US Supreme Court Fends Off ERISA Estoppel Case

April 1, 2003 ( - US Supreme Court justices have turned away an Illinois case about whether the legal doctrine of estoppel can be applied to ERISA health insurance benefit claims.

>The case from the US 7 th Circuit Court of Appeals involved a former telecommunications company employee who never enrolled in his employer’s health plan, but still demanded coverage when he suffered a heart attack shortly after he was fired, according to Washington-based legal publisher BNA.

>Lawyers for Brent Kamler had argued in their US Supreme Court estoppel petition that Kamler would have enrolled if the employer, PAL Telecom Group, had not told him he was already insured. The legal concept of estoppel argues that someone should be barred from denying an assertion that was already determined in an official proceeding or by an authoritative body or, in this case, that PAL should not be allowed to deny him benefits if he had already been told he would be covered.

Appeals Court: No Automatic Enrollment

>Although PAL may have promised that Kamler would receive insurance, such alleged misrepresentations “might imply that Kamler did not have to enroll, but it was not reasonable for him to interpret the alleged misrepresentations in that manner,” the appeals judges wrote.

>The appeals court found unreasonable Kamler’s belief that he was automatically enrolled in his employer’s health plan. In addition, the 7 th Circuit found that he acted unreasonably in indefinitely delaying completion of the health insurance enrollment forms while waiting for the company to assure him that the forms would not compromise his privacy.

>The case started when Kamler submitted the medical bills from his treatment for his heart attack suffered two weeks after he was fired. PAL’s health plan administrator denied the claim. A federal judge in the US District Court for the Northern District of Illinois threw out Kamler’s suit, ruling that he couldn’t sue if he never enrolled in the plan. Kamler appealed to the 7 th Circuit and then to the US Supreme Court.