Summers v. Touchpoint Health Plan, Inc.

N. PATRICK CROOKS, J.

¶ 1. This is a review of a published decision of the court of appeals,1 reversing in part and remanding for further proceedings a judgment of the Circuit Court for Outagamie County, Judge Dee R. Dyer, presiding. >

*84¶ 2. Petitioner, Touchpoint Health Plan, Inc. (Touchpoint), seeks review of a published decision of the court of appeals, which reversed the circuit court's grant of summary judgment in favor of Touchpoint. The court of appeals remanded the case to the circuit court with an instruction to order the reinstatement of benefits as of the date that the benefits were terminated. The circuit court had upheld Touchpoint in its decision to terminate the health insurance benefits of Parker Summers (Parker), the minor son of Kevin and Amy Summers (the Summers), in regard to Parker's treatments for anaplastic ependymoma. This case involves this court's authority under 29 U.S.C. § 1132(a)(l)(B)-(e)(l) (2000)2 to review claims arising from an Employee Retirement Income Security Act (ERISA) governed plan for the recovery of benefits due under such a plan, the enforcement of rights under the terms of such a plan, or the clarification of rights to future benefits under such a plan. See Evans v. W.E.A. Ins. Trust, 122 Wis. 2d 1, 5, 361 N.W.2d 630 (1985). The case also involves 29 U.S.C. § 1133 and 29 C.F.R. § 2560-503-1 (2002)3.

¶ 3. There are two principal issues upon review: 1) Whether the termination decision itself, which denied the resubmitted request for benefits under an ERISA-governed plan, as well as the termination letter, were both arbitrary and capricious when, as here, the termination letter4 allegedly did not adequately set forth the *85reasons for the termination?; and 2) If so, what is the appropriate remedy?

¶ 4. We affirm the decision of the court of appeals. We hold that the termination decision itself was arbitrary and capricious because Touchpoint's interpretations of the plan were inconsistent. We also are satisfied that Touchpoint's decision was arbitrary and capricious because Touchpoint's termination of benefits decision was made despite the external review agency's finding that the requested treatment met the standard of care and was medically necessary, and despite the external review agency recommending approval for the treatment. We further hold that the second termination letter of December 12, 2002, was arbitrary and capricious, because it did not provide a sufficient and adequate explanation of the reasons for Touchpoint's termination of benefits. As a result, the Summers were not provided with the opportunity for a full and fair review of the termination, which is required by 29 U.S.C. § 1133 and 29 C.F.R. § 2560-503-1.

¶ 5. Lastly, we hold that, given the inconsistent interpretations of the plan by Touchpoint, as well as the ambiguous policy provisions concerning participation in a clinical trial, the appropriate remedy for the termination of benefits in this case is the reinstatement of benefits forward from the date that the benefits were terminated.

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¶ 6. Kevin Summers was employed by and received health benefits for his family through Kimberly Clark Corporation (Kimberly Clark). Kimberly Clark *86had contracted with Touchpoint, a health care maintenance organization, to administer its health benefits plan. This case involves the question of whether benefits for high-dose chemotherapy with stem-cell rescue were due under the provisions of that health benefits plan.

¶ 7. In October 2002 the Summers' son, Parker, was diagnosed as having a cancerous brain tumor known as an anaplastic ependymoma, which is a rare form of childhood cancer. Parker's doctor referred him to the University of Wisconsin Hospital for surgery to remove his tumor, which Touchpoint approved. Touch-point paid for the surgery and follow-up care.

¶ 8. After the surgery, Parker's surgeon referred him to a pediatric oncologist, Dr. Diane Puccetti (Dr. Puccetti), for ongoing cancer treatment. Such follow-up treatment was necessary after surgery to prevent the progression of his disease and, therefore, to increase his chances of surviving. Dr. Puccetti weighed three treatment options for Parker: observation, chemotherapy with radiation, and high-dose chemotherapy with stem-cell rescue. After weighing all three options, Dr. Pucc-etti decided that high-dose chemotherapy with stem-cell rescue would be Parker's best option, because it had a higher cure rate than conventional chemotherapy. As a result, Dr. Puccetti sought to have Parker enrolled in a clinical trial that included this specialized chemotherapy, which a doctor at the New York University Medical School was conducting.

¶ 9. The Summers sought coverage from Touch-point for the ongoing cancer treatment that was recommended. Touchpoint terminated coverage for such cancer treatment, because of the exclusion of experimental and investigational procedures in Kimberly Clark's plan with Touchpoint. Specifically, the plan excluded any *87"service, supply, drug, device, treatment, or procedure" that Touchpoint's medical director determined was "the subject of an on-going Phase I or II clinical trial" or was "furnished in connection with medical or other research to determine its maximum tolerated dose, its toxicity, its safety, or its efficacy .. .

¶ 10. After the recommended cancer treatment was terminated,5 the Summers took Parker to see Dr. Kelly Maloney at the Children's Hospital of Wisconsin. Dr. Maloney recommended chemotherapy and radiation as a course of treatment, which the Summers rejected because of the risks to a young child associated with radiation.

¶ 11. On November 20, 2002, the Summers requested that Touchpoint submit its termination of benefits to an independent review organization for an expedited review under the terms of Kimberly Clark's plan. On November 25, 2002, while determining that the recommended cancer treatment was within the standard of care and medically necessary, the independent review organization upheld Touchpoint's termination of benefits because it concluded that, "[biased on the policy language submitted, the proposed therapy meets the criteria of experimental."

¶ 12. Touchpoint's external review agency, despite upholding Touchpoint's termination of benefits, stated, *88"Although the proposed treatment would fall under the policy language as experimental/investigational, I would recommend approving the proposed therapy as it would be one of the standard approaches for three-year-old children with this disorder. . . . There is no alternative with superior or proven results and is therefore, medically necessary." Furthermore, the review agency stated, "All patients with this disorder are standardly enrolled in clinical trials and all mature trials are phase II. ... [T]he standard of care for patients with this disorder is to enroll patients into the best phase II trials available that are building on the success of previous phase II trials. That is the case for this patient."

¶ 13. After learning about the results of the independent review, Dr. Puccetti suggested removing Parker from the clinical trial, but giving him the same cancer treatment. Dr. Puccetti submitted another request for the treatment's coverage that noted the treatment would now not be a part of any clinical trial. Once again, Touchpoint terminated coverage, and it issued a letter on December 12, 2002, that noted the decision. It is that letter which has become a focal point of this case.

¶ 14. Notwithstanding Touchpoint's termination of coverage, Dr. Puccetti administered the treatment to Parker. The Summers then sued Touchpoint in Outagamie County Circuit Court to attempt to gain coverage for the treatment. The circuit court granted Touchpoint's summary judgment motion, after determining that the plan unambiguously excluded coverage for any treatments that were the subject of Phase II clinical trials, and that Touchpoint's termination was reasonable, because it was not in dispute that the treatment administered was the subject of such a Phase II clinical trial. The court of appeals reversed the circuit court's decision. It held that the December 12, 2002 *89termination letter was arbitrary and capricious, thus violating 29 U.S.C. § 1133, and the applicable regulations promulgated under that statute's authority. As a result, the court of appeals remanded the case back to the circuit court with instructions to reinstate benefits retroactively. Touchpoint petitioned this court for a review of that decision.

¶ 15. We begin with a discussion of our standards of review. We review a circuit court's grant or denial of summary judgment independently of either the circuit court or the court of appeals, applying the same methodology, but benefiting from their analyses. AKG Real Estate, LLC v. Kosterman, 2006 WI 106, ¶ 14, 296 Wis. 2d 1, 717 N.W.2d 835. Summary judgment is appropriate if there are no genuine issues of material fact, and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2). Summary judgment materials, including pleadings, depositions, answers to interrogatories, and admissions on file are viewed in the light most favorable to the nonmoving party. Rainbow Country Rentals v. Ameritech Publ'g, 2005 WI 153, ¶ 13, 286 Wis. 2d 170, 706 N.W.2d 95. In this case, the material facts are not in dispute, which leaves only questions of law that we review de novo. 1325 N. Van Buren, LLC v. T-3 Group, Ltd., 2006 WI 94, ¶ 22, 293 Wis. 2d 410, 716 N.W.2d 822.

¶ 16. The motion for summary judgment in this case also presents a question of law on how we review the termination of benefits under an ERISA-governed plan. In cases involving the termination of benefits *90under an ERISA-governed plan, courts apply one of two standards of review. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). The default standard of review for the termination of benefits is de novo. Id. Under the de novo standard, no deference is given to the plan administrator's or fiduciary's termination of benefits. Id. at 113-15. However, if the plan reserves discretion to the plan administrator or fiduciary, the termination of benefits is reviewed under a discretionary standard. Id. at 115. Under the discretionary standard, the termination of benefits will not be reversed unless it was arbitrary and capricious. Id. at 113-15. Courts review the policy's language on a case by case basis to determine which standard of review applies to the termination of benefits in the particular case. Id.

¶ 17. The language of the policy in question here supports the application of the discretionary standard. A benefit plan may confer such discretion even in the absence of any express language to that effect. Vander Pas v. Unum Life Ins. Co., 7 F. Supp. 2d 1011, 1014 (E.D. Wis. 1998) (citing Sisters of the Third Order of St. Francis v. SwedishAmerican Group Health Benefit Trust, 901 F.2d 1369, 1371 (7th Cir. 1990)). In this case, however, Touchpoint's plan expressly conferred such discretion. The policy states, "Touchpoint Health Plan has the power and authority to administer, interpret and apply this Policy. Touchpoint Health Plan will decide all questions arising in connection with the Policy, and may issue any necessary rule and regulations for the purpose of administering the Policy." The policy grants Touchpoint's medical director the discretion to terminate coverage if treatments are experimental or investigational. The plan also gives Touchpoint's medical director the authority and discretion to inter*91pret the plan's language and its coverage. Because the plan conferred discretion, the appropriate issue in this case is whether Touchpoint's termination of benefits was arbitrary and capricious. Firestone Tire & Rubber Co., 489 U.S. at 113—15; see also Halpin v. W.W. Grainger, Inc., 962 F.2d 685, 688 (7th Cir. 1992) (holding the administrator had discretion, and, therefore, the discretionary standard of review was the appropriate one to utilize, based on nearly identical language to Touchpoint's plan, when the Grainger plan stated the administrator " 'shall determine all questions arising in the administration, interpretation and operation of the Plan'" (citation omitted)). However, review under even "the deferential arbitrary and capricious standard is not a rubber stamp and deference need not be abject." Hackett v. Xerox Corp. Long-Term Disability Income Plan, 315 F.3d 771, 774 (7th Cir. 2003) (citation omitted). As a result, even under this deferential review, the United States Court of Appeals for the Seventh Circuit stated that "we will not uphold a termination when there is an absence of reasoning in the record to support it." Id. at 774-75.

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¶ 18. Before addressing the termination decision itself, we examine whether the failure to extend benefits under an ERISA-governed plan6 was arbitrary and capricious here, where the termination letter allegedly does not adequately set forth the reasons for the termination. At issue here is the second termination letter of December 12, 2002. That letter, in pertinent part, stated: "The request was reviewed and it was *92determined this is an exclusion of coverage as stated in your Certificate of Coverage .... For additional information, refer to your Certificate of Coverage under RESTRICTIONS, LIMITATIONS, AND EXCLUSIONS FOR COVERED SERVICES."

¶ 19. On review, Touchpoint claims that its second termination letter substantially complied with 29 U.S.C. § 1133. Touchpoint argues that the communication was sufficient to inform the Summers of the basis for the termination of coverage. It also argues that, evaluating all the communications with the Summers, there was enough for a meaningful review by them.

¶ 20. The Summers argue that the second termination letter was arbitrary and capricious. They claim that letter failed to provide them with a clear and precise understanding of the termination decision, in violation of ERISA's requirements. As a result, they assert that the letter was arbitrary and capricious, because it did not provide them with an adequate reason for the termination of benefits. The Summers argue that, because the second termination letter did not adequately state why coverage was terminated, and merely described the procedures that the Summers could use to challenge the termination, the Summers were not provided with the opportunity for a full and fair review of the termination, which is required by 29 U.S.C. § 1133 and 29 C.F.R. § 2560-503-1.

¶ 21. We are satisfied that the Summers are correct that the second termination letter of December 12, 2002, was arbitrary and capricious, because it did not provide a sufficient explanation of the reasons for Touchpoint's termination of benefits. As a result, the Summers were not provided with the opportunity for a full and fair review of the termination, which is re*93quired by 29 U.S.C. § 1133 and 29 C.F.R. § 2560-503-1. The second letter violates the relevant statutes and regulations.

¶ 22. For a letter communicating an adverse benefits decision to satisfy ERISA's requirements, so that it is not arbitrary and capricious, it must provide adequate reasoning to explain the decision, so the beneficiary will have a "clear and precise understanding" of the decision. Hackett, 315 F.3d at 775. Bare conclusions are not a sufficient rationale, and "the regulations require that the denial letter itself contain specific reasons." Halpin, 962 F.2d at 693.

¶ 23. Compliance with 29 U.S.C. § 1133 requires two elements. First, every ERISA-governed employee benefits plan must "provide adequate notice in writing to any participant or beneficiary whose claim for benefits under the plan has been denied, setting forth the specific reasons for such denial, written in a manner calculated to be understood by the participant...." 29 U.S.C. § 1133(1) (emphasis added). Second, every ERISA-governed employee benefits plan also must "afford a reasonable opportunity to any participant whose claim for benefits has been denied for a full and fair review by the appropriate named fiduciary of the decision denying the claim." 29 U.S.C. § 1133(2).

¶ 24. Furthermore, the relevant Code of Federal Regulations section requires that a notification of an adverse benefits determination must contain the "specific reason or reasons for the adverse determination;" a "[reference to the specific plan provisions on which the determination is based;" a "description of the plan's review procedures and the time limits applicable to such procedures, including a statement of the claimant's right *94to bring a civil action under section 502(a) of the Act following an adverse benefit determination on review;" and, for a group health plan with an experimental treatment exclusion or limit upon which an adverse benefits determination was based, "either an explanation of the scientific or clinical judgment for the determination, applying the terms of the plan to the claimant's medical circumstances, or a statement that such explanation will he provided free of charge upon request." 29 C.F.R. § 2560 — 503—1(g)(1) (emphasis added). A termination letter lacking the minimal requirements codified in the statutes and regulations is arbitrary and capricious. Dade v. Sherwin-Williams Co., 128 F.3d 1135, 1141 (7th Cir. 1997); see also Vander Pas, 7 F. Supp. 2d at 1018.

¶ 25. The second termination letter was deficient in numerous regards. The letter did not meet the requirement of including a specific reason for the termination, as required by 29 U.S.C. § 1133(1) and 29 C.F.R. § 2560-503-l(g)(l), but merely made reference to an exclusion of coverage. It did not include the required "[rjeference to the specific plan provisions on which the determination [was] based[,]" because it only referenced a broad, nonspecific segment of the policy (the Certificate of Coverage). 29 C.F.R. § 2560-503-l(g)(l)(ii). Also, because the adverse benefit determination apparently was based on an experimental treatment exclusion, the second letter was deficient given that it did not contain, as required, "either an explanation of the scientific or clinical judgment for the determination, applying the terms of the plan to the claimant's medical circumstances, or a statement that such explanation will be provided free of charge upon request." 29 C.F.R. § 2560-503-l(g)(l)(v)(B). Applying the relevant statutes and regulations, Touchpoint's second termination letter was arbitrary and capricious.

*95¶ 26. Case law also supports this conclusion. The Seventh Circuit recently dealt with a case based on similar factual underpinnings in the context of an ERISA-governed employer-sponsored disability benefits plan. Schneider v. Sentry Group Long Term Disability Plan, 422 F.3d 621 (7th Cir. 2005). Sentry terminated Schneider's long term disability benefits using a letter that merely referenced, but did not provide any details from, an independent medical exam report. The letter merely stated that the report held that Schneider had recovered and could return to work. Id. at 624. The letter stated, "As a result of this information, no further benefits are due." Id. The court noted that ERISA required that such notification to the claimant must provide the specific reasons behind the termination of benefits. Id. at 627. While acknowledging that previous case law had held that substantial compliance with the statutes and regulations was sufficient, the letter "was indefensible as a matter of statute, regulation and case law." Id. at 628 (citing Halpin, 962 F.2d at 690). The court noted that the letter failed to set forth the specific reasons why benefits were terminated and that it "did not identify the specific plan provision on which the denial was based ...." Schneider, 422 F.3d at 628. As a result, the court held that Schneider did not have " 'a sufficiently clear understanding of the administrator's position to permit effective review.'" Id. (citing Halpin, 962 F.2d at 690). The court determined Schneider was entitled to summary judgment on her claim that the letter violated ERISA and ordered the reinstatement of Schneider's benefits as of the date that the benefits were terminated. Schneider, 422 F.3d at 629-30.

¶ 27. In another case, a letter sent to a claimant informing him of the termination of his long term disability benefits was arbitrary and capricious when its *96reasoning only stated, " 'Continued Disability not clinically supported.'" Hacked, 315 F.3d at 773. When the claimant appealed, the appeal's termination only contained the exact same explanation. Id. The court held that the "absence of reasoning in the record to support [the decision]" did not provide the needed grounds to uphold the plan's decision to terminate benefits, even under the deferential arbitrary and capricious standard of review. Id. at 774-75. The reasons for the termination must be clear and specific. Id. at 774. As in this case before us, the specificity of the letter was the main issue, and that letter was inadequate, because it lacked the details behind the termination and contained only statements of the termination decision. The court concluded that the termination of Hackett's benefits was inappropriate, because benefits cannot be terminated as "the result of arbitrary and capricious procedures ...." Id. at 776.

¶ 28. In another case, an employer violated 29 U.S.C. § 1133 by failing to give a claimant adequate notice of the reasons for the termination of his benefits using a letter similar to the one in this case. Schleibaum v. Kmart Corp., 153 F.3d 496, 497 (7th Cir. 1998). Kmart's benefit administrator had informed Schleibaum that, after reviewing all the medical evidence, the administrator had found that Schleibaum was not permanently and totally disabled. Id. at 498. As a result, Kmart informed Schleibaum that the company would not continue to pay for his life insurance policy's premiums. Id. Kmart's "conclusory letter did not explain any specific reason for the finding that Mr. Schleibaum was not disabled ...." Id.

¶ 29. Touchpoint's attorney conceded at oral argument that the December 12, 2002, letter did not literally *97comply with ERISA's requirements. Indeed, as he admitted, one need only compare the first termination letter ■with the second termination letter to see that the second letter lacked the required details about the reasons why Touchpoint denied the Summers' second claim. However, he argued that the letters must be read together. Where this argument fails is on the fact that the Summers did not merely resubmit their first request. The Summers requested coverage using a different rationale. This change in the claim's rationale is significant. Given that the Summers submitted the second claim using a different rationale, reading the two termination letters together is not sufficient to meet the required specificity. The second termination letter must stand on its own.7

¶ 30. The Summers based their changed rationale on their interpretation of the plan's experimental exclusion as not excluding coverage for a treatment received by a patient who is not enrolled in a Phase II clinical trial, regardless of whether such treatment is "subject to" a Phase II clinical trial. The exclusion in the Touchpoint plan for treatments that are "the subject of an on-going Phase I or II clinical trial" is ambiguous, because of the uncertainty over what triggers the exclusion for an individual who is not in a Phase I or II clinical trial, but who is receiving a treatment that is the subject of such a trial. For example, it is unclear *98whether it is the treatment itself that is the subject of a Phase II trial, even if the claimant is not participating in the Phase II trial, or whether it is the claimant's receiving the treatment as a participant in the Phase II trial that triggers the exclusion. A term in an ERISA-governed benefits plan "is ambiguous if there is 'genuine (meaning, substantial) uncertainty, not resolvable by other means' in interpreting the term." Casey v. Uddeholm Corp., 32 F.3d 1094, 1096 (7th Cir. 1994), citing Harnischfeger Corp. v. Harbor Ins. Co., 927 F.2d 974, 976 (7th Cir. 1991). Touchpoint's experimental exclusion certainly seems to be genuinely uncertain and, as a result, ambiguous.

¶ 31. We agree with the federal courts that have held that " 'ambiguous terms in an insurance contract will be construed in favor of the insured.'" Pitcher v. Principal Mut. Life Ins. Co., 93 F.3d 407, 411 (7th Cir. 1996) (citations omitted). Here, it appears appropriate to resolve the ambiguous experimental exclusion against Touchpoint, its drafter, and in favor of the Summers. Given that its experimental exclusion was ambiguous, Touchpoint's failure to address the Summers' interpretation of the exclusion made the second termination letter arbitrary and capricious.8

*99¶ 32. When the Summers submitted their second application for the ongoing cancer treatment that was recommended, they proceeded under the belief that the reason Touchpoint refused their first request for such treatment was because Parker was participating in a Phase II clinical trial. Touchpoint's second termination letter does not acknowledge the Summers' changed reasoning that, because Parker was no longer participating in the clinical trial, Parker's treatments should be covered as part of his continuing course of treatment. Instead, Touchpoint simply repeated its decision to terminate coverage without giving any specific details for its decision. By only repeating its termination conclusion, and by failing to address or to respond to the Summers' changed rationale for coverage in its second termination letter, Touchpoint failed to communicate fully the specific reasons for its termination. Touchpoint erred in not addressing the Summers' policy interpretation, and should have provided the statutorily-required detailed rationale for its termination on the new grounds, regardless of the detail that the first letter had contained. The second letter simply does not provide the Summers with the required clear and precise understanding of why their second coverage request was denied, in light of their reasonable assumption about coverage for the treatment. Consequently, Touchpoint's second termination letter was arbitrary and capricious.

¶ 33. We also find Touchpoint's decision in terminating benefits to be arbitrary and capricious. At vari*100ous relevant times, Touchpoint was inconsistent in its position on what it would cover under the terms of the plan. This court has held that the absence of evidence that an administrator has consistently maintained an interpretation of the terms of its own plan "suggests arbitrary action on the part of the trustees[,]" and that the "Trust's interpretation of the terms of its plan . . . [was] arbitrary and capricious." Evans, 122 Wis. 2d at 19. Indeed, we held that "the burden is [on] the trustees to produce [such evidence]." Id.

¶ 34. Touchpoint has not consistently maintained its interpretation of its own plan, which suggests arbitrary action. In this case, the record reflects that Touchpoint's attorney, speaking for the plan's administrator in an attempt to justify the administrator's actions, conceded in the circuit court that "[t]here is also no dispute.. . that [the Summers] were told by Touchpoint that observation would be covered and radiation/chemotherapy treatment would be covered post surgery." Touchpoint now claims in its briefs to this court that this statement was merely a "simple mistake" by Touchpoint's attorney. In his deposition, Dr. Ronald Harms, Touchpoint's Medical Director stated that Touchpoint would have covered radiation plus chemotherapy, if requested, but later in his deposition, he stated that Touchpoint "would have covered anything that was not in a clinical trial," even though it appears undisputed that the radiation treatment protocol was part of a Phase II clinical trial.

¶ 35. Asa result, Touchpoint maintained an arbitrary and capricious reading of its own experimental exclusion9 by apparently agreeing to cover some treat-*101merits that were subject to Phase II clinical trials, while not agreeing to cover other treatments that were subject to such clinical trials. Touchpoint's varying arguments on the treatments in question at various stages of this proceeding demonstrate the arbitrary and capricious nature of its interpretation of the experimental exclusion.

¶ 36. Another reason why we are satisfied that Touchpoint's decision was arbitrary and capricious remains the fact that Touchpoint's external review agency, while upholding Touchpoint's termination of benefits decision, actually recommended the approval of the requested treatment finding that the treatment was the standard of care and also was medically necessary. It is important to note, again, that Touchpoint's external review agency stated the proposed therapy (high-dose chemotherapy with stem-cell rescue) "would be one of the standard approaches for three-year-old children with this disorder. ... There is no alternative with superior or proven results and is therefore, medically necessary .... [T]he standard of care for patients with this disorder is to enroll patients into the best phase II trials available that are building on the success of previous phase II trials." The review agency concluded as follows: "This is the best available therapy and there is no standard therapy that can be substituted."

¶ 37. For example, when a health benefits plan refused to pay benefits for gastric bypass surgery as being "not medically necessary," this court upheld the decision of the circuit court reinstating coverage, because the plan's decision was arbitrary and capricious. *102Evans, 122 Wis. 2d at 4. This court found that the decision was arbitrary and capricious, because it was made based on internal plan administrative procedures for claims personnel, which "were not incorporated into the plan as benefit plan amendments." Id. at 7. These guidelines "constituted an unauthorized alteration of the plan." Id. at 11. The plan administrators improperly had evaluated the claims "under the guideline standards that were not a part of the contracted-for plan ...." Id. at 12. Such an approach is analytically similar to the unwritten and changing interpretations of its own policy's experimental exclusion that Touchpoint exhibited in this case.

¶ 38. Furthermore, in Evans, the claims personnel were held to have acted in an arbitrary and capricious manner because, despite the plan's continued position that the treatment was not medically necessary for obesity alone without secondary illnesses as a result of the obesity, the plan's doctor had "recognized that obesity was an illness and that the surgery might well have been appropriate for the treatment of that illness." Id. at 10. Similarly, here, Touchpoint terminated Parker's coverage despite its admission that the requested treatment was "the standard of care" for children with anaplastic ependymoma.

¶ 39. Finally, as in the case before us, this court in Evans found the refusal to pay benefits to be arbitrary and capricious because the trustees of the plan "failed to present evidence that their interpretation of the terms of the plan was consistently maintained." Id. at 18. As we noted, the absence of such evidence "suggests arbitrary action on the part of the trustees." Id. at 19 (footnote omitted). In a similar manner, Touchpoint failed to present evidence of a consistent interpretation of its experimental exclusion. Accordingly, while we hold that the termination decision was embodied in an *103arbitrary and capricious termination letter, we also hold that the termination decision itself was arbitrary and capricious. Id. at 16-19.

¶ 40. The Summers' attorney claimed at oral argument that the Touchpoint plan was an illusory contract, and Touchpoint's attorney argued in response that the Summers' illusory contract argument was preempted by ERISA. We need not address this contention because we have decided the case on other grounds. However, we note that it appears that a strong argument could be made favoring preemption of the Summers' illusory contract claim under ERISA. See generally Ingersoll-Rand Co. v. McClendon, 498 U.S. 133 (1990).

IV

¶ 41. As a result of our holdings that the second termination letter, as well as the termination decision itself, were arbitrary and capricious, we now address the issue of what the appropriate remedy is for those arbitrary and capricious termination actions. We note that our discussion of the ambiguous policy provisions concerning participation in a clinical trial relates to the remedy issue as well.

¶ 42. On review, Touchpoint claims that ERISA prohibits an award of extracontractual benefits, so a court may not order as a remedy for arbitrary and capricious termination actions any coverage for an experimental medical treatment that is unambiguously excluded under the plan. Touchpoint further argues that remedies for improper claim processing are limited to those remedies in 29 U.S.C. § 1132(a).10 Touchpoint contends that the court of appeals erred by awarding a *104remedy that was not due under the plan, by giving substantive relief for a procedural deficiency, and by considering this a termination of benefits case, rather than an initial denial of benefits case.

¶ 43. On review, the Summers claim that, because Touchpoint terminated ongoing and previously afforded benefits, and because Touchpoint acted in an arbitrary and capricious fashion in failing to address the Summers' reasonable interpretation of the plan, they are entitled to the reinstatement of benefits forward from the date that the benefits were terminated. The Summers argue that this is a termination of benefits case, not an initial denial of benefits case, because the treatments in question began with the removal of the tumor and continued with some follow-up care.11 They assert that the mere fact that Parker had reached a point where there was more than one possible treatment does not mean that medically necessary follow-up care was not an ongoing course of treatment. The Summers state that the surgery was premised on the idea that, once the tumor was removed, Parker would receive ongoing treatment by a specialist.

*105¶ 44. We hold that the appropriate remedy for Touchpoint's arbitrary and capricious termination actions is the reinstatement of benefits forward from the date that the benefits were terminated. We hold that this is a termination of benefits case, because surgeiy had occurred and some follow-up care already had commenced, which had been paid for by Touchpoint. We are, therefore, satisfied that the appropriate remedy is a return to the status quo prior to the arbitrary and capricious termination actions. In this case, that remedy encompasses Touchpoint paying Parker's health care providers for the services they have given to Parker forward from the date that the benefits were terminated.12

¶ 45. In cases of arbitrary and capricious denials of coverage, there are two remedies. See Hackett, 315 F.3d at 774-75. When the beneficiary has not yet undergone the treatments, the appropriate remedy is *106for the beneficiary to be provided with a benefits application process that is not arbitrary and capricious, which may or may not result in coverage for the treatments. Id. at 776. When the beneficiary has undergone the treatments and then coverage is terminated, the appropriate remedy is for the beneficiary to receive the "retroactive reinstatement of benefits .. . ." Id. at 777.

¶ 46. In Hackett, a claimant was receiving long term disability benefits, because his serious psychiatric condition prevented him from performing any type of work. Id. at 773. After an employer-paid doctor examined Hackett, and after that doctor reviewed the previous findings of the other doctors, the employer-paid doctor found that "Hackett suffered from a personality disorder but found [that] Hackett [was] able to return to work without restriction." Id. at 773. As a result of this employer-paid doctor's opinion, the employer terminated Hackett's long term disability benefits. Id. The reason the employer gave for the termination of Hackett's benefits merely stated, "Continued Disability not clinically supported." Id. When Hackett appealed the decision to terminate his benefits, the plan's reviewer gave Hackett only the exact same response. Id. Hackett sued, and the United States Court of Appeals for the Seventh Circuit retroactively reinstated Hackett's benefits, even under the deferential arbitrary and capricious review standard, because there was an absence of appropriate reasoning in the record to support the termination of Hackett's benefits. Id. at 774-75. As in the case before us, the court held that the reasons for the termination of benefits were not appropriately articulated, so as to allow for a meaningful review. Id. at 775. The court held the termination was arbitrary and capricious as a result, and that the *107appropriate remedy for such an arbitrary and capricious termination of ongoing benefits was the "retroactive reinstatement" of Hackett's benefits. Id. at 777. As the court stated, "Remedying the defective procedures requires a reinstatement of benefits." Id. at 776. The court went on to note that plans may not terminate benefits as a result of arbitrary and capricious procedures. Id.

¶ 47. We agree with the remedy that this court provided in a very similar case. In Evans, we held that the appropriate remedy for the arbitrary and capricious denial of benefits under a health benefits plan was the restoration of payment to the health care providers involved. Evans, 122 Wis. 2d at 4.

¶ 48. In a case similar to the case before us, where the plan administrator failed to communicate specific reasons for its termination of continuing benefits to the claimant, thus depriving him of the opportunity for a full and fair review of his benefits termination, the United States Court of Appeals for the Seventh Circuit upheld the district court's order of reinstatement of the claimant's benefits. Halpin, 962 F.2d at 698. The Seventh Circuit held that, in the absence of an appropriate termination letter and review process, the plan administrator "cannot be permitted to terminate benefits previously awarded." Id.

¶ 49. As noted previously, we hold that this is a termination of benefits case because surgery had occurred and some follow-up care had commenced, which had been paid for by Touchpoint. Benefits were terminated when the Summers proceeded with Dr. Puccetti's recommended treatment for Parker. Here, the Summers requested coverage for a treatment that is part of the standard treatment protocol for anaplastic ependy-moma and that was determined upon independent *108review to be medically necessary. The treatment protocol begins with the tumor's removal and continues with follow-up treatment, whether observation, and/or radiation or chemotherapy. Accordingly, Parker's chemotherapy with stem-cell rescue was a continuation of his treatment for anaplastic ependymoma. We agree with the Summers that the chemotherapy with stem-cell transplant was an ongoing treatment that was medically necessary to prevent the progression of Parker's disease and to improve his chances of survival. Given the ambiguous policy provisions concerning participation in a clinical trial, it was a reasonable expectation of the insureds, the Summers, that the follow-up treatments to the surgery were a continuing course of treatment that would be covered. As a result, because Touehpoint arbitrarily and capriciously terminated ongoing benefits,, the appropriate remedy is the reinstatement of benefits forward from the date that the benefits were terminated.

¶ 50. In Hackett, where the termination letter was held to be arbitrary and capricious because it contained no rationale for the decision and only stated that the claimant's continued disability was "not clinically supported," the court held that the appropriate remedy for the termination of continuing benefits, following an arbitrary and capricious letter, was the retroactive reinstatement of benefits. Hackett, 315 F.3d at 776-77.13 However, as the Hackett court noted, "nothing in this opinion should be read as expressing an *109opinion that. . . benefits should not [or could not] be terminated in the future." Id. at 777.

¶ 51. We hold that the appropriate remedy here is to remand this case to the circuit court with an instruction for that court to order the reinstatement of Parker's benefits forward from the date that the benefits were terminated.

V

¶ 52. We affirm the decision of the court of appeals. We hold that the termination decision itself was arbitrary and capricious because Touchpoint's interpretations of the plan were inconsistent. We also are satisfied that Touchpoint's decision was arbitrary and capricious because Touchpoint's termination of benefits decision was made despite the external review agency's finding that the requested treatment met the standard of care and was medically necessary, and despite the external review agency recommending approval for the treatment. We further hold that the second termination letter of December 12, 2002, was arbitrary and capricious, because it did not provide a sufficient and adequate explanation of the reasons for Touchpoint's termination of benefits. As a result, the Summers were not provided with the opportunity for a full and fair review of the termination, which is required by 29 U.S.C. § 1133 and 29 C.F.R. § 2560-503-1.

¶ 53. Lastly, we hold that, given the inconsistent interpretations of the plan by Touchpoint, as well as the ambiguous policy provisions concerning participation in a clinical trial, the appropriate remedy for the *110termination of benefits in this case is the reinstatement of benefits forward from the date that the benefits were terminated.

¶ 54. The decision of the court of appeals is affirmed, and the case is remanded to the circuit court for proceedings consistent with our decision.

By the Court. — Affirmed and remanded to the circuit court.

¶ 55. SHIRLEY S. ABRAHAMSON, C.J., and DAVID T. PROSSER, J., did not participate.

Summers v. Touchpoint Health Plan, Inc., 2006 WI App 217, 296 Wis. 2d 566, 723 N.W.2d 784.

All references to the United States Code are to the 2000 version, as updated to the relevant dates of October to December 2002, unless otherwise noted.

All references to the Code of Federal Regulations are to the 2002 version, as updated to the relevant dates of October to December 2002, unless otherwise noted.

While the case law often uses the terminology "denial letter" regardless of whether the letter was in an initial denial of *85benefits case or in a termination of benefits case, we will use the terminology "termination letter" given that we hold this was a termination of benefits case, not an initial denial of benefits case.

The dissent takes issue with our determination that what occurred here was a " 'termination' of benefits, rather than acknowledging that benefits were 'denied.'" Dissent, ¶ 57. Make no mistake, when Parker's parents and his doctor were informed that what was recommended for the ongoing cancer treatment would not be allowed, that was a termination of the benefits for the follow-up treatment. Benefits had been previously provided for the cancer surgery and for follow-up care thereafter. Such benefits were then terminated.

Neither party has disputed that the plan in question is an ERISA-governed plan.

This case is distinguishable from Dade v. Sherwin-Williams Co., 128 F.3d 1135, 1141-42 (7th Cir. 1997), because, in Dade, the plaintiff never submitted his claim using a different rationale, so the series of letters in Dade all responded to the plaintiffs consistent rationale. Id. As a result, it was not inappropriate for the Dade court to read the letters together, unlike this case where the letters must stand on their own given the changed rationale that the Summers presented.

As one law review article aptly noted, insurance companies' "wide discretion" in deciding "whether a medical technology should be considered 'experimental,' and, accordingly, denied coverage, can result in great disparity in the policies of insurers, with coverage decisions influenced not just by the medical data and clinical judgments, but also by factors such as lawsuits and public relations concerns." Natalie Regoli, Insurance Roulette: The Experimental Treatment Exclusion & Desperate Patients, 22 Quinnipiac L. Rev. 697, 700 (2004) (footnote omitted). As a result, the court system plays "an important role in regulating insurance contract terms because statutory regu*99lation is often ineffective." Id. As in this case, "[t]he conflict between the standardized nature of an insurance contract and the attempt to incorporate provisions for unknown or changing therapies often leads to situations where the scope of coverage is in dispute." Id. at 701.

The dissent wishes us to uphold the plan administrator's interpretations and applications of the plan as reasonable. *101Dissent, ¶ 58. That is impossible here, since the interpretations and applications were inconsistent, and, thus, they were arbitrary and capricious. Such arbitrary and capricious actions are not reasonable.

It is noted, however, that the available remedies under 29 U.S.C. § 1132(a) appear to be expansive and to include the *104recovery of benefits due to a participant or a beneficiary under the terms of the plan, enforcement of the rights of a participant or a beneficiary under the terms of the plan, or a clarification of his or her rights to future benefits pursuant to the terms of the plan. See 29 U.S.C. § 1132(a)(1)(B). Clearly, the ambiguous policy provisions discussed herein relate to the benefits due under the terms of the plan at issue here.

A letter from Dr. Puccetti suggests that Touchpoint paid for follow-up care on November 15, 2002, which included a "metastatic evaluation including a MRI of the total spine and a diagnostic lumbar puncture." Furthermore, an earlier letter from Dr. Puccetti indicates that Touchpoint paid for a postoperative CAT scan.

We note that Wolfe v. J.C. Penney Co., 710 F.2d 388 (7th Cir. 1983), even if it were still good law, is distinguishable in many regards from the case before us. In Wolfe, a former employee applied for, but was denied, long term disability benefits from his former employer. Id. at 389. The employee never received the benefits he applied for, and, as a result, his case was an initial denial of benefits case and not a termination of benefits case. Accordingly, the Wolfe court's remand to the fiduciary, for a review of the information that the employee had presented in the federal trial court for the first time, so that the fiduciary could make a proper initial benefits determination is not applicable to a termination of benefits case. Id. at 394. We further note that the holding in Wolfe was abrogated by the United States Supreme Court in Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989), where the Court established the analytical framework that was discussed in this decision's standard of review section.

While we recognize that Hackett dealt with the termination of long term disability benefits and not health care benefits, the Hackett decision rested on the interpretation and application of the very same federal statutes and regulations as in this case, and, as noted previously, also dealt with the required contents of a termination letter under an ERISA-governed *109benefits plan. Hackett v. Xerox Corp. Long-Term Disability Income Plan, 315 F.3d 771, 772 (7th Cir. 2003).