Rossi v. Precision Drilling Oilfield Services Corp. Employee Benefits Plan
704 F.3d 362
5th Cir.2013Background
- Rossi, a confirmed Plan beneficiary, suffers a lifelong neurological condition from a stroke at age 16.
- Rossi’s care included inpatient rehabilitation and therapy at facilities (TIRR, Eventide, St. David’s) with ongoing Plan denial for coverage.
- The Plan initially denied Eventide citing custodial/maintenance care and later denied St. David’s for not meeting strict rehabilitation criteria.
An independent reviewer recommended denial of inpatient therapy; denial ultimately rested on a physical therapy exclusion.
- Rossi administratively appealed; the Plan changed its basis for denial during the administrative appeal and relied on a physical therapy exclusion rather than the prior rationales.
- The district court granted summary judgment for the Plan; Rossi appealed, and the court vacated/remanded for full and fair review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Plan’s appellate denial complied with ERISA §1133 procedural requirements | Rossi argues the Plan changed bases for denial on appeal. | Plan asserts substantial compliance under controlling Fifth Circuit precedent. | Plan did not substantially comply; change of basis violated §1133 and Lafleur/Robinson guidance. |
| Whether reliance on a new basis (PT exclusion) on appeal violated §1133 | Rossi contends the new basis deprived meaningful review. | Plan argues the new basis was supported by record evidence. | Remand required because a new basis on appeal undermines full and fair review. |
| Whether remand is the proper remedy given procedural violations | Rossi seeks full record development on remand to determine coverage. | Plan should proceed with review under existing record. | Remand to the Plan for a full and fair review is appropriate. |
Key Cases Cited
- Wade v. Hewlett-Packard Dev. Co. L.P. Short Term Disability Plan, 493 F.3d 533 (5th Cir. 2007) (ERISA review standards and substantial compliance with procedures)
- Lafleur v. Louisiana Health Serv. & Indemnity Co., 563 F.3d 148 (5th Cir. 2009) (lack of specificity in denial letters fails ERISA notice requirements)
- Cooper v. Hewlett-Packard Co., 592 F.3d 645 (5th Cir. 2009) (substantial compliance with ERISA where new evidence affirms original assessment without changing denial basis)
- Robinson v. Aetna Life Ins. Co., 443 F.3d 389 (5th Cir. 2006) (requirement to review the specific ground for denial; switching reasons on appeal undermines ERISA notice and review)
- Vega v. Nat’l Life Ins. Servs., Inc., 188 F.3d 287 (5th Cir. 1999) (abrogated on other grounds; illustrates standards for arbitrary and capricious review)