ERISA-Eighth Circuit Holds That  Equitable Estoppel Doctrine May Not Be Used To Expand Benefits Provided Under The Plan

In Spizman v. BCBSM, Inc., No. 16-1557 (8th Cir. 2017), Raleigh Spizman was hospitalized in November 2012 and returned home in February 2013, where a home health care provider and personal care assistants began providing 24-hour care. Blue Cross Blue Shield of Minnesota provided Raleigh’s health care insurance coverage under a group policy sponsored by her husband Robert’s employer. When Blue Cross denied the Spizmans “round-the-clock” in-home health care coverage, they brought this federal action, asserting claims for relief in six counts. The district court granted Blue Cross’s motion to dismiss four counts, the parties stipulated to dismiss the remaining two counts with prejudice, and the court entered final judgment in favor of Blue Cross. The Spizmans appeal the dismissal of Counts I, II, and VI, claims governed by ERISA.   Reviewing the grant of a motion to dismiss de novo, the Eighth Circuit Court of Appeals (the “Court” affirmed the district court’s decision.

In Counts I and II, the Spizmans sought a declaratory judgment that they are entitled to round-the-clock in-home nursing services. The Court rejected these Counts, based on its reading of the applicable insurance policy.

In Count VI, a claim for equitable estoppel, the Spizmans alleged that they were entitled to equitable relief under section 502(a)(3) of ERISA, which grants the home health care benefits Blue Cross’s agents promised would be paid under ambiguous policy terms. The district court dismissed Count VI because the applicable insurance policy plainly excluded the extended  hours skilled nursing care the Spizmans sought, and the Spizmans may not use an estoppel theory to enlarge benefits under a written plan. The Court agreed with this reasoning, concluding that Count VI must likewise be rejected.


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