Hall v. Metropolitan Life Insurance

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 05-2432
JENNIFER ELAINE HALL,
Plaintiff - Appellant,
versus
METROPOLITAN LIFE INSURANCE COMPANY, a/k/a
MetLife, Incorporated; GENERAL ELECTRIC
COMPANY, a/k/a GE; GE LIFE, DISABILITY AND
MEDICAL PLAN,
Defendants - Appellees.
Appeal from the United States District Court for the Western
District of Virginia, at Roanoke. Glen E. Conrad, District Judge.
(CA-05-304)
Argued: October 30, 2007 Decided: December 27, 2007
Before NIEMEYER, SHEDD, and DUNCAN, Circuit Judges.
Affirmed by unpublished opinion. Judge Duncan wrote the opinion,
in which Judge Niemeyer and Judge Shedd joined.
ARGUED: Richard Franklin Hawkins, III, Richmond, Virginia, for
Appellant. Lowell D. Kass, METROPOLITAN LIFE INSURANCE COMPANY,
Long Island City, New York, for Appellees. ON BRIEF: Susan A.
Waddell, WOOTENHART, P.L.C., Roanoke, Virginia, for Appellant.
Eric W. Schwartz, Sandra Compton Simmons, TROUTMAN SANDERS, L.L.P.,
Virginia Beach, Virginia, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
2
DUNCAN, Circuit Judge:
Plaintiff-Appellant Jennifer E. Hall (“Hall”) appeals the
district court’s grant of summary judgment to Defendant-Appellee
Metropolitan Life Insurance Company (“MetLife”) on her action under
the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C.
§ 1132(a)(1)(B), to recover accidental death and dismemberment
benefits and personal accident insurance benefits in the amount of
$284,208.00. Hall claimed these benefits as the widow and sole
beneficiary of Tommie B. Hall (the “decedent”), an employee of
General Electric Company who suffered a fatal allergic reaction to
a bee sting. The decedent was insured under an employee welfare
benefits plan that excluded coverage for losses contributed to or
caused by disease or physical impairment. The district court held
that MetLife properly denied coverage based on this exclusion. For
the following reasons, we affirm.
I.
On July 16, 2004, the decedent, age 37, was stung by a bee on
the bridge of his nose. Within minutes, his tongue swelled; he
stopped breathing and lost consciousness. Emergency personnel were
unable to revive him, and he was pronounced dead little more than
an hour after he was stung. The death certificate listed
anaphylaxis as the immediate cause of death, noting the bee sting
as an underlying cause. The hospital disposition summary listed
3
diagnoses of anaphylaxis and cardiac arrest. The decedent’s family
physician agreed that the decedent died after suffering
anaphylactic shock from a bee sting, but she noted no prior history
of bee sting allergies. An independent consulting physician,
retained by MetLife, reviewed the medical records and opined that
the decedent likely had an allergy to stinging insects that was not
reflected in the medical records, and that this allergy caused the
anaphylactic reaction resulting in his death.
Prior to his death, the decedent had been employed by the
General Electric Company (“GE”) and covered under the GE Life,
Disability and Medical Plan (the “Plan”). As relevant here, the
Plan provided accidental death and dismemberment (“AD&D”) and
personal accident insurance (“PAI”) benefits.1 Under the Plan,
MetLife served as the claims administrator:
[MetLife] will make all determinations with respect to
benefits under this Plan. Accordingly, the management
and control of the operation and administration of claim
procedures under the Plan, including the review and
payment or denial of claims and the provision of full and
fair review of claim denial pursuant to Section 503 of
[ERISA], shall be vested in [MetLife].
J.A. 171.2
1
The Plan also included basic life insurance benefits, for
which MetLife found Hall eligible in the amount of $118,420.00.
2
This language comes from the PAI section of the Plan. The
AD&D section contains substantially the same language, except that
the first sentence reads, “Determinations of all benefit payments
under the Plan will be made by [MetLife].” J.A. 151.
4
There is no dispute in this case that the bee sting suffered
by the decedent was an accident. The GE Benefits Handbook explains
the circumstances in which accidental losses are not covered under
the Plan:
Benefits under [the AD&D and PAI sections of the Plan]
are not paid for losses contributed to or caused by:
Disease or medical or surgical treatment of such disease;
[i]ntentionally self-inflicted injury; [p]hysical or
mental impairment or medical or surgical treatment of
such impairment; or [i]nsurrection or any act of war,
whether declared or undeclared.
J.A. 365 (emphasis added). After receiving Hall’s claim as the
beneficiary under the decedent’s policy, and quoting this
exclusionary language, MetLife denied the claim on “the basis of .
. . the Plan’s exclusions for accidental losses contributed to or
caused by disease and/or physical impairments.” J.A. 715.
The denial letter cited the death certificate, the hospital
disposition summary, the letter from the decedent’s family
physician, and the independent physician consultant’s report,
concluding that these records “demonstrate[d] that decedent’s
allergy to bee stings was both a disease and physical impairment
which caused and/or contributed to his death.” J.A. 714. MetLife
relied extensively on the independent physician consultant’s
report, in which the doctor cited authority to the effect that a
bee-sting allergy is a “disease,” J.A. 718-19, opined that “[a]n
allergy is [also] a physical impairment when the allergy is
activated,” J.A. 719, and rendered the opinion that the decedent
5
had an allergy to stinging insects even though no such allergy was
noted in his medical records. The report concluded that the
decedent’s reaction to the bee sting was consistent with a severe
allergic reaction and that this reaction caused the decedent’s
death. J.A. 718-19.
Hall appealed the denial, arguing that there was no evidence
that an allergy was a contributing cause of the decedent’s death--
only evidence that the decedent died as a result of being stung on
the bridge of his nose. Hall also argued that even if the decedent
had a pre-existing sensitivity or allergy to bee stings, this
condition was not a “disease” or “impairment.” Hall further argued
that when an injury activates a dormant disease, the injury should
be held to be the direct and exclusive legal cause of death,
thereby allowing her to recover. MetLife found Hall’s assertion
regarding causation to be contrary to the uncontroverted medical
evidence and reiterated its earlier conclusion that the decedent’s
bee-sting allergy was a disease and a physical impairment that
contributed to or caused his death.3 MetLife then wrote,
Finally, an additional basis [for denial] exists under
the coverage language, which requires that the loss
result solely and directly from an accident. . . . [W]e
find that [the decedent’s] death did not result solely
3
Regarding the question of whether an allergy is a disease,
MetLife cited a website submitted by Hall during the appeal process
for the propositions that “Allergies are disorders of the immune
system” and that “Anaphylactic shock, also called anaphylaxis, is
a severe, life threatening reaction to certain allergens.” J.A.
667, 671.
6
and directly from an accident. . . . [W]e must uphold
the denial of your client’s claim based on the
requirement that the loss be solely and directly due to
an accident, and the Plan’s disease and physical
impairment exclusions listed above. This letter
concludes the administrative review process.
J.A. 668.
Hall initiated this action in Virginia state court. MetLife
removed to the United States District Court for the Western
District of Virginia. On cross-motions for summary judgment, the
district court concluded that MetLife had not abused its discretion
in denying Hall’s claim based on the aforementioned exclusion.
Hall v. Metro. Life Ins. Co., 398 F. Supp. 2d 494, 499 (W.D. Va.
2005). At Hall’s suggestion, the court in the alternative reviewed
the denial de novo but nevertheless found that the record evidence
that the decedent suffered anaphylactic shock from a bee sting was
“overwhelming,” and that the decedent’s allergic reaction fell
within the parameters of the disease or physical impairment
exclusion. Id. at 501. This appeal followed.
II.
A.
Under our well-settled framework for reviewing denials of
benefits under ERISA plans, we examine the district court’s grant
of summary judgment de novo. Sheppard & Enoch Pratt Hosp., Inc. v.
Travelers Ins. Co., 32 F.3d 120, 123 (4th Cir. 1994). Where a Plan
gives a claims administrator discretion to construe plan terms or
7
determine eligibility for benefits, we review the administrator’s
denial decision for abuse of discretion. See Firestone Tire &
Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Ellis v. Metro. Life
Ins. Co., 126 F.3d 228, 232-33 (4th Cir. 1997). Otherwise, the
denial is reviewed de novo. Bruch, 489 U.S. at 115. Of course, we
review de novo the threshold matter of whether the Plan language at
issue limits us to abuse-of-discretion review. Haley v. Paul
Revere Life Ins. Co., 77 F.3d 84, 89 (4th Cir. 1996).
MetLife argues that the Plan language in this case contains
sufficient discretion-conferring authority to require review under
the deferential abuse-of-discretion standard. Although we are
inclined to disagree, we need not resolve the issue since, as the
district court noted, the outcome here would be the same under
either standard. Assuming the applicability of de novo review,
which is more favorable to Hall, we assess whether the denial of
AD&D and PAI benefits to Hall was appropriate. We are limited to
the evidence that was before MetLife at the time it made its
decision unless we determine that additional evidence is necessary
to facilitate an adequate de novo review of the denial.
Quesinberry v. Life Ins. Co. of N. Am., 987 F.2d 1017, 1025 (4th
Cir. 1993).
B.
Hall urges us to review only the rationale contained in the
initial denial letter, J.A. 715 (“the basis of MetLife’s denial of
8
[Hall’s] claim is the Plan’s exclusions for accidental losses
contributed to or caused by disease and/or physical impairments”),
and not consider the additional rationale for the denial offered by
MetLife for the first time in its denial of Hall’s appeal, J.A. 668
(“the requirement that the loss be solely and directly due to an
accident”). In doing so, Hall relies on the ERISA requirement
that,
[i]n accordance with [applicable regulations], every
employee benefit plan shall . . . 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. ERISA’s implementing regulations explain that a
claimant must initially be provided with, inter alia, “[t]he
specific reason or reasons for the adverse determination,” and
“[r]eference to the specific plan provisions on which the
determination is based.” 29 C.F.R. § 2560.503-1(g)(1)(i)-(ii).
The claimant must then be given “the opportunity to submit written
comments, documents, records, and other information relating to the
claim for benefits,” and the claims administrator must take any
such materials submitted into account in deciding the appeal.
§ 2560.503-1(h)(2)(ii), (iv). Under either standard of review–-de
novo or abuse of discretion–-the administrator must comply with
these procedural guidelines. See Weaver v. Phoenix Home Life Mut.
Ins. Co., 990 F.2d 154, 158 & n.3 (4th Cir. 1993).
9
The safeguards in 29 U.S.C. § 1133 and the implementing
regulations “have been read as ensuring that a full and fair review
is conducted by the administrator, that a claimant is enabled to
prepare an appeal for further administrative review or recourse to
the federal courts, and that the courts can . . . review[] a claim
denial.” Ellis, 126 F.3d at 236-37 (emphasis added). For that
reason, this court has previously held, albeit in an unpublished
opinion, that 29 U.S.C. § 1133 and 29 C.F.R. § 2560.503-1 require
that judicial review be “limited to whether the rationale set forth
in the initial denial notice is reasonable.” Thompson v. Life Ins.
Co. of N. Am., 30 F. App’x 160, 164 (4th Cir. 2002) (unpublished)
(emphasis added); see also Robinson v. Aetna Life Ins. Co., 443
F.3d 389, 393 (5th Cir. 2006) (holding that under § 1133 the
administrative review must focus on the specific reason for the
administrator’s decision cited in the initial denial notice);
Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 974 (9th Cir.
2006) (“[A]n administrator that adds, in its final decision, a new
reason for denial, a maneuver that has the effect of insulating the
rationale from review, contravenes the purpose of ERISA.”);
McCartha v. Nat’l City Corp., 419 F.3d 437, 446 (6th Cir. 2005)
(holding that an administrator was not in substantial compliance
with § 1133 where the initial denial notice omitted one of the
grounds later relied on for the denial of benefits); Abram v.
Cargill, Inc., 395 F.3d 882, 886 (8th Cir. 2005) (noting that
10
ERISA’s procedural requirements are intended to generate a
“meaningful dialogue” between claim administrators and
beneficiaries and to avoid beneficiaries being “sandbagged by post-
hoc justifications of plan decisions”) (internal quotations
omitted); Juliano v. Health Maint. Org. of N.J., Inc., 221 F.3d
279, 287 (2d Cir. 2000) (same).
The district court below erroneously reasoned that the
limitation suggested by these cases would render superfluous
another of ERISA’s procedural safeguards–-the requirement that the
administrator, in reviewing an appeal of a denial, consider new
materials “submitted by the claimant relating to the claim” after
the initial denial. 29 C.F.R. § 2560.503-1(h)(2)(iv). Hall, 398
F. Supp. 2d at 501. In doing so, the court failed to distinguish
between the obligation of a claim administrator to provide
sufficient notice of the precise reason for a denial and the right
of a claimant to submit additional information in response to the
reason given. The statutory and regulatory text and the case law
demand that judicial review take into account only reasons for an
adverse benefits determination offered in the initial denial
notice, because these are the only rationales on which a claimant
might have arguably been given a “full and fair” opportunity to
respond during the administrative process. See Ellis, 126 F.3d at
237. Therefore, in this case, we will limit our review to
11
MetLife’s initial denial based on the Plan’s disease and physical
impairment exclusions.4
III.
Courts have long grappled with policy exclusions such as the
one at issue in this case, which could conceivably preclude
coverage in all but a few accident cases. See J.A. Bock,
Annotation, Pre-existing Physical Condition as Affecting Liability
Under Accident Policy or Accident Feature of Life Policy, 84
A.L.R. 2d 176 (1962). For example, an insured driver in a fatal
automobile accident whose end was hastened somewhat by his pre-
existing heart disease, even where experts agreed that a perfectly
healthy individual would have died under like circumstances, would
arguably not be covered under the policy (the disease having
contributed, albeit in a minor way, to his death). The waters
become murkier still if we depart from the seemingly scientific
term “disease” and also consider death contributed to or caused by
“impairment” or “infirmity,” which could conceivably include
4
Our customary course of action when faced with an
administrator which has failed to comply with ERISA’s procedural
requirements is to remand the case to the administrator for a full
and fair review. See Weaver, 990 F.2d at 159; Berry v. Ciba-Geigy
Corp., 761 F.2d 1003, 1007 n.4 (4th Cir. 1985). Here, however,
because our de novo review leads us to conclude that the plan
exclusion cited in the initial denial letter precludes an award of
benefits in this case, remand would be futile. Accordingly, we
decline to issue the customary remedy of remand, instead curing
MetLife’s violation by simply reviewing the case as though the new
rationale in the appeal denial had not been given.
12
anything from high blood pressure to the common frailties of youth
or old age.5 Indeed, it is difficult to conjure up scenarios in
which no argument could be made that some disease or infirmity
contributed to an accidental loss. Landress v. Phoenix Mut. Life
Ins. Co., 291 U.S. 491, 499 (1934) (Cardozo, J., dissenting)
(“Probably it is true to say that in the strictest sense and
dealing with the region of physical nature there is no such thing
as an accident.”) (internal quotations omitted).
In this context, one court has recognized the existence of a
“long-standing allegorical tug-of-war” between insurance companies
and the courts (with beneficiaries serving merely as “highly
partisan spectator[s]”). Collins v. Metro. Life Ins. Co., 729 F.2d
1402, 1404 (11th Cir. 1984). At one extreme, insurance companies
can be characterized as proffering an interpretation of policy
provisions in which “accidental death” coverage applies only on
facts “which [are] the equivalent of a truck dropping from the
skies, striking squarely and killing instantly a perfectly fit
human specimen clutching a just-issued physician’s clean bill of
health.” Id. At the other, the beneficiary of a particularly
5
Lest we be accused of presenting outrageous extremes, we note
that, at oral argument, counsel for MetLife suggested that a
hypothetical snake-bite allergy afflicting a random fifty percent
of the population, or, alternately, everyone under the age of
twelve, would be an infirmity or impairment precluding coverage
under the policy (though he later retracted the statement as it
pertained to those under age twelve).
13
fragile decedent might claim coverage even when an insignificant
trauma had disproportionately debilitating consequences.
Hall encourages us to solve the causation dilemma before us by
drawing a sharp line of demarcation between the accidental bee
sting and the allergy, which Hall characterizes as merely a dormant
condition activated by the bee sting. See Appellant’s Br. at 44.
Under Hall’s theory, the allergy must be viewed as arising only
after, and as a consequence of, the bee sting for purposes of
determining legal causation.6
Our precedent does not permit such fine distinctions. In
Adkins v. Reliance Standard Life Ins. Co., 917 F.2d 794, 797 (4th
Cir. 1990), we concluded that,
“[A] pre-existing infirmity or disease is not to be
considered as a cause unless it substantially contributed
to the disability or loss. . . . [A] ‘pre-disposition’
or ‘susceptibility’ to injury, whether it results from
congenital weakness or from previous illness or injury,
does not necessarily amount to a substantial contributing
cause. A mere ‘relationship’ of undetermined degree is
not enough.”
Id. at 797 (quoting Colonial Life & Accident Ins. Co. v. Weartz,
636 S.W.2d 891, 894 (Ky. Ct. App. 1982)). We later refined this
into a two-prong test: (1) whether there is a pre-existing disease,
pre-disposition, or susceptibility to injury; and (2) if so,
whether the pre-existing disease, pre-disposition, or
6
Paradoxically, Hall elsewhere argues that “the sting and the
allergy are one-in-the-same and cannot be separated for causation
purposes.” Reply Br. at 18.
14
susceptibility to injury substantially contributed to the
disability or loss. Quesinberry, 987 F.2d at 1028. Adkins and
Quesinberry control the result here.
On the first Quesinberry prong, Hall argues that the evidence
of record does not support a conclusion that the decedent suffered
from a bee-sting allergy prior to his death. Hall offers a
somewhat disingenuous characterization of the decedent’s doctor’s
report in support of her position by representing that “Decedent’s
treating physician clearly stated that Decedent suffered from no
such prior allergy.” Appellant’s Br. at 46. In fact, the doctor’s
letter stated, “[Decedent] had no history of bee sting allergy. I
have reviewed his entire medical chart and there has never been a
visit related to any allergic reaction.” J.A. 725. Saying that
there is no history of a condition is a far cry from “clearly
stating” that no such condition existed. Fairly read, the doctor’s
letter is entirely consistent with the other evidence of record
establishing that the decedent suffered from an allergy to bee
stings that pre-existed the fatal sting.
The record in this case compels the conclusion that the
decedent’s bee-sting allergy is properly viewed as a “pre-existing
disease, pre-disposition, or susceptibility to injury.”
Quesinberry, 987 F.2d at 1028. The independent consulting
physician’s report and the website submitted by Hall in support of
her appeal support such a finding. Further, as the district court
15
noted, the National Institute of Allergy and Infectious Disease
supports the view that an allergy is a disease or impairment.
Hall, 398 F. Supp. 2d at 500 n.2. Hall did not argue, nor need we
decide, whether an “allergy” is a “disease or impairment” for all
purposes, in every case; our decision is grounded in the record
before us.
We now turn to the second Quesinberry prong and the question
of causation. For the one or two people out of every thousand
afflicted with the decedent’s condition, a bee sting has the
potential to cause a severe anaphylactic reaction. That is
precisely what happened here. The death certificate and
independent physician’s report document the fact that the
decedent’s allergy triggered the anaphylaxis that was the immediate
cause of his death. Consequently, on the second prong of
Quesinberry, we are constrained to conclude that the decedent’s
bee-sting allergy was a pre-existing condition that substantially
contributed to his death, and the Plan unambiguously excludes
coverage on that basis.
We are not unsympathetic to the concern voiced by Hall that an
expansive reading of the exclusionary language in the Plan in this
case might negate coverage in spite of the legitimate expectations
of insured individuals and beneficiaries. See Silverstein v.
Metro. Life Ins. Co., 171 N.E. 914, 915 (N.Y. 1930) (“A policy of
insurance is not accepted with the thought that its coverage is to
16
be restricted to an Apollo or a Hercules.”). However, we are
satisfied that our analysis, dictated by precedent, of whether a
“pre-existing disease, pre-disposition, or susceptibility to injury
. . . substantially contributed to the disability or loss” serves
as an adequate check on insurers’ decisions in accidental loss
cases. Quesinberry, 987 F.2d at 1028 (emphasis added).
IV.
For the foregoing reasons, the judgment of the district court
is
AFFIRMED.
17