Opinion
No. C99-0124
July, 2000
ORDER
This matter comes before the court pursuant to the plaintiff's April 26, 2000, motion for summary judgment (docket number 24); the defendants' June 1, 2000, cross-motion for summary judgment (docket number 32); and the defendants' June 1, 2000, motion for extension of time (docket number 33). For the reasons set forth below, the plaintiff's motion is denied; the defendants' motion for summary judgment is granted.
Background
Kenneth Fee is a participant of the Sheet Metal Workers (Local 263) Health and Welfare Fund, Cedar Rapids, Iowa. The Fund is an employee benefit plan subject to the
Employee Retirement Income Security Act (ERISA). The Fund identifies benefits available to participants and beneficiaries, as well as exclusions and limitations to health insurance benefits. Fee's wife, Chris, and his son, Jeremy, were both covered under the insurance plan which is provided by United of Omaha Life Insurance Co., Omaha, Nebraska.
On the evening of September 6, 1996, Jeremy Fee, who was, at the time, 17 years old, took an increased dosage of physician-prescribed, Imipramine. Jeremy, was being treated for Attention Deficit Hyperactivity Disorder, and had heard from a classmate that an increased dosage of the drug would cause hallucinogenic effects. Jeremy attempted to achieve those effects. At 6:00 a.m. on September 7, 1996, Chris found Jeremy leaning over the bathroom sink, sick and disoriented. When she learned that Jeremy took more than the prescribed dosage of Imipramine, Chris took Jeremy to the emergency room at Mercy Medical Center in Cedar Rapids, Iowa. Jeremy underwent standard medical procedures and was released from the hospital on September 8, 1996.
The medical bill that was submitted to the insurance company totaled $2,835.52. The Plan paid $208, or 80 percent of the $260 bill from the Cedar Centre Psychiatric Group. A balance of $2,627.52 remained unpaid. At the end of September 1996, the Local 263 claims office in Darien, Ill., determined that the balance would not be paid because the treatment was contractually excluded.
In plaintiff's benefits package, revised January 1, 1995, under the section entitled "General Exclusions and Limitations," on page 68, the policy excludes coverage for "(e) any loss, expense or charge which results, whether the insured person is sane or insane, from: (1) an intentionally self-inflicted injury or sickness; or (2) suicide or attempted suicide." On October 21, 1996, the plaintiff filed an appeal with the Plan Administrator saying that benefits should be covered under the policy unless evidence proved the overdose was a suicide attempt or an attempt to inflict illness. The Fees were informed by letter dated October 28, 1996, that their request for coverage had been denied by the Plan Administrator. The letter stated in part:
"Treatment or services related to self-inflicted illness, drug overdose or injury are not eligible for payment under the plan. . . . The claim submitted by Mercy Hospital indicated a diagnosis related to an overdose of antidepressants. The claim was denied because the Plan excludes charges which are a result of self-inflicted injury or sickness. No evidence was submitted indicating that Jeremy did not intend to harm himself."
The Plan Administrator is explicitly provided with the discretionary authority to construe and interpret the Plan. On pages 95-96 of the Policy, under the section entitled "Authority to Interpret Policy," the policy states: "By purchasing this Policy, the Policyholder grants us the discretion and the final authority to construe and interpret the Policy. This means that we have the authority to decide all questions of eligibility and all questions regarding the amount and payment of any policy benefits within the terms of the policy a interpreted by us."
The Fees filed a second appeal. They sought the opinions of two psychiatrists, Dwight Schroeder, M.D., and Allyson Wheaton, M.D., who wrote letters saying that the medical evidence and circumstances showed that Jeremy had not intended to harm himself. Also, Jeremy, Chris, and a family friend, Sister Rosemary Riesberg, wrote letters explaining Jeremy's intent to get high, not kill himself. These documents were submitted on December 20, 1996. The second appeal was denied February 17, 1997, because the Plan's Board of Trustees determined that taking an overdose of a prescription drug for the purpose of hallucinating was evidence of a self-inflicted injury. In the second and final appeal, the Trustees wrote: "The Trustees were not persuaded by the proposition that he [Jeremy] was just experimenting and didn't intend to make himself sick." Kenneth and Jeremy Fee filed this complaint September 17, 1999, within the three-year statute of limitations provided by the Plan (see page 82 under "Legal Actions").
Summary Judgment
A motion for summary judgment may be granted only if, after examining all of the evidence in the light most favorable to the nonmoving party, the court finds that no genuine issues of material fact exist and that the moving party is entitled to judgment as a matter of law. Kegel v. Runnels, 793 F.2d 924, 926 (8th Cir. 1986). Once the movant has properly supported its motion, the nonmovant "may not rest upon the mere allegations or denials of [its] pleading, but . . . must set forth specific facts showing that there is a genuine issue for trial."Fed.R.Civ.P. 56(e). "To preclude the entry of summary judgment, the nonmovant must show that, on an element essential to [its] case and on which [it] will bear the burden of proof at trial, there are genuine issues of material fact." Noll v. Petrovsky, 828 F.2d 461, 462 (8th Cir. 1987), cert denied, 484 U.S. 1014 (1988) (citing Celotex Corp. v. Catrett, 477 U.S. 317 (1986)). Although "direct proof is not required to create a jury question, . . . to avoid summary judgment, `the facts and circumstances relied upon must attain the dignity of substantial evidence and must not be such as merely to create a suspicion.'" Metge v. Baehler, 762 F.2d 621, 625 (8th Cir. 1985), cert denied, 474 U.S. 1057 (1986) (quoting Impro Prod., Inc. v. Herrick, 715 F.2d 1267, 1272 (8th Cir. 1983), cert denied, 465 U.S. 1026 (1984)). In applying these standards, the court must give the nonmoving party the benefit of all reasonable inferences to be drawn from the evidence. Krause v. Perryman, 827 F.2d 346, 350 (8th Cir. 1987).
Analysis
Under ERISA, a plan beneficiary has the right to judicial review of a benefits determination. 29 U.S.C. § 1132 (a)(1)(B). See also Sahulka v. Lucent Technologies, Inc., 206 F.3d 763 (8thCir. 2000). In their complaint, the plaintiffs seek recovery of health benefits from the Sheet Metal Workers (Local 263) Health and Welfare Fund. The plaintiffs have set forth these arguments:
First, the plaintiffs claim the "abuse of discretion" standard of review should be relaxed in this case because the plaintiffs allege there were procedural irregularities during the administrative appeals process. Specifically, the plaintiffs claim the Board of Directors and Trustees of the Fund failed to properly explain the "specific reasons" for denying the Fee claim and failed to provide an explanation that was "written in a manner calculated to be understood by the participant" as required by 29 U.S.C. § 1133(1) (2000).
The appropriate standard of review for a denial of benefits under ERISA is de novo "unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan," Firestone Tire Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989), in which case review is under the arbitrary and capricious standard. The Eighth Circuit will refer to the arbitrary and capricious standard as the abuse of discretion standard, but the two differ in name only. Id. at FN1 671. This highly deferential standard reflects the fact that courts are hesitant to interfere with the administration of a pension plan. Maune v. International Brotherhood of Electrical Workers, Local #1, Health and Welfare Fund, 83 F.3d 959, 962-63 (8th Cir. 1996). See also Cox v. Mid-America Dairymen, Inc., 965 F.2d 569, 571 (8th Cir. 1992). Thus, the court will uphold the Trustee's decision to deny benefits if it is reasonable. Id. at 963. See Woo v. Deluxe Corp., 144 F.3d 1157, 1162 (8th Cir. 1998) (the plan administrator's decision to deny benefits will stand if a reasonable person could have reached a similar decision. In evaluating reasonableness, the court determines whether the decision is supported by substantial evidence, which is more than a scintilla, but less than a preponderance.). A decision by the trustees to deny benefits is an abuse of discretion if the action is extraordinarily imprudent or extremely unreasonable. Lutheran Medical Center of Omaha, Neb. v. Contractors, Laborers, Teamsters and Engineers Health and Welfare Plan, 25 F.3d 616, (8th Cir. 1994).
Standard of Review
Because the Plan Administrators in this case have the final authority to interpret the policy and to determine benefits, the standard of review is arbitrary and capricious. The decision by Plan administrators to deny benefits to these plaintiffs will be deemed arbitrary and capricious only if the action was extraordinarily imprudent or extremely unreasonable.See Lickteig v. Business Mens's Assurance Company of America, 61 F.3d 579582 (8th Cir. 1995) (Trustees abused their discretion in denying plaintiff's claim; even though plaintiff was not scheduled to work the weekend of his injury, he still was eligible for employee benefits.); Buttram v. Central States, S.E. S.W. Areas Health and Welfare Fund, 76 F.3d 896, 901 (8th Cir. 1996) (A deferential standard of review remains intact as long as the ultimate decision regarding benefits was made with reflection and judgment). In this case, there is no evidence that the defendants abused their discretion by not complying with ERISA procedures when informing the plaintiffs about the denial of benefits, and the reason for that denial. There is no evidence that the decision regarding the plaintiff's benefits was made without reflection and judgment, nor was the decision extremely unreasonable. . . . If there were any procedural irregularities, they were not sufficiently egregious as to amount to evidence of abuse of discretion. The standard of review should not be modified.Language of the Policy: The Meaning of "Self-Inflicted Injury"
The plaintiffs claim the meaning of language within the policy that excludes payment for "self-inflicted injury or sickness" was interpreted by them to mean the result of voluntary acts that might lead to an intended injury or expected sickness. The plaintiffs interpret the exclusionary clause as requiring evidence of intent and they contend Jeremy's drug experimentation-related illness was accidental, and not an intentional act of self-inflicted injury. The plaintiffs claim that the administrators of the Plan abused their discretion by incorrectly excluding the Fees from coverage.
In Lutheran Medical Center of Omaha, Neb. v. Contractors, Laborers, Teamsters and Engineers Health and Welfare Plan, 25 F.3d 616, (8th Cir. 1994), the court found trustee's denial of benefits to be arbitrary and capricious after the plaintiff was hospitalized as a result of a drug overdose, and subsequently admitted to a psychiatric facility. The Plan did not cover "injury or sickness resulting from any attempt at suicide or from any intentionally self-inflicted injury, whether the covered person is sane or insane" but the court said the trustees should not be allowed to use the exclusion to swallow coverage for an underlying condition merely because the expenses incurred are contemporaneous with or follow an alleged suicide attempt. Id. at 621.
The terms in a ERISA-governed plan are to be construed "in an ordinary and popular sense as would a [person] of average intelligence and experience." Hammond v. Fidelity and Guaranty Life Ins. Co., 965 F.2d 428, 430 (7th Cir. 1992). A term within the Plan is ambiguous if "it is subject to reasonable alternative interpretations" or if there is "genuine" (meaning substantial) uncertainty, not resolvable by other means" in construing the terms. See Hickey, 995 F.2d at 1389. In Bevans v. Iron Workers' Tri-State Welfare Plan, 971 F. Supp. 357 (C.D.Ill. 1997), the plaintiff took an overdose of Tylenol and became ill with liver necrosis. The health plan denied Bevans claims for hospital and doctor bills because the Plan excluded coverage as a result of self-inflicted injuries. The Seventh Circuit has held that an intentionally self-inflicted injury can reasonably be construed as the "natural and probable consequence of an intentional act," without specifically addressing the issue of ambiguity. In Wickman v. Northwestern National Insurance Co., 908 F.2d 1077 (1st Cir. 1990), court rejected the state law distinction between accidental means and results, focusing instead on the reasonableness of the insured's expectations. Id. at 1086. Federal district courts have found that in order to determine whether the exclusion for intentionally self-inflicted injury applies to the facts of a case involving the ingestion of drugs, the court should examine four factors: (1) was the ingestion intentional? (2) Did the insured know that the ingestion would likely to cause an injury? (3) Did the ingestion cause an injury? (4) Did the loss result from the injury?
It is not necessary that the person ingesting the drugs know that death could result. If the person ingesting the drugs has a general cognizance that the drugs could produce some injury, it is enough that there is a some causal relation between the injury caused and the ultimate loss.Holsinger v. New England Mutual Life Ins. Co., 765 F. Supp. 1279, 1282 (E.D.Mich. 1991) (After consuming alcohol, youth consumed unknown large quantity of Tylenol, and the Plan denied coverage. The court found the language "self-inflicted injury" unambiguous). While the youth inHolsinger may not have specifically known at the time of ingestion that Tylenol taken in combination with alcohol would have a toxic effect on his liver, a reasonable person in his position should have known that taking a large quantity of any pain killers is dangerous and could naturally cause some form of injury. Bevans, supra, at 362. While that plaintiff didn't think he would die from the Tylenol overdose, he was "vaguely aware that he might die." Id.
The court acknowledged that teenagers frequently do unwise things and exercise bad judgment due to their lack of maturity . . . however, the court's sympathy cannot change the terms of the insurance policy in order to achieve a more compassionate result. Id. In this case, Jeremy Fee may have suffered from the same kind of poor judgment the court saw inHolsinger, making these plaintiffs ineligible for benefits. Analyzing this case under the four-part Holsinger test:
(1) There is no dispute that Jeremy intentionally and voluntarily ingested the prescription medication;
(2) Jeremy knew that the ingestion would be likely to cause an injury. Jeremy had some experience with drug experimentation. While he may not have been attempting suicide, Jeremy knew that his efforts to hallucinate by taking a drug overdose would be likely to cause an injury. He wrote that on a "few occasions in the past, I have experimented with Imipramine, taking more than I was supposed to." Also, Jeremy told Allyson Wheaton, M.D., that he though taking the overdose might be "a little dangerous";
(3) The ingestion of the prescription drug did, in fact, cause an injury; and
(4) The loss resulted from the injury.
The insurance policy will not pay for "self-inflicted injury," but there some courts have ruled that "self-inflicted injury" is different than an "accident." For example, in Santaella v. Metropolitan Life Insurance Co., 123 F.3d 456, 459 (7th Cir 1997), the district court concluded that Teresita Eldridge's death (she died after taking the prescription painkiller, Darvon) was not accidental and should not be covered by insurance, but the Seventh Circuit overruled the district court, saying there was no evidence that she knew or should have known death or serious injury was substantially likely to occur. The insurance policy had expressly denied coverage for "intentionally self-inflicted injuries, suicide or any attempt thereof, while sane or insane." Interpreting the policy terms in an ordinary and popular sense, "accidental" would be commonly defined as "unexpected or unintentional."Id. at 462. The question comes down to what level of expectation is necessary for an act to constitute an "accident." Santaella, supra, at 463. It was undisputed that Mrs. Eldridge voluntarily took the drug, but nothing in the record suggested she intended to take an overdose or inflict injury upon herself. See Casey v. Uddeholm Corp., 32 F.3d 1094, 1097 (7th Cir. 1994) (a self-inflicted injury may be accidental, where accidental is taken to mean unintentional rather than unexpected. For example, it is an accident when someone hits his thumb with a hammer when driving a nail. The injury was self-inflicted, but not intended, hence, an accident.)
In Winchester v. Prudential Life Insurance Co. of America, 975 F.2d 1479 (10th Cir. 1992), the court found that when the plaintiff died as a result of his participation in a firefighting exercise, he presumably did not reasonably foresee suffering heart failure. As a result, the court said recovery from the insurance policy was permitted despite that his engagement in the firefighting activity was intentional.
In this case, the plaintiffs claim that when Jeremy took an increased dose of Imipramine, his intent was the pleasure of hallucination, rather than the injury which resulted. Unlike Mrs. Eldridge who was not aware of the risk of serious injury or death, the plaintiff voluntarily took an increased dose of medication, knowing he could be injured as a result of his voluntary act. His overdose and subsequent hospitalization was the result of a self-inflicted injury, an intentional ingesting of an increased dose of prescription drugs. The resulting injury was not accidental. The defendant was acting within the scope of its authority when it denied benefits to the plaintiffs for Jeremy Fee's self-inflicted injury. The plaintiff's motion for summary judgment is denied.
IT IS ORDERED
1. The plaintiff's April 26, 2000, motion for summary judgment (docket number 24) is denied.
2. The defendants' June 1, 2000, cross-motion for summary judgment (docket number 32) is granted. The Clerk of Court shall enter judgment for the defendants.
3. The defendants' June 1, 2000, motion for extension of time (docket number 33) is granted.