*2 blood cells “atypical, were but not leukemic.” Underhill, M. Kevin City, MO, Kansas ar- While Perry Dr. suggested no immediate gued, appellant. for action as a results, result of the test she Cowden, John W. City, MO, Kansas ar- encouraged Armstrong to return for a “well- (Patricia gued Rosa, MO, City, Kansas on the woman examination” September brief), appellees. Armstrong saw Dr. Davidner, Mark Before ARNOLD, RICHARD S. Chief oncologist, 15, 1995, on June two weeks after Judge, and BEAM, HEANEY and Circuit her coverage Aetna began. Dr. Davidner Judges. examined Armstrong, finding signs of leu- kemia. A aspiration bone marrow on June HEANEY, Judge. 27th resulted in a definitive diagnosis of leu- Pamela E. Armstrong appeals the district kemia. Armstrong subsequently received court’s of summary judgment in favor treatment for leukemia through chemothera- of Aetna Life Insurance Company, Aetna py a bone and transplant. marrow Plan, Health (collec- and Plan Administrator Armstrong sought coverage from Aetna “Aetna”) tively on Armstrong’s claim that for her leukemia treatment. Aetna initially Aetna wrongfully denied her benefits under a indicated that Armstrong’s policy covered the plan health administered by Aetna gov- treatment but subsequently limited her cov- erned Employee Retirement Security erage based on the “preexisting condition” Act, Income (“ERISA”). U.S.C. provision in the health plan. The defines We affirm. a preexisting condition as a condition that diagnosed was treated, or or I. for which treat- ment or received, services were or prescrip- May Armstrong diagnosed was .In drugs tion or prescribed medicines were with leukemia. She underwent chemothera- taken within days of the date coverage py for the disorder after which the leukemia became effective. (Appellant’s 92.) App. at went into remission October 1993. At the limits benefits for time, treatment of a Armstrong had health-care coverage preexisting condition within year the first through a group health administered coverage $4,000. to Armstrong appealed Travelers Insurance Company. 1,May On Aetna’s determination that her Armstrong claim fell left un- her residence in Colora- der do, the preexisting job condition taking with a limitation. Aet- realtor in Kansas na City. reaffirmed realtor offered Armstrong because Armstrong a group health had received a insured service for Aetna. leukemia Aetna within also previous plan, and, administers the six by the months when terms of Dr. Perry health agreement, her conducted Aetna' examination has of Armstrong. discretion to review claims. Armstrong Armstrong appealed Aetna’s determination transferred her coverage to the district court. Armstrong argued that becoming eligible for benefits under the court should review Aetna’s decision de 1,1995. on June novo because Aetna’s role as both insurer On March Armstrong visited Dr. and administrator of created con- Perry, Pamela a primary doctor, care “get flict of Moreover, interest. she claimed that presumed to be an abuse of discre claim conflict is provided to its the incentives can justified unless the administrator demon further deny benefits evaluators (1) under de novo court. strate that either review review the heightened (2) correct, apply the decision law should the result was that Missouri argued then law, that, under to serve the. administrator’s con Missouri not made to her claim Fourth, Fifth, Seventh, in- provision is flicting condition interest. The Aetna’s *3 alternatively “sliding ap that a Armstrong argued and Tenth use scale” Circuits valid. the proach, reviewing a “condition” within the court not have under which al she did ways court abuse-of-discretion standard policy. applies determined an meaning of the subject given to an the amount of discretion that decision but decreases Aetna’s standard, law Delaware in proportion to the decision abuse-of-discretion administrator’s claim, Armstrong’s and substantial conflict. See applied to to the of the Cham seriousness that Aetna’s supported Family Corp., Health Plan 100 evidence bers v. F.3d (10th Cir.1996); condition. 818, a Armstrong Group had v. 824-27 Doe ruling Serv., 80, court’s Armstrong appeals the district & Med. 3 F.3d 87 Hospitalization (4th Co., Cir.1993); and we affirm. v. ARCO Chem. Wildbur (5th Cir.1992); 631, 974 F.2d 638-42 Van II. Employees’ Co. Boxel v. Journal Pension (7th Cir.1987). Trust, 1048, 1052-53 836 F.2d Review A. of Standard , the of this We hold that circumstances ERISA a decision an We review require to review decision to case us Aetna’s fiduciary abuse plan or administrator novo. We are informed benefits de gives the plan specifically if the of discretion reasoning Eleventh Circuit’s hold- the the authority fiduciary the administrator Brown, a in which tiiat relation- ing stated plan. Firestone of the the terms construe plan benefits ship places that an ERISA Bruch, 101, 489 v. U.S. Tire & Rubber Co. “perpetual in conflict” war- administrator 948, 956, 80 115, 103 L.Ed.2d 109 S.Ct. Brown, scrutiny. 898 higher level of rants a (1989). However, the administrator where continuing a con- F.2d at 1561. Aetna faces interest or acts fiduciary has a conflict of playing the role of administrator flict in dual motive, must be improper that with an plan. the-health benefits As and insurer of determining-whether weighed as a “factor insurer, an obvious interest in the Aetna has Restate an abuse of discretion.” there is Apparently minimizing payments. its claim (Second) 187, § d of Trusts Comment ment provides in- payments, limit claim Tire, (1959), at U.S. in Firestone 489 quoted claims to its reviewers centives and bonuses 115, not ad at 956. We have S.Ct. 109 category a that include based on criteria review appropriate standard for the dressed (Appellant’s App. at savings.” called “claims benefits is insurer of a health where the 250-66). argument that Aetna’s Despite circuits also administrator.1 Other the Aetna has directed that there no evidence specific question. this have addressed claims, improperly reject we its reviewers to Company, 45 F.3d Atwood v. Newmont Gold arrangement fiduciary view the be- (9th cannot Cir.1995), 1317, v. Blue and Brown 1323 reviewers, Aetna, Inc., claims Alabama, tween 898 Blue Cross & Shield of pro- type the ERISA (11th Cir.1990), as 1556, beneficiaries the Ninth F.2d 1566-67 “solely in the interest vides as administered adopted “presump a Circuits Eleventh beneficiaries.” 29 participants and which a decision ren tively test under void” 1104(a)(1). a with such U.S.C. a administrator dered irregularity procedural question a must show of whether addressed the have fiduciary duty apply a the abuse of discretion should trustee to breach caused variation Wald, 1007; "procedural irregularity” a beneficiary. a occurred plan's where .in 83 F.3d at to the availability determination of Buttram, Armstrong administrator’s does at 900. not 76 F.3d Bell Cus- See Wald v. Southwestern of benefits. irregularity. procedural a assert existence Plan, (8th F.3d 1007 tomcare Med. 83 Rather, that Aetna has conflict she contends 1996); v. Central S.E. Cir. Buttram States and administra- as insurer interest both Fund, F.3d Health & 76 S.W. Areas Welfare were Aetna’s claim evaluators biased tor and that 1996). (8th cases we held that Cir. In those reject incentives claims. Aetna’s financial apply, plaintiff heightened standard to for a B. Choice of Law mencement of her coverage plan. under the inquiry Because that is not relevant under Armstrong argued below that Dela ' plan, terms of the we need not consider ware law applies to her claim. She now propriety of the district court’s conclu- argues that applies. Missouri law Although sion. Under the a “preexisting we generally need not arguments consider condition” is a condition for which services raised for the first time on appeal, Ryder see or treatment were rendered within the 180- Morris, (8th v. 752 F.2d Cir.1985), day period preceding coverage regardless of we conclude that the district properly court whether the condition manifested itself dur- determined that Missouri apply courts ing period. received ser- law of the state which a policy is delivered. vice for leukemia during 180-day period, Co., See Miller Home Ins. 605 S.W.2d and leukemia ais condition under the terms (Mo.1980). presented be plan. She therefore only entitled low demonstrates that Aetna delivered the *4 to benefits for the treatment of that condi- in policy Therefore, Delaware.. Delaware law tion as in devised the for a preexisting applies. An examination of the Delaware condition. statute governing the preexist treatment of ing conditions, 18 3517(a), Del.Code reveals III. only the applies statute prospectively For the foregoing reasons, the decision of from the enactment, statute’s which occurred the district court to Aetna’s motion for after the delivery of the health bene summary judgment deny Armstrong’s fits plan, leaving the outside of the motion for summary judgment is affirmed. statute’s reach. the absence of a statuto ry directive invalidating the plan’s BEAM, Judge, and, concurring in clause, conditions provision the is part, dissenting. construed based on plain language. I in concur the result reached the court. I disagree, however, with the conclusions C. Deny Aetna’s Decision to Benefits in. reached Part IIA of opinion the on the turn now to whether Thus, standard of review. part, in I dissent. is entitled to benefits. Armstrong contends holding “that the circumstances of this that because her leukemia was in remission require case us to review Aetna’s decision to during the 180-day period prior to her cover is, benefits de novo” essentially, obiter age, she did not have a preexisting condition dictum. Ante at 1265. This is because under under the terms of plan. the Under the any standard of review the district court’s of the however, terms if a partici decision must given be affirmed interpre- the pant receives treatment or a service for a place tation we on the employ- words the condition within days the 180 prior to when er’s insured Aetna. Accordingly, we coverage began, the limits benefits. are not at all required to establish a review Armstrong did not below, contest nor does standard in this case and we should not do so now, she do so that the testing she received under particular these circumstances since was a “service” within the meaning of the appears the issue to be a matter of first plan. Therefore,' accept we that she received impression in this circuit. such a service. Ryder, See . F.2d at 332. Even assuming that our decision calls for Likewise, parties do dispute not whether the establishment of a review, standard of leukemia is a “condition” within the meaning the de novo adopted standard directly plan. contrary Supreme precedent Court estab The district court determined that suffi- hi lished Firestone Tire & Rubber Co. v. cient supported a finding Bruch, U.S. 109 S.Ct. Armstrong had prior leukemia (1989).2 the com- L.Ed.2d 80 at issue here 2. The conflict in Firestone Tire purposes resulted Tire, from applying in Firestone this is a Firestone being both the sole source of funding Indeed, distinction without a difference. since for and the administrator plans of the ERISA at we nothing know premium arrangement issue while in this case Aetna is both the benefits between Armstrong’s Aetna, employer and it is insurer administrator. For our deny Blue standard would Cross the ben- Aetna broad discretion gives specifically any in plan. bargain Absent it made the insur- terms of efit construe interest,” any re a “conflict of anee contract. elements would be acts or decisions of Aetna’s view short, support not Id. In Brown does of dis “abuse upon an unconstrained based it proposition for which is advanced at at 109 S.Ct. Id. standard. cretion” Indeed, I court. no case that have discover- course, plan gives dis if a benefit “Of ed does so. fiduciary who to an administrator cretion Accordingly, I concur in the result while [as a conflict of interest operating under court, disagree I with its reached here], weighed as a must be that conflict novo decision to establish de standard is an determining whether there in ‘facto[r] ” in this case of first review for this circuit (second alteration Id. abuse of discretion.’ omitted). impression. (citation difficult, It is original) language from impossible, to read this if not “sliding scale” contrary to the
Firestone Tire reviewing court which the
approach —under stan an abuse of discretion
always applies amount of discretion
dard decreases pro
given to the administrator’s of the conflict—
portion to the seriousness *5 Fourth, Fifth, Seventh by the established ANDERSON, Appellant, Kenneth L. Fami Chambers v. and Tenth Circuits. See Corp., 100 F.3d 824-27 ly Health Plan (10th Cir.1996); Group Hospitaliza Doe v. COMPANY, GENUINE PARTS (4th Servs., 80, 87 Cir. & Med. 3 F.3d tion INC., Appellee. Co., 1993); Chem. Wildbur v. ARCO (5th Cir.1992); Boxel 638-42 Van F.2d No. 97-1049. Trust, Employees’ Pension v. Journal Co. Appeals, Court of United States Cir.1987). (7th 1048, 1052-53 836 F.2d Eighth Circuit. presently no other circuit that I can find under the circum- applies a de novo review Sept. Submitted any similar case. estab- stances of this 14, 1997. Decided Nov. standard, the court as- lishing this de novo reasoning that it is “informed” serts v. Blue Brown
of the Eleventh Shield, 898 F.2d Cross & Blue Cir.1990). (11th Ante at 1265. It is some- how the court to understand
what difficult from Brown since processed
has information Circuit, therefore “[w]e Eleventh .said discretion, arbitrary abuse of
hold applies to cases capricious, standard one, application as this
such shaped by the circumstances standard Brown, conflict of interest.”
the inherent Indeed, the court also at 1563.
898 F.2d
stated: an attractive ave- de novo review is
While controlling the of discre-
nue for exercise contrary of the bene- to the interests
ficiaries, application of this strict matter.
possible, likely, had a more if not that Firestone Aetna in this of interest than does intense conflict