## Facts

- Tracy L. Reid sued individually and on behalf of her minor son, M.A.R., who was diagnosed with autism spectrum disorder in 2008.
- Reid alleged M.A.R. needed intensive behavioral therapy from 2008 through about 2012 and that the treatment reduced violent tantrums and aggressive behavior and allowed him to attend school with nondisabled peers.
- While Reid was employed, she had health coverage through a HealthPartners Insurance Company plan that expressly excluded intensive behavioral therapies for the treatment of autism.
- HealthPartners denied claims for M.A.R.’s intensive behavioral therapy based on that exclusion.
- Reid pursued internal appeals and then sought external review through an organization contracted by the Minnesota Department of Commerce (MNDC); the external reviewer affirmed the denial.
- Reid later became self-employed and bought an individual policy issued by BCBSM, Inc. d/b/a Blue Cross and Blue Shield of Minnesota (Blue Cross).
- Reid alleged the Blue Cross plan initially did not contain an autism-treatment exclusion, but Blue Cross denied coverage on the ground that the therapy was not medically necessary.
- After Reid appealed and obtained coverage for a period, Blue Cross notified her it was adding an explicit exclusion for intensive behavioral therapies to treat autism and then denied further coverage based on the new exclusion.
- Reid filed a federal lawsuit against Blue Cross, HealthPartners, MNDC, and MNDC Commissioner Michael Rothman, asserting disability-discrimination and insurance-related claims, including ERISA-based theories.
- Defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6) (and related dismissal grounds as to the state defendants).

## Issues

1. Whether Reid plausibly stated federal disability-discrimination claims (including ADA-based theories) challenging the insurers’ coverage denials and autism-related therapy exclusions.
2. Whether Reid plausibly stated ERISA claims against Blue Cross based on its denial of benefits and its addition and application of an autism-related therapy exclusion.
3. Whether HealthPartners could be liable for denying benefits under a plan provision that expressly excluded intensive behavioral therapies for autism.
4. Whether MNDC and its commissioner could be held liable based on their regulatory and external-review roles, and whether immunity doctrines barred claims against them.

## Decision

- The court granted MNDC and Commissioner Rothman’s motion to dismiss in full, dismissing all claims against the state defendants.
- The court granted HealthPartners’ motion to dismiss in full, dismissing all claims against HealthPartners.
- The court granted Blue Cross’s motion to dismiss in part and denied it in part, allowing only a narrowed set of claims—primarily ERISA-based claims connected to the Blue Cross plan’s benefit determinations and coverage terms—to proceed.

## Legal Principles

- On a Rule 12(b)(6) motion, the court accepts well-pleaded factual allegations as true but requires sufficient factual matter to state a plausible claim for relief.
- ADA theories aimed at the content of insurance coverage (as opposed to denial of access to a place of public accommodation or covered governmental services) generally face significant limits at the pleading stage.
- ERISA provides a cause of action to seek benefits allegedly due under the terms of an ERISA plan and, in appropriate circumstances, equitable relief tied to plan administration; however, duplicative or legally unavailable remedies may be dismissed.
- A plaintiff must connect alleged wrongdoing to each defendant’s own conduct; a state regulator’s approval, oversight, or use of an external-review process is not, by itself, enough to make the regulator liable for a private insurer’s benefit denials.
- Sovereign-immunity principles and defendant-specific pleading requirements can bar or defeat claims against state agencies and state officials sued in their official capacities.

## Conclusion

Reid held that claims against the Minnesota Department of Commerce, its commissioner, and HealthPartners should be dismissed at the pleading stage, while the case could continue only in limited form against Blue Cross, chiefly on ERISA theories tied to benefit denials and the plan’s autism-related therapy exclusion.


Reid v. BCBSM, Inc., 2013 U.S. Dist. LEXIS 165364 (2013)