This week’s first notable decision, Meyers v. Kaiser Found. Health Plan, Inc., No. 19-15051, __F.App’x__, 2020 WL 1673078 (9th Cir. Apr. 6, 2020), is a cautionary tale for claimants seeking out-of-network treatment under a Kaiser health plan. Meyers brought the action on behalf of her teenage daughter, A.M., a covered dependent under the Kaiser medical plan. Meyers sought reimbursement of medical expense for A.M.’s treatment at Elevations residential treatment center for approximately four months in 2016. 

District Court Judge Lucy Koh granted judgment for Kaiser following a bench trial. Meyers appealed.

While the parties disputed the standard of review, the Ninth Circuit agreed with the district court— even under de novo review, Kaiser’s denial was proper.  Continue Reading Ninth Circuit Holds Kaiser Not Liable for Out-of-Network Mental Health Treatment Benefits

Good morning, ERISA Watchers!  I hope this finds you well and in good spirits.  This week’s notable decision, Wallace v. Oakwood Healthcare, Inc., No. 18-2316, __F.3d__, 2020 WL 1522833 (6th Cir. Mar. 31, 2020), involves something we might all be feeling these days: exhaustion.  

Wallace involves a challenge to a denied long-term disability benefit claim.  Plaintiff was a registered nurse who was a participant in an ERISA-governed employee welfare benefit plan sponsored by her employer (“the Plan”). She stopped working in 2012 while the Plan was insured by Hartford Life & Accident Insurance Company. On January 1, 2013, the Plan shifted its contract to Reliance Standard. Plaintiff tried to return to work in 2013, but quickly went back on medical leave. She subsequently submitted a claim for benefits to Reliance, who denied it on the ground that she had a pre-existing condition that barred coverage. Plaintiff also submitted a claim to Hartford, who denied that as well. She appealed the Hartford denial, but did not appeal the Reliance denial before filing suit against Reliance. Continue Reading Sixth Circuit Holds Exhaustion of Administrative Remedies Not Required Where Plan Document Is Silent on Claims Review Process

This week’s notable decision is one from a wave of ERISA lawsuits against universities over allegations of imprudent investments and excessive fees.  In Divane v. Northwestern Univ., No. 18-2569, __F.3d__, 2020 WL 1444966 (7th Cir. Mar. 25, 2020), the Seventh Circuit Court of Appeals upheld the dismissal of claims alleging that Northwestern breached its fiduciary duty as a prudent investor.   

Plaintiffs, who are beneficiaries of the Northwestern University Retirement Plan and the Northwestern University Voluntary Savings Plan (“the Plans”), alleged that Northwestern, the Plans’ administrator and designated fiduciary, breached its duty to act as a prudent fiduciary and that they are entitled to relief under ERISA, 29 U.S.C. §§ 1132(a)(2) and 1109(a).  “In their amended complaint, plaintiffs specifically alleged that Northwestern failed to act as a prudent fiduciary when it included the Stock Account as a plan investment offering and allowed TIAA-CREF to serve as a recordkeeper for its funds (Count I); created a multi-entity recordkeeping arrangement (Count III); and provided investment options that were too numerous, too expensive, and underperforming (Count V). In Counts II, IV, and VI, plaintiffs claimed the above conduct also constituted prohibited transactions under ERISA. Id. § 1106.”  Divane, 2020 WL 1444966, at *5.

In upholding the district court’s dismissal, the Seventh Circuit made several key findings.   Continue Reading Seventh Circuit Rules for Northwestern University in Retirement Plan Investment Dispute