We are commonly encouraged to do what we can to stay fit, but not everyone's weight is within their control. Today, we're highlighting a recent case which addressed the question: “Is lipedema liposuction covered by insurance?”

What is Lipedema?

Some people suffer from lipedema, a rare condition involving an abnormal buildup of fat.

People with this condition have disproportionately large hips, stomachs, buttocks, and column-like legs. As lipedema advances, pain arises, mobility and joint disorders develop, and various other physical problems impact the person.

Can Lipedema be Treated?

Lipedema is not treated simply by diet and exercise. The most effective known treatment is tumescent liposuction surgery, or suction lipectomy. If successful, the patient gains increased mobility and reduction or even elimination of pain. It can lead to a more productive lifestyle.

Does Insurance Cover Lipo for Lipedema?

Most health plans have a general exclusion for cosmetic services or for plastic surgery that is not related to a health issue. Aetna, like many other health insurance companies, says that it will not provide coverage for cosmetic services.

What is a Clinical Policy Bulletin?

To identify services not covered, it has an internal list of procedures not found in the actual policy, called a Clinical Policy Bulletin. That bulletin is not typically provided with the policy, so the insured must obtain the Clinical Policy Bulletin online and locating it sometimes proves difficult. Aetna lists liposuction in its bulletin as a surgical procedure no covered, contending it is cosmetic surgery.

Facts of the Case:

• Ms. Kazda was insured by Aetna and suffered from lipedema.
• When she filed a claim through her surgeon's office for treatment, the procedure was promptly denied.
• The surgeon provided an appeal stating medical necessity and demonstrating that it was not cosmetic surgery. Still, it was denied since it was listed in the Clinical Policy Bulletin.
• A subsequent appeal followed and the claim was denied again for being merely a cosmetic surgery.
• She sought an attorney to assist with her medical benefit claim.
• Her attorney faced a problem that is typical in medical benefit claims in how to provide services that were cost-effective for the client.
• Because ERISA does not permit an award of attorney's fees or compensation to go to the client but rather the benefit goes to the provider, the attorney, unless representing the provider and the client, had some difficulty representing the client on a contingent fee basis.
• However, the attorney decided to assert a class action, which presents a much better opportunity for obtaining attorney's fees in all federal courts.
• After Ms. Kazda filed the class action lawsuit, Aetna amended the Clinical Policy Bulletin to exempt lipedema from the cosmetic surgery exclusion. (This was likely an effort to minimize the number of people that could be contained within the class.)
• Nonetheless, the decision affecting Ms. Kazda remained, and she had exhausted all claim remedies. Aetna opposed the class action.

Court Finding

The court ruled in Kazda v. Aetna Life Ins. Co., 19-cv-02512-WHO, at *1 (N.D. Cal. Apr. 26, 2022), “Kazda has standing to seek declaratory and injunctive relief requiring Aetna to reprocess the class members' previously denied claims and notify them of its policy change. Her claims are typical. She is an adequate representative. She has also sufficiently alleged questions common to the class-namely, whether Aetna had a policy or practice of denying these claims as cosmetic-that will drive the resolution of this matter. And although the class is small, given the circumstances of this case, certification is appropriate. Certification is also appropriate under Rule 23(b)(1)(A), as separate suits would risk establishing incompatible standards of conduct for Aetna, and Rule 23(b)(2), as the relief sought is appropriate for the class as a whole.”

There are other similar health conditions that may also have the potential for class certification. That is especially appealing in circuits that see an award of attorney's fees less frequently.