McLeod v. Hartford Life and Acc. Ins. Co.
| Decision Date | 22 June 2004 |
| Docket Number | No. 03-1744.,03-1744. |
| Citation | 372 F.3d 618 |
| Parties | Shirley MCLEOD, Appellant v. HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY; Group Long Term Disability Benefits for Employees of Valley Media, Inc; Valley Media, Inc. |
| Court | U.S. Court of Appeals — Third Circuit |
Barry L. Gross (Argued), Stief, Waite, Gross, Sagoskin & Gilman, Newtown, for Appellant.
Brian P. Downey (Argued), Pepper Hamilton, LLP, Harrisburg, for Appellee Hartford Life & Accident Insurance Company.
Lawrence M. Kelly, Mintzer, Sarowitz, Zeris, Ledva & Meyers, Philadelphia, for Appellee Valley Media Inc.
Before ALITO, CHERTOFF, and BECKER, Circuit Judges.
This is an ERISA case. Plaintiff Shirley McLeod ("McLeod"), a former employee of defendant Valley Media, Inc., appeals the District Court's grant of summary judgment in favor of defendant Hartford Life and Accident Insurance Co. ("Hartford") in which the Court upheld Hartford's denial of long term disability ("LTD") benefits to McLeod based upon Hartford's interpretation of the language in McLeod's benefits policy with Hartford. The question before us on appeal is whether Hartford wrongfully determined that McLeod, who had been receiving medical care for various ailments since 1997, but who was neither diagnosed with nor treated specifically for multiple sclerosis ("MS") until after her benefits plan became effective in 1999, should have been excluded from coverage due to the existence of a "pre-existing condition," namely MS. Consistent with our opinion in Lawson ex rel. Lawson v. Fortis Insurance Co., 301 F.3d 159 (3d Cir.2002), we hold that despite language in the benefit plan aimed to cast a broad net as to what constitutes receiving medical care for a "pre-existing condition," McLeod did not receive treatment "for" such a pre-existing condition prior to her effective date of coverage because neither she nor her physicians either knew or suspected that the symptoms she was experiencing were in any way connected with MS. Under the heightened standard of review formulated in Pinto v. Reliance Standard Life Insurance Co., 214 F.3d 377 (3d Cir.2000), the decision to deny McLeod LTD benefits was arbitrary and capricious and we will therefore reverse the District Court's grant of summary judgment to Hartford, reverse its denial of McLeod's motion for summary judgment on liability, and remand for calculation of benefits.
On January 26, 1998, McLeod was hired by Valley Media to fill a position described as "Operations — General Warehouse." The job consisted of stocking video cassettes in a warehouse and involved long periods of standing. McLeod signed up for health insurance and other benefits under the Valley Media Plan ("the Plan") with an effective date of April 1, 1999. Under the terms of the Plan, a participant is not entitled to receive benefits for any disability that stems from a "pre-existing condition." In relevant part, the Plan provides that:
No benefit will be payable under the Plan for any Disability that is due to, contributed to by, or results from a Pre-existing Condition, unless such Disability begins:
(1) after the last day of 90 consecutive days while insured during which you receive no medical care for the Pre-existing Condition; or
(2) after the last day of 365 consecutive days during which you have been continuously insured under this Plan.
Pre-existing Condition means:
(1) any accidental bodily injury, sickness, mental illness, pregnancy, or episode of substance abuse; or
(2) any manifestations, symptoms, findings, or aggravations related to or resulting from such accidental bodily injury, sickness, mental illness, pregnancy, or substance abuse;
for which you received Medical Care during the 90 day period that ends the day before:
(1) your effective date of coverage; or
(2) the effective date of a Change in Coverage.
Medical Care is received when:
(1) a Physician is consulted or medical advice is given; or
(2) treatment is recommended, prescribed by, or received from a Physician
Treatment includes but is not limited to:
(1) medical examinations, tests, attendance or observation;
(2) use of drugs, medicines, medical services, supplies or equipment.
(italics supplied).
The issue in the case centers around the fact that on February 22, 1999, a date that fell within the 90 day period that ended the day before the effective date of coverage — the so-called "look-back period" — McLeod consulted Dr. Eileen DiGregorio because of numbness in her left arm. Dr. DiGregorio had already treated McLeod for a number of years for cardiac insufficiency, and for multiple bulging cervical discs whose presence had been confirmed by MRI evaluations. McLeod had also been diagnosed with hypertension and had suffered several panic attacks. It is unconstested both that Dr. DiGregorio provided medical care for the numbness during the February 1999 visit and that she did not diagnose or otherwise suggest that McLeod might have MS at that time. McLeod continued to seek treatment for her condition over the next several months from Dr. DiGregorio, as well as from two neurologists, Drs. Emil Matarese and Clyde Markowitz, and underwent a number of neurological evaluations and MRIs, none of which produced a diagnosis of MS or even a suspicion that MS was a possible cause of the numbness and other complaints.
It was not until August 1999 that McLeod was finally diagnosed with MS, an inflammatory disease of the central nervous system. With the benefit of hindsight, a number of physicians including her treating physicians and a non-treating physician who reviewed her medical record for Hartford, attributed McLeod's various pre-coverage symptoms and ailments to MS.1 In March 2000, McLeod applied for short term disability ("STD") benefits. She had last worked on January 28, 2000. The Attending Physician's Statement completed by Dr. DiGregorio and submitted as part of McLeod's application provides:
Diagnosis: Multiple Sclerosis
Subjective Symptoms: Severe pain legs, feet, can't stand long, paresthesias
Date of onset of this condition: 1997
Dates of treatment for this condition: Progressive symptoms since 1997
McLeod's claim for STD benefits was initially approved from February 4, 2000 through February 17, 2000 and was then extended through May 4, 2000. At the time of the extension, McLeod was informed that benefits beyond May 4, 2000, would be reviewed to determine her eligibility for LTD benefits. Hartford denied McLeod's application for LTD benefits on the grounds that her disabling condition, MS, was a pre-existing condition for which LTD benefits were not payable under the Plan. Although the diagnosis of MS was not made until August 1999, more than four months after her effective date of coverage, Hartford concluded that McLeod had "received medical [care] for manifestations, symptoms, findings or aggravations relating to or resulting from Multiple Sclerosis during the 90 day period prior to [her] insured effective date of April 1, 1999 [1/1/99-3/31/99]" when she saw Dr. DiGregorio for left arm numbness on February 22, 1999.
On November 2, 2000, McLeod appealed this denial through an internal appeals mechanism. Hartford informed McLeod, by letter dated February 22, 2001, that it was upholding its determination that "the Multiple Sclerosis was a Pre-existing condition based on the `Manisfestations, symptoms, findings, or aggravations related to' the Multiple Sclerosis."
McLeod filed a timely appeal of that decision, again in accordance with the Plan's grievance procedures. The appeal focused on McLeod's claim that she had not received treatment for MS during the look-back period, since the MS had not yet been diagnosed at that time. As part of the appeal process, Hartford forwarded McLeod's file to the University Disability Consortium for an independent medical review. The review was conducted by Dr. Brian Mercer, a neurologist. As part of the process, Dr. Mercer reviewed McLeod's medical information and spoke to her treating physicians, Drs. DiGregorio and Markowitz. Based on his review of the medical records and his discussions with McLeod's treating physicians, Dr. Mercer concluded that "the records indicate that [McLeod] was treated on 2/22/99 for left arm numbness, which was a symptom and manifestation of her multiple sclerosis, albeit not yet diagnosed at that time." In consideration of all the information before it, Hartford affirmed its decision to deny LTD benefits.
McLeod then filed a complaint in the District Court alleging claims of interference with protected rights (Count I); failure to award benefits due under the terms of the Plan (Count II); breach of fiduciary duty (Count III); and breach of contract (Count IV). McLeod named Hartford, Group Long Term Disability Benefits for Employees of Valley Media, Inc., and Valley Media, Inc., as defendants. McLeod voluntarily dismissed Counts I, III and IV of her complaint as against Hartford pursuant to Fed.R.Civ.P. 41. The matter was stayed as against Hartford's co-defendants due to the bankruptcy of Valley Media, Inc.2
Hartford and McLeod filed cross-motions for summary judgment. The Court granted Hartford's motion on February 27, 2003. McLeod filed a timely Notice of Appeal on March 14, 2003. The Court had jurisdiction pursuant to 28 U.S.C. § 1331 because the complaint sought benefits under 29 U.S.C. § 1132(a)(1)(B). We have appellate jurisdiction pursuant to 28 U.S.C. § 1291.
Our review of the grant of summary judgment is plenary. See Shelton v. Univ. of Med. & Dentistry of N.J., 223 F.3d 220, 224 (3d Cir.2000). We apply the same standard of review to Hartford's decision to deny LTD benefits to McLeod that the District Court should have applied. See Smathers v. Multi-Tool Inc./Multi-Plastics, Inc. Employee Health & Welfare Plan, 298 F.3d 191, 194 (3d Cir.2002). McLeod's claim...
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