Hopelessness
When
McNaughton enrolled at Penn State in 2020, it brought a sense of normalcy that
he had lost when he was first diagnosed with colitis. He still needed monthly
hours-long infusions and suffered occasional flare-ups and symptoms, but he was
attending classes in person and living a life similar to the one he had before
his diagnosis.
It was a
striking contrast to the previous six years, which he had spent largely
confined to his parents’ house in State College. The frequent bouts of diarrhea
made it difficult to go out. He didn’t talk much to friends and spent as much
time as he could studying potential treatments and reviewing ongoing clinical
trials. He tried to keep up with the occasional online course, but his disease
made it difficult to make any real progress toward a degree.
United, in
correspondence with McNaughton, noted that its review of his care was “not a
treatment decision. Treatment decisions are made between you and your
physician.” But by threatening not to pay for his medications, or only to pay
for a different regimen, McNaughton said, United was in fact attempting to
dictate his treatment. From his perspective, the insurer was playing doctor,
making decisions without ever examining him or even speaking to him.
The idea of
changing his treatment or stopping it altogether caused constant worry for
McNaughton, exacerbating his colitis and triggering physical symptoms,
according to his doctors. Those included a large ulcer on his leg and welts
under his skin on his thighs and shin that made his leg muscles stiff and
painful to the point where he couldn’t bend his leg or walk properly. There
were daily migraines and severe stomach pain. “I was consumed with this
situation,” McNaughton said. “My path was unconventional, but I was proud of
myself for fighting back and finishing school and getting my life back on
track. I thought they were singling me out. My biggest fear was going back to
the hell.”
McNaughton
said he contemplated suicide on several occasions, dreading a return to a life
where he was housebound or hospitalized.
McNaughton
and his parents talked about him possibly moving to Canada where his
grandmother lived and seeking treatment there under the nation’s government
health plan.
Loftus
connected McNaughton with a psychologist who specializes in helping patients
with chronic digestive diseases.
The
psychologist, Tiffany Taft, said McNaughton was not an unusual case. About 1 in
3 patients with diseases like colitis suffer from medical trauma or PTSD
related to it, she said, often the result of issues related to getting
appropriate treatment approved by insurers.
“You get
into hopelessness,” she said of the depression that accompanies fighting with
insurance companies over care. “They feel like ‘I can’t fix that. I am
screwed.’ When you can’t control things with what an insurance company is
doing, anxiety, PTSD and depression get mixed together.”
In the case
of McNaughton, Taft said, he was being treated by one of the best
gastroenterologists in the world, was doing well with his treatment and then
was suddenly notified he might be on the hook for nearly a million dollars in
medical charges without access to his medications. “It sends you immediately
into panic about all these horrific things that could happen,” Taft said. The
physical and mental symptoms McNaughton suffered after his care was threatened
were “triggered” by the stress he experienced, she said.
In early
June 2021, United informed McNaughton in a letter that it would not cover the
cost of his treatment regimen in the next academic year, starting in August.
The insurer said it would only pay for a treatment plan that called for a
significant reduction in the doses of the drugs he took.
United wrote
that the decision came after his “records have been reviewed three times and
the medical reviewers have concluded that the medication as prescribed does not
meet the Medical Necessity requirement of the plan.”
In August
2021, McNaughton filed a federal lawsuit accusing United of acting in bad faith
and unreasonably making treatment decisions based on financial concerns and not
what was the best and most effective treatment. It claims United had a duty to
find information that supported McNaughton’s claim for treatment rather than
looking for ways to deny coverage.
United, in a
court filing, said it did not breach any duty it owed to McNaughton and acted
in good faith. On Sept. 20, 2021, a month after filing the lawsuit, and with
United again balking at paying for his treatment, McNaughton asked a judge to
grant a temporary restraining order requiring United to pay for his care. With
the looming threat of a court hearing on the motion, United quickly agreed to
cover the cost of McNaughton’s treatment through the end of the 2021-2022
academic year. It also dropped a demand requiring McNaughton to settle the
matter as a condition of the insurer paying for his treatment as prescribed by
Loftus, according to an email sent by United’s lawyer.
The Cost
of Treatment
It is not
surprising that insurers are carefully scrutinizing the care of patients
treated with biologics, which are among the most expensive medications on the
market. Biologics are considered specialty drugs, a class that includes the
best-selling Humira, used to treat arthritis. Specialty drug spending in the
U.S. is expected to reach $505 billion in 2023, according to an estimate from
Optum, United’s health services division. The Institute for Clinical and
Economic Review, a nonprofit that analyzes the value of drugs, found in 2020
that the biologic drugs used to treat patients like McNaughton are often
effective but overpriced for their therapeutic benefit. To be judged
cost-effective by ICER, the biologics should sell at a steep discount to their
current market price, the panel found.
A panel
convened by ICER to review its analysis cautioned that insurance coverage
“should be structured to prevent situations in which patients are forced to
choose a treatment approach on the basis of cost.” ICER also found examples
where insurance company policies failed to keep pace with updates to clinical
practice guidelines based on emerging research.
United
officials did not make the cost of treatment an issue when discussing
McNaughton’s care with Penn State administrators or the family.
Bill Truxal,
the president of UnitedHealthcare StudentResources, the company’s student
health plan division, told a Penn State official that the insurer wanted the
“best for the student” and it had “nothing to do with cost,” according to notes
the official took of the conversation.
Behind the
scenes, however, the price of McNaughton’s care was front and center at United.
In one
email, Opperman asked about the cost difference if the insurer insisted on only
paying for greatly reduced doses of the biologic drugs. Kavanaugh responded
that the insurer had paid $1.1 million in claims for McNaughton’s care as of
the middle of May 2021. If the reduced doses had been in place, the amount
would have been cut to $260,218, she wrote.
United was
keeping close tabs on McNaughton at the highest levels of the company. On Aug.
2, 2021, Opperman notified Truxal and a United lawyer that McNaughton “has just
purchased the plan again for the 21-22 school year.”
A month
later, Kavanaugh shared another calculation with United executives showing that
the insurer spent over $1.7 million on McNaughton in the prior plan year.
United
officials strategized about how to best explain why it was reviewing
McNaughton’s drug regimen, according to an internal email. They pointed to a
justification often used by health insurers when denying claims. “As the cost
of healthcare continues to climb to soaring heights, it has been determined
that a judicious review of these drugs should be included” in order to “make
healthcare more affordable for our members,” Kavanaugh offered as a potential
talking point in an April 23, 2021, email.
Three days
later, UnitedHealth Group filed an annual statement with the U.S. Securities
and Exchange Commission disclosing its pay for top executives in the prior
year. Then-CEO David Wichmann was paid $17.9 million in salary and other
compensation in 2020. Wichmann retired early the following year, and his total
compensation that year exceeded $140 million, according to calculations in
a compensation
database maintained by the Star Tribune in Minneapolis. The newspaper
said the amount was the most paid to an executive in the state since it started
tracking pay more than two decades ago. About $110 million of that total came
from Wichmann exercising stock options accumulated during his stewardship.
The
McNaughtons were well aware of the financial situation at United. They looked
at publicly available financial results and annual reports. Last year, United
reported a profit of $20.1 billion on revenues of $324.2 billion.
When
discussing the case with Penn State, Light said, she told university
administrators that United could pay for a year of her son’s treatment using
just minutes’ worth of profit.
“Betrayed”
McNaughton
has been able to continue receiving his infusions for now, anyway. In October,
United notified him it was once again reviewing his care, although the insurer
quickly reversed course when his lawyer intervened. United, in a court filing,
said the review was a mistake and that it had erred in putting McNaughton’s
claims into pending status.
McNaughton
said he is fortunate his parents were employed at the same school he was
attending, which was critical in getting the attention of administrators there.
But that help had its limits.
In June
2021, just a week after United told McNaughton it would not cover his treatment
plan in the upcoming plan year, Penn State essentially walked away from the
matter.
In an email
to the McNaughtons and United, Penn State Associate Vice President for Student
Affairs Andrea Dowhower wrote that administrators “have observed an unfortunate
breakdown in communication” between McNaughton and his family and the
university health insurance plan, “which appears from our perspective to have
resulted in a standstill between the two parties.” While she proposed some
potential steps to help settle the matter, she wrote that “Penn State’s role in
this process is as a resource for students like Chris who, for whatever reason,
have experienced difficulty navigating the complex world of health insurance.”
The university’s role “is limited,” she wrote, and the school “simply must
leave” the issue of the best treatment for McNaughton to “the appropriate
health care professionals.”
In a
statement, a Penn State spokesperson wrote that “as a third party in this
arrangement, the University’s role is limited and Penn State officials can only
help a student manage an issue based on information that a student/family,
medical personnel, and/or insurance provider give — with the hope that all
information is accurate and that the lines of communication remain open between
the insured and the insurer.”
Penn State
declined to provide financial information about the plan. However, the
university and United share at least one tie that they have not publicly
disclosed.
When the
McNaughtons first reached out to the university for help, they were referred to
the school’s student health insurance coordinator. The official, Heather
Klinger, wrote in an email to the family in February 2021 that “I appreciate
your trusting me to resolve this for you.”
In April
2022, United began paying Klinger’s salary, an arrangement which is not noted
on the university website. Klinger appears in the online staff directory on the
Penn State University Health Services webpage, and has a university phone
number, a university address and a Penn State email listed as her contact. The
school said she has maintained a part-time status with the university to allow
her to access relevant data systems at both the university and United.
The
university said students “benefit” from having a United employee to handle
questions about insurance coverage and that the arrangement is “not uncommon”
for student health plans.
The family
was dismayed to learn that Klinger was now a full-time employee of United.
“We did feel
betrayed,” Light said. Klinger did not respond to an email seeking comment.
McNaughton’s
fight to maintain his treatment regimen has come at a cost of time,
debilitating stress and depression. “My biggest fear is realizing I might have
to do this every year of my life,” he said.
McNaughton
said one motivation for his lawsuit was to expose how insurers like United make
decisions about what care they will pay for and what they will not. The case
remains pending, a court docket shows.
He has been
accepted to Penn State’s law school. He hopes to become a health care lawyer
working for patients who find themselves in situations similar to his.
He plans to
reenroll in the United health care plan when he starts school next fall.
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