A medical device company that designs and manufactures customized hip and knee replacements sued an insurance company that characterized customized total knee replacements as experimental and investigational. The lower court dismissed the case. The decision was partially overturned on appeal, and the case was reinstated.
WHY THIS IS IMPORTANT…the insurer’s plans provided reimbursement for the system from 2011 until 2018, when it released a revised policy that considered customized total knee replacements as experimental and investigational. The product in question had FDA approval. Because the court found that the policy statement could be read as a verifiable assertion that the system is not clinically effective and not accepted by doctors and insurance providers as a standard treatment, the product disparagement case was reinstated.