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$25.6 Million Awarded in Bad Faith Lawsuit Against Medical Insurer

Published on Jan 8, 2019 at 8:33 am in Insurance Bad Faith.

In November 2018, a jury in Oklahoma City, OK awarded the family of Oranna Cunningham nearly $25.6 million for a bad faith insurance lawsuit after she lost her battle with cancer.

Cunningham has been diagnosed with advanced nasopharyngeal cancer. Her physician recommended proton beam therapy; however, her insurer, Aetna, refused to cover the cost of the therapy because they deemed it to be experimental.

Proton beam therapy is recognized by the FDA and is often approved for pediatric and Medicare patients. The treatment allows doctors to focus cancer-fighting proton energy on the cancerous cells. Because it’s targeted, it preserves organ health and may reduce other harmful side effects.

Because of the location of Cunningham’s tumor, blindness and memory loss were risks. At the age of 54, however, she was deemed neither young or old. While unexplained, this age gap put her outside the range of insurance coverage. Because of the denial, the Cunningham’s had to mortgage their home to pay for the proton beam treatment. She died shortly after receiving the treatment and her husband filed a bad faith insurance lawsuit in an attempt to hold the insurance company responsible for their actions.

Mr. Cunningham’s attorney claimed Aetna’s denial involved underqualified doctors who were working in the best interests of the bottom line, instead of Ms. Cunningham. None of Aetna’s in-house medical reviewers were specialists in proton beam cancer therapy. One physician was an internal medicine doctor who had not practiced with patients in 25 years. Another reviewer was a general surgeon. The third was a hematologist/oncologist who had no experience with radiation therapy.

The reviewers were also found to have not spent more than 30 to 45 minutes reviewing claims for treatments and at least one had filed an official personnel complaint regarding having to review 80 plus claims per day. It was also clear that not a single reviewer had read the insurance contract prior to denying Cunningham’s claim. One of the reviewers had spoken to Cunningham’s doctor and acknowledged the treatment was recommended but said the claim had to be denied anyway.

The jury agreed the insurance company acted in bad faith and nearly $10 million of the total compensation was awarded in the form of punitive damages, as a way to punish the insurance company for their action.

Treatments deemed experimental or investigational by insurance companies cause problems for individuals who are seeking forms of modern medical treatment. This often includes technologies like pacemakers and microprocessor-augmented prosthetic knees. While there is some success when attempting to reverse the denial, it can take weeks – which not every patient has. Bad faith insurance claims can help victims and their families recover some of the losses they’ve incurred.