In the case of Susie Weitzenkamp, Vs. Unum Life Insurance Company Of America, the Court of Appeals, Seventh Circuit recently ruled that the Unum Life Insurance Company Of America (UNUM) cannot rely on a Self-Reported Symptoms Limitation Clause to discontinue the plaintiff’s long term disability benefits as UNUM had failed to include the self-reported symptoms limitation in the Summary Plan Description (SPD).
The Facts of the UNUM Case – Discontinuation of Long Term disability Benefits Due to Self-Reported Symptoms Limitation
The plaintiff Susie Weitzenkamp worked at Time Warner Cable Inc. as a sales representative and participated in a plan, which is governed by the Employee Retirement Income Security Act (ERISA) and administered by UNUM. The plan gives Unum discretion to determine eligibility and to interpret the plan’s terms. The plaintiff was awarded long term disability benefits by UNUM after she was diagnosed with fibromyalgia, chronic pain, anxiety, and depression. However, after a little more than twenty four (24) months later, UNUM discontinued the plaintiff’s long term disability benefits on the ground that she had received all to which she was entitled under the plan’s self-reported symptoms limitation.
Under the self-reported limitation as defined in the Plan, benefits cease after twenty-four months for those with “[d]isabilities, due to sickness or injury, which are primarily based on self-reported symptoms, and disabilities due to mental illness, alcoholism or drug abuse.“
Self-reported symptoms were defined in the plan as “the manifestations of your condition which you tell your doctor that are not verifiable using tests, procedures or clinical examinations standardly accepted in the practice of medicine.” The plan also provided a non-exhaustive list of self-reported symptoms: “headaches, pain, fatigue, stiffness, soreness, ringing in ears, dizziness, numbness and loss of energy.“
The District Court for Eastern District of Wisconsin’s Ruling
After exhausting all her administrative remedies, the plaintiff and her disability attorney filed a lawsuit at the District Court for Eastern District of Wisconsin challenging UNUM’s application of the self-reported symptoms limitation to discontinue her long term disability benefits. Upon judicial review, the District Court ruled that Unum’s discontinuation of benefits based on a finding that the plaintiff was not disabled was an arbitrary and capricious decision. However, the district court upheld Unum’s application of the self-reported symptoms limitation.
Appeal to the Seventh Circuit Court of Appeal
On appeal to the Court of Appeal, the plaintiff challenged UNUM’s decision to discontinue the disability benefits on the ground that Unum’s failure to include the self-reported symptoms limitation in the SPD estops it from relying on the limitation as a basis for its decision.
The Court of Appeal’s Opinion
The Court of Appeals ruled that the failure to include the self-reported symptoms limitation in the SPD is a defense against its application and thus was properly raised in response to Unum’s cross-motion in the plaintiff’s combined response and reply brief.
The Court of Appeal opines that the SPD is intended to be a “capsule guide [to the plan] in simple language.” Although it need not “anticipate every possible idiosyncratic contingency that might affect a particular participant’s or beneficiary’s status,” it must “be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.“
The Court of Appeal further stated that in addition to providing identifying information about the administrator of the plan, an SPD must include “the plan’s requirements respecting eligibility for participation and benefits” and “circumstances which may result in disqualification, ineligibility, or denial or loss of benefits.” Hence, if the SPD does not “… satisfy ERISA’s disclosure requirements, a court may estop a plan administrator from denying coverage for terms not included in the SPD but found in the underlying plan.“
In the Plaintiff’s case, the SPD clearly sets out that long-term benefits will be discontinued after twenty-four months if a participant’s disability is due to mental illness or substance abuse. However, it does not mention that if a participant’s disability is based primarily on self-reported symptoms, long-term benefits will be discontinued after twenty-four months. The Court of Appeal ruled that this omission violates the provisions of ERISA and UNUM offered no reason why this limitation was omitted in the SPD while the application of the mental illness and substance abuse limitations in appeared three different places in the SPD. The Court of Appeal stated that because the self-reported symptoms limitation concerns a broad spectrum of plan participants, it should be reasonably included in the SPD.
The Court of Appeal’s Ruling
Hence, UNUM is therefore prevented from relying on the self-reported symptoms limitation in denying the plaintiff’s benefits. The Court of Appeal reversed the District Court’s judgment on this issue and remanded with instructions to order Unum to reinstate the plaintiff’s benefits retroactive to August 22, 2008.