Court Opinion

ID: 9492749
Source: CourtListenerOpinion
Date Created: 2023-08-05 14:49:57.150047+00
Date Added: 2024-06-11T17:55:28.989180
License: Public Domain

DAVID A. NELSON, Circuit Judge,
dissenting.
I agree with my colleagues on the panel that the Employee Benefit Committee did not act irrationally in determining that Mr. Weaver received “treatment or services” when he saw Dr. Kumar on September 28, 1990. I also agree that the Committee did not act irrationally in determining that the hospital and medical expenses incurred after the commencement of coverage were incurred in connection with the same preexisting disease for which Mr. Weaver received treatment or services on September 28. I cannot agree, however, that the Committee acted irrationally in determining that Mr. Weaver failed to come within the three-months-without-treatment exception to the provision under which the payment of benefits for such a pre-existing disease is barred until there has been a full year of coverage.
If the Committee was irrational in finding this exception inapplicable, then a unanimous three-judge panel of this court must have been equally irrational when, speaking for the court when the case was here earlier, the panel quoted the pertinent sections of the Plan in their entirety and went on to note that neither exception to the preclusion of benefits for certain pre-existing conditions — neither the one-year-of-coverage provision nor the three-months-without-treatment provision — had been satisfied in the matter at hand. See University Hospitals of Cleveland v. Emerson Electric Co. Benefit Plan, No. 93-4924, slip op. at 3 n. 1, 1994 WL 714326 (6th Cir. Dec. 22, 1994) (“It should be *853noted that neither exception (1) nor exception (2) applies to the matter at hand”).
I should have thought, at first blush, that this court’s 1994 opinion might well have established the law of the case with respect to the issue on which the current panel rests its decision. The applicability of the law-of-the-case doctrine has not been briefed and argued, however, and I have conducted no independent research on the matter. I dissent here not because of what was said by the original panel (a panel of which I was a member, incidentally), but because I remain of the opinion that it was not irrational for the Committee to construe the terms of the Plan as meaning that no benefits would be payable in connection with Mr. Weaver’s pre-exist-ing illness during the first year of coverage unless and until there had been three months of coverage in which Mr. Weaver had been free of treatment for the illness.
I acknowledge that the language of the Plan is not as clear as it might be. The Plan’s Benefit Provisions start off plainly enough by establishing certain “Pre-Exist-ing Condition Limits” once coverage commences:
“Hospital expenses and other medical expenses incurred in connection with a disease or injury for which a covered individual received treatment or services or took prescribed drugs during the three month period immediately preceding the effective date of such individual’s coverage under this Plan will not be included as covered medical expenses prior to the earliest of the dates shown in the Schedule of Benefits.”
Under the catchline “Pre-existing Limitation” (a reference, obviously, to the limits pertaining to medical conditions that were “pre-existing” as of the commencement of coverage), the Plan’s Schedule of Benefits — speaking as of the commencement of coverage, in the Committee’s undertaking — then says this:
“No benefits are payable for a pre-exist-ing illness or injury for which an individual was treated or took prescribed medicine within 3 months prior to coverage until:
1) the individual has been covered under this Plan for one year, or
2) the individual has been free of treatment for the pre-existing illness or injury for 3 months.”
As written, the second clause is open to conflicting interpretations. It is possible that the drafters intended to provide that the one-year-of-coverage requirement would be overridden upon the expiration of three treatment-free months commencing with the last treatment. Had this been their intent, the drafters could have said so explicitly. They could have said, for example, that the year-of-coverage requirement would be overridden once the individual had gone without treatment for three months “from the date of the last treatment.” Unfortunately, the quoted words were not included in the Pre-existing Limitation provision.
It is also possible — and perhaps more likely- — that the drafters intended to provide that the year-of-coverage requirement would be overridden once the individual had been free of treatment for three months during that first year of coverage. Unfortunately, however, the drafters did not explicitly say this either. Through inadvertence, no doubt, they left their intention ambiguous.
Such ambiguities are almost certain to creep into a document as complex as this one. The drafters could, of course, have left the resolution of these inevitable ambiguities to the courts. But they chose not to. Instead, the drafters provided that a five-member Employee Benefit Committee appointed by the Emerson Electric Company's Board of Directors should have “discretionary authority to determine eligibility for benefits or to construe the terms of the Plan....” And they further provided that unless the Committee’s construction of the Plan’s terms should be “arbitrary and capricious” — ie., simply irrational — the Committee’s decision “shall be final and non-reviewable.... ” In the face of such language, it is clear that the *854courts have no authority to second-guess the Committee unless the Committee has acted irrationally. See Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989), and Yeager v. Reliance Standard Life Ins. Co., 88 F.3d 376, 381 (6th Cir.1996).
The record leaves no room for doubt as to why the Committee upheld the denial of benefits in the case at bar. As the deposition testimony of Committee Member James Draeger shows, the Committee saw no reason even to consider whether Mr. Weaver had received treatment or services during the first 90 days after September 28, 1990. The Committee upheld the denial of benefits solely on the basis of its construction of the provisions of the Plan relating to pre-existing medical conditions. And the record shows, I believe,, that the Committee had a rational basis for construing the provisions in the way that it did.
Addressing the Pre-existing Limitation clause in the Schedule of Benefits, Mr. Draeger explained at page 104 of his deposition transcript that “this particular provision starts where an individual is eligible for the plan.... ” (Mr. Weaver became eligible on December 24, 1990.) The exclusion for medical expenses incurred in connection with certain pre-existing conditions, Mr. Draeger went on to explain, continues “for a period of one year.” Draeger Depo. Trans, at 104-105'. Once eligibility starts, in other words,
“[the exclusion] is going to go for one year from that date. Or it is going to go ... from that date for three months.
Q From which date?
A We are talking about an individual becoming eligible under the plan, so now the individual is eligible. So now we are talking about one date [ie., one year] from the date of eligibility, or if the individual has been free of treatment at any three-month period during that particular one year period of time, whichever fi[r]st occurs.” Id. at 105.
Given the structure of the Pre-existing Limitation provision, where “Pre-existing” has no meaning except in relation to the start of coverage and where the date used for the calculation of the first two of the three time periods mentioned is clearly the date on which the individual becomes eligible under the plan, it was not irrational for the Committee to conclude that the drafters intended the use of the same date for calculating the third time period as well. This is not the only possible construction of the provision, but it is certainly not an irrational construction.
The parties agree that there was no three-month period when Mr. Weaver was treatment-free between December 24, 1990, the date on which he became eligible for coverage, and June 3, 1991, the date on which he died. Accordingly, and because I agree with the district court that the Committee’s most recent decision was rendered pursuant to the order of remand and was not subject to the contractual time limits that applied during the initial decision-making process, I would affirm the challenged judgment.