A recent successful appeal highlighted how the sometimes everyday interchangeability of the words “illness” and “injury” can mean the difference between temporary and lifetime ERISA benefits.
The thrill of temporary victory
In Stein v. Paul Revere Life Ins. Co., the plaintiff, an interventional radiologist, was forced to end his career early due to chronic pain in his back and legs and subsequent mobility issues. His doctors later diagnosed him with musculoskeletal conditions.
The plaintiff’s doctors agreed that his condition was caused by his many years of wearing heavy, lead-lined vests to protect himself from radiation exposure. When he applied for benefits through Paul Revere Life Insurance Company, he was approved for income loss compensation due to illness.
Anyone who successfully wins ERISA benefits on the first try, an increasingly rare occurrence, would be rightly thrilled to have that obstacle behind them. It’s therefore understandable that while in the throes of this relief, the claimant might not zero in on the word “illness” in their benefits notice, when their condition was plainly an injury.
The other shoe drops
Cut to 30 months later, when Paul Revere reduced the plaintiff’s monthly benefits by 90 percent. The reduction was due to Paul Revere’s lifetime payments rider, stipulating that they would only pay 10 percent of the claimant’s original benefits after an initial period of 30 months for conditions due to illness. For disabilities due to injury, this rule did not apply. Suddenly the suspiciously careful use of the word “illness” was crucial.
Fortunately, the court was not receptive to this word-play tactic. In a summary judgement, meaning without ever going to trial, the court ruled against Paul Revere and restored the plaintiff’s full benefits for life. The court correctly pointed out that the plaintiff’s condition was due to the repetitive stress of wearing lead vests for 30 years, not an unnamed illness.
Ending on a sour note
In a discouraging footnote to the case, the court did not award the plaintiff with attorney’s fees. In its ruling, the court explained that “The merits of the parties’ positions here were relatively balanced and the Court recognizes other courts, including in the Third Circuit, may disagree with this decision.”
In comparison to the award of full benefits, the attorney’s fees snub may seem inconsequential. However, the court’s unwillingness to penalize Paul Revere’s strategic use of the word “illness” may embolden the company to try the same tactic again, hoping the claimant won’t push the matter to trial.
The dismaying takeaway seems to be that even in victory, ERISA claimants must remain on high alert for single-word, legally consequential clues that might come back to haunt them years later.