The opinion of the court was delivered by: Judge Virginia M. Kendall
MEMORANDUM OPINION AND ORDER
James E. Hopkins ("Mr. Hopkins" or "Plaintiff") brings this action against Prudential Insurance Company of America ("Prudential" or "Defendant"), the claims administrator for the Bank One Corporation Health and Welfare Benefit Options Plan ("the Plan"). Plaintiff alleges that Prudential wrongfully denied him long-term disability ("LTD") benefits in violation of the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001, et seq., ("ERISA"). (D.E. 1 at 1-2.)*fn1 Prudential filed a counterclaim, seeking restitution for LTD benefits wrongly paid to date and, alternatively, restitution for offset of those benefits paid in the amount of estimated Social Security Disability Benefits ("SSDBs") that Plaintiff may have been entitled to receive. The parties have filed cross-motions for summary judgment on all claims.
Prudential determined that Plaintiff, as a rehired employee, was ineligible for LTD benefits under the Plan's pre-existing condition provisions. Because the Plan did not clearly reserve to Prudential the authority to determine eligibility for benefits and construe the terms of the Plan, this Court reviews Prudential's denial of benefits de novo. Reviewing that decision, the Court finds that the Summary Plan Description ("SPD") failed to comply with the requirements of 29 U.S.C. § 1022 in regard to pre-existing conditions for re-hired employees and Prudential thus is estopped from denying benefits to Plaintiff. Prudential also is estopped from denying benefits because Plaintiff relied on the rehire provision in the SPD, a provision that conflicts with the Plan. Prudential's counterclaim for benefits wrongly paid to date is denied accordingly. Finally, Prudential's counterclaim for offset of those benefits paid in the amount of estimated SSDBs that Plaintiff may have been entitled to receive is granted to the extent that Mr. Hopkins is required to make a claim for SSDBs to avoid the offset.
Mr. Hopkins first became a Bank One employee on March 28, 1999. (D.E. 33, ¶ 1.) As a Bank One employee, Mr. Hopkins was insured under Group Insurance Policy No. DG-56249-IL ("the Plan"), which Prudential issued to Bank One and which is governed by ERISA. (Id., ¶ 2; D.E. 33, ¶ 55; R. at 1-57.) The Plan includes a LTD provision, under which employees may opt to increase LTD coverage once they have become eligible for basic coverage. (See R. at 28.)*fn2 Mr. Hopkins' initial effective date for LTD coverage was August 1, 1999. (D.E. 34, ¶ 22; R. at 93.) Mr. Hopkins worked at Bank One until November 2, 1999, when he was laid off. (D.E. 34, ¶ 8.) Bank One hired Mr. Hopkins again on November 27, 2000. (Id., ¶ 9.) During the intervening period, Mr. Hopkins was not a Bank One employee and no LTD premiums were paid for him. (D.E. 34, ¶ 37.)
Prudential's phone and computer records indicate that in 2000 Mr. Hopkins had LTD coverage and he elected and paid for increased LTD coverage of 20% over the basic coverage. (See R. at 83, 98, 252.) Those phone records also indicate that Prudential informed Mr. Hopkins that, due to changes in the Plan, his increased coverage was reduced back to the basic (50%) level on January 1, 2001, and that Mr. Hopkins was "very upset with the bank because he has been paying for this coverage." (R. at 83.)
Mr. Hopkins' last day of employment at Bank One was April 27, 2001. (D.E. 33, ¶ 2; R. at 241.) Shortly thereafter, he applied for LTD benefits under the Plan. (D.E. 33, ¶¶ 4, 6.) Prudential denied Mr. Hopkins' initial application for LTD benefits on December 10, 2001. (Id., ¶ 9.) Pursuant to the Plan, Mr. Hopkins appealed that decision three times, and Prudential denied LTD benefits, or awarded only limited LTD benefits, in three subsequent decisions dated March 25, 2002, August 26, 2003, and July 29, 2004, respectively. (Id., ¶¶ 17, 22-27, 31-32, 36, 39-41.) The following is a summary of Mr. Hopkins' appeals and Prudential's four decisions regarding his request for LTD benefits:
Prudential's First Decision
In its December 10, 2001 decision denying benefits, Prudential stated that the PreExisting Condition provision barred Mr. Hopkins' claim because he had stopped working due to disability within twelve months of the date he had elected LTD coverage. (D.E. 34, ¶ 18.) Prudential defined the six-month pre-existing condition period as October 1, 2000 to March 31, 2001. (Id.) Because Mr. Hopkins had, during that period, experienced symptoms "for which an ordinarily prudent person" would have sought medical treatment (namely, severe anxiety) the "prudent person pre-existing provision" applied to deny him LTD benefits. (Id.)
Mr. Hopkins' Appeal; Prudential's Second Decision: In its March 25, 2002 decision, Prudential reiterated its finding that, during the pre-existing condition period, Mr. Hopkins suffered from stress and anxiety for which an ordinarily prudent person would have sought treatment. (D.E. 34, ¶ 20.) Prudential cited Mr. Hopkins' medical records to support its denial of benefits. (Id.)
Mr. Hopkins' Second Appeal; Prudential's Third Decision
On March 12, 2003, Bank One notified Prudential that, because Mr. Hopkins was first hired on March 28, 1999, his benefits bridged back to that initial hire date and the effective date of his LTD coverage was August 1, 1999. (D.E. 34, ¶ 22.) Based on this new information, Prudential notified Mr. Hopkins' attorney that the pre-existing provision did not apply and they would review the claim from a medical standpoint. (Id., ¶ 23; D.E. 33, ¶¶ 28-30.) Prudential then requested and received certain medical records from the relevant periods (D.E. 34, ¶¶ 24-26), and undertook two clinical reviews thereof. (Id., ¶¶ 27, 29.) Prudential contacted Mr. Hopkins' therapist, Ms. Olsen, and his treating psychiatrist, Dr. Trumm, regarding his ability to work. (Id., ¶¶ 30-31.) Prudential states that Ms. Olson indicated that Mr. Hopkins could have worked during "all of 2002," and Dr. Trumm could not see why he was "not working." (Id., ¶¶ 30-32.)
On August 26, 2003, Prudential issued its third decision letter, noting that "Mr. Hopkins' previous employment with Bank One was confirmed, rendering the pre-existing provision inapplicable." (D.E. 33, ¶ 33; R. at 108.) Prudential approved LTD benefits for the period prior to January 31, 2002, but denied benefits for the period thereafter. In its letter, Prudential noted a lack of evidence concerning any disabling psychiatric symptoms after January 31, 2002. (D.E. 33, ¶ 31; D.E. 34, ¶ 32; R. at 107-10.) Prudential subsequently paid benefits totaling $9,588.01 for the closed period of October 26, 2001 to January 31, 2002. (D.E. 34, ¶¶ 32-33.)
Mr. Hopkins' Third and Final Appeal; Prudential's Fourth Decision
Mr. Hopkins filed a third and final administrative appeal on October 24, 2003, requesting information pertaining to issues raised in the previous denial. (D.E. 34, ¶ 35.) On July 16, 2004, Mr. Hopkins submitted a letter from Dr. Trumm, who stated that his prior statements had been misconstrued and that he did not believe that Mr. Hopkins could resume his former duties at Bank One. (See id.; D.E. 33, ¶ 38; R. at 156.) Mr. Hopkins' counsel posited that Dr. Trumm's previous answer merely indicated that Mr. Hopkins might be capable of other work. (D.E. 33, ¶ 37; R. at 160.)
In its July 29, 2004 final decision letter, Prudential denied Mr. Hopkins' claim for LTD benefits, finding that he had a pre-existing condition for which an ordinarily prudent person would have sought treatment. Prudential supported its finding by pointing to previously cited medical evidence (Dr. Shah's and Dr. Lozano's notes), as well as to a psychological evaluation indicating a 6-month history of anxiety attacks. (D.E. 34, ¶ 38.)
Prudential acknowledged its prior finding that the pre-existing condition did not apply, but identified information subsequently obtained from Bank One that Mr. Hopkins had been terminated on November 2, 1999, that he had not been a Bank One employee from that date until November 27, 2000, and that "LTD premiums were not paid for him for this period." (R. at 101-02; D.E. 34, ¶ 38.) Prudential concluded that, under the terms of the Plan, his LTD coverage had ended when he had been terminated as an employee, and he only became eligible for LTD coverage again on April 1, 2001: after his rehire on November 27, 2000 and "after fulfilling the Employment Waiting Period (EWP) of the first of the month after 120 days of employment." (D.E. 34, ¶ 38.) Thus, as a newly covered employee, his claim was subject to the pre-existing condition provision. (Id.) Prudential noted that, as a consequence, it had previously paid Mr. Hopkins a closed period of LTD benefits in error, though it declined to seek reimbursement at that time. (Id., ¶ 38.)
Relevant Provisions of the Prudential Plan and the Summary Plan Description
Employees do not automatically receive a copy of the Plan, but can review a copy thereof by visiting Bank One offices in Ohio or requesting a copy of the Plan in writing. (R. at 292.) Pursuant to 29 U.S.C. § 1022, employees receive a copy of the Summary Plan Description ("SPD"). The SPD summarizes the Plan, but it is not listed within the Plan as one of the documents comprising the Plan. (See D.E. 44, ¶ 2; R. at 9.) The SPD provides that:
This document is not a contract . . . [it] describe[es] the highlights of the Bank One Corporation Short-term Disability Plan and Long-term Disability Plan . . . and is subject to the terms and conditions of the Plans, which govern the operations of the Plans. In the event this summary differs in any way from the Plans, the actual terms of those documents will govern . . . [t]his summary doesn't replace or control the legal Plan document. In the event of a discrepancy . . . the Plan document always governs. (D.E. 44, ¶ 2; R. at 292.) The SPD also states that, "effective January 1, 2001, [it] replaces and supersedes any and all prior explanations and SPDs." (R. at 272.)
In regard to discretionary authority, the Plan states that, "[w]e may request that you send proof of continuing disability, satisfactory to Prudential, indicating that you are under the regular care of a doctor." (D.E. 44, ¶ 1.) The SPD states that, "Bank One has delegated to Prudential all discretionary authority to interpret the Plan and to make appropriate determinations regarding eligibility for and the amount of benefits." (D.E. 28, ¶ 39.)
In regard to disability, the Plan defines a claimant as disabled when he is unable "to perform the material and substantial duties of [his] regular occupation." (D.E. 34, ¶ 40.)
In regard to the pre-existing condition limitation on LTD coverage, the Plan contains the following provisions:
[The Plan does] not cover a disability which: begins within 12 months of the date your coverage under the plan becomes effective; and is due to a pre-existing condition . . .
You have a pre-existing condition if . . . in the 6 months just prior to your effective date of coverage or the date an increase in benefits would otherwise be available . . .
1. You have received medical treatment, consultation, care or services including diagnostic measures . . . or
2. You had symptoms for which an ordinarily prudent person would have consulted a health care provider[.] (Id., ¶ 47.) The Plan also states:
How Does the Pre-Existing Condition Work if You Were Covered Under Your Employer's Prior Plan?
*[If] this [LTD] plan replaces your Employer's prior plan and:
*you were covered by that [prior] plan on the day before this [new] plan became effective; and
*you became covered under this plan within thirty-one days of its effective date[:] . . . If the Employer's prior plan did not have a pre-existing condition exclusion or limitation, then a pre-existing ...