McMahan v. United Healthcare Insurance Company et al, No. 3:2011cv00063 - Document 26 (S.D. Cal. 2012)
Court Description: ORDER Granting 16 Defendants' Motion for Summary Judgment. For the reasons stated herein, the Court Grants Defendants' motion for summary judgment. The Clerk of the Court is directed to enter judgment in accordance with this Order. Signed by Judge M. James Lorenz on 9/13/2012. (leh) (av1).
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McMahan v. United Healthcare Insurance Company et al Doc. 26 1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 14 15 16 17 18 19 SUZANNA MCMAHAN, ) Case No. 11-cv-63-L(BLM) ) Plaintiff, ) ORDER GRANTING ) DEFENDANTS’ MOTION FOR v. ) SUMMARY JUDGMENT [DOC. 16] ) UNITED HEALTHCARE INSURANCE ) COMPANY, et al., ) ) Defendants. ) ) On January 12, 2011, Plaintiff Suzanna McMahan commenced this action against 20 Defendants United Healthcare Insurance Company (“UHC”) and Farmers Group, Inc. Medical 21 Plan (“Farmers”) seeking declaratory judgment and injunctive relief under the Employee 22 Retirement Income Security Act (“ERISA”), 29 U.S.C. §§ 1132(a), (e), (f), and (g). This action 23 arises from UHC’s decision to deny Plaintiff’s request for health benefits (obesity surgery). 24 Defendants now move for summary judgment. (Doc. 16.) Plaintiff opposes. 25 The Court found this motion suitable for determination on the papers submitted and 26 without oral argument. See Civ. L.R. 7.1(d.1). (Doc. 23.) For the following reasons, the Court 27 GRANTS Defendants’ motion for summary judgment. 28 // 11cv63 Dockets.Justia.com 1 I. BACKGROUND1 2 A. 3 Plaintiff is an employee of Farmers Insurance Exchange, and in 2010, she was a The Summary Plan Description (“SPD”) 4 participant in Farmers’ Welfare Benefit Plan (“Plan”), an employee welfare benefit plan 5 regulated by ERISA. (JSUF ¶¶ 1–2.) The Plan is self-funded by Farmers. (Id. ¶ 3.) 6 The SPD,2 effective January 1, 2010, designates Farmers as both the Plan Administrator 7 and Plan Sponsor, and UHC as the Claims Administrator. (SPD 1, 93, 100; JSUF ¶¶ 3–4.) It 8 states that Farmers and UHC have the “sole and exclusive discretion” to: (1) “interpret Benefits 9 under the Plan”; (2) “interpret the other terms, conditions, limitations and exclusions of the Plan, 10 including this SPD and any Riders and/or Amendments”; and (3) “make factual determinations 11 related to the Plan and its Benefits.” (SPD 88.) Farmers and UHC may also “delegate this 12 discretionary authority to other persons or entities that provide services in regard to the 13 administration of the Plan.” (Id.) 14 Section 6 of the SPD provides Additional Coverage Details, supplementing the Plan 15 Highlights contained in Section 5. (SPD 22.) This section includes covered health services for 16 which the Plan pays Benefits, and covered health services that require the participant to notify 17 Personal Health Support before receiving them as well as any reduction in Benefits that may 18 apply. (Id.) One of the covered health services listed under Section 6 is Obesity Surgery. (Id. at 19 33.) “The Plan covers surgical treatment of obesity provided by or under the direction of a 20 Physician when all of the following are true: 21 # you have a minimum Body Mass Index (BMI) of 40; or 22 # you have documentation from a Physician of a diagnosis of morbid obesity for a 23 24 1 Some of the following factual background is taken from the parties’ Joint Statement of 25 Undisputed Facts (“JSUF”). (Doc. 25-7.) Even though the JSUF is attached to Defendants’ Reply, it was signed by counsel for both parties. 26 2 The operative SPD—also referred to as the 2010 SPD—is attached as Exhibit A to the 27 Declaration of Patricia Wojcik. (Doc. 16-3.) References to the SPD in this Order will be to the original page numbers and not the subsequently added Bates-stamped page numbers. 28 11cv63 2 1 minimum of five years; 2 # you are over the age of 21; and 3 # the surgery is performed at a Network Hospital by a Network surgeon even if there 4 are no Network Hospitals near you.” 5 (SPD 33.) 6 Section 9 of the SPD sets forth the Claims Procedures, including the options available to 7 plan participants following the denial of a claim and procedures to file a formal appeal. (SPD 8 62–68.) The SPD gives participants the option to call UHC following the denial of a claim 9 before requesting a formal appeal. (Id. at 64.) If a participant wishes to appeal a denied pre10 service request for Benefits or post-service claim, then the participant is instructed to submit an 11 appeal in writing to UHC. (Id.) UHC then conducts a “full and fair review” of the appeal. (Id. 12 at 65.) If unsatisfied with the first-level-appeal decision, the participant “[has] the right to 13 request a second level appeal from UnitedHealthcare.” (Id.) “UnitedHealthcare’s decision will 14 be final.” (Id.) Under Section 9, UHC is responsible for assessing requests for Benefits and 15 rendering decisions for all levels of appeal. (Id. at 65–68.) 16 17 B. 18 On June 24, 2010, Plaintiff requested pre-approval for obesity surgery from UHC. (JSUF Plaintiff’s Request for Pre-Approval of Obesity Surgery 19 ¶ 5.) On July 7, 2010, UHC denied the request on the grounds that Plaintiff failed to meet all 20 four of the criteria listed for coverage for the surgery. (Id. ¶ 7; Wojcik Decl. Ex. C.) 21 Specifically, UHC found that Plaintiff did not have documentation from a physician of a 22 diagnosis of morbid obesity for a minimum of five years. (Wojcik Decl. Ex. C.) UHC based its 23 denial on the following language in the SPD: 24 25 26 27 The Plan covers surgical treatment of obesity provided by or under the direction of a Physician when all of the following are true: you have a minimum Body Mass Index (BMI) of 40; or you have documentation from a Physician of a diagnosis of morbid obesity for a minimum of five years; you are over the age of 21; and the surgery is performed at a Network Hospital by a Network surgeon even if there are no Network Hospitals near you. 28 (Wojcik Decl. Ex. C.) 11cv63 3 1 After UHC denied her request, Plaintiff formally appealed. On August 10, 2010, Plaintiff 2 submitted a first-level appeal to UHC. (JSUF ¶ 9.) She argued that the obesity surgery should 3 be covered because she had a BMI over 40, and thus, she met the SPD’s first requirement for 4 surgery pre-approval. (Wojcik Decl. Ex. D.) However, on August 27, 2010, UHC upheld the 5 denial of benefits for obesity surgery on the grounds that Plaintiff failed to meet Criterion 6 2—“Documentation from a Physician of a diagnosis of morbid obesity for a minimum of five 7 years”—for obesity surgery. (Wojcik Decl. Ex. E.) Dr. Stephen Lincoln, M.D. reviewed the 8 appeal, and reached that conclusion after reviewing additional clinical information. (Id.) 9 On October 18, 2010, Plaintiff submitted a second-level appeal to UHC. (JSUF ¶ 13.) 10 Plaintiff again contended that the SPD requires that only one of the first two criteria need to be 11 satisfied to qualify for bariatric (obesity) surgery. (Wojcik Decl. Ex. F.) She also explained that 12 a UHC Customer Service Representative advised her that “it was clear [she] qualified for the 13 surgery based on the language and stated that [the request] had been denied by mistake.” (Id.) 14 That representative later contacted Plaintiff and stated that the policy was “written incorrectly,” 15 should have stated “and” after Criterion 2, and that the company was in the process of trying to 16 have the language changed. (Id.) Plaintiff also stated in her second-level appeal that she spoke 17 with a UHC Customer Service Supervisor, Customer Service Manager, and Business Manager. 18 (Id.) All three representatives acknowledged to her that the policy “clearly shows” the word 19 “or,” and that, at the time, UHC was “in the process of changing the language.” (Id.) 20 Eventually, UHC once again upheld its denial of Plaintiff’s request for pre-approval for 21 obesity surgery. (JSUF ¶ 15.) On November 5, 2010, UHC sent Plaintiff a letter explaining that 22 her request for obesity surgery is not a covered benefit because, “based upon the clinical 23 information provided for this review, the specific requirement for [] Documentation from a 24 Physician of a diagnosis of morbid obesity for a minimum of five years has not been met.” 25 (Wojcik Decl. Ex. G.) The letter also noted that there is a “typographic error in the Benefit Plan 26 document of which Farmer’s [sic] is aware” and “[t]he word ‘or’ should be ‘and’ in the section 27 about coverage of bariatric [obesity] surgery.” (Id.) Dr. Brian Rose, D.O., reviewed this 28 second-level appeal. (Id.) 11cv63 4 1 On November 15, 2010, UHC amended the 2010 SPD to delete the word “or” after the 2 first criterion for obesity surgery. (Pellymounter Decl. ¶ 14.) The prefatory language requiring 3 that all criteria be met to qualify for the surgery remained the same. (Id.) 4 On November 23, 2010, Plaintiff contacted a Farmers Employee Benefits Manager, 5 expressing her dissatisfaction with the denial of her appeal, and informing Farmers that she had 6 incurred $600.00 in expenses in connection with her request for pre-approval of obesity surgery. 7 (Pellymounter Decl. ¶ 12.) In response, the Employee Benefits Manager contacted UHC to 8 confirm whether Plaintiff had incurred the identified expenses, and to request that she be 9 reimbursed for these expenses by UHC. (Id. ¶ 13.) 10 On January 12, 2011, Plaintiff commenced this action against Defendants, seeking 11 declaratory judgment that the requested obesity surgery be covered, and equitable relief requiring 12 Defendants to pay for the same. She also seeks attorneys’ fees and costs. Defendants now move 13 for summary judgment. Plaintiff opposes. 14 15 II. LEGAL STANDARD 16 Summary judgment is appropriate under Rule 56(c) where the moving party demonstrates 17 the absence of a genuine issue of material fact and entitlement to judgment as a matter of law. 18 See Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A fact is material 19 when, under the governing substantive law, it could affect the outcome of the case. Anderson v. 20 Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Freeman v. Arpaio, 125 F.3d 732, 735 (9th Cir. 21 1997). A dispute about a material fact is genuine if “the evidence is such that a reasonable jury 22 could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248. 23 A party seeking summary judgment always bears the initial burden of establishing the 24 absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. The moving party can 25 satisfy this burden in two ways: (1) by presenting evidence that negates an essential element of 26 the nonmoving party’s case; or (2) by demonstrating that the nonmoving party failed to make a 27 showing sufficient to establish an element essential to that party’s case on which that party will 28 bear the burden of proof at trial. Id. at 322-23. “Disputes over irrelevant or unnecessary facts 11cv63 5 1 will not preclude a grant of summary judgment.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors 2 Ass’n, 809 F.2d 626, 630 (9th Cir. 1987). 3 “The district court may limit its review to the documents submitted for the purpose of 4 summary judgment and those parts of the record specifically referenced therein.” Carmen v. San 5 Francisco Unified Sch. Dist., 237 F.3d 1026, 1030 (9th Cir. 2001). Therefore, the court is not 6 obligated “to scour the record in search of a genuine issue of triable fact.” Keenan v. Allen, 91 7 F.3d 1275, 1279 (9th Cir. 1996) (citing Richards v. Combined Ins. Co. of Am., 55 F.3d 247, 251 8 (7th Cir. 1995)). If the moving party fails to discharge this initial burden, summary judgment 9 must be denied and the court need not consider the nonmoving party’s evidence. Adickes v. S.H. 10 Kress & Co., 398 U.S. 144, 159-60 (1970). 11 If the moving party meets this initial burden, the nonmoving party cannot defeat summary 12 judgment merely by demonstrating “that there is some metaphysical doubt as to the material 13 facts.” Matsushita Electric Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); 14 Triton Energy Corp. v. Square D Co., 68 F.3d 1216, 1221 (9th Cir. 1995) (“The mere existence 15 of a scintilla of evidence in support of the nonmoving party’s position is not sufficient.”) (citing 16 Anderson, 477 U.S. at 242, 252). Rather, the nonmoving party must “go beyond the pleadings” 17 and by “the depositions, answers to interrogatories, and admissions on file,” designate “specific 18 facts showing that there is a genuine issue for trial.” Celotex, 477 U.S. at 324 (quoting Fed. R. 19 Civ. P. 56(e)). 20 When making this determination, the court must view all inferences drawn from the 21 underlying facts in the light most favorable to the nonmoving party. See Matsushita, 475 U.S. at 22 587. “Credibility determinations, the weighing of evidence, and the drawing of legitimate 23 inferences from the facts are jury functions, not those of a judge, [when] he [or she] is ruling on 24 a motion for summary judgment.” Anderson, 477 U.S. at 255. 25 // 26 // 27 // 28 // 11cv63 6 1 III. DISCUSSION 2 A. 3 4 The Abuse of Discretion Standard of Review Applies. 1. Standard of Review “[A] denial of benefits challenged under 29 U.S.C. § 1132(a)(1)(B) is to be reviewed 5 under a de novo standard unless the benefit plan gives the administrator or fiduciary 6 discretionary authority to determine eligibility for benefits or to construe the terms of the plan.” 7 Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). “Where the plan vests the 8 administrator with the discretionary authority to determine eligibility for benefits, . . . a district 9 court may review the administrator’s determination only for an abuse of discretion.” Taft v. 10 Equitable Life Assurance Soc’y, 9 F.3d 1469, 1471 (9th Cir. 1993) (citing Firestone, 489 U.S. at 11 115; Eley v. Boeing Co., 945 F.2d 276, 278 (9th Cir. 1991)) (abrogated on other grounds). 12 “[T]he presumption of de novo review can be overcome only when a plan’s reservation of 13 discretion is unambiguous.” McDaniel v. The Chevron Corp., 203 F.3d 1099, 1107 (9th Cir. 14 2000) (citing Kearney v. Standard Ins. Co., 175 F.3d 1084, 1088-89 (9th Cir. 1999) (en banc)). 15 An ERISA plan that does not grant any power to construe the terms of the plan is 16 insufficient to confer discretionary authority on the administrator. See, e.g., Ingram v. Martin 17 Merietta Long Term Disability Income Plan, 244 F.3d 1109, 1112 (9th Cir. 2001) (applying a de 18 novo standard of review when plan provisions merely identified the plan administrator’s tasks, 19 but granted no power to interpret the plan). But in cases where the plan bestows on the 20 administrator the responsibility to interpret the terms of the plan and to determine eligibility for 21 benefits, the Ninth Circuit has found it sufficient to grant discretionary authority. Abatie v. Alta 22 Health & Life Ins. Co., 458 F.3d 955, 965 (9th Cir. 2006) (finding a plan giving the 23 administrator “full and final” authority and cautioning that such authority “rest exclusively” with 24 the plan administrator unambiguous). 25 Here, Farmers is the Plan Administrator and UHC is the Claims Administrator under the 26 SPD. The Plan unambiguously confers discretionary authority upon both Farmers and UHC. 27 (See SPD 88.) As laid out above, both have “sole and exclusive discretion” to: (1) “interpret 28 Benefits under the Plan”; (2) “interpret the other terms, conditions, limitations and exclusions of 11cv63 7 1 the Plan”; and (3) “make factual determinations related to the Plan and its Benefits.” (Id.) Both 2 also may “delegate this discretionary authority to other persons or entities.” (Id.) Therefore, the 3 appropriate standard of review is abuse of discretion. See Firestone, 489 U.S. at 111 (plan 4 granted discretion if administrator has power to construe uncertain terms in the plan); Abatie, 5 458 F.3d at 965. 6 7 8 2. Conflict of Interest Courts apply the abuse-of-discretion standard even if there are egregious conflicts of 9 interest. Abatie, 458 F.3d at 965. “If a benefit plan gives discretion to an administrator or 10 fiduciary who is operating under a conflict of interest, that conflict must be weighed as a factor 11 in determining whether there is an abuse of discretion.” Metro. Life Ins. Co. v. Glenn, 554 U.S. 12 105, 111 (2008) (emphasis in original) (internal quotation marks omitted). Consideration of the 13 conflict can “affect judicial review,” thus a court must consider the conflict whenever it exists, 14 and must temper the abuse-of-discretion standard with skepticism “commensurate” with the 15 conflict. Abatie, 458 F.3d at 959; see Nolan v. Heald Coll., 551 F.3d 1148, 1154 (9th Cir. 2009). 16 “The level of skepticism with which a court views a conflicted administrator’s decision may be 17 low if a structural conflict of interest is unaccompanied, for example, by any evidence of malice, 18 of self-dealing, or of a parsimonious claims-granting history.” Abatie, 458 F.3d at 968. The 19 existence of a structural conflict of interest is more important where “circumstances suggest a 20 higher likelihood that it affected the benefits decision.” Glenn, 554 U.S. at 117. Other factors 21 relevant to this determination are whether the administrator “has a history of biased claims 22 administration”; and whether the administrator “has taken active steps to reduce potential bias 23 and to promote accuracy, for example, by walling off claims administrators from those interested 24 in firm finances, or by imposing management checks that penalize inaccurate decisionmaking 25 irrespective of whom the inaccuracy benefits.” Id. 26 “[A]n insurer that acts as both the plan administrator and the funding source for benefits 27 operates under what may be termed a structural conflict of interest.” Abatie, 458 F.3d at 965 28 (citing Tremain v. Bell Indus., Inc., 196 F.3d 970, 976 (9th Cir. 1999). As Plaintiff points out, 11cv63 8 1 Farmers is both the Plan Administrator and funds the Plan. (Pl.’s Opp’n 11:23–24.) Thus, there 2 is a structural conflict of interest. See Abatie, 458 F.3d at 965. However, that is only one factor 3 in determining whether there was an abuse of discretion. See Glenn, 544 U.S. at 111. The Court 4 may consider extrinsic evidence outside the administrative record “to decide the nature, extent, 5 and effect on the decision-making process of any conflict of interest.” Abatie, 458 F.3d at 970. 6 The “decision on the merits, though, must rest on the administrative record once the conflict (if 7 any) has been established.” Id. (citing Doe v. Travelers Ins. Co., 167 F.3d 53, 57 (1st Cir. 8 1999)). 9 Plaintiff provides extrinsic evidence in the form of email communications that 10 purportedly shows that Farmers directed the determination to deny Plaintiff’s appeal. (Pl.’s 11 Opp’n 13:12–16 (citing Green Decl. Ex. 1).) The email communications show that UHC 12 informed Farmers that it would deny Plaintiff’s second-level appeal and inquired whether 13 Farmers wanted to make an exception. (Green Decl. Ex. 1.) However, the email 14 communications do not show that Farmers directed any determination. Rather, as Defendants 15 point out, the email communications show that Farmers, given that UHC would handle the claim 16 no differently, did not see the need to intercede and request an exception. (See id.) That also 17 suggests that the final decision remained with UHC. Thus, the email communications do not 18 show that the conflict influenced UHC’s decision-making here. 19 Even though Farmers has a structural conflict of interest with respect to the Plan, the 20 Court will not afford the conflict significant weight. A court may weigh a conflict more heavily 21 where the conflict informs the eligibility decision. Abatie, 458 F.3d at 967-68. However, a 22 conflict of interest reaches the “vanishing point” where an administrator “has taken active steps 23 to reduce potential bias and to promote accuracy.” Glenn, 554 U.S. at 118. 24 Here, Farmers played no role in the decision to deny Plaintiff’s request for obesity 25 surgery. Rather, Farmers delegated such responsibilities to UHC, and thus, Farmers took active 26 steps to reduce bias by walling itself off from eligibility decisions. See Russell v. Comcast 27 Corp., No. C08-309Z, 2009 WL 666592, at *6 (W.D. Wash. Mar. 10, 2009) (finding that the 28 plan administrator delegated the responsibility to review appeals to the claims administrator even 11cv63 9 1 though the plan granted both discretionary authority). Section 9 of the SPD shows that UHC is 2 responsible for overseeing all claims procedures, conducting a “full and fair review,” and 3 rendering “final” decisions for all levels of appeal. (SPD 65–68.) And the SPD directs 4 participants, such as Plaintiff, to contact only UHC to request benefits and pursue appeals. (Id.) 5 In fact, Section 9 does not grant Farmers any responsibilities for assessing claims. (See id. at 6 62–68.) And finally, the structural conflict is unaccompanied by any evidence of malice, self7 dealing, or a parsimonious claims-granting history. Accordingly, the Court will apply a low 8 degree of skepticism in its abuse-of-discretion analysis.3 See Abatie, 458 F.3d at 959, 968. 9 10 B. 11 Under the abuse-of-discretion standard, an administrator’s decision to deny benefits must Defendants Did Not Abuse Their Discretion. 12 be upheld if it is based upon a reasonable interpretation of the plan’s terms and was made in 13 good faith. McDaniel, 203 F.3d at 1113. The question the court must ask is not “whose 14 interpretation of the plan document is most persuasive, but whether the . . . interpretation is 15 unreasonable.” Canseco v. Constr. Laborers Pension Trust, 93 F.3d 600, 606 (9th Cir. 1996) 16 (citations and internal quotation marks omitted). In making this decision, the court is permitted 17 to review only the evidence presented to the administrator. Banuelos v. Constr. Laborer’s Trust 18 Funds for S. Cal., 382 F.3d 897, 904 (9th Cir. 2004); Taft v. Equitable Life Assurances Soc’y, 9 19 F.3d 1469, 1471 (9th Cir. 1993). 20 The test for abuse of discretion in a factual determination (as opposed to a legal error) is 21 whether “[the court has been] left with a definite and firm conviction that a mistake has been 22 committed.” Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666, 676 (9th Cir. 2011) 23 24 3 Beyond asserting that a conflict of interest exists, Plaintiff’s only supporting evidence is 25 that she was denied a full and fair review of her appeal because Dr. Lincoln, specializing in thoracic and cardiovascular surgery, and Dr. Rose, specializing in family medicine, were not 26 specialists in bariatric surgery. (Pl.’s Opp’n 13:19–14:24.) Because the only medical question Dr. Lincoln and Dr. Rose reviewed in Plaintiff’s appeals were whether her medical records 27 indicated whether she had a history of morbid obesity for a minimum of five years, and because this determination requires no specialized medical training, Plaintiff’s argument lacks merit. 28 11cv63 10 1 (internal quotation marks omitted). To make such a determination, the Court must decide 2 whether the administrator’s decision was illogical, implausible, or without support in inferences 3 that could reasonably be drawn from the record. Id. “[A]pplying [this] highly deferential 4 standard of review does not mean that the plan administrator will prevail on the merits.” Id. at 5 674-75 (quoting Conkright v. Frommert, — U.S. —, 130 S. Ct. 1640, 1646, 1651 (2010)) 6 (internal quotation marks omitted). “What deference means is that the . . . administrator’s 7 interpretation of the plan ‘will not be disturbed if reasonable.’” Id. at 675. 8 The sole remaining issue here is whether UHC’s interpretation of the Plan is reasonable. 9 In its November 5, 2010 decision, UHC explained that “[t]here is a typographic error in the 10 Benefit Plan document of which Farmer’s [sic] is aware,” and “[t]he word ‘or’ should be ‘and’ 11 in the section about coverage of bariatric [obesity] surgery.” (Wojcik Decl. Ex. G.) In the prior 12 decision issued on August 27, 2010, UHC implicitly reached the same conclusion. (Wojcik 13 Decl. Ex. E.) In that decision, UHC explained that “[t]he specific criteria in the SUMMARY 14 PLAN DESCRIPTION and amendments noted in the CLARIFICATION OF BENEFITS PLAN 15 GRID requires” all four criteria. (Id.) Neither party provides the Clarification of Benefits Plan 16 Grid. Rather, both parties rely on the plain language of the SPD to support their respective 17 positions. 18 Specifically, Defendants argue that there was a reasonable basis to deny coverage for 19 Plaintiff’s requested obesity surgery, and thus, UHC did not abuse its discretion. (Defs.’ Mot. 20 10:8–16.) They support that argument by directing the Court to the plain language of the SPD, 21 which they contend that even with the erroneously included “or” after the first criterion for BMI, 22 makes clear that obesity surgery is not covered unless all of the identified criteria are met. (Id.) 23 Plaintiff responds that Defendants are mistaken. She argues that UHC’s interpretation was 24 unreasonable, primarily because UHC failed to apply the plain language of the SPD. (Pl.’s 25 Opp’n 15:24–16:3.) The Court agrees with Defendants. 26 The prefatory language in the SPD for Obesity Surgery states that “[t]he Plan covers 27 surgical treatment of obesity provided by or under the direction of a Physician when all of the 28 following are true.” (SPD 33 (emphasis added).) Then the SPD goes on to list the four criteria, 11cv63 11 1 but after the first criterion, there is a peculiarly placed “or,” and after the third criterion, there is 2 a more customarily used “and.” (Id.) Given the prefatory language and the peculiar placement 3 of the “or,” the Court cannot conclude that UHC’s interpretation of the Plan requiring all four 4 criteria for obesity surgery is illogical, implausible, or without support in inferences that could 5 be reasonably drawn from the plain language of the SPD.4 See Salomaa, 642 F.3d at 676. 6 Rather, based on the plain language of the SPD, UHC’s interpretation is reasonable, and thus it 7 did not abuse its discretion in denying Plaintiff’s request for pre-approval for obesity surgery.5 8 See id. at 675. 9 As a lingering issue, Plaintiff also argues that her interpretation of the Plan should be 10 adopted because she is a plan participant and case law requires Defendants to bear the burden of 11 for inaccuracies when Plaintiff relies upon it to her detriment. (Pl.’s Opp’n 21:9–22:3.) 12 However, that argument does not address whether UHC’s interpretation of the Plan is 13 reasonable, and thus, is outside the scope of review. Setting that aside, Plaintiff only requested 14 pre-approval for the surgery, which was denied. (Wojcik Decl. Ex. C.) There is no evidence 15 before the Court that Plaintiff actually completed and payed for the obesity surgery herself. 16 Consequently, she did not bear any costs for surgery. Furthermore, Defendants are in the 17 process of reimbursing all expenses that Plaintiff incurred to obtain pre-authorization. 18 19 4 Plaintiff further argues that, under the doctrine of contra proferentem, any ambiguity in 20 the SPD must be construed against Defendants. (Pl.’s Opp’n 22:6–8.) The Ninth Circuit has rejected this argument. Winters v. Costco Wholesale Corp., 49 F.3d 550, 554 (9th Cir. 1995). 21 Specifically, the Winters court held that, “the rule of contra proferentem is not applicable to selffunded ERISA plans that bestow explicit discretionary authority upon an administrator to 22 determine eligibility for benefits or to construe the terms of the plan.” Id. As determined above, the SPD grants explicit discretionary authority upon UHC to determine eligibility for benefits 23 and to construe the terms of the Plan. Therefore, following the Ninth Circuit, the Court also rejects this argument. 24 5 Plaintiff also argues that UHC’s decision to deny benefits created an impossibility. 25 (Pl.’s Opp’n 16:18–20:28.) To support this argument, Plaintiff relies on definitions provided by various medical organizations, internal correspondences, and UHC’s Medical Policy on Bariatric 26 Surgery. However, all of this information is outside the scope of the Court’s review. In particular, the Medical Policy on Bariatric Surgery that Plaintiff provides is dated January 1, 27 2012, which means it would have been impossible for UHC to have even considered that document when considering Plaintiff’s request in November 2010. Therefore, the Court rejects 28 Plaintiff’s impossibility argument. 11cv63 12 1 (Pellymounter Decl. ¶ 13.) Therefore, any detriment caused by Plaintiff’s reliance on the “or” 2 typographical error has already been, or will be, born by Defendants. Thus, this argument is 3 without merit. 4 5 IV. CONCLUSION & ORDER 6 For the forgoing reasons, the Court GRANTS Defendants’ motion for summary 7 judgment. (Doc. 16.) The Clerk of the Court is directed to enter judgment in accordance with 8 this Order. 9 IT IS SO ORDERED. 10 11 DATED: September 13, 2012 12 13 M. James Lorenz United States District Court Judge 14 COPY TO: 15 HON. BARBARA LYNN MAJOR UNITED STATES MAGISTRATE JUDGE 16 17 ALL PARTIES/COUNSEL 18 19 20 21 22 23 24 25 26 27 28 11cv63 13
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