OGC Opinion No. 08-07-18

The Office of General Counsel issued the following opinion on July 22, 2008, representing the position of the New York State Insurance Department.

RE: Post-Mastectomy Breast Reconstruction Surgery Mandate

Questions Presented:

1) May an insurer apply its utilization review process to a request or claim for a post-mastectomy breast reconstruction for which coverage is required pursuant to N.Y. Ins. Law § 4303(x) (McKinney Supp. 2008)?

2) Does Insurance Law § 4303(x) apply to a request or claim for breast reconstruction surgery that follows the successful completion of an initial post-mastectomy breast reconstruction?

Conclusions:

1) No. Insurance Law § 4303(x) prohibits an insurer from applying its utilization review process to post-mastectomy breast reconstruction because the statute mandates coverage for breast reconstruction surgery that is performed in the manner determined by the attending physician and the patient to be appropriate.

2) Yes. Insurance Law § 4303(x) applies to a request or claim for breast reconstruction surgery that follows the successful completion of all stages of an initial post-mastectomy breast reconstruction.

Facts:

The inquirer reports that she represents ABC Health Plan (ABC). This inquiry stems from the client’s denial of an insured’s request for a DIEP Flap breast reconstruction. The insured requested the procedure to replace a saline breast implant from a previous post-mastectomy breast reconstruction because the implant had failed.¹

On June 13, 2007, ABC issued an adverse determination stating the following:

On July 18, 2007, ABC issued a final adverse determination denying the insureds appeal for the following reason:

The insured has submitted a request for an external appeal pursuant to Article 49 of the Insurance Law based upon the insurer’s denial of the claim as not medically necessary. The inquirer asks whether utilization review applies to claims regarding post-mastectomy breast reconstruction for which coverage is required under the New York Insurance Law.

Despite this particular set of facts, the inquirer has presented the inquiry as one of a general nature.

Analysis:

A. Utilization Review

The inquirer asks whether an insurer may apply its utilization review procedure to claims or requests for post-mastectomy breast reconstruction for which coverage is required pursuant to Insurance Law § 4303(x). Implicit in the inquirer’s question is whether an insurer may use the findings of its utilization review process as a basis for denying such a claim or any part thereof.

Insurance Law § 4900(h) defines “utilization review” as a review to determine whether particular health care services sought or provided to an insured are medically necessary. The statute specifically excludes certain other types of determinations from utilization review, such as coverage issues that do not concern whether a health care service is medically necessary.

Insurance Law § 4303(x)(1) requires non-profit health plans and health maintenance organizations (HMOs)³ to provide coverage for breast reconstruction surgery after a mastectomy. The statute reads as follows:

Insurance Law §§ 3216(i)(20) and 3221(k)(10) contain similar provisions with respect to commercial individual and group accident and health insurance policies, respectively.

Under a plain reading of Insurance Law § 4303(x), an insurer may not deny a post-mastectomy breast reconstruction claim based upon a utilization review determination. By its terms, the statute requires coverage for breast reconstruction surgery after mastectomy. And, since the statute requires coverage for reconstruction “in the manner determined by the attending physician and the patient to be appropriate,” Insurance Law § 4303(x) vests the patient and her attending physician with discretion in choosing the type of reconstruction. Given the unequivocal language of the statute, the only determination left to the insurer is to determine the insured’s eligibility for coverage, or other coverage issues not inconsistent with the statute’s mandate.

The Department’s reading of Insurance Law § 4303(x) is consistent with the statute’s legislative history, which demonstrates that breast reconstruction after a mastectomy is always medically necessary. For instance, the sponsor’s memo states that “a patient who must undergo a mastectomy . . . should have the right to decide with their primary care physician or surgeon, how rehabilitation will occur after surgery.” 1997 N.Y. Sess. Laws 2025. The memo also states that “[t]his legislation would preserve a patient’s ability to consider all post-treatment options without limitations set in place by insurance industry policy.” 1997 N.Y. Sess. Laws 2026 (emphasis added). Further, the Legislature’s intent is evident from its stated concern about preventing insurers from denying claims for post-mastectomy breast reconstruction surgery as cosmetic. 1997 N.Y. Sess. Laws 2025 (“[M]any physicians have spent needless hours convincing insurance providers that breast reconstructive surgery after a mastectomy is not a cosmetic procedure . . . . ). Thus, the utilization review process is not available to insurers where Insurance Law § 4303(x) is implicated.

B. Subsequent Post-Mastectomy Breast Reconstruction

The inquirer also asks whether the scope of Insurance Law § 4303(x) includes additional breast surgeries following the successful completion of an initial post-mastectomy breast reconstruction, such as a subsequent surgery to replace a failed implant.

There is nothing in the text of Insurance Law § 4303(x) that specifically limits the statute’s scope to an initial post-mastectomy breast reconstruction. Nor does the statute (or for that matter, the legislative history) specify any time limit between the mastectomy and the breast reconstruction. Where, as is the case here, the Legislature “in enacting a statute utilized general terms, and did not, either expressly or by implication limit their operation, [a] court will not impose any limitation.” McKinney's Cons Laws of NY, Book 1, Statutes § 114. Thus, in addition to an initial breast reconstruction, Insurance Law § 4303(x)’s scope encompasses breast reconstruction surgery to correct or replace a failed reconstruction or otherwise maintain a patient’s breast reconstruction, provided the initial reconstruction followed a mastectomy.⁴

For further information you may contact Senior Attorney Brenda Gibbs at the Albany Office.

¹ Although the policy does not provide out-of-network coverage, that issue is not before the Department, because the claim in question was denied based upon medical necessity.

² In conversations with the Department, ABC representatives stated that a TRAM Flap reconstruction is available in-network. The TRAM Flap is similar to the DIEP Flap in that it uses tissue from a patient’s body to reconstruct the breasts. The procedures differ in the type of tissue used.

³ In accordance with New York Public Health Law § 4406(1), subscriber contracts of HMOs are regulated by the Insurance Department as if they were subscriber contracts of not-for-profit insurers.

⁴ The Department of General Counsel notes that the conclusions set forth in this opinion above apply no less to commercial individual and group accident and health insurance policies.