Issued and entered this _6th_ day of October 2010 by Ken Ross Commissioner ORDER I PROCEDURAL BACKGROUND

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1 STATE OF MICHIGAN DEPARTMENT OF ENERGY, LABOR & ECONOMIC GROWTH OFFICE OF FINANCIAL AND INSURANCE REGULATION Before the Commissioner of Financial and Insurance Regulation In the matter of XXXXX Petitioner File No v Blue Cross Blue Shield of Michigan Respondent / Issued and entered this _6th_ day of October 2010 by Ken Ross Commissioner ORDER I PROCEDURAL BACKGROUND On February 11, 2010, XXXXX, MD, authorized representative of XXXXX (Petitioner), filed a request for external review with the Commissioner of Financial and Insurance Regulation under the Patient s Right to Independent Review Act, MCL et seq. The Commissioner reviewed the request and accepted it on February 19, The Commissioner notified Blue Cross Blue Shield of Michigan (BCBSM) of the external review and requested the information used in making its adverse determination. The Commissioner received BCBSM s response on March 2, The contract here is the BCBSM Community Blue Group Benefits Certificate (the certificate). Because medical issues were involved, the Commissioner assigned the case to an independent review organization which provided its analysis and recommendations to the Commissioner on March 5, 2010.

2 Page 2 II FACTUAL BACKGROUND The Petitioner had X-STOP interspinous process decompression surgery on March 16, In this surgery, a device is inserted between vertebrae in a position that relieves pressure on the nerve canal. The charge for the surgery was $2, BCBSM denied coverage because it believes the surgery to be investigational and therefore excluded under the terms of the certificate. The Petitioner appealed BCBSM s decision. BCBSM held a managerial-level conference on January 5, 2010, and issued a final adverse determination on January 14, 2010, upholding its denial. III ISSUE Did BCBSM correctly deny coverage for the Petitioner s X-STOP surgery? Petitioner s Argument IV ANALYSIS The Petitioner s condition is called lumbar spinal stenosis, a narrowing of the spinal canal that compresses or pinches the nerves. He had been experiencing back pain and had received various forms of treatment for the condition before he had the X-STOP surgery, also called an interspinous distraction system. The Petitioner s doctor argues that the X-STOP procedure is not investigational. He says it has been approved by the FDA and is covered by Medicare and most other insurance companies. He believes the procedure clearly meets the substantial clinical improvement criterion when compared to other management modalities for lumbar spinal stenosis patients. The Petitioner s doctor says BCBSM should therefore cover this surgery as it was medically necessary for treatment of the Petitioner s condition.

3 Page 3 BCBSM s Argument BCBSM says that under the terms of the certificate, investigational services are not covered. The certificate, in Section 6: General Conditions of Your Contract, has this provision: Experimental Treatment Services That Are Not Payable We do not pay for experimental treatment (including experimental drugs or devices) or services related to experimental treatment.... In Section 7, the certificate defines experimental treatment as: Treatment that has not been scientifically proven to be as safe and effective for treatment of the patient s conditions as conventional treatment. In its denial of coverage, BCBSM relied on its medical policy title, Interspinous Distraction Systems, which states in part: Interspinous distraction systems are considered experimental/investigational. These devices have not been scientifically demonstrated to be as effective as conventional treatment. Rationale The only available controlled study of the X-STOP IPD System was performed by Zucherman, et al., in The investigators enrolled 200 patients who experienced back pain for an average of 4.1 years and who had neurogenic intermittent claudation secondary to lumbar spinal stenosis. These patients were randomized to a treatment group that underwent implantation of one or two X-STOP devices or a control group that underwent conservative management with one or more epidural steroid injections. Some control group patients also underwent treatment with NSAIDs, analgesics and/or physical therapy. The primary outcome measure was the Zurich Claudication Questionnaire (ZCQ). At 2 years follow-up, mean ZCQ Symptom Severity scores improved 45%± 40% for the X-STOP treatment group versus a 7% ± 40% improvement for the control group. In addition, mean ZCQ Physical Function scores had improved 44% ±50% for the X-STOP treatment group versus a 0% ± 65% change for the control group. Results of this study suggest that this device enables statistically significant improvements in symptoms severity and physical function as measured by the ZCQ. However, there has been one sole randomized controlled trial, and the device manufacturer sponsored this trial. The North American Spine Society published guidelines in 2007 on the diagnosis and treatment of degenerative lumbar spinal stenosis. The conclusion was that there is insufficient evidence that placement of the X- STOP is more effective than medical/interventional treatment.

4 Page 4 Recommendations included performing a large, multicenter, three-arm randomized, controlled trial using a well-defined group of patients with moderate stenosis, comparing the use of X-STOP to a microlaminotomy decompression and a well-defined medical/interventional treatment program. Medical Policy Position Summary (Non-clinical summary statement for customer use) Lower back pain in mature adults may be caused by lumbar spinal stenosis. The back pain develops due to changes in the spinal disks, joints and/or ligaments. These changes can compress the spinal nerves which cause pain and difficulty walking. If conservative treatment such as rest, nonsteroidal anti-inflammatory drugs (NSAIDS), muscle relaxants and physical therapy do not provide relief or improvement, surgery may be indicated. Interspinous distraction systems (IPD) have been developed to treat the lumbar stenosis associated with pain and difficulty walking. The surgery consists of the placement of a spacer in the back to reduce some back movement and prevent the symptoms of spinal stenosis. There have been some promising studies with noted improvement when IPD systems are used, but several questions remain about the device and additional studies need to be completed. Therefore, the interspinous distraction system implant is considered experimental/investigational. BCBSM maintains its denial of coverage for the Petitioner s surgery was appropriate under the terms of the contract. Commissioner s Review The question of whether the Petitioner s surgery was experimental or investigational was presented to an independent review organization (IRO) for analysis as required by Section 11(6) of Patient s Right to Independent Review Act. The IRO reviewer is board-certified in neurology and has been in active practice for more than fifteen years. The IRO physician reviewer concluded that the X-STOP device is investigational for treatment of the Petitioner s condition. The MAXIMUS physician consultant explained that the X-STOP device is designed to distract the posterior elements of a stenotic segment and place it into flexion to treat neurogenic claudication. The MAXIMUS physician consultant also explained that although early results with this device suggest that it has a possible role in the management of degenerative disorders of the lumbar spine, it continues to be evaluated in clinical trials. The MAXIMUS physician consultant indicated that there are concerns about the long term effectiveness of the X-STOP device after one year. The MAXIMUS

5 Page 5 physician consultant also indicated that the [Petitioner] did not have neurogenic claudication that was relieved by forward flexion. The MAXIMUS physician consultant further indicated that the [Petitioner] has multilevel degenerative disease of the lumbar spine. The MAXIMUS physician consultant explained that [the] available literature does not show that the X- STOP procedure was likely to be more efficacious than any other standard therapy for treatment of [the Petitioner s] condition. [Citations omitted] Pursuant to the information set forth above and available documentation, the MAXIMUS physician consultant determined that the X-STOP procedure that [the Petitioner] underwent was experimental/investigational for treatment of his condition. While the Commissioner is not required in all instances to accept the IRO s recommendation, it is afforded deference. In a decision to uphold or reverse an adverse determination, the Commissioner must cite the principal reason or reasons why the Commissioner did not follow the assigned independent review organization s recommendation. MCL (16) (b). The IRO reviewer s analysis is based on extensive expertise and professional judgment and the Commissioner can discern no reason why that judgment should be rejected in the present case. The Commissioner accepts the conclusion of the IRO and finds that BCBSM s denial of coverage is consistent with the terms of the certificate and should be upheld. V ORDER BCBSM s final adverse determination of January 14, 2010, is upheld. BCBSM is not responsible for covering for X-STOP surgery. This is a final decision of an administrative agency. Under MCL , any person aggrieved by this Order may seek judicial review no later than sixty days from the date of this Order in the circuit court for the county where the covered person resides or in the circuit court of Ingham County. A copy of the petition for judicial review should be sent to the Commissioner of Financial and Insurance Regulation, Health Plans Division, Post Office Box 30220, Lansing, MI

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