Published June, 2008

Metropolitan Life Ins. Co. v. Glenn, 554 U.S. __ , 128 S.Ct. 2343 (2008)

In a 6 to 3 decision of potential impact for people with HIV, the U.S. Supreme Court ruled that courts must examine benefit denials by insurance companies carefully when circumstances indicate that the company’s financial considerations may have affected a benefits decision. The ruling recognizes that the apparent conflict of interest created when an insurance company is both the reviewer and payer of claims is one of many factors to consider, and offers guidance to federal judges reviewing medical disability and health insurance determinations in group policies. Although the plaintiff in this case was not HIV-positive, she suffered from severe fatigue, a condition that many people with advanced HIV disease frequently experience.

The plaintiff had applied for and was granted long-term disability benefits through her employer when she became disabled with a heart condition that caused severe fatigue and prevented her from doing any kind of work. MetLife, as administrator of the employer’s ERISA-governed long-term disability insurance plan, had the authority to make disability determinations and was also responsible for making payments to beneficiaries. When MetLife terminated the employee’s disability benefits based on a determination that she was able to do sedentary work, she brought a claim under ERISA alleging a conflict of interest on the part of MetLife. The court found that MetLife, as reviewer and payer, did have a conflict of interest in this situation. The court further found that the conflict could be considered as a factor in determining whether or not the administrator abused its discretion, and that the significance of the factor would be determined by the circumstances of the case.