Rogers v. Department of Health and Environmental Control, 97-2780

• Decision Date: 08 April 1999
• Docket Number: No. 97-2780,97-2780
• Citation: 174 F.3d 431
• Parties: 9 A.D. Cases 257, 15 NDLR P 1 Major ROGERS, Plaintiff-Appellant, v. DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL; South Carolina Budget and Control Board, Office of Insurance Services, Defendants-Appellees, South Carolina Retirement System, Defendant. The Association of Private Pension and Welfare Plans; Bluecross and Blue Shield Association; American Council of life Insurance; The Health Insurance Association of America; State and Local Government Benefits Association; Equal Employment Advisory Council; United States of America, Amici Curiae.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 431

174 F.3d 431

9 A.D. Cases 257, 15 NDLR P 1

Major ROGERS, Plaintiff-Appellant, v. DEPARTMENT OF HEALTH AND ENVIRONMENTAL CONTROL; South Carolina Budget and Control Board, Office of Insurance Services, Defendants-Appellees South Carolina Retirement System, Defendant The Association of Private Pension and Welfare Plans Bluecross and Blue Shield Association; American Council of life Insurance; The Health Insurance Association of America; State and Local Government Benefits Association Equal Employment Advisory Council; United States of America, Amici Curiae.

No. 97-2780.

United States Court of Appeals, Fourth Circuit.

Argued Sept. 25, 1998.

Decided April 8, 1999.

ARGUED: William Andrew Arnold, Arnold & Murphy, L.L.C., Greenville, SC, for Appellant. Ashley Bryan Abel, Jackson, Lewis, Schnitzler & Krupman, Greenville, SC, for Appellees. ON BRIEF: Robert E. Hoskins, Foster & Foster, L.L.P., Greenville, SC, for Appellant. Ronald S. Cooper, Tracy Zorpette, Steptoe & Johnson, L.L.P., Washington, D.C.; James A. Klein, Association of Private Pension and Welfare Plans, Washington, D.C.; William A. Breskin, Blue Cross and Blue Shield Association, Washington, D.C., for Amici Curiae Welfare Plans and Blue Cross. Gregory G. Katsas, Carol M. Stapleton, Jones, Day, Reavis & Pogue, Washington, D.C.; Phillip E. Stano, Terri Sorota, American Council of Life Insurance, Washington, D.C.; Jeffrey L. Gabardi, Health Insurance Association of America, Washington, D.C., for Amici Curiae ACLI and HIAA. Lynn Zehnder, State and Local Government Benefits Association, Springfield, IL, for Amicus Curiae Benefits Association. Ann Elizabeth Reesman, Corrie L. Fischel, McGuinness & Williams, Washington, D.C., for Amicus Curiae Advisory Council. Bill Lann Lee, Acting Assistant Attorney General, Mark L. Gross, Marie K. McElderry, U.S. Department of Justice, Wasington, D.C., for Amicus Curiae U.S.

Before HAMILTON and MICHAEL, Circuit Judges, and MOON, United States District Judge for the Western District of Virginia, sitting by designation.

OPINION

MICHAEL, Circuit Judge:

The key question in this case is whether Title II of the Americans With Disabilities Act of 1990 (ADA or Act), 42 U.S.C. §§ 12132-12134 (1994), requires a state's long-term disability plan to provide equal benefits for mental and physical disabilities. We hold that it does not.

I.

The facts are undisputed and can be stated in short order. Major Rogers was employed by the South Carolina Department of Health and Environmental Control (DHEC) as a maintenance engineer for approximately 22 years. As a state worker Rogers was a participant in a long-term disability plan sponsored by the State of South Carolina (the State) for the benefit of its employees. The plan administrator was the South Carolina Budget and Control Board, Office of Insurance Services (OIS). It appears that all eligible state employees were covered by the same plan. It provided one year of benefits for mental disabilities and benefits to age 65 for physical disabilities. Rogers was diagnosed with a panic-anxiety disorder, and he applied for long-term benefits under the plan based on a psychological disability. He received benefits for one year.

When his benefits ended, Rogers sued DHEC (which he treats as the State) and OIS in federal court, claiming that the State's plan discriminated against him on the basis of his mental disability, in violation of Title II of the ADA. Specifically, he alleged (1) that he was discriminated against because he was denied the same level of benefits as someone with a physical disability and (2) that the plan's "lower benefit level" for mental disability was not based on proper risk classification because the separate classification for mental dis-ability lacked a sound actuarial basis. The State and OIS moved to dismiss Rogers' complaint for failure to state a claim. See Fed. R.Civ. P. 12(b)(6). The district court granted the motion, holding that a disparity in benefits between physical and mental disabilities in a benefit plan is not unlawful discrimination under the ADA. Rogers appeals.

II.

Rogers contends that he has stated a claim for violation of Title II of the ADA because the State's long-term disability plan arbitrarily provided different levels of benefits to the mentally and physically disabled. This states a claim only if the Act requires equal benefits for mental and physical disabilities or requires plan sponsors to justify risk classifications with actuarial data. We conclude that Title II requires neither. Our decision is consistent with recent opinions from the Third, Sixth, and Seventh Circuits. See Ford v. Schering-Plough Corp., 145 F.3d 601, 608 (3d Cir.1998) (holding that "[t]he ADA does not require equal coverage for every type of disability"), cert. denied, --- U.S. ----, 119 S.Ct. 850, 142 L.Ed.2d 704 (1999); Parker v. Metropolitan Life Insurance Co., 121 F.3d 1006, 1015 (6th Cir.1997) (en banc) (same), cert. denied, --- U.S. ----, 118 S.Ct. 871, 139 L.Ed.2d 768 (1998); E.E.O.C. v. CNA Ins. Cos., 96 F.3d 1039, 1044 (7th Cir.1996) (same).

A.

Title II of the ADA applies to "public entities," which include states and their departments and agencies. See 42 U.S.C. § 12131. The substance of Title II is that "no qualified individual with a disability shall, by reason of such disability, be excluded from participation in or denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity." 42 U.S.C. § 12132 (emphasis added). Here, the State satisfied the first part of this provision because Rogers was not "excluded from participation in or denied the benefits of" the long-term disability plan. Specifically, the State provided the same plan to all of its eligible employees, and Rogers received his allotted benefits. We must address, however, whether the State's plan violated the second part of the provision, that is, whether the plan "subjected [Rogers] to discrimination" on the basis of his disability.

The broad question is whether the "subjected to discrimination" phrase in § 12132 was intended to require equal benefits for mental and physical disabilities. That question is not answered in plain language anywhere in the ADA, but we are not without guidance. The Supreme Court has interpreted a statute with similar language, the Rehabilitation Act of 1973, 29 U.S.C. § 794 et seq. (1994). In addition, the legislative history of the ADA and a policy statement of the Equal Employment Opportunity Commission (EEOC) are quite instructive. Finally, we get a good indication of the limits of § 12132 by reviewing another provision of the ADA and by analyzing post-ADA congressional activity. We will now examine these sources.

The Rehabilitation Act is the most appropriate starting point for our discussion because, in many ways, it is the precursor to the ADA. The two Acts share the same definitions of disability. Compare 42 U.S.C. § 12102(2)(a) (1994) (ADA) with 29 U.S.C. § 705(9)(B) (1994) (Rehabilitation Act). They also contain the same operative language about discrimination. Compare 42 U.S.C. § 12132 (supra, at ----) with 29 U.S.C. § 794(a) (1994) ("No otherwise qualified individual ... shall, solely by reason of her or his disability, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity conducted by any Executive Agency"). Moreover, Congress has called for a coordinated interpretation of the Rehabilitation Act and the ADA to "prevent [ ] imposition of inconsistent or conflicting standards for the same requirements" under the two statutes, see 42 U.S.C. § 12117(b) (1994); Tyndall v. National Education Centers, Inc., 31 F.3d 209, 213 n. 1 (4th Cir.1994), and courts have used their understanding of the Rehabilitation Act to interpret the ADA, see e.g., McPherson v. Michigan High School Athletic Association, 119 F.3d 453, 460 (6th Cir.1997) ("[b]ecause the standards under both of the acts are largely the same,cases construing one statute are instructive in construing the other." (alteration in original) (citation omitted)); Doe v. University of Md. Med. Sys. Corp., 50 F.3d 1261, 1264 n. 9 (4th Cir.1995) ("Because the language of [Title II of the ADA and the Rehabilitation Act] is substantially the same, we apply the same analysis to both"). Relevant Rehabilitation Act precedent, then, may inform our understanding of what § 12132 requires. We turn to that precedent.

In Alexander v. Choate, 469 U.S. 287, 105 S.Ct. 712, 83 L.Ed.2d 661 (1985), certain Tennessee Medicaid recipients sued the State of Tennessee when it proposed a reduction in the number of days of inpatient hospital care covered by the state's Medicaid program. The recipients asserted a violation of § 504 of the Rehabilitation Act, claiming that the reduction would have a disproportionate (and discriminatory) effect on the handicapped, who generally require more extended hospital stays than the non-handicapped. See id. at 289-90, 105 S.Ct. 712. The Supreme Court disagreed. It held that the limit on hospital care was "neutral on its face" and did not "distinguish between those whose coverage will be reduced and those whose coverage will not on the basis of any test, judgment, or trait that the handicapped as a class are less capable of meeting or less likely of having." 469 U.S. at 302, 105 S.Ct. 712 (emphasis added). The Court said that the reduction in coverage did not discriminate against the handicapped because both classes of Medicaid users, the handicapped and the non-handicapped, were "subject to the same durational limitation." Id.

The Supreme Court built upon Alexander v. Choate in Traynor v.Turnage, 485 U.S. 535, 108 S.Ct. 1372, 99 L.Ed.2d 618 (1988). In Traynor the Court took up whether § 504 of the Rehabilitation Act requires equal benefits for all categories of handicapped persons. Certain veterans, claiming to be handicapped by reason...