McCann v. Unum Provident
921 F. Supp. 2d 353
D.N.J.2013Background
- McCann, a physician, received a supplemental long-term disability policy from Provident in 1991 while at Henry Ford Hospital.
- The Hospital offered Base Plan (non-contributory LTD), SSDP (staff doctors), and RSDP (Residents) with premium discounts.
- LEI acted as broker; McCann spoke with LEI's David Manes about the Policy and potential replacement of his Northwestern policy.
- The Policy took effect July 1, 1991 and carried a monthly benefit based on post-fellowship income; discounts applied included a 15% risk discount.
- McCann filed a claim in 2007; Provident began benefits, then terminated in 2009 after medicals supported return to work.
- Provident moved for ERISA ruling; Court ultimately held Count I is governed by ERISA and that the Hospital established or maintained the RSDP.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Count I governed by ERISA? | McCann argues ERISA should not apply because the Policy isn’t part of the RSDP. | Provident asserts the Policy is part of the RSDP and thus ERISA governs. | ERISA governs Count I. |
| Does the Safe Harbor apply to remove ERISA coverage? | McCann contends Safe Harbor applies, removing the Policy from ERISA. | Provident argues Safe Harbor does not apply because the Hospital contributed to and endorsed the plan. | Safe Harbor not satisfied; conventional ERISA tests apply. |
| Is the RSDP a plan under ERISA and did the Hospital establish it? | McCann contends no ERISA plan existed or was established by the Hospital. | Provident argues the RSDP is an ERISA plan established or maintained by the Hospital. | RSDP is a plan established/maintained by the Hospital. |
| Is McCann a participant and a beneficiary of the RSDP? | McCann asserts he was not an employee when the Policy took effect and thus not a participant. | Court should treat former employees eligible for benefits as participants; McCann qualifies. | McCann is both a participant and a beneficiary of the RSDP. |
Key Cases Cited
- Donovan v. Dillingham, 688 F.2d 1367 (11th Cir. 1982) (ERISA purpose and plan concepts in employee welfare litigation)
- Deibler v. United Food & Commercial Workers’ L. Union, 973 F.2d 206 (3d Cir. 1992) (define ERISA plan concepts and coverage standards)
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (Supreme Court 1989) (scope and interpretation of ERISA plan benefits)
- Shaver v. Siemens Corp., 670 F.3d 462 (3d Cir. 2012) (ERISA plan existence and employer involvement framework)