Battle Over Unproved Treatments Escalates : Health insurance: A growing number of lawsuits from cancer patients are trying to force cost-conscious companies to pay for ‘experimental’ procedures.

In June of 1991, shortly after her 38th birthday, Nelene Fox of Temecula discovered she had breast cancer. Despite three months of chemotherapy, the cancer spread to her bone marrow. Her only hope, her doctors said, was to undergo an expensive and unproved treatment, a bone-marrow transplant that would allow Fox to receive very high doses of chemotherapy.

But her insurer, Health Net of Woodland Hills, said it would not pay for the procedure, which it considered “investigational.” In June, Fox’s attorney filed suit against Health Net, the state’s second-largest health maintenance organization (HMO). She then turned to her family and friends, who with the help of 1,700 donors raised $210,000--enough so she could get the transplant. Fox’s cancer is now in remission, though her prognosis is unclear. Her suit is still pending.

Fox’s case is at the heart of a continuing battle in California and nationwide between people seeking costly, unproved treatments and insurance companies that are doggedly trying to contain rising medical costs.

Scores of cancer patients have filed or threatened to bring suits against insurance firms, including PacifiCare, Maxicare and Blue Shield of California--all of which have generally denied coverage for breast cancer-related bone marrow treatments on the ground that it is experimental. A few insurers, such as Blue Cross of California, based in Woodland Hills, and Kaiser Permanente, generally pay for the procedure, although each patient is reviewed individually.

“The bone marrow transplant issue gets at part of the crux of the health-care crisis,” said Dr. James Gajewski, a member of the UCLA Medical Center bone marrow transplant team. “What do you do with patients with a terminal disease who may have a chance of cure” with therapy that’s inconclusive? he asked. “How do you pay for it?”

Gajewski believes financial concerns are behind the insurance industry’s reluctance to pay for bone marrow transplants for breast cancer patients. Unlike similar treatments for other, more uncommon cancers, which insurance firms generally cover, breast cancer afflicts one out of nine women. As such, Gajewski said, insurance firms are worried about the costs of “dealing with a much larger population.”

Others say the problem is that insurance firms do not fully disclose what they cover and what they don’t, leaving the patient with an uncertain policy. Health insurance companies “must clearly tell patients what is not covered, and they don’t do it,” said Melvin H. Kischner, a Van Nuys family physician who is chairman of the bioethics committee at Valley Hospital.

Health insurers acknowledged that costs are a major consideration in their operations, but deny that they hold financial interests above the needs of patients. Most said they rely on a panel of doctors that determine what is or isn’t covered.

“Initially, some insurers did use technological assessment to get away from paying for” certain expensive procedures, said Dr. Lee N. Newcomer, national medical director for the United Health Care Corp., a large Minneapolis-based operator of HMOs. United Health Care, he said, generally does not pay for bone marrow transplants for breast cancer patients--a procedure that typically costs about $150,000.

But today, Newcomer said, the primary incentive for not covering bone marrow transplants and other advanced treatments is “because it’s truly unproven.”

Health Net, an HMO with an enrollment of nearly 900,000 people in California, says it has been hit with a “handful” of suits from breast cancer patients seeking bone marrow transplants. Spokesman Don Prial said he couldn’t discuss any specific cases, including Nelene Fox’s, because of state privacy laws. But in general, he said, the company doesn’t pay for anything that’s “experimental or investigational.”

Yet Health Net has paid for the procedure before, but only after a lengthy battle with the patient--who happened to be one of Health Net’s employees.

For months in 1991, Janice Bosworth of Simi Valley, then a supervisor at Health Net, sought to have her employer pay for a bone marrow transplant to treat her advanced stage of breast cancer, which doctors said was her only chance of survival. According to Steve Bosworth, her husband, Health Net would not give approval for the treatment, until the Bosworths filed a suit against the HMO in February. Janice Bosworth had the transplant later that month, and her cancer is now in remission. She is on disability leave. Steve Bosworth said he and his wife “went through a horrendous nightmare.”

Prial of Health Net conceded that the HMO reversed its decision in Bosworth’s case. But he said the approval came after a medical review, but had nothing to do with financial considerations.

Steve Bosworth, an independent insurance broker, believes, however, that Health Net was motivated by financial concerns. He alleges that Health Net did not want to pay for the test because its executives and some doctors that contract with Health Net have incentives in their contract that allow them to make more if they spend less for medical care.

“That’s a claim that is made, but it is fallacious,” Prial said.

While health insurers routinely deny advanced medical techniques or drugs on the grounds that they are unnecessary or experimental, no procedure has stirred as much emotion or debate as bone marrow transplantation for breast cancer patients.

The medical community has long recognized bone marrow transplants as an effective procedure for some types of cancer, including leukemia. Insurers generally pay for those treatments. But transplants for breast cancer patients are a subject of intense debate.

Cancer specialists say medical centers have been conducting transplants for breast cancer for the past decade, and they agree that for advanced breast cancer patients, transplants seem to offer as much as a 20% chance for long-term survival.

Doctors, however, say 5% or more die from the treatment itself. In autologous bone marrow transplant, as the procedure is called, doctors use a needle to remove the patient’s bone marrow, which produces crucial disease-fighting white blood cells. By removing the marrow and freezing it, doctors can give the patient high doses of chemotherapy that otherwise could kill the bone marrow and the patient. After the intensive chemotherapy, the marrow cells are re-injected into the patient.

Doctors agree that as a whole, the procedure remains inconclusive, but many put a different spin on what is known.

UCLA’s Gajewski calls the procedure “a useful tool in treating breast cancer.”

Dr. William Osheroff, medical director at PacifiCare, a Cypress-based HMO with 720,000 members, says, “The problem with bone marrow transplants is that we don’t really have the data yet.” He added that PacifiCare had one case in which a breast cancer patient threatened to file a lawsuit. Osheroff said the company eventually decided to approve the procedure in that case.

According to a statement from the National Cancer Institute, which is now sponsoring studies that may resolve the debate, preliminary results show the procedure appears to be “very promising.” But experts say results from the Cancer Institute trials are three to four years away.

Until then, questions surrounding the procedure and whether to pay for it can be expected to fester.

“It’s a problem endemic to all insurance carriers,” said Gary Tysch, an attorney whose Claremont firm Shernoff, Bidart & Darras has filed about 20 suits against insurance firms for denying payment for medical procedures, mostly bone marrow transplants for breast cancer patients.

Health Net isn’t the only HMO or insurance company that has taken heat from patients and some doctors for denying medical coverage. According to Tysch, numerous suits have been filed against Blue Shield of California. But like doctors, the health-care industry is divided on the issue.

Blue Cross of California, for instance, agreed in February, 1991, to pay for bone marrow transplants for some of its breast cancer patients. The company, which has 5.4 million members, took the step after it faced several lawsuits by its patients.

“All available clinical studies, research and published data led to the conclusion it was an effective medical treatment,” spokesman Michael Chee said in explaining why Blue Cross approved the procedure.

But for most other insurance companies, the general rule seems to be to disallow it.

Dr. William Weil, medical director for Maxicare, a Los Angeles-based HMO with 285,000 members, argued that “people who have managed care policies have standard, solid health care. But they don’t have Cadillacs. It doesn’t pay for experimental procedures.”