Darrin Shafer v. Zimmerman Transfer, Inc., No. 22-2275 (8th Cir. 2023)
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Plaintiff underwent bariatric surgery to lose weight. A few months later, Plaintiff began working for Zimmerman Transfer, Inc. and became a participant in its self-insured employee benefit plan. Zimmerman is the plan administrator, and Benefit Plan Administrators of Eau Claire, LLC (“BPA”) served as the third-party administrator until January 2020. After exhausting his administrative appeals, Plaintiff sued BPA and Zimmerman for benefits under Section 1132(a)(1)(B). He then moved for summary judgment against BPA and Zimmerman. Both Defendants filed cross-motions for summary judgment, which the district court granted.
The Eighth Circuit affirmed. The court explained that because Plaintiff’s plan specifically excludes coverage of treatment for complications of weight-reduction surgery, neither Iowa law nor the ACA requires that his treatment be covered. It is undisputed that Plaintiff’s treatment was due to a complication of his prior bariatric surgery. Thus, Iowa law and the ACA do not require that his treatment be covered. Further, the court wrote that imposing and enforcing coverage limitations, even if it results in a plan participant paying large medical bills, is not inconsistent with the plan’s goal because the plan must allocate limited resources among all plan participants. Accordingly, the court concluded that there was no abuse of discretion in denying Plaintiff’s claim for benefits because the interpretation of the plan was reasonable, and the decision to deny benefits was supported by substantial evidence.
Court Description: [Gruender, Author, with Colloton and Wollman, Circuit Judges] Civil case - ERISA. The fact that a plan participant might not be able to enforce a money judgment against a former third-party plan administrator does not mean that he lacks standing to sue that defendant; Where the insurance plan did not cover bariatric surgery, the Plan's determination that surgery related to complications from the surgery was not covered was reasonable, and the decision to deny benefits was supported by substantial evidence.
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