lump as "nothing suspicious", by which Dr. Apen testified that he meant "nothing suspicious for cancer". (July 6 TT. at 54)
Dr. Apen testified that as he was removing the lump on April 5, 1991, he did consider that the mass could be a "benign tumor" because it looked like one at that point. Notwithstanding this possibility, Dr. Apen's postoperative diagnosis, as reported in the Postoperative Report admitted as Plaintiff's Exhibit 14, was that the mass was a cyst.(July 6 TT. at 47-48)
Dr. Apen testified that the first time he knew it was cancer was April 9, 1991 when he read the pathology report. Dr. Apen also testified, however, that had he known it was cancer prior to the surgery, he still would have proceeded in the same manner.
Dr. Apen testified that the excision of the lump is not adequate treatment for cancer and that a modified radical mastectomy was performed because there was some residual cancer in the breast tissue.(July 6 TT. at 49-50) The pathology performed after the mastectomy indicated that the cancer had spread to plaintiff's lymph glands which necessitated chemotherapy.(July 6 TT. at 51-52) Dr. Apen testified that the chemotherapy would prevent plaintiff from working.
(July 6 TT. at 53) Dr. Apen stated that plaintiff was not disabled until April 9, 1991 or April 19, 1991 when there was a diagnosis of metastatic cancer. Finally, Dr. Apen testified that plaintiff was not treated for cancer until after it was diagnosed on April 9, 1991.(July 6 TT. at 58)
On cross-examination, Dr. Apen testified that the standard treatment upon observing a breast mass in a young women is to watch it for two months, and if it doesn't go away, perform a biopsy.(July 6 TT. at 62) A somewhat existential dialog between Dr. Apen and defendant's counsel concluded with Dr. Apen's testimony that plaintiff probably had breast cancer for three and one-half years prior to April 1, 1991 (July 6 TT. at 65-67) However, Dr. Apen declined to agree that plaintiff had lymphatic cancer prior to April 1, 1991 and stated that it is not possible to determine how long plaintiff had lymphatic cancer from the pathology reports because the growth of this disease is highly differentiated. (July 6 TT. at 68-69)
On re-direct, Dr. Apen testified that the excision of the actual mass removed from plaintiff on April 5, 1991 in and of itself would not have prevented her from returning to work within a few days. (July 6 TT. at 76) It was the invasion of the lymph system which caused plaintiff's disability. (July 6 TT. at 79) Finally, Dr. Apen testified that if he had suspected the lump to be cancerous he would probably have performed an incisional biopsy, as opposed to the exisional biopsy which was performed, because if there is a clinical impression that it is a cancer, it is likely that major definitive treatment would be required.(July 6 TT. at 81)
Dr. Richard G. Cooper testified as an expert witness on behalf of the defendant. Dr. Cooper testified that, in his opinion, plaintiff "sought advice because of a palpable lesion in her breast, which she found in January, for which a subsequent workup revealed it to be malignant". (July 7 TT. at 6) Dr. Cooper opined that the lump for which plaintiff sought treatment from Drs. Ruh and Apen prior to April 1, 1991 was the same lump which turned out to be cancerous.(July 7 TT. at 7) This is not seriously disputed.
On cross-examination, Dr. Cooper agreed that the mammogram taken of plaintiff in January 1991 was negative for any malignant lesions. (July 7 TT. at 13) Dr. Cooper testified that the malignancy was not diagnosed until April 5, 1991 when Dr. Apen performed the initial surgery. (July 7 TT. at 16) Dr. Cooper also testified that "ideally", once the lump was determined to be malignant, and assuming the cancer had not spread outside the lump, the lymph nodes should be removed and radiation therapy would be required. Dr. Cooper testified that had the cancer not metasticized the plaintiff would have been able to return to work in two months, perhaps sooner, after excision of the cancerous lump. (July 7 TT. at 22-23)
Dr. Cooper testified that the original pathology following the April 5, 1991 surgery provided some evidence that the cancer had spread to the lymph nodes prior to April 1, 1991 because of the size of the tumor. (July 7 TT. at 25) Finally, Dr. Cooper testified that in his opinion plaintiff had cancer prior to April 1, 1991.(July 7 TT. at 29).
1. Standard of Review
Although the parties were in agreement that the standard of review to be applied in this case is whether CNA's determination was arbitrary and capricious, a review of the controlling case law and the language of the insurance policy indicate that such a view is incorrect. The language of the policy determines whether the court must apply the arbitrary and capricious standard of review or whether the court may review the determination de novo. If the language of the policy gives the plan administrators "discretion" to "interpret" the terms of the policy, the arbitrary and capricious standard applies. If the policy does not vest the plan administrators with this discretion, then the court may review the determination de novo. Firestone v. Bruch, 489 U.S. 101, 103 L. Ed. 2d 80, 109 S. Ct. 948 (1989); Jordan v. Retirement Committee of Rensselaer Polytechnic Institute, 46 F.3d 1264 (2d Cir. 1995); Masella v. Blue Cross, 936 F.2d 98 (2d Cir. 1991).
In the instant case, the court's review of the policy
, admitted as Plaintiff's Exhibit 1, reveals that no such discretion is reserved for the policy administrator. Thus, the court must conduct a de novo review of CNA's determination. Masella v. Blue Cross, 936 F.2d 98 (2d Cir. 1991).
2. Interpretation of the Contract
A "federal common law of rights and obligations" governs the interpretation of a group insurance plan subject to the Employee Retirement Income Security Act ('ERISA"). Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 95 L. Ed. 2d 39, 107 S. Ct. 1549 (1987); Burnham v. Guardian Life Ins. Co. of America, 873 F.2d 486 (1st Cir. 1989); Hughes v. Boston Mutual Life Ins. Co., 26 F.3d 264 (1st Cir. 1994). As noted in Hughes, however, the need for uniformity in this area does not require federal rules at variance with the general law of the states. Indeed, the emerging federal common law should embody commonsense canons of contract interpretation of which state law is the richest source. Hughes, 26 F.3d at 268, citing Rodriguez-Abreu v. Chase Manhattan Bank N.A., 986 F.2d 580 (1st Cir. 1993).
While the "straightforward language in an ERISA-regulated insurance policy should be given its natural meaning," ( Burnham, 873 F.2d at 489), it is well-settled that ambiguous terms should be construed against the insurer. See Masella v. Blue Cross & Blue Shield of Conn., 936 F.2d 98, 107 (2d Cir. 1991); Hughes, 26 F.3d at 268; Rodriguez-Abrreu, 986 F.2d at 586; See also Golden Rule Insurance Co. v. Atallah, 45 F.3d 512 (1st Cir. 1995); and Lee v. Blue Cross/Blue Shield, 10 F.3d 1547 (11th Cir. 1994) (collecting cases to demonstrate that the contra proferentum rule has been widely adopted among circuit courts for resolution of ambiguities in ERISA-regulated insurance contracts).
With this framework in mind, the court now turns to review the terms of the policy in this case. The "Exclusions and Limitations" declaration set forth on page H of the policy provide that the policy does not cover any loss caused by or resulting from a pre-existing condition. The "Definitions" declaration set forth on page E of the policy defines a pre-existing condition as follows:
Pre-existing condition means a condition for which medical treatment or advice was rendered, prescribed or recommended within 3 months prior to [the insured's] effective date of insurance.
The policy does not further define what is encompassed by the word "condition". The policy definition of "sickness", as it relates to this case, is circular and of little help. According to the policy: "'Sickness' means sickness or disease causing loss which begins while [the insured's] coverage is in force. Sickness shall not include any loss caused by or resulting from a pre-existing condition".
Initially, it should be noted that the language of the policy does not exclude coverage of all pre-existing conditions. The plain language of the policy requires that for the exclusion to apply the advice or treatment of the "condition" must have been "rendered, prescribed or recommended" within three months prior to the effective date of the policy. Thus, as was the case in Hughes, the policy at issue in this case would not exclude coverage (1) if the condition existed prior to the effective date of the contract but plaintiff received no medical advice or treatment whatsoever; or (2) if the condition existed prior to the effective date of the contract and plaintiff received medical advice or treatment, but such advice or treatment was rendered more than three months before the effective date of the contract. See Hughes, 26 F.3d at 268.
CNA's interpretation of "condition", would include the treatment of any symptom of the disease that caused the disability whether or not the disease was diagnosed at the time the symptom was treated. Such an interpretation has some support. See Bullwinkel v. New England Mut. Life Ins. Co., 18 F.3d 429 (7th Cir. 1994); Cury v. Colonial Life Ins. Co., 737 F. Supp. 847 (E.D.Pa 1990). On the other hand, plaintiff reasonably argues that to obtain advice or treatment regarding a medical "condition", you must first have some awareness that the "condition" exists. This interpretation also has support. See Hughes, 26 F.3d 264 (1st Cir. 1994); Ross v. Western Fidelity Ins. Co., 881 F.2d 142 (5th Cir. 1989). See also Mannino v. Agway Inc. Group Trust et al.,192 A.D.2d 131, 600 N.Y.S.2d 723 (2d Dept. 1993).
The Hughes case is particularly instructive. In Hughes, during the probationary period just prior to the effective date of the policy the plaintiff received medical attention for various symptoms consistent with multiple sclerosis ("MS") but was not diagnosed as having MS until after the effective date of the policy. Reviewing the pertinent language of the policy at issue in that case, the First Circuit held that an ambiguity existed, and resolving the ambiguity against the insurer, accepted the construction offered by the plaintiff. Hughes, 26 F.3d at 269-70. In vacating summary judgment granted for defendant, the Hughes court noted that under the accepted interpretation offered by the plaintiff, "a physician's awareness of the sickness would probably require at least a tentative diagnosis; however, it may be that no diagnosis would be necessary if the insured was already aware of the condition." Hughes, 26 F.3d at 270, n.5.
The First Circuit's insights in Golden Rule Insurance Co. v. Atallah, 45 F.3d 512 (1st Cir. 1995) are similarly instructive. In Golden Rule, the insured suffered from a brain tumor which was not diagnosed until after the effective date of the health insurance policy. Because the pre-existing condition provision of that policy specifically excluded conditions for which medical advice or treatment was obtained within 60 months prior to the effective date of the policy, or :
which in the opinion of a qualified doctor, (a)probably began prior to the Effective Date ...; or (b) manifested symptoms which would cause an ordinarily prudent person to seek diagnosis or treatment within the 60 months immediately preceding the Effective Date... .