ERISA – Summary Plan Description

Parker County ERISA attorneys know the two documents needed to be reviewed in an ERISA case are the Certificate of Coverage (COC) and the “summary plan description.”
The United States Court of Appeals for the Fifth Circuit issued an ERISA opinion in 2012, that is relevant to these documents. It is styled, Nancy Koehler v Aetna Health, Inc.
The case is an appeal from an adverse summary judgment against Koehler. Aetna refused to reimburse Koehler for an out of network specialist who had been referred by an in network physician. Aetna denied based on the referral not being pre-authorized by Aetna.
The parties agreed that the relevant plan provisions are found in the plan’s COC, which set forth the plan’s health insurance benefits. However, in addition to appearing in the plan, the COC’s text also constitutes the “summary plan description” which ERISA requires plan administrators to provide to participants and beneficiaries. Thus, although a plan summary is a separate document from the plan itself, in this case the summary’s text is simply a verbatim copy of the underlying plan provisions.
The court then spent considerable time and text discussing what the documents said in context with the facts of this case.
After reviewing the documents and the facts, the court then reviews Aetna’s interpretation for abuse-of-discretion. The plan gives Aetna discretion to resolve ambiguities in the plan language in its favor. However, Aetna’s discretion to resolve ambiguities in the plan does not extend to the plan summary, notwithstanding that in this instance the summary is a verbatim copy of text in the plan. Ambiguities in a plan summary are resolved in favor of the beneficiary. That is because ERISA requires that plan summaries be “written in a manner calculated to be understood by the average plan participant, and . . . sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” Therefore, when considering the COC as a plan summary the court must resolve its ambiguity against requiring pre-authorization of ad hoc outside services. That of course diverges from the interpretation Aetna has given to identical language in the underlying plan. If that outcome seems puzzling, the anomaly is traceable to Aetna’s curious decision to use identical language in both plan and plan summary-documents that serve quite different functions and are accordingly subject to differing interpretative standards.
In this case, the court reversed the ruling against Koehler and remanded the case back to the district.