Cаrol Jones filed a claim for long term benefits under the group disability insurance policy issued to her employer by an affiliate of Unum Provident Corporation (“Unum”). After Unum denied the claim and Jones’s appeal, she commenced this action for wrongful denial of benefits under the Employee Retirement Income Security Act of 1974 (“ERISA”).
See
29 U.S.C. § 1132(a)(1)(B). The district court
1
granted summary judgment dismissing her claim. Jones appeals, arguing Unum and the court erred in concluding that a lapse in coverage triggered the preexisting condition limitation in the prior group insurer’s policy. Reviewing the grant of summаry judgment
de novo,
we affirm.
See Jessup v. Alcoa, Inc.,
I. Background
In January 2004, Jones was hospitalized for major depression and stopped working as a legal secretary with Fabyanske, Westra & Hart, P.A. She filed a claim for disability benefits under the firm’s Group Long Term Disability Insurance Policy issued by Fortis Benefits Insurance Company (“Fortis”). Fortis found Jones disаbled and began paying long-term disability benefits after a three-month qualifying period. Her treating psychiatrist, Dr. Paul Richardson, cleared Jones to return to work
Jones retxxrned to work part-time on June 28. She scheduled initial appointments with two other psychiatrists, who refused to support her claim of continuing long-term disability without further investigation. She did not pursue follow-up appointments. She stopped working on July 15, and a new psychiatrist, Dr. John Heefner, supported her claim of continuing disability. Jones sent Fortis records from her visits to Dr. Heefner and the other psychiatrists. On August 26, Fortis notified Jones that it was denying her long-term disability claim for benefits after June 7, based on her failure to satisfy the test of disability in the Fortis policy. Jones did not appeal this adverse decision. She returned to work part-time on September 20, 2004, and began working full-time on October 4. Effective January 1, 2005, the Fabyanske firm changed group disability insurance providers from Fortis to Unum.
II. The Claim at Issue
Jones stopped working in late February 2005, complaining of an infected dog scratch. The Fabyanske firm terminated her employment in mid-March. Later that month, Jоnes filed a long-texm disability claim with Unum, based upon a recurrence of her major depression and other ailments. Unum denied the claim based upon the pre-existing condition clause in the Unum policy:
In order to receive a payment you must satisfy the pre-existing condition provision under: 1. the Unum plan; or 2. the prior carrier’s plan, if benefits would have been paid had that policy remained in force.
Unum first determined that Jones did not satisfy the Unum policy’s pre-existing condition clause because she received psychiatric treatment within thе three months prior to the effective date of the Unum policy, January 1, 2005, and her disability began during the first twelve months after the effective date of the policy. Jones does not challenge that decision. Rather, the dispute turns on Unum’s application of the pre-existing сondition limitation in the Fortis policy.
Like the Unum policy, the Fortis policy defined a pre-existing condition as one that was diagnosed or treated during the three months before the claimant became insured; it denied coverage “for any disability caused by a pre-existing сondition” during the first twelve consecutive months of being insured under the policy. Unum initially determined that Jones’s coverage under the Fortis policy lapsed on August 26, 2004, the date of Fortis’s final decision that she was “no longer considered disabled.” Because coverage did not resumе until she returned to full-time work in October 2004, and because Jones received psychiatric treatment within three months prior to that date, Unum concluded that benefits would not have been paid under the pre-existing condition clause of the Fortis policy, had it remained in forсe. Jones appealed that decision under the appeal provisions of the policy.
Before resolving Jones’s appeal, Unum contacted Fortis about the apparent lapse in coverage. The Fortis claims agent who handled Jones’s рrior disability claim opined that coverage lapsed on June 8. Unum sent Fortis a confirming letter.
In granting summary judgment, the district court concluded that Unum did not abuse its discretion in determining that Jones’s coverage under the Fortis policy lapsed between June 8 and October 4, 2004:
[T]he Fortis policy provides that a covered persоn’s insurance ends when the person is no longer in an eligible class or when the person stops active work. Under the Fortis policy, eligible classes are defined in part to include active full-time employees, full-time means working at least thirty hours per week, and active work means working full-time for the policyholder at the employee’s usual place of business. Fortis determined that Jones was no longer disabled as of June 8, 2004, and she first returned to full-time work at Fabyanske approximately four months later. Under these circumstances, the Fortis рlan plainly provides that her insurance ended.
For the most part, we agree with this analysis. The Fortis policy provided that insurance coverage ends when a person “stops active work” or is no longer in an “eligible class,” defined as being “an active full-time employee.” Coverage for Jones was not an issue while she was receiving long-term disability benefits. No doubt for this reason, the policy did not address the issue. The record suggests that the Fabyanske firm continued to classify Jones as a full-time employee who was on disability leave, and Fortis waived monthly insurance premiums for continued coverage. But what happened to that status when Jones recovered the ability to resume work?
We disagree with Unum and the district court on one aspect of the issue. We conclude that coverage continued when Jones returned to work part-time on June 28, 2004, consistent with Dr. Richardson’s limited release-for-work and with long-term benefits suspended but not yet denied, just as coverage would continue for a full-time employee who is reduced to part-time work during a medical leave.
Accord Weber v. GE Group Life Assur. Co.,
Jones argues that a literal interpretation of the thirty-hour requirement would lead to absurd results, because any employee taking a day off for vacation, a holiday, or illness would lose coverage and be subject to the pre-existing condition provision upon returning to work. But neither Fortis nor Unum applied either policy in this extreme manner. For example, the Fortis billing records reflect that Fortis waived prеmiums — rather than lapsing coverage^ — -while Jones received long-term disability benefits, and neither insurer took the position that Jones’s coverage lapsed when she was absent from her full-time work for one week in November 2004 due to illness.
Jones further argues that Unum erred by ignoring the Cоntinuance of Insurance clause in the Fortis policy, which provided that the policyholder may continue coverage for a person unable to perform active work on account of a covered disability. Leaving aside the question whether this provision applied after Jones recovered from a long-term disability, the clause expressly provided that “[cjontinuance must be based on a uniform policy, and not individual selection.” Here, a human resources employee advised Unum that the Fabyanske firm had no “formаl” leave of absence policy other than the Family and Medical Leave Act (FMLA). The record further reflects that the Fabyanske firm wrote Jones on August 13 asking if she would return to work. On September 3, Jones “stopped in to the office to say that she would be attempting to return to work on Wednesday, September 8.” She later left a message stating she would not return to work on September 8. On this record, Jones failed to prove either that her employer requested continued coverage, or that she was eligible for continued coverage because the continuance, if
III. Standard of Review
Because the policy granted Unum discretion “to determine your eligibility for benefits and to interpret the terms and provisions of the policy,” the district court applied the familiar abuse-of-discretion standard in reviewing Unum’s denial of Jоnes’s claim.
See Walke v. Group Long Term Disability Ins.,
Jones argues that Unum’s decision is entitled to less deferential review because Unum operated under the financial conflict of interest present whenever an insurer both evaluates clаims for benefits and pays granted claims. Under the Supreme Court’s recent decision in
Metropolitan Life Ins. Co. v. Glenn,
Jones argues that, even if Unum had discretion to interpret its own policy, the district court erred in not reviewing
de novo
Unum’s interpretation of the Fortis policy. This is an interesting issue of first impression. But Jones did not preserve the issue by raising it to the district court. Accordingly, we decline to consider it.
See Menz v. Procter & Gamble Health Care Plan,
Our decision in this case is not affected by the ERISA standard of review. Based on thе extensive record compiled during Unum’s thorough investigation, we conclude that coverage under the Fortis policy lapsed more than six weeks prior to Jones’s return to full-time work in October 2004. Accordingly, her March 2005 disability claim was not covered because of the pre-existing condition clauses of the Unum and the Fortis policies.
The judgment of the district court is affirmed.
Notes
. The HONORABLE JOAN N. ERICKSEN, United States District Judge for the District of Minnesota.
. Jones relies on
Reese v. Brookdale Motors, Inc.,