University Hospitals of Cleveland v. Emerson Electric Co., 202 F.3d 839 (6^th Cir. 2000); 2000 FED App. 0040P (6th Cir.)-This case concerns a dispute whether a pre-existing condition exclusion prevented a claim for benefits.  A deceased Plan participant, Mr. Weaver, assigned his rights to University Hospitals of Cleveland (UHOC).  UHOC filed a claim for health care benefits with the Emerson Electric Company Benefit Plan.  UHOC here appeals the district court's summary judgment in favor of the Plan's decision to deny benefits.  This court reversed and remanded in favor of UHOC.

            This court used an arbitrary and capricious standard of review since the plan document clearly gave the plan administrator discretionary authority to determine eligibility for benefits and to construe the terms of the Plan.  However, it also stated that this high standard was "tempered" by two factors—an observance of potential conflict of interest and the rule of contra proferentum.  "Courts should be particularly vigilant in situations where, as here, the plan sponsor bears all or most of the risk of paying claims, and also appoints the body designated as the final arbiter of such claims."

                Using this standard, this court found that the Plan covered Weaver.  Although Weaver could not prove that his prior treatment for anemia was not evidence of pre-existing myelodysplasia—a bone marrow condition—he satisfied the provisions, which allowed for coverage of pre-existing conditions after "the individual has been free of treatment for the pre-existing illness or injury for 3 months."  This court rejected Emerson's argument that this meant 3 months after the beginning of coverage.  The court further denied that any physician-patient contact necessarily constitutes a course of "treatment."  Such things as a phone call and a recommendation for future treatment are not themselves "treatment," especially since the SPD effectively equated "treatment" with accruing charges for services.  Thus, this court concluded that the Committee's denial of UHOC's claim for benefits was arbitrary and capricious.