Opinion ID: 171217
Heading Depth: 2
Heading Rank: 2

Heading: Mrs. Weber's Eligibility for Benefits

Text: GE advances two interrelated arguments for overturning the district court's summary judgment decision. First, GE argues that Mrs. Weber was never eligible for the Voluntary Life Insurance coverage because she did not work 30 hours per week after the May 1, 2003, effective date. Second, GE argues that Mrs. Weber was never actively at work after May 1, 2003. We hold that, under our proper standard of review, GE's interpretation of the Policy's eligibility and actively at work language was arbitrary.
We review summary judgment orders de novo. Flinders v. Workforce Stabilization Plan of Phillips Petroleum Co., 491 F.3d 1180, 1189 (10th Cir.2007). We accord no deference to the district court's decision. See Sandoval v. Aetna Life & Cas. Ins. Co., 967 F.2d 377, 380 (10th Cir.1992). Like the district court, we must first determine the appropriate standard to be applied to GE's decision to deny benefits. See Fought v. UNUM Life Ins. Co. of Am., 379 F.3d 997, 1002 (10th Cir.2004). ERISA providers may retain the authority to interpret ambiguous provisions in a plan. Miller v. Monumental Life Ins. Co., 502 F.3d 1245, 1250 (10th Cir. 2007). Where an ERISA provider has, in fact, retained this authority in explicit terms, we employ a deferential standard of review, id., asking only whether the denial of benefits was arbitrary and capricious, Flinders, 491 F.3d at 1189; cf. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989) ([W]e hold that a denial of benefits ... is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.). Under the arbitrary and capricious standard, we curtail our review, asking only whether the interpretation of the plan was reasonable and made in good faith. Flinders, 491 F.3d at 1189 (quoting Fought, 379 F.3d at 1003). However, we dial back our deference if a benefit plan gives discretion to an administrator or fiduciary who is operating under a conflict of interest.  Metro. Life Ins. Co. v. Glenn, ___ U.S. ___, 128 S.Ct. 2343, 2348, 171 L.Ed.2d 299 (2008) (quoting Firestone, 489 U.S. at 115, 109 S.Ct. 948). In such a situation, that conflict should be weighed as a factor in determining whether there is an abuse of discretion. [10] Id. at 2350 (internal quotation marks omitted) (quoting Firestone, 489 U.S. at 115, 109 S.Ct. 948); see also Flinders, 491 F.3d at 1189-90. To incorporate this factor, we have crafted a `sliding scale approach' where the `reviewing court will always apply an arbitrary and capricious standard, but [will] decrease the level of deference given ... in proportion to the seriousness of the conflict.' Flinders, 491 F.3d at 1190 (quoting Chambers v. Family Health Plan Corp., 100 F.3d 818, 825-26 (10th Cir.1996)). This approach mirrors the Glenn Court's method of accounting for the conflict-of-interest factor. See Glenn, 128 S.Ct. at 2351-52 (explaining that factor should prove more or less important depending on the conflict of interest's magnitude). Here, the Policy explicitly states that GE is a fiduciary, as that term is used in ERISA.... Additionally, [i]n this capacity, [GE] is charged with the obligation, and possesses discretionary authority to make claim, eligibility and other administrative determinations regarding those policies, and to interpret the meaning of their terms and language. GE thereby retained discretionary authority, which triggers this court's arbitrary and capricious standard of review. As both the insurer and the plan administrator, GE operates under a conflict of interest in this case. See Glenn, 128 S.Ct. at 2349-50. Accordingly we will still employ the arbitrary and capricious standard, but we will weigh GE's conflict of interest as a factor in determining the lawfulness of the benefits denial. Lastly, in reviewing a plan administrator's decision under the arbitrary and capricious standard, the federal courts are limited to the administrative record  the materials compiled by the administrator in the course of making his decision. Fought, 379 F.3d at 1003 (internal quotation omitted).
[W]hen reviewing a plan administrator's decision to deny benefits, we consider only the rationale asserted by the plan administrator in the administrative record and determine whether the decision, based on the asserted rationale, was arbitrary and capricious. Flinders, 491 F.3d at 1190. We make that determination based on the language of the plan. Accordingly, as the first step towards interpreting an ERISA plan, we scrutinize the plan documents as a whole and, if unambiguous, construe them as a matter of law. Miller, 502 F.3d at 1250 (quoting Admin. Comm. of Wal-Mart Assocs. Health & Welfare Plan v. Willard, 393 F.3d 1119, 1123 (10th Cir.2004)). In making this determination, we consider the common and ordinary meaning as a reasonable person in the position of the plan participant, not the actual participant, would have understood the words to mean. Id. (internal quotation marks omitted) (quoting Willard, 393 F.3d at 1123) (emphasis added). If the language is ambiguous, then we must take a hard look and determine whether GE's decision was arbitrary in light of its conflict of interest. Fought, 379 F.3d at 1008. As part of this review, we typically consider whether: (1) the decision was the result of a reasoned and principled process, (2) is consistent with any prior interpretations by the plan administrator, (3) is reasonable in light of any external standards, and (4) is consistent with the purposes of the plan. Flinders, 491 F.3d at 1193 (internal quotations omitted); see also Geddes v. United Staffing Alliance Employee Med. Plan, 469 F.3d 919, 929 (10th Cir.2006). Neither party addresses these questions specifically and the record reveals little about GE's claims assessment process, so we are left to our own analytic devices.